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Alan Monre CFO, Square SoftwareOverview
DGFT Certification.
Overview of the Service & Importance
The DGFT (Directorate General of Foreign Trade) is the regulatory body under the Ministry of Commerce and Industry, responsible for implementing India’s Foreign Trade Policy (FTP). It issues essential certifications such as the Import Export Code (IEC), Advance Authorizations, and Export Promotion Capital Goods (EPCG) Licenses, which are crucial for businesses involved in international trade. DGFT Certification is required to legally export or import goods and services, access government benefits under trade promotion schemes, and ensure compliance with Indian trade regulations.
Importance:
1. Mandatory for Trade : A legal requirement to engage in import and export activities.
2. Access to Incentives : Enables businesses to claim benefits like duty exemptions and export subsidies.
3. Customs Clearance : Facilitates smooth clearance of goods at customs.
4. Market Expansion : Opens doors to global markets for Indian businesses.
5. Regulatory Compliance : Aligns businesses with the Foreign Trade Policy to avoid legal issues.
Documents Required
For Indian Citizens
For Foreign Nationals
Features
Environmental Due Diligence (EDD)
Facilitates Trade Incentives
Covers Multiple Certifications
Simplified Online Portal
Government Integration
Directorate General of Foreign Trade
Export Subsidy Access
Digital Certificates
Mandatory for Customs Clearance
Adaptable for Foreign Businesses
Supports Trade Policy Compliance
Comparison with Import Export Code (IEC)
| Feature | DGFT Certification | Import Export Code (IEC) |
|---|---|---|
| Purpose | Comprehensive trade compliance | Basic authorization for imports/exports |
| Scope | Covers multiple licenses and benefits | IEC is limited to trade authorization |
| Issuing Authority | DGFT | DGFT |
| Applicable Benefits | Duty exemptions, export subsidies | Legal authorization for trade |
| Mandatory for Trade | Yes | Yes |
Frequently Asked Questions
What is DGFT Certification?
DGFT Certification includes a range of trade licenses issued by the Directorate General of Foreign Trade for import/export compliance.
Is DGFT Certification mandatory?
Yes, it is required for businesses engaged in foreign trade, especially for obtaining an IEC.
What is the timeline for obtaining DGFT Certification?
The process usually takes 5-10 working days, depending on document verification.
What is an IEC, and how is it related to DGFT?
IEC (Import Export Code) is a mandatory trade license issued by DGFT to engage in import/export activities.
Can foreign companies apply for DGFT Certification?
Yes, they can apply by appointing an authorized Indian representative or setting up a local entity.
How much does DGFT Certification cost?
Costs vary based on the type of certification; IEC registration typically has a nominal application fee.
What benefits can businesses access through DGFT Certification?
Export subsidies, duty exemptions, and faster customs clearances.
Can DGFT Certification be modified or updated?
Yes, businesses can amend details or update certifications through the DGFT portal.
What happens if businesses fail to comply with DGFT regulations?
Non-compliance may lead to fines, license suspension, or blacklisting.
Is DGFT Certification recognized internationally?
Yes, it facilitates global trade by ensuring compliance with Indian trade policies.