The world of e-commerce has opened up new opportunities for businesses and entrepreneurs to expand their reach and tap into global markets. One popular platform for selling online is Amazon, and for businesses based in India, selling on Amazon USA can be a great way to gain success with a wider audience and increase revenue. However, before you start selling on Amazon USA from India, it’s important to understand the legal and compliance requirements in both countries.

Legal and Compliance Requirements in India:

• Importer and Exporter Code (IEC) – Businesses engaged in export and import activities are required to obtain an Importer Exporter Code (IEC) from the Directorate General of Foreign Trade (DGFT). IEC is a 10-digit number issued by the DGFT to businesses engaged in import and export activities. This is a mandatory requirement for businesses engaged in international trade and is required for the clearance of goods at customs.
• Goods and Services Tax (GST) – Businesses must register for GST, file GST returns, and pay GST on their sales. GST Registration is mandatory for any business whose turnover exceeds 20 lacs. Further, GST Registration is mandatory for businesses involved in import and export activities, irrespective of turnover. GST is a consumption-based tax that is imposed on the sale of goods and services. Businesses must register for GST, file GST returns, and pay GST on their sales. This is a mandatory requirement for any business operating in India and failure to comply can result in penalties and legal action.
• Indian Customs Act – Businesses must comply with customs laws and regulations, including those related to classification, valuation, and documentation. This ensures that the correct duties and taxes are imposed on imported goods and that all imports are compliant with Indian laws and regulations. Failure to