AD COCE REGISTRATION
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Overview
An AD, or Authorised Dealer, is a 14-digit code issued by a bank to an exporter or importer. It is required for all export and import transactions involving foreign currency. The purpose of the AD Code is to ensure that foreign currency transactions are genuine and not used for illegal purposes.
Benefits of AD Code Registration
Ease of Making and Receiving Foreign Currency Payments
- The AD Code helps to verify your identity and the authenticity of the transaction, making it easier to make and receive foreign currency payments.
- ssThis can save you time and hassle, and can help to ensure that your payments are processed smoothly.
Faster Customs Clearance
- The AD Code helps to identify your shipments and to ensure that they are compliant with all the necessary regulations.
- This can help you to clear your goods from customs more quickly, which can save you time and money.
Access to Government Incentives and Schemes
- The AD Code shows that you are a legitimate business that is engaged in genuine trade activities.
- This can make you eligible for government incentives and schemes, which can help you to grow your business.
Reduced Risk of Penalties and Fines
- The AD Code helps to ensure that you are complying with all the necessary regulations.
- This can help you to avoid penalties and fines, which can save you money and reputational damage.
Eligibility for AD Code Registration
To be eligible for AD Code registration, the entity must:
- Be registered with the Directorate General of Foreign Trade (DGFT) for an Import Export Code (IEC).
- Have a current account with a bank that is authorised to deal in foreign currency.
- Provide all the required documents to the bank.
Documents Required for AD Code Registration
The documents required for AD Code registration may vary depending on the bank and the type of entity applying for the code. However, the following are some of the most common documents that are required:
- IEC Registration Certificate: This certificate issued by the Directorate General of Foreign Trade (DGFT) establishes the entity’s eligibility to export or import goods.
- Bank Account Details: This includes the name of the bank, the branch address, the account number, and the IFSC code.
- Proof of Identity: A PAN card, Aadhaar card, passport, or voter ID card.
- Proof of Address: This could be a utility bill, a lease agreement, or a property registration document.
- Board Resolution: This is a resolution passed by the entity’s board of directors authorising the registration of the AD Code.
- Letter of Authorisation: This is a letter from the authorised signatory of the entity authorising the person applying for the AD Code to do so on their behalf.
Applying for an AD Code
To apply for an AD Code, you’ll need to complete two main steps:
1. Apply for AD Code through your bank:
- Visit your bank branch: Go to the bank where you maintain your current business account.
- Submit an application letter: Request the bank to issue an AD Code for your business. The bank will likely provide a specific format for this letter. Be sure to include all necessary details like your IEC number, GST registration number, and desired port locations.
- Provide supporting documents: The bank might require documents like your PAN card, bank account details, and proof of business address.
- Pay the applicable fees: There might be a processing fee associated with issuing an AD Code.
2. Register your AD Code on ICEGATE:
- Go to the ICEGATE portal: Sign up or log in to the Indian Customs Electronic Gateway (ICEGATE) portal
- Verify your port locations: Ensure all port locations where you plan to conduct exports are listed in your profile.
- Obtain a Class-3 digital signature: If you haven’t already, acquire a Class-3 digital signature certificate for online authentication on ICEGATE.
- Register your AD Code account: Under ‘Bank Management System,’ choose ‘Add Bank Account’ for AD Code bank account registration.
- Fill in the form: Provide details like your AD code, bank account details, and chosen port locations.
- Upload documents: Attach scanned copies of required documents like the AD code authorisation letter from your bank, GST registration certificate, and cancelled cheque.
- Verify and submit: Check all information thoroughly before submitting your application.
List of Ports / ICD for AD Code Registration
AD Code registration is required for all ports in India. The list of ports is as follows:
- Chennai
- Cochin
- Kolkata
- Mumbai
- New Delhi
- Kandla
- Visakhapatnam
- Haldia
- Paradip
- Mangalore
- Tuticorin
ICEGATE Registration Verification
Verifying your ICEGATE Registration
There are two ways to verify your ICEGATE registration, depending on what information you want to confirm:
1. Checking your User Details:
This method verifies that your PAN is registered with ICEGATE and provides details like your ID, role, registration date, and registered filing service.
Here’s how to do it:
- Go to the ICEGATE User Details against the PAN page
- Enter your PAN number in the provided field.
- Click on the ‘Reload’ button.
- If your PAN is registered, you’ll see your details displayed on the page, including:
- ICEGATE User ID
- Role (e.g., Importer, Exporter)
- Registration Date
- Registered Filing Service (e.g., eSANCHIT)
2. Checking your IE Code Status:
This method verifies the status of your IE code registration with DGFT (Directorate General of Foreign Trade) and confirms its accuracy.
Here’s how to do it:
- Go to the ICEGATE IE Code Status Enquiry page.
- Choose the appropriate option from the ‘Select IE Code Registration From’ dropdown menu:
- ‘DGFT Headquarter’ for registrations directly submitted to DGFT headquarters.
- ‘Various Offices of DGFT to Various Automatic Customs Location’ for registrations submitted through regional DGFT offices.
- Enter your IE code in the provided field.
- Click on the ‘IE Code @ DGFT’ button.
If your IE code is registered and valid, details like the issuing office, date of issue, and validity period are displayed on the page.
Why is AD Code Registration Required?
AD Code registration is required to ensure that foreign currency transactions are genuine and not used for illegal purposes. The AD Code is a unique identification number issued by a bank to an exporter or importer. It is used to track all foreign currency transactions and to prevent money laundering and other financial crimes.
Here are some of the specific reasons why AD Code registration is required:
- To prevent illegal outflow of foreign exchange: The AD Code helps to track all foreign currency transactions and to identify any suspicious activity. This helps to prevent the illegal outflow of foreign exchange, which can be used for terrorist financing or other illegal activities.
- The AD Code is only issued to entities engaged in genuine trade activities to ensure that foreign currency transactions are for genuine trade purposes. This helps to prevent the use of foreign currency for illegal purposes, such as money laundering.
- To facilitate the export and import process, AD Code registration is a necessary requirement for exporters and importers who deal in foreign currency. It helps to speed up the export and import process and to avoid delays at customs.
- To avail of government incentives and schemes: The government offers a number of incentives and schemes to exporters and importers. AD Code registration is a requirement for many of these schemes.
Consequences of Not Registering for an AD Code
The consequences of not registering for an AD Code can be serious. Here are some of the most common consequences:
You may not be able to make or receive foreign currency payments
This can severely hamper your business operations, as it will prevent you from paying your overseas suppliers or receiving payments from your overseas customers.
You may not be able to clear your goods from customs
This can delay or even prevent the import or export of your goods, which can lead to financial losses and reputational damage.
You may not be eligible for government incentives and schemes
The government offers a number of incentives and schemes to exporters and importers, but many of these schemes require AD Code registration.
You may be subject to penalties and fines
The government can impose penalties and fines on businesses that do not comply with the Foreign Exchange Management Act (FEMA), which requires AD Code registration for certain types of foreign currency transactions.
Importance of AD Code Registration
The importance of AD Code registration cannot be overstated. It is a crucial requirement for all exporters and importers who deal in foreign currency.
Here are some of the key reasons why AD Code registration is important:
To prevent illegal outflow of foreign exchange
The AD Code helps to track all foreign currency transactions and to identify any suspicious activity. This helps to prevent the illegal outflow of foreign exchange, which can be used for terrorist financing or other illegal activities.
- To ensure that foreign currency transactions are for genuine trade purposes: The AD Code is only issued to entities that are engaged in genuine trade activities. This helps to prevent the use of foreign currency for illegal purposes, such as money laundering.
- To facilitate the export and import process: AD Code registration is a necessary requirement for exporters and importers who deal in foreign currency. It helps to speed up the export and import process and to avoid delays at customs.
- To avail of government incentives and schemes: The government offers a number of incentives and schemes to exporters and importers. AD Code registration is a requirement for many of these schemes.
Why AccountsWaale?
At AccountWaale, we recognise the significance of AD Code registration for businesses engaged in international trade. Our commitment to providing comprehensive legal and regulatory solutions makes us the preferred choice for individuals and companies seeking efficient AD Code registration services.
Here are some compelling reasons why you should partner with AccountWaale for your AD Code registration:
1.Expertise in Foreign Exchange Regulations: We have a team of experienced professionals who specialise in foreign exchange regulations and procedures. Our experts are well-versed in the specific requirements and intricacies of AD Code registration, ensuring compliance with the Reserve Bank of India (RBI) guidelines.
2.Efficiency and Timeliness: Navigating the AD Code registration process can be complex and time-consuming. Our team can streamline the process, ensuring that all necessary documentation and requirements are met accurately and promptly.
3.Customised Solutions: We understand that every business has unique needs. Whether you’re an exporter or importer, our services are tailored to meet your specific AD Code registration requirements.
4.Compliance Assurance: Staying compliant with RBI regulations is crucial to the success of your international trade operations. AccountWaale can assist you in maintaining continuous compliance, reducing the risk of regulatory issues or penalties.
5.Risk Mitigation: Our in-depth understanding of foreign exchange laws allows us to identify potential risks and challenges. We work proactively to mitigate these risks, ensuring that your international trade transactions proceed smoothly and within the bounds of the law.
6.Transparent and Competitive Pricing: We believe in transparency when it comes to our services and pricing. You’ll receive a clear breakdown of costs, making it easier for you to plan your budget for AD Code registration.
7.Dedicated Customer Support:Our customer support team is dedicated to providing you with prompt assistance and addressing your inquiries or concerns. Your satisfaction and peace of mind are our top priorities.
8.Proven Track Record:AccountWaale has a proven track record of assisting businesses in successfully obtaining their AD Codes. Our clients’ success stories reflect our competence and reliability in this domain.