Importer of Record in India | IOR Services

IOR Importer of Record Meaning?

• An importer of record or IOR is an entity that
  • Imports goods into India on your behalf & (depending on scope of work) delivers them to your desired location.
  • Ensure complete compliance of Indian law for Import
  • Files all required documents related to the Import
  • Procures all necessary licenses and certifications for the goods being imported
  • Ensures timely payment of various duties and taxes

Need for IOR services?

Need of IOR services for Foreign Companies:

• If a foreign company wishes to test it’s product in the Indian Market by itself, it must
  • Appoint an Indian Director
  • Set up a subsidiary in India
  • Build a team in India
  • Comply with Indian laws
• This setup requires huge investment for a market that may or may not work out for the foreign company.
• Using an Importer of Record in India the foreign company can get its product imported into India and test the Indian market.
• It allows the foreign company to understand whether their product sells in India, which in turn mitigates risk of not achieving product market fit.
• It also allows them to test their product much faster as an IOR service provider like JPARKS INDIA Pvt Ltd already has the general licenses & can easily obtain the product specific licenses. 
• Thus hiring an Importer of Record service provider allows the foreign company to enter the Indian markets without having to invest much time and capital.

Need of IOR services for Indian Companies

The reason why an Indian company may prefer to import goods via an Importer of Record is

• To outsource burden & responsibility of compliance
• To avoid delays in Import as the IOR has basic licenses
• Lack of experience with Import compliance
• If they don’t plan to import regularly

Thus It’s much cheaper & less of a headache for first time importers to hire an IOR.

Do you need IOR Services – Questions to Consider

To determine whether you should hire an Importer of the record or carry out import yourself, consider the following questions

1. Do you plan to Import goods regularly?
2. Do you have a team to handle the compliance work?
3. Are you well informed about the various licenses & certification required to Import your product?
4. Are you aware about the process of Importing & clearing your goods in India?

If you plan to import regularly, but are uncertain about any of the above questions, speaking to a professional import export consultant like JPARKS INDIA will help you gain clarity.

Does the Importer of Record In India Own the goods?

• The ownership of goods must be transferred to your entity by executing a transaction between the IOR Importer of Record and your entity.

Importer of Record Requirement

An Importer of Record (IOR) is the party legally responsible for importing goods into India. The IOR must be a resident of India and must have a valid importer-exporter code (IEC).

The IOR is required to complete all necessary customs formalities and paying any applicable duties and taxes.

Importer of Record Responsibilities

• Assessment & payment of duties & taxes correctly
• Valuation of goods based on Indian laws
• Accurate classification of goods
• Ensure timely filing of Import documents with required declarations under various laws
• Procurement of required licenses & certifications for the goods (guide to refrain from importing prohibited goods  & ensure regulatory compliance for restricted goods)
• Complying to State & Central laws
• Clearing the goods from customs through a good reputed and informed Custom Brokers 
• Appointing a valid Power of Attorney if Importer or Indian representative is not available
• Preparation & record of all necessary documents in case audits and inspections 
• Maintain all import records for at least 8 years after being imported into India for future queries from governmental agencies 
• Availing relevant benefits from the Foreign Trade Policy to benefit the client

Importer Of Record in India VS Consignee In India

Importer of Record (IOR)

The Importer of Record (IOR) is the party legally responsible for importing goods into India. The IOR is responsible for ensuring that all import formalities are completed correctly and that all applicable duties and taxes are paid. The IOR must also be able to demonstrate that they have the legal right to import the goods.

Consignee

The consignee is the party who will be receiving the imported goods. The consignee may be the same as the IOR, but it is not always the case. For example, a company may import goods for a customer, in which case the customer would be the consignee.

Differences between the IOR and the consignee

The following table summarizes the key differences between the IOR and the consignee in India:

Characteristic	Importer of Record (IOR)	Consignee
Legal responsibility	Legally responsible for the imported goods, including ensuring that all import formalities are completed correctly and that all applicable duties and taxes are paid.	Not legally responsible for the imported goods.
Ownership of the goods	May or may not own the imported goods.	Does not own the imported goods until they have been cleared through customs.
Liability for import duties and taxes	Responsible for paying all applicable import duties and taxes.	Not responsible for paying import duties and taxes, unless specified in the sales contract.

