How to Incorporate an FMCG Export Business from India?

India exports a wide range of FMCG products, such as snacks, beverages, cosmetics, and packaged foods, to many countries. These products enjoy high demand due to their good quality and low prices. To start this export business, the first and most important step is to register the company. It gives businesses a proper identity and helps them get licenses like IEC, GST, and APEDA. A registered company gains the trust of buyers, banks, and customs. It also avoids legal issues, qualifies for government support, and ensures smooth global trade operations.

This article describes how to incorporate an FMCG Export Business in India in detail.

How to Incorporate an FMCG Export Business in India

Incorporation means a business legally registered as a company with the government. It gives the business a separate legal identity. This allows the company to sign contracts, own property, and open bank accounts in its name. It also brings tax benefits, like claiming deductions and easier refund processing.

Incorporation protects business owners from personal liability. If the company faces any loss or legal issue, personal assets stay safe. It also builds trust with international buyers, suppliers, and banks. A registered company looks professional and reliable in the global market.

Types of Business Structures for FMCG Exports:

It is important for business owners to choose the correct structure to start an FMCG export business from India. Below is a list of the main types:

1. Sole Proprietorship

A sole proprietorship is the simplest form of FMCG business. In this type, an individual owns, controls, and manages the entire business. It is quick to set up with minimal paperwork. This type of business involves low cost and fewer legal formalities.

However, the business and the owner are the same in the eyes of the law. The owner takes full responsibility for any business debt or legal issue. If the business suffers a loss, the owner’s money and assets are also at risk. A sole proprietorship is mainly for small-scale exporters with limited investment.

2. Partnership Firm

A partnership firm is formed when two or more people start a business together. Each partner invests money, time, or skills in the business. They share profits and losses based on the agreed terms. It is suitable when multiple people want to run an FMCG export business together.

The registration process is easy and cost-effective. A written partnership deed defines the roles and duties of each partner. However, the firm does not have a separate legal identity. All partners are personally responsible for debts or legal problems.

3. Private Limited Company

A private limited company is a popular choice for FMCG export businesses. It separates the business’s legal identity from the owners. This means the owners’ assets are protected from business losses or debts. The company can easily raise funds from investors or banks.

This structure enhances credibility with international buyers, suppliers, and financial institutions. Foreign buyers feel more secure when they work with a registered company. However, once a company is registered, it needs to comply with various rules. The company must file annual reports and tax returns regularly. These legal requirements can increase operational responsibilities.

1. LLP (Limited Liability Partnership)

An LLP is a business type that combines partnership benefits with company-like protection. The partner’s liability is limited to their agreed-upon investment. This means personal assets are safe if the business faces losses. It also allows partners to manage the business freely without much legal pressure.

LLPs suit exporters who want fewer rules and still want legal protection. It needs less paperwork compared to a private limited company. However, LLPs cannot issue shares or raise money from the stock market. This limits their ability to attract big investors for business growth.

Requirements for incorporating an FMCG business in India:

FMCG products are divided into many sectors. A few of the sectors are listed below, along with their requirements.

1. Food and Beverage Sector

Listed below are the requirements that a food and beverage business will have to meet to incorporate its FMCG business:

1. 1. Company Registration: Every food export business must register with the Ministry of Corporate Affairs (MCA). It can be registered as a private limited company, LLP, or proprietorship. This gives the business legal recognition and allows it to operate under Indian law.
   2. Import Export Code (IEC): The Directorate General of Foreign Trade(DGFT) issues the Import Export Code. It is a 10-digit code which is mandatory in order to export any goods from India. Without IEC, businesses will face compliance issues when they export goods from India.
   3. FSSAI License: The Food Safety and Standards Authority of India FSSAI license is required to manufacture, store, distribute, or export food items. It ensures that the food is safe, hygienic, and meets international quality standards.
   4. APEDA Registration: The Agricultural and Processed Food Products Export Development Authority APEDA registration is needed to export agricultural and processed food items. It helps in getting access to international markets and government support.
   5. GST registration:  GST registration is necessary to file taxes and claim input tax credits. Exporters can claim IGST refunds on exports. A valid GSTIN also improves the credibility of the business.
   6. ISO Certification: ISO 22000 or ISO 9001 certifications help businesses improve trust in foreign markets. They confirm that the food is made using quality and safety standards recognized globally.
2. Hygiene and Personal care

Listed below are the requirements that a company needs to meet to run a hygiene and personal care FMCG business:

1. Company Registration: Businesses dealing in personal care products must register under the Ministry of Corporate Affairs (MCA) to obtain their company registration certificate. This certificate gives the business a legal identity and allows it to operate formally. It also helps to secure licenses and open a business bank account.
2. Import and Export Code (IEC): An Import Export Code (IEC) is mandatory to export products outside India. The Directorate General of Foreign Trade (DGFT) issues IEC for an exporting business. This code is required during customs clearance and international transactions.
3. BIS Certificate: The Bureau of Indian Standards issues this certificate to confirm that the product meets Indian safety and quality standards. The Bureau of Indian Standards issues this certificate to confirm that the product meets Indian safety and quality standards.
4. GST Registration: GST registration is required for tax purposes. It helps the exporter claim tax refunds on input and output GST. It is also needed to legally sell products within and outside India.
5. ISO Certification: ISO 22716 or ISO 9001 is important to improve the business’s image. It proves the products are made under clean, safe, and consistent processes, which helps gain trust in global markets.

