If you are an exporter in India, you might be aware of the two most important permits you need to send your goods out of the country. The first is an Import Export Code (IEC), a business identification number issued by the Directorate General of Foreign Trade (DGFT). The second is an Authorised Dealer Code (AD Code), without which you cannot complete customs clearance of your goods.
An AD Code is a 14-digit numerical code you can get from the bank with which you have a current account to run your import-export business. The code comes printed on a document with the bank’s letterhead, in a format prescribed by the DGFT. A bank must deal in or be an authorised dealer of foreign currency in order to be able to grant an AD Code. This is in line with the purpose behind an AD Code, which is to ensure that foreign currency transactions in an exporter’s current account are from legal trade.
Exporters must register their AD Code with the port or airport from where they intend to ship their goods abroad. If the shipment is to be dispatched from an inland container depot (ICD), AD Code registration is required for that facility as well as the port attached to it. For example, if you ship from ICD Khodiyar in Ahmedabad, you will need to register there as well as at Mundra port in Gujarat and/or Nhava Sheva in Maharashtra as the cargo will be routed through either of these ports.
An AD Code registration has a lifetime validity. However, if an exporter ships from more than one port, whether in the same state or in different states, they must register the AD Code for each of these ports. In such a scenario, the AD Code for each of these ports will be different.