In the global trade ecosystem, India has emerged as a major player, exporting everything from pharmaceuticals and textiles to IT services and agricultural products. However, success in international trade isn’t just about having the right products or competitive pricing — it’s equally about adhering to compliance norms and regulations. For both exporters and importers, compliance ensures smoother transactions, prevents costly penalties, and strengthens international credibility.
From managing customs documentation to adhering to Foreign Trade Policy (FTP) norms, compliance in international trade can often feel complex and overwhelming. Whether you’re a seasoned exporter or a startup venturing into cross-border trade, understanding compliance is crucial for operational efficiency and sustainable growth. In this blog, we’ll simplify the process by outlining the Top 10 Compliance Tips for an import export license consultant.
Obtain the Right Licenses and Registrations
Before starting export or import operations, businesses must ensure they have the proper registrations in place. The most essential is the Importer Exporter Code (IEC), issued by the Directorate General of Foreign Trade (DGFT). Without an IEC, no entity can engage in cross-border trade.
Additionally, exporters may need registration with the Export Promotion Councils (EPCs), while importers dealing with restricted goods must secure specific licenses. Ensuring all relevant documentation is valid and up to date helps avoid shipment delays and compliance violations.
Stay Updated with the Foreign Trade Policy (FTP)
India’s Foreign Trade Policy (2015–2020), extended with periodic amendments, outlines the procedures, incentives, and restrictions governing exports and imports. Businesses must stay informed about the latest changes, as FTP revisions can impact tariff rates, documentation requirements, and eligibility for government incentives.
Regularly review DGFT notifications and circulars to ensure your operations align with current trade regulations. Partnering with professional consultants can simplify this process, ensuring you never miss a policy update that affects your business.
Maintain Accurate and Complete Documentation
Trade documentation errors are one of the most common causes of shipment delays and penalties. Key documents include the commercial invoice, packing list, bill of lading, certificate of origin, and shipping bill. Importers should also ensure proper bill of entry, duty payment proofs, and compliance certificates.
Maintaining digital records and following a structured documentation process reduces human error, ensures transparency, and simplifies audits. Always cross-check that all information — especially HS codes and declared values — matches across documents.
Classify Products Correctly Under HS Codes
The Harmonised System (HS) Code classification is fundamental to determining customs duties, restrictions, and applicable trade benefits. Misclassification can result in overpayment of duties or, worse, legal action for under-declaration.
An import export license consultant should refer to the Indian Trade Classification (ITC-HS) system for accurate product categorisation. It’s advisable to get expert verification for high-value or sensitive products to ensure compliance and prevent disputes with customs authorities.
Understand Customs Valuation Rules
Customs valuation determines the duty applicable to imported goods. India follows the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007, which primarily uses the “transaction value” method.
Importers must declare the actual price paid or payable, including transportation and insurance costs, where applicable. False valuation or under-invoicing is a serious offence that can lead to heavy fines, blacklisting, and seizure of goods. Accurate valuation ensures fair duty payment and maintains business integrity.
Adhere to the Export Control and Restricted Items List
Not all goods can be freely exported or imported. The DGFT maintains a list of restricted, prohibited, and canalised items under the ITC-HS classification. Exporters dealing in sensitive goods — such as defence equipment, chemicals, or dual-use items — must obtain special permissions or clearances.
Similarly, importers should verify whether their products require special certification, such as BIS (Bureau of Indian Standards) or FSSAI (for food products). Ignoring these controls can result in shipment confiscation and license suspension.
Ensure Compliance with Foreign Exchange Management Act (FEMA)
All cross-border financial transactions must comply with the Foreign Exchange Management Act (FEMA), 1999. FEMA governs how payments, receipts, and currency exchanges are handled in international trade.
Exporters must ensure the timely realisation of export proceeds, typically within nine months from shipment. Importers, on the other hand, must complete remittances for imports within stipulated timeframes. Non-compliance may invite penalties from the Reserve Bank of India (RBI) and other regulatory authorities.
Verify Country-Specific Compliance Requirements
Every country has unique import regulations and documentation standards. A tax consultancy firm must research the destination country’s compliance norms, including product labelling, packaging, and safety certifications.
For instance, food exporters to the EU must comply with EU Food Safety Regulations, while electronics shipped to the US may need FCC certification. Understanding these requirements in advance prevents cargo rejections or returns, safeguarding your brand’s reputation abroad.
Implement Robust Risk Management and Due Diligence
International trade involves dealing with multiple stakeholders — suppliers, freight forwarders, banks, and clients. Conducting thorough due diligence on all partners helps prevent fraud, delays, and compliance breaches.
Adopt a proactive risk management approach:
- Verify suppliers’ authenticity and trade history.
- Check buyers’ creditworthiness.
- Ensure logistic partners comply with customs and export control norms.
- Maintain insurance for shipments and payments.
This not only enhances operational security but also builds long-term credibility in the global market.
Work with Experienced Trade Compliance Consultants
Even with the best internal systems, staying fully compliant can be challenging, especially for SMEs and startups. That’s where professional business startup and compliance consultants come in. They help streamline registration, licensing, documentation, and ongoing regulatory obligations.
Consultants like Pravega Business Consultants specialise in helping businesses navigate the complexities of trade compliance, business setup, and export-import regulations. Our expertise ensures your operations remain fully compliant, efficient, and optimised for global success.
End Notes
In today’s highly regulated trade environment, compliance isn’t optional — it’s the foundation of sustainable success in global business. From proper licensing and documentation to understanding customs valuation and FEMA regulations, each aspect contributes to a transparent and trustworthy trading ecosystem.
However, given the evolving nature of international trade laws, partnering with an experienced import export license consultant can make all the difference. Pravega Business Consultants provides end-to-end business startup and compliance consulting services for Indian exporters and importers. Our team ensures that every regulatory requirement — from IEC registration to risk management — is handled with precision and efficiency.