3. Home Care and Cleaning

Listed below are the requirements that a company needs to meet in order to run a home care and cleaning business under FMCG.

1. Company registration: A business must register under the Ministry of Corporate Affairs (MCA) to get a legal identity. This allows the company to enter contracts, apply for licenses, and open bank accounts. It also helps build trust with buyers and partners.
2. Import and Export Code (IEC): The Directorate General of Foreign Trade (DGFT) issues IEC for an exporting business. It is required for customs clearance and to receive international payments. If a business does not have this code, it will not be able to start its export business legally.
3. Pollution Control Board NOC: If the products contain chemical ingredients, a No Objection Certificate (NOC) must be obtained from the State Pollution Control Board. This ensures that the manufacturing process follows environmental safety rules and does not harm nature.
4. BIS certificate: Exporters who deal with items like detergents, soaps, and disinfectants will require a BIS certificate. This certificate confirms that the product meets Indian quality and safety standards, especially for mass-market use.
5. GST registration: All businesses must register for Goods and Services Tax (GST). This allows exporters to file returns, pay taxes, and claim input tax credits. It is also needed to send goods across states and to foreign markets legally.

4. Health and Wellness

Listed below are the requirements of the health and wellness sector of FNCG.

1. Company Registration: Every health and wellness business must register under the Ministry of Corporate Affairs (MCA). This gives the business a legal identity and allows it to apply for licenses, open a bank account, and start exports legally.
2. Import Export Code (IEC): IEC is a mandatory code that the Directorate General of Foreign Trade (DGFT) issues.  With the IEC code, businesses can easily clear customs. It also allows businesses to receive payments from international buyers.
3. Ayush License: Products that fall under Ayurveda, Unani, or Siddha need an Ayush License. The Ministry of AYUSH issues this certificate. This certificate ensures that businesses comply with the quality and purity standards of medicine.
4. Drug License: If the company exports pharmaceutical or medicated wellness products, it must have a Drug License from the Central Drugs Standard Control Organization (CDSCO). This ensures the drugs meet proper health and safety norms.
5. GST Registration: GST registration is required for tax purposes. It helps the company collect and pay taxes, file returns, and claim refunds. With GST registration, businesses can legally ship goods across India and overseas.

5. Stationery and Daily Essentials:

Listed below are the requirements that a Stationery and daily essential business owner needs to meet:

1. Company Registration: Businesses need to register their company with the Ministry of Corporate Affairs (MCA) in order to give it a legal structure. This certificate helps businesses to get licenses, open a current account, and sign export deals.
2. Import and Export Code (IEC): Businesses need to obtain their IEC from the Directorate General of Foreign Trade (DGFT). This code helps to clear customs and receive payments from international buyers.
3. GST Registration: With GST registration, businesses pay taxes on sales. It also allows the business to claim input tax credits and issue proper tax invoices to buyers, both in India and abroad.
4. BIS Certification: Some stationery products like pens, pencils, notebooks, or school supplies may require BIS certification. This certificate confirms that the products meet quality and safety standards set by the Bureau of Indian Standards.
5. Eco Label Certification: Exporters who deal with eco-friendly or recycled stationery items need to have the Eco Label Certificate. This certificate helps build trust with buyers who prefer sustainable products. It also gives an edge in international markets focused on green products.

Step-by-step process to apply for an IEC for FMCG business

Step 1: Prepare Required Documents

Listed below are the documents that a business should prepare to apply for an IEC, or Import and Export Code.

1. Business Registration Documents

2. Proprietorship – GST certificate or MSME registration
3. Partnership – Partnership deed & firm registration
4. Company (Pvt. Ltd./LLP) – Incorporation certificate (from MCA)

2. PAN Card

5. PAN card of the business entity (for Company/LLP)
6. PAN card of the owner (for Proprietorship)

3. Proof of residence

7. Aadhaar Card / Voter ID / Passport / Electricity Bill / Rent Agreement (if rented office)

4. Bank Account Proof

8. Cancelled Cheque or Bank Certificate with your business name and IFSC code

5. Digital Signature DSC

1. DSC is required in the case of a company or LLP only.

Step 2: Register on the DGFT Website

10. Visit the DGFT portal.
11. Click on “Apply for IEC.

50. Register with your PAN number

1000. Verify with the OTP sent to your email and mobile number

Step 3: Fill out the IEC Application

14. Log in to your DGFT account
15. Go to "Apply for IEC"
16. Fill in the ANF-2A Application Form with:
    1. Business name and details
    2. Bank details (Account No. & IFSC)
    3. PAN and GST details (if applicable)
    4. Business activity (Import/Export of FMCG)
17. Upload scanned copies of required documents.

Step 4: Pay the Application Fee

18. IEC application fee: ?500
19. Pay online via Net Banking, Credit/Debit Card, UPI

Step 5: Submit the IEC Application

20. After payment, apply.
21. An Application Reference Number (ARN) will be generated.

Step 6: Download Your IEC Certificate

5. The IEC will be issued within 1-2 working days

23. You can download your IEC certificate from the DGFT portal

Conclusion:

The demand for FMCG exports across the globe is on the rise. From food and beverages to personal care and wellness items, Indian products offer quality at competitive prices. Businesses must follow the right steps and choose the correct structure to succeed in the export market. Legal registration helps them stay compliant, gain buyer trust, and access financial and government support.

Business needs to choose a trusted platform that will help them with their operations. Online Legal India is the most reliable platform. They help new exporters with company registration, IEC, and other related services to start their FMCG export business smoothly.