India’s Department forÌýtheÌýPromotion ofÌýIndustry ²¹²Ô»åÌýInternal Trade () has recently updated theÌýprocesses forÌýregistering aÌýbusiness inÌýtheÌýcountry. Now, most industrial undertakings must file anÌýIndustrial Entrepreneur Memorandum (IEM) inÌýorder toÌýbeÌýrecognized byÌýtheÌýDPIIT. This new registration process isÌýdesigned toÌýimprove transparency ²¹²Ô»åÌýease ofÌýregistration forÌýentrepreneurs inÌýIndia.
But what isÌýtheÌýIndustrial Entrepreneur Memorandum, exactly? Who isÌýrequired toÌýfile forÌýit, ²¹²Ô»åÌýwhat isÌýtheÌýfiling process? This helpful guide will answer all ofÌýthese essential questions.
What isÌýIndustrial Entrepreneur Memorandum?
Per theÌý, IEM’s registration isÌýintended forÌý“Industrial undertakings exempted from theÌýrequirements ofÌýIndustrial Licensing under theÌýIndustries Development ²¹²Ô»åÌýRegulation Act.”
IEM registration isÌýcompleted inÌýtwo parts: Part AÌý²¹²Ô»åÌýPart B.ÌýThese are sometimes also referred toÌýasÌýIEM Number 1Ìý²¹²Ô»åÌýIEM Number 2.
Breaking Down IEM Part AÌý²¹²Ô»åÌýB
IEM Part AÌýisÌýforÌýtheÌýestablishment ofÌýtheÌýbusiness. Exempted industrial undertakings must file IEM Part AÌýinÌýorder toÌýreceive IEM Acknowledgment (Ack. Receipt). Once theÌýAck. AÌýreceipt isÌýsecured, theÌýindustrial undertaking must then follow upÌýbyÌýfiling IEM Part B.
IEM Part BÌýisÌýforÌýtheÌý“commencement ofÌýcommercial production.” InÌýother words, when theÌýundertaking isÌýprepared toÌýlaunch asÌýaÌýcommercial business, itÌýmust file Part B.ÌýThe IEM Part BÌýfiling must have anÌýattached copy ofÌýtheÌý“Ack. Receipt” from Part AÌýofÌýtheÌýfiling.
Once both Part AÌý²¹²Ô»åÌýPart BÌýare filed ²¹²Ô»åÌýacknowledged, theÌýindustrial undertaking isÌýapproved toÌýconduct business. Filing IEM Part AÌýhas aÌýsmall fee (1000Ìýrupee) attached. Part BÌýisÌýfree toÌýfile asÌýlong asÌýPart AÌýhas been properly filed ²¹²Ô»åÌýapproved beforehand.
Who isÌýRequired toÌýFile IEM?
Not all industrial undertakings are required toÌýfile forÌýtheÌýIndustrial Entrepreneur Memorandum. The memorandum isÌýreserved forÌýlarge scale industrial undertakings, with some exceptions. Most notably, manufacturers ofÌýindustrial explosives ²¹²Ô»åÌýhazardous chemicals must still obtain industrial licenses under theÌýIndustries Development ²¹²Ô»åÌýRegulation Act.
AnÌýIEM filing isÌýalso required forÌýtheÌýmanufacturing ofÌýproducts that are not exclusively reserved forÌýtheÌýSmall Scale Industrial sector. Thus, most
AÌýNote onÌýtheÌýSSI Industrial Sector
The SSI industrial sector generally refers toÌýindustries that manufacture products onÌýtheÌýsmall orÌýmicro level. This includes things like toys, handcrafted goods, ²¹²Ô»åÌýmany food goods.
However, ifÌýyour business has produced SSI units but isÌýnow graduating into aÌýlarge scale industry, you must also file anÌýIEM inÌýorder toÌýbeÌýapproved forÌýexpansion.
How DoÌýIÌýKnow ifÌýIÌýMust File anÌýIndustrial Entrepreneur Memorandum?
IfÌýyou are anÌýIndian entrepreneur who wishes toÌýlaunch aÌýbusiness that produces large scale products, you likely need toÌýfile forÌýIEM. This filing isÌýonly required forÌýindustrial undertakings inÌýtheÌýnation ofÌýIndia. IfÌýyou are registering aÌýbusiness inÌýanyÌýother country, you must follow local registration requirements inÌýthat region.
For most Indian entrepreneurs outside ofÌýSSI manufacturing, IEM Parts AÌý²¹²Ô»åÌýBÌýare necessary filings. These filings are necessary when starting aÌýnew large scale industrial undertaking orÌýwhen expanding anÌýexisting one.
Need Help Following Your Entrepreneurial Dreams?
Filing all ofÌýtheÌýnecessary documents isÌýaÌýgreat place toÌýstart forÌýanyÌýentrepreneur. But this isÌýnot theÌýend ofÌýtheÌýjourney. Once your industrial undertaking isÌýregistered, you have aÌýlot more preparations toÌýmake. This includes steps like hiring your team, manufacturing products, ²¹²Ô»åÌýfinding ways toÌýreach your target market.
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With soÌýmany consumers ²¹²Ô»åÌýbusinesses making purchases online, every entrepreneur needs anÌý
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