What is included in an Importer of Record Agreement in India ?

An Importer of Record Agreement is a contract between a company (importer) and an IOR in which the Importer of the record agrees to import goods on behalf of the importer.

Key elements of an Importer of Record Agreement in India

An IOR Agreement in India should include the following key elements:

• Parties to the agreement: The names and addresses of the importer and the IOR.
• Scope of work: The services to be provided by the IOR, such as customs clearance, payment of duties and taxes, and compliance with Indian laws and regulations.
• Fees: The fees to be charged by the IOR for their services.
• Liabilities: The liabilities of each party in the event of errors, delays, or other problems with the import process.
• Governing law and dispute resolution: The law that will govern the agreement and the procedure for resolving any disputes that may arise.

Additional considerations for Importer of Record Agreements in India

In addition to the key elements listed above, there are a few other things to keep in mind when drafting an IOR Agreement in India:

• The IOR must be a resident of India and must have a valid importer-exporter code (IEC).
• The IOR Agreement should be in writing and signed by both parties.
• The IOR Agreement should be kept up-to-date to reflect any changes in the relationship between the importer and the IOR, or in Indian laws and regulations.

How to draft an Importer of Record Agreement in India

It is advisable to have an IOR Agreement drafted by an experienced lawyer. This will help to ensure that the agreement is legally binding and that it protects the interests of both the importer and the IOR.

IOR Customs Clearance Process in India

The IOR Customs Clearance Process in India is as follows:

1. Prepare the required documentation. This includes the bill of lading, commercial invoice, packing list, certificate of origin, and any other documentation required by the Indian Customs Department.
2. Submit the documentation to the Indian Customs Department. The documentation can be submitted electronically or in person.
3. Pay the applicable duties and taxes. The amount of duty and tax payable will vary depending on the type of goods being imported.
4. Clear the goods from customs. Once the duties and taxes have been paid, the IOR will receive a customs clearance certificate. The IOR can then take possession of the goods.

Non Compliance Risk of not using IOR Services in India

Importing goods into India without proper compliance could have extreme financial & business consequences. 

• Imported goods can be seized by Customs
• You may be forced to re export the goods back to the seller
• Fines & penalties can be levied along with the duties based on valuation of goods

A lack of due diligence prior to importing may lead to numerous issues that would sideline your business goals. If you are unaware about the process & compliance of Import, it is highly advisable to hire professional import consultants like JPARKS INDIA to help you safely import your goods into India.

How to choose the right IOR services provider?

When you look for an Importer of Record, ideally you should talk to at least a few service providers. Consider the following points before you select an Importer of Record for your business:

1. Years of experience : more years = better knowledge of laws 
2. Expertise in your industry & previous experience
3. Product knowledge
4. Do they provide a fair market rate?
5. Quality of work – this can be gauged through systems & processes you encounter at the time of initial discussion.
6. Do they have a good & sizable team that can handle your volume?
7. Is the IOR covering all the details and regulations in their scope of work or are you or your end customer  still liable to do some legal work on their  own.
8. Will they provide a Power of Attorney, in case you need one?
9. Do they provide a one stop solution for logistics, storage, packing & delivery too? An end to end service equals less headache for you!
10. Most Importantly, do you like working with them or see yourself working with them in the long term? Having an IOR you can trust will save you a lot of time & effort in the long run.

Importer Of Record Services | IOR Services by JPARKS INDIA

At JPARKS INDIA we provide complete IOR services, right from Import to last mile delivery we handle everything. To provide a complete done for you experience besides regular IOR responsibilities we include services like

• Freight forwarding, Logistics & warehousing
• Local Transport
• Packing & Loading etc

So you get time to focus on the business, instead of spending time on technicalities of Import.

With a team having over 40 years of experience in Import Export, JPARKS INDIA is the right Importer of Record for you.

Contact us to schedule a meeting & discuss this further.