What is the AD Code for International Shipping and Bank Registration Steps

For Exporters

If you're an exporter, the AD Code is indispensable. It allows you to receive payments from foreign buyers efficiently and ensures that your transactions are transparent and compliant with regulatory requirements. Without this code, managing your finances can become convoluted, potentially hindering your business growth.

For Importers

On the other hand, importers use the AD Code during the payment process for goods imported from abroad. This code helps verify the authenticity of transactions and ensures that funds are transferred securely and swiftly. It's critical to maintaining smooth operations within the supply chain and logistics network.

AD Code in Trade Documentation

The AD Code is not just about transactions; it's also vital for trade documentation. Essential documents such as the Bill of Lading, Shipping Bill, and Letter of Credit require the AD Code for validation. 

This ensures that all your trade paperwork is in order, which is crucial for avoiding delays and complications in the supply chain.

Also Read: Format and Registration of AD Code Request Letter

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Streamlining Customs Clearance

Every exporter knows the bottleneck customs can create. Required to generate the shipping bill, the AD Code links your cargo to its departure, ensuring customs clearance is a formality. 

Have you ever found yourself stuck at customs, watching time tick away? Here's where a valid AD Code can help.

Keeping Tabs on Your Transactions

For businesses engaging in foreign currency trade, the AD Code acts as a watchful guardian. It allows businesses and the government to monitor and regulate foreign currency transactions. 

How do your transactions remain transparent and above board? The AD Code is your silent auditor.

Seamless Linkage for Swift Clearance

Linking your business details directly to customs through the AD Code facilitates smooth clearance, minimising delays and discrepancies. It's like having a pre-approved pass for your goods through the maze of international trade regulations.

Simplifying Financial Incentives

One of the less talked about but highly significant advantages of the AD Code is how it enables the direct deposit of government incentives and subsidies into your business bank account. This seamless transaction saves time and ensures you receive every benefit you're entitled to without the hassle.

Also Read: Navigating GST on Export of Services: A Practical Guide for Indian Businesses

Simplifying Record-Keeping

The AD Code serves as a standardised identification for your business in global trade. Whether you import electronics from East Asia or export textiles to Europe, this code simplifies your activities and record-keeping, both for you and the government.

Also Read: 10 Required Pre-Shipment Documents for Export Procedure and Shipping Process

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Step 1: Visit Your Bank

Begin by visiting the bank where you hold a current account. This bank must be authorised to deal in foreign exchange. Ensure you have all necessary documents, including your Import Export Code (IEC), PAN card, and a cancelled cheque.

Step 2: Submit the Application

Draft a formal application letter addressed to your bank's branch manager requesting the issuance of an AD Code. The letter should follow the format prescribed by the Directorate General of Foreign Trade (DGFT). Submit the required documents along with the application.

Step 3: Receive the AD Code

Upon verifying your application and documents, the bank will issue the AD Code on its letterhead. This 14-digit code is a unique identifier for your business’s export transactions.

Step 4: Register the AD Code at Export Ports

Once you have the AD Code, the next step is to register it with the customs authorities at each port from which you plan to export. This involves submitting the AD Code letter and additional documents such as your GST certificate, past bank statements, and income tax returns.

Step 1: Log in to the ICEGATE Portal

First, visit the ICEGATE portal and create an account if you haven't already. Ensure you have your Import Export Code (IEC) handy, as it's required for registration.

Step 2: Navigate to 'e-Sanchit' and Upload Documents

Once logged in, go to the 'Filing Services' section and select 'e-Sanchit'. Here, you'll need to upload all the necessary supporting documents. Please refer to the next section for the required documents.

Step 3: Obtain DRN and IRN

After uploading, you'll receive a Document Reference Number (DRN) and an Image Reference Number (IRN). The DRN and IRN are critical as they will be used in the subsequent steps. Ensure you note these numbers down accurately.

Step 4: Go to Financial Services -> Bank Account Management -> AD Code Registration

Return to the main page of the ICEGATE portal and navigate to 'Financial Services'. Select 'Bank Account Management' and then 'AD Code Registration'. 

Here, you will enter your bank account details and the IRN of the documents uploaded in e-Sanchit​.

Step 5: Fill in the Registration Form and Submit

Complete the registration form by providing all the necessary details and upload the required documents again if prompted. Once everything is filled out correctly, submit the form for approval. You may need to complete a mobile OTP verification as part of the submission process​​.

Error 1: Incorrect Information in AD Code Letter

Problem: Sometimes, the information provided in the AD Code letter from your bank may contain errors, such as an incorrect company name, wrong PAN details, or mismatched bank account information.

Error 2: Delays in AD Code Issuance

Problem: The bank's delay in issuing the AD Code can disrupt your trade activities.

Error 3: Issues During Customs Registration

Problem: Errors, such as data mismatch or missing documents, can occur while registering your AD Code with customs.

Error 4: AD Code Not Linked Properly with Customs

Problem: Your AD Code might not be properly linked to your customs profile, causing issues generating shipping bills.

Error 5: “Error 110”: IEC Registered with Another Site

Problem: This error indicates that your Import Export Code (IEC) is already registered with another site.

Solution:

1. Ensure you have all the required supporting documents for AD Code registration.
2. Re-upload the necessary documents as per the specified guidelines on the ICEGATE portal.
3. If the problem persists, contact your home bank branch for further verification and reissue of the AD Code​.

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Can I apply for multiple AD Codes if I export from multiple ports? 

Yes, each port requires a unique AD Code registration to ensure compliance with customs regulations at each location. This helps streamline the clearance process and manage your shipments efficiently.

What should I do if my AD Code registration is rejected? 

If your AD Code registration is rejected, check the error code provided for specific issues. Common reasons include incorrect documentation or discrepancies in the provided information. Correct the errors and resubmit your application. Consult with a customs broker if the issue persists.

Is there an online system for managing AD Code registrations? 

Yes, the ICEGATE portal allows you to manage your AD Code registrations online. You can upload documents, track the status of your application, and make necessary updates directly through the portal.

Can I use a digital signature for AD Code registration? 

Yes, a Class 3 Digital Signature Certificate is required for online submissions and verifications on the ICEGATE portal. This ensures the security and authenticity of your documents.

How long does it take to get an AD Code? 

Typically, it takes 3-4 working days for your bank to process the application and issue the AD Code. The registration with customs may take additional time depending on the verification process.

What are the common errors during AD Code registration and how can I avoid them? 

Common errors include incorrect documentation, missing details, or network issues during online submissions. Ensure all documents are accurate and up-to-date, and verify network connectivity before uploading files.

Can I update my AD Code details if my business information changes? 

Yes, you can update your AD Code details through the ICEGATE portal. Ensure you have the necessary documents and follow the update process as specified.

How does the AD Code affect my cargo insurance? 

Having an AD Code ensures that all your export transactions are properly documented, which can facilitate smoother claims processing with your cargo insurance provider in case of any issues.

Are there any specific requirements for AD Code registration for e-commerce exports? 

While the basic requirements remain the same, e-commerce exporters may need to provide additional documentation related to their online business operations. Consult with your bank for any specific requirements.

Are there annual fees associated with maintaining an AD Code?

Here's some good news—there are no annual fees for maintaining an AD Code. Once issued, your AD Code remains valid indefinitely unless there are significant changes to your bank account details or regulatory status. This makes the AD Code a cost-effective solution for your ongoing foreign trade needs.

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