Trading & import-export
Import-Export Company Registration in India: IEC, DGFT & the Process
Registering an import-export or trading company in India uses the same core incorporation process as any company, plus one additional, non-negotiable registration — the Import Export Code — that is easy to overlook if you are focused only on incorporation itself.
Quick answer
What is an Import Export Code (IEC) and do I need one?
The IEC is a 10-digit business identifier issued by the DGFT — customs will not clear an imported or exported shipment without a valid IEC on the bill of entry or shipping bill. Any company that plans to import or export goods or services commercially needs one; it costs a one-time ₹500 government fee and is usually issued within 1–2 working days, separate from company incorporation itself.
The Import Export Code (IEC): the one registration incorporation does not cover
The IEC is a 10-digit business identifier issued by the Directorate General of Foreign Trade (DGFT), and customs will not clear an imported or exported shipment without a valid IEC on the bill of entry or shipping bill. It is entirely separate from your company's incorporation with the Ministry of Corporate Affairs — a newly incorporated company still needs to apply for its own IEC before it can legally import or export. The application is filed online through the DGFT portal, linked directly to your company's PAN, and costs a one-time government fee of ₹500, typically issued within 1 to 2 working days of a complete application.
The annual update requirement — easy to miss
An IEC carries lifetime validity once issued, but since 2021 DGFT has required every holder to confirm or update their profile details once every financial year, between April and June. This is a light-touch requirement — often just a confirmation that nothing has changed — but missing the window causes the IEC to be temporarily deactivated, which can hold up shipments at customs at exactly the wrong moment. Building this into your annual compliance calendar alongside your standard RoC and tax filings avoids it becoming a last-minute scramble.
GST treatment for import-export transactions
Exports of goods and services generally qualify as zero-rated supplies under the IGST Act — no GST is charged, provided you file a Letter of Undertaking (LUT) at the start of each financial year. Imports work differently: IGST is charged at the point of customs clearance, alongside applicable customs duty, and GST registration is what lets you claim input tax credit on that IGST rather than treating it as a straight cost. Getting this distinction right from your first shipment avoids both overpaying and under-claiming credit later.
Choosing the right entity structure
Most foreign investors setting up an India-based trading operation incorporate a Wholly Owned Subsidiary — a private limited company — since it supports institutional trade finance relationships, letters of credit and bank guarantees more readily than an LLP or proprietorship, alongside the standard benefits of limited liability. As with any foreign-owned Indian company, at least one India-resident director is required under Section 149(3) of the Companies Act — see our resident director requirement guide for how foreign companies typically satisfy it.
Incorporation process
The core incorporation sequence — DSC and DIN issuance, name reservation via SPICe+ Part A, drafting your MOA and AOA, and SPICe+ Part B filing — is the same for a trading company as for any Indian private limited company; the IEC application is a separate step that follows once incorporation is complete and your PAN is issued. See our step-by-step incorporation guide for the full walkthrough.
FAQs: import-export company registration in India
What is an Import Export Code (IEC) and do I need one? The IEC is a 10-digit business identifier issued by the Directorate General of Foreign Trade (DGFT) — customs will not clear an imported or exported shipment without a valid IEC on the bill of entry or shipping bill. Any company that plans to import or export goods or services commercially needs one; it is separate from, and in addition to, your company’s incorporation itself.
How much does an IEC cost and how long does it take? The government fee is a one-time ₹500, and the IEC is typically issued within 1 to 2 working days of a complete online application through the DGFT portal, since it is linked directly to your company’s PAN. It carries lifetime validity once issued.
Does an IEC need to be renewed? Not renewed exactly, but it does need annual attention. Since 2021, DGFT has required every IEC holder to confirm or update their profile details once every financial year, between April and June. Missing this window causes the IEC to be temporarily deactivated, which can hold up shipments at customs until it is reactivated.
What entity structure suits an import-export or trading business? Most foreign investors setting up an India-based trading operation incorporate a private limited company — a Wholly Owned Subsidiary, if the parent is a foreign company — since it supports institutional trade finance relationships and bank guarantees more readily than an LLP or proprietorship, alongside the standard advantages of limited liability and a separate legal identity.
Does GST apply to import-export transactions? Yes, though the treatment differs by direction. Exports of goods and services generally qualify as zero-rated supplies under the IGST Act, meaning no GST is charged provided you file a Letter of Undertaking (LUT). Imports, by contrast, attract IGST at the point of customs clearance, calculated alongside applicable customs duty — GST registration is required to claim input tax credit on that IGST.
How much does it cost to register a trading company in India, beyond the IEC? The MCA government filing fee for the SPICe+ incorporation form itself is nil for authorised capital up to ₹15 lakh, under Schedule I of the Companies (Registration Offices and Fees) Rules, 2014. On top of that you pay state stamp duty (which varies by registered office state) plus the one-time ₹500 IEC fee covered above and professional fees. We quote a fixed total once we know your structure and state.
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