AD Code Registration

Authorized Dealer Code (AD Code) Registration

Conducting business across borders in international trade depends mostly on negotiating customs processes and rules. The Authorized Dealer Code (AD Code) is one of the fundamental criteria needed for flawless trade operations and smooth customs clearance. Usually known as the AD Code, it is a special numerical identification provided by the bank where a corporation keeps its current account, especially important for export and import transactions.

What does the term “Authorized Dealer Code” mean?

It is a 14-digit numerical code issued by the exporter’s bank where the current account is maintained. This code is supported by the bank’s letterhead and can be obtained when the exporter is registered with an Import Export Code (IEC) by the Director General of Foreign Trade (DGFT). The AD Code has a lifetime validity and does not expire.

Required Documents for AD Code Registration

• Bank’s original AD Code authorization letter
• Letter from exporter requesting AD Code registration
• Letter from customs broker for AD code registration
• Certificate for GST Registration
• Latest IT Returns
• Copies of bank statements
• Import-Export Code License
• Company’s PAN card
• Export House Certificate
• License for Manufacturing
• Identity proofs (passport, voter ID, PAN, Aadhaar, etc.) for owner/partner

Benefits of Registering an AD Code

• Facilitates business development and global expansion.
• Getting an AD Code is a one-time process with lifetime validity.
• No need to renew the AD Code after issuance.
• Essential for exporters/importers to receive various DGFT and customs incentives.
• Enables seamless customs clearance through the ICEGATE platform.
• Ensures direct fund transfers to trader’s account for export transactions.
• Helps avoid penalties for non-compliance with FEMA regulations.

The Impact for Not Applying for an AD Code Registration

• Inability to pay foreign suppliers or receive payments from foreign clients.
• Import/export delays leading to financial and reputational loss.
• Missed government incentives and export-related benefits.
• Violation of FEMA regulations can result in heavy penalties and fines.

Conclusion

In conclusion, the AD Code is crucial for any exporter or importer, supplying lifetime validity and numerous benefits. It assists in business development, smooth customs approval, and direct fund transfers. Failing to register for an AD Code can cause severe disruptions and financial penalties. Proper registration ensures seamless international trade compliance.

FAQ’s