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India is the world’s sixth-largest economy. As India’s middle class grows, so does its demand for imported goods. India’s total imports from the years 2021 to 2022, reported by the Ministry of Commerce and Industry, were US$610.22 billion, showing an increase of 54.71% over the last year. These numbers indicate the large number of products imported into the country and hold great potential for entrepreneurs.
However, just like many countries of the world, India also has some strict rules and regulations regarding shipping products into the country and clearing them from customs. One such requirement essential for customs clearance is the documents required for KYC. So what is KYC, why are KYC documents required for a smooth import clearance process in India, and what exactly is the process of submitting KYC documents? DHL Express provides the answers to these questions in this article.
What is KYC?
KYC is the abbreviation of ‘Know Your Customer’. Simply put, it is a mandatory procedure where entities shipping items abroad are required to submit documents to verify the identity and address of the receiver. Whether an individual is sending a shipment to India or a company is sending bulk products, KYC documents must be submitted to the logistics carrier.
India’s KYC regulations were implemented as part of the Money-Laundering Act (2002) and the Prevention of Money-Laundering Rules (2005). The aim is to prevent anyone from fraudulently making use of export incentives, misusing export promotion schemes, and evading import duties. Therefore, when consignees receive products from abroad, they must submit KYC documents in order for their imports to be cleared by Indian customs. This is irrespective of the value of those shipments.
DHL KYC requirements for customs clearance in India
Since KYC documents should be provided to the customs officials during the import clearance process, the receiver needs to submit them to the logistics carrier before the shipment arrives. If the documents are not submitted at that time for customs clearance or are incorrectly completed, the shipment will be held in Customs Bond until the shipper or consignee in India furnishes the right materials as required. This will not only result in the process of clearance being delayed but can even incur penalties in some cases.
To help you navigate these requirements for a seamless international shipping experience, DHL Express has outlined what KYC documents the receiver must submit. These can be categorized under two groups: proof of identity and proof of address, and are discussed below:
Proof of identity
As part of the KYC proof of identity requirements, individuals shipping items to or from India with DHL Express must provide documents that can verify the identity of the consignee.
- Any of the following identification documents, including an Aadhar Card, Voter ID, PAN Card driver’s license, or passport, can be provided by the recipient.
If the receiver is a minor below 18, the following documents need to be submitted as proof of ID and address:
- Aadhar Card;
- PAN Card;
- Birth Certificate; or
- Passport of the minor.
Besides this, any of the following documents of the parent/guardian must be submitted:
- Aadhar Card;
- PAN Card; or
- Passport.
Proof of address
Proof of address is an official or legal document that confirms the consignee's residential address. If the address shown on the KYC document matches the one on the shipment, the proof of identification can also be used as a proof of address. However, suppose the address on the KYC document differs from the shipment delivery address. In that case, the receiver should provide any of the following records that include the address listed on the shipment:
- Acceptable Address Proof for Individuals and Minors:
- Bank account statement
- Electricity bill
- Rent agreement
- Hotel booking receipt
- LPG connection receipt
- Employee ID
- For Proprietors, Partnership Firms, and Companies: Proprietors, partnership firms, and companies must provide additional address proof aligned with their business requirements, such as:
- Bank account statement
- Electricity or telephone bill
- Lease or rent agreement
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