AD Code Registration: A Guide for Exporters
International Trade, the exchange of goods and services across borders, is a complex process. An AD Code (Authorized Dealer Code) is not just crucial but a requirement for this process. It helps regulate foreign currency trades and ensures smooth customs clearance for export transactions, making it an indispensable part of your international trade activities.
FAQs on AD Code
Is AD Code registration free?
AD Code registration itself is typically free. However, some banks might charge a processing fee for handling your application. It’s advisable to check with your bank beforehand to confirm any associated costs.
Can I register for an AD Code online?
Currently, most AD Code registrations are handled offline through your bank branch. However, some banks might offer online application options. It’s best to contact your bank directly to inquire about their specific process.
What documents are required for AD Code registration?
The exact documents required might vary slightly depending on your bank, but standard requirements include:
- Application form for AD Code registration (provided by your bank)
- Copy of your company’s IEC certificate
- Cancelled cheque from your business current account
- KYC (Know Your Customer) documents for your company directors/owners
- Board resolution authorising AD Code application (for companies)
How long does it take to get an AD Code after applying?
Processing time for AD Code registration can vary depending on your bank’s internal procedures. It typically takes anywhere from a few days to a couple of weeks.
What happens if I lose my AD Code letter?
If you lose your AD Code letter, you can usually request a duplicate copy from your bank. Replacing the lost document might incur a small fee.
Do I need a new AD Code if I change banks?
The AD Code is linked to your bank account with the authorised dealer (AD Bank). If you change banks, you must register for a new AD Code with your new bank.
Can a foreign company get an AD Code in India?
Generally, yes. Foreign companies with an office or branch office in India and an operational bank account can apply for an AD Code. The process might involve additional documentation requirements compared to domestic companies.
What are the penalties for not having an AD Code when exporting?
Penalties for not having an AD Code while exporting can include delays in customs clearance, potential fines, and difficulty claiming government export incentives. In severe cases, authorities might even restrict your export activities.
Can I use an AD Code for import transactions?
No, AD Codes are specifically for export transactions. They link your foreign currency earnings from exports to your designated current account. There are separate regulations for handling foreign currency transactions related to imports.
What are the differences between the AD Code and the IEC?
- AD Code (Authorized Dealer Code): A 14-digit code issued by your bank that links your export activities to your current account. It facilitates customs clearance, receiving export incentives, and government monitoring of foreign exchange earned through exports.
- IEC (Import Export Code): A mandatory license issued by DGFT (Directorate General of Foreign Trade) that authorises a company to engage in import and export operations in India. It is a general requirement for both import and export businesses.
