International trade helps businesses grow across borders, but it comes with legal responsibilities. Companies in India must follow several import and export compliances to ensure smooth transactions and avoid penalties. These compliances cover licensing, customs procedures, taxation, and reporting. Knowing them in detail helps businesses operate confidently in the global market.
Key Import Compliances 📦
1. Import Export Code (IEC) Registration 📝
Every importer must obtain an IEC from DGFT before importing goods. Without IEC, customs will not allow shipments.
2. Customs Clearance and Bill of Entry 🏢
At the time of import, businesses must file a Bill of Entry with Indian Customs. This document records the details of goods, value, and duties paid.
3. Payment of Import Duties 💰
Import duties include Basic Customs Duty (BCD), IGST, and other cess or surcharges. Importers must calculate and pay them accurately for clearance.
4. Compliance with Import Restrictions ⚖️
Certain goods require additional approvals, such as:
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FSSAI license for food items 🍴
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Drug Controller approval for medicines 💊
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BIS certification for electronics 📱
Key Export Compliances 🚢
1. IEC for Exporters ✅
Just like imports, exporters must also have an IEC before shipping goods abroad.
2. Shipping Bill and Customs Filing 📑
Exporters must file a Shipping Bill with Customs, which acts as a declaration of goods leaving India.
3. GST and LUT Filing 🧾
To export without paying IGST, exporters should furnish a Letter of Undertaking (LUT) under GST. Otherwise, IGST is paid and later claimed as a refund.
4. Export Incentive Claims 💼
Exporters can apply for incentives like RoDTEP (Remission of Duties and Taxes on Exported Products) through DGFT.
Import vs. Export Compliance Table 📊
| Compliance Area | Import Requirements | Export Requirements |
|---|---|---|
| IEC Code | Mandatory | Mandatory |
| Customs Filing | Bill of Entry | Shipping Bill |
| Taxation | BCD, IGST, cess | GST LUT/Refund |
| Special Approvals | FSSAI, BIS, Drug Controller | Export incentives, RoDTEP |
Conclusion 🏁
Import and export compliances ensure that businesses follow the rules set by the government for global trade. By completing IEC registration, customs filings, tax payments, and special approvals, companies can avoid penalties and benefit from smoother cross-border transactions. Following these compliances builds credibility and opens doors to international opportunities.