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CS Executive · Economic, Commercial and Intellectual Property Laws · Foreign Trade Policy and Procedure

Kaveri Software of Bengaluru exports ordinary IT services, does not claim any benefit under the foreign trade policy and does not deal with specified services or specified technologies. Under the Act, is an IEC necessary for this service export?

An IEC is not needed in this case. For export of services or technology, the Act requires an IEC only where the provider takes benefits under the foreign trade policy or deals with specified services or specified technologies. Kaveri does neither, so it need not hold one.

  1. AYes, an IEC is mandatory for every service export without exception
  2. BYes, but only if the export value exceeds a limit fixed by the Act
  3. CNo, for services an IEC is necessary only when the provider takes foreign trade policy benefits or deals with specified services or technologiesCorrect
  4. DNo, an IEC is never required for services under any circumstance

Explanation

The proviso to Section 7 says that for services or technology the IEC is necessary only when the provider is taking benefits under the foreign trade policy or deals with specified services or technologies. Kaveri meets neither condition, so no IEC is needed. The option saying never required is wrong because the exceptions exist.

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