Understanding AD Code for Exports from India

Growing your brand and taking it globally is a goal shared by all sellers, whether they are seasoned exporters, budding entrepreneurs, or well-known local vendors. Thousands of Indian vendors are expanding their global consumer base by exporting goods and services thanks to the convenience of conducting business via e-commerce exports.The initial phase of launching an export enterprise from India involves acquiring certain crucial documents and fulfilling regulatory obligations. An AD Code is one such important document needed for customs clearance (Authorised Dealer Code).

What Does an Authorised Dealer Code Mean?

The bank where the exporter keeps a business current account provides the exporter with a 14-digit code known as an Authorised Dealer Code. Once the exporter has registered for an Import Export Code (IEC) by the Director General of Foreign Trade (DGFT), they can acquire this code, printed on the bank letterhead. It is valid for a lifetime.

Here’s why an export procedure requires an Authorised Dealer Code:

• To have your export customs cleared at the port, you must have a shipping bill. It is not possible to generate a shipping bill without registering an AD code.
• Benefits like exemptions that are immediately paid to the current account are another advantage of registering an AD code.

Significance of an Authorised Dealer Code

Three aspects of international transport require an Authorised Dealer Code:

• For Exporters: An AD code is required for a number of foreign exchange operations, including receiving payment for exports, when an Indian company or individual engages in overseas trade.

• For Importers: When paying for imports, importers can also require an AD code. This code aids in making sure that import-related foreign exchange transactions are appropriately authorised and documented.

• Trade Documentation: A number of trade documents, including the Bill of Lading, Shipping Bill, and Letter of Credit, frequently require the AD code. It facilitates the keeping track of and documentation of foreign exchange transactions related to global trade.

Benefits of Authorised Dealer Code in Export Processes

An Authorised Dealer Code aids in the export process in the following ways:

• You must have a shipping bill in order for customs clearance. The shipping bill for your cargo cannot be generated without the AD code. 
• Commencing on August 03, 2018, commercial shipments with a maximum value of INR 5,00,000 are permitted by courier mode, utilising Courier Shipping Bill-V, or CSB-V. Without the registration of the AD code, CSB-V cannot be generated. 
• Additionally, the AD Code permits government benefits that are directly credited to the current bank account linked to your firm, including GST, refunds, duty rebates, and exemptions. 

How to Apply for Authorised Dealer Code Code?

The bank where you now keep your export business’s bank account can provide you with an Authorised Dealer Code. To get an AD code, take the following actions:

• Send the bank branch manager a letter seeking an AD code using the format provided by the bank.
• After processing your application, the bank will provide you with the AD code document on letterhead in the DGFT-mandated format.
• After receiving it, you can register your AD code by giving your paperwork to the Customs House Agents (CHA) at the port from which your shipment will be delivered.
• Every port from which you wish to export your goods and clear customs requires you to register your AD code. For example, if your shipment is coming from Mumbai and Vishakhapatnam, you will need to register at both ports.

Among the paperwork needed to register an Authorised Dealer Code with CHA are the following:

• AD Code
• Copy of IEC (Import Export Code) Code
• Copy of Pan Card 
• GST Registration Certificate 
• Export House Certificate (this is optional)
• Bank Statement of one year
• Aadhar, Voter ID/passport or IT returns of Export Partner.

Steps to Register for Authorised Dealer Code

Additionally, you can register your AD code on the Icegate website of customs. Now, the entire procedure is done online.

1. Enter your ID and password to log into the Icegate website.
2. In the left panel, select Bank Account Management.
3. After the page for managing your export promotion bank account opens, you must click on AD Code Registration.
4. To display the dashboard for AD Code Bank Account Registration, select the Authorised Dealer Code Registration and click submit. Go to the bottom of the dashboard and select the ‘Add Account option’ if you haven’t already registered your locations.
5. Next, provide the necessary information, such as the location, bank name, and AD code. Upload the required file in the manner specified on the page.
6. An image reference number (IRN) and document reference number (DRN) are generated as soon as your documents are successfully uploaded.
7. After the user has entered all relevant data, select Save Change. You receive a six-digit OTP on your mobile number and email address.
8. After the OTP is validated, ICEGATE receives the request for a bank account update. The Authorised Dealer or AD Code dashboard will display the bank account details once ICEGATE has authorised the bank account add request.

How to Export from India using Authorised Dealer Code?

You can export from India with simplicity now that you have your Authorised Dealer Code and other paperwork, such as the IEC. Global expansion has never been simpler with e-commerce export initiatives. A vendor who formerly served a small clientele inside his state or even country might now focus on the worldwide market.
E-commerce exports are a simple and advantageous concept that can be adapted by budding companies and aspiring entrepreneurs to facilitate worldwide expansion and enhance revenue prospects. The process might be straightforward and uncomplicated with the correct knowledge and comprehension, especially by incorporating the Advance Authorisation Scheme in your export procedures.