RCMC vs IEC: Understanding the Difference Between Two Key Export Documents

Imagine you recently started a new export house and are thinking of applying for RCMC registration. However, exporters can face challenges during registration. That’s where you are required to provide an IEC number. The export-import code is the primary document that is mandatory to start export businesses. But what is the role of the IEC code during certification of RCMC? Looking for the same? Then you are on the right page. In this comprehensive guide, we will explore the export registration requirements, RCMC vs IEC, export regulations, and much more. Read more below.

The Guide for RCMC Certificate: Importance for Exporters

Several councils and commodity boards are connected to the Indian government. These organizations are responsible for promoting Indian goods or services worldwide. Furthermore, it provides valuable support to traders by allowing them to participate in trade fairs. Even the exporters can access the government support, benefits, schemes, and incentives. But here is the catch. The Indian export businesses are required to obtain the RCMC certificate to avail these benefits. To become a member of any right export promotion council, the Registration-cum-Membership Certificate (RCMC) is a prerequisite. The major role of the export registration certificate is

• Allows new export houses to import or export restricted items.
• To claim the export benefits and incentives under the Foreign Trade Policy.
• To participate in the foreign trade fairs.

Note: With a single RCMC certificate, organizations can export two or more products. There is no need to apply for a separate certificate for each product.

What is an Import Export Code (IEC) for Businesses?

Whoever is from India and is engaged in international trade is subject to the mandatory IEC registration. The Import Export Code (IEC) is a mandatory 10-digit unique code that identifies any business. On the other hand, the import-export code is basically issued by the Directorate General of Foreign Trade (DGFT). The code is basically linked to the entity’s Permanent Account Number (PAN). The key aspects are

Legal Formality: Holding the IEC number is mandatory for individuals or businesses that deal in international trade. 

Issuing Authority: To obtain the import-export code, apply through the DGFT portal.

Link to PAN: The code is basically provided on the basis of the applicant’s PAN.

Validity Timeline: There is no need to renew the IEC, as it’s permanent and doesn’t expire.

When Did the Entities Require an IEC Number?

• Individuals or businesses importing or exporting goods.
• Anyone dealing with services exporting or importing.
• To get the customs clearance at ports.
• To apply for the AD code registration and RCMC certificate

RCMC vs IEC: Importance for Importing-Exporting

As earlier disclosed, the RCMC certificate is issued by the EPCs, who are involved in importing-exporting businesses and gain membership. Meanwhile, EPC doesn’t care about exporting and importing goods. But it is responsible for promoting a specific category of products, boosting business credibility, and providing access to global trade fairs. However, the IEC number cares about how many goods are exported from India, the quality, and many other parameters. During the registration of the RCMC license, the IEC number is a major document. Let’s break it down to know the difference between:

Conclusion  | Apply for IEC and RCMC to meet Export Regulations

Both the IEC and RCMC certificates are prerequisites to gain access to international trade. The IEC number serves as the primary document, while you will only be eligible for RCMC when you have an IEC code. Import export code generally verifies the businesses as traders, whereas RCMC is a specific document for exporters who want to promote their goods. The code provides the legal rights to businesses to trade freely without external restrictions. Holding both IEC and RCMC is beneficial and has separate working functions. Get valuable support and guidance from LegalRaasta experts to obtain the IEC number and certificate of RCMC. 

FAQs | IEC is the Gateway to Meet Trade Compliance

1. Can you export without the RCMC certificate?

Ans. Yes, you can export goods or services without obtaining the Registration-cum-Membership Certificate (RCMC). However, obtaining the certificate becomes crucial when you want to claim export incentives, benefits, and schemes under the Foreign Trade Policy (FTP).

2. Is IEC registration mandatory?

Ans. Yes, it is marked as one of the most important code certificates required for international trade. Exporters are restricted from international trade without a valid IEC code. 

3. What is the use of IEC at ports?

Ans. For the goods customs clearance at ports, businesses are required to show their IEC code certificate to the customs authority.

4. Which supported export documents are required for international trade?

Ans. For international trade, the exporter must provide:

• Import-Export Code (ICE)
• GST registration certificate
• Shipping bill
• The commercial invoice
• Certificate of Origin (COO)
• Inspection or Quality Check Certificate
• Export License
• AD code Registration
• RCMC Certificate (if wants to claim export incentives and benefits)

5. Who grants the license of RCMC for multiple products?

Ans. The products that are not promoted by EPCs or Commodity Boards are managed by FIEO. The exporter who deals with multiple products can register with the Federation of Indian Export Organizations (FIEO). This authority grants the RCMC certificate to a multi-product exporter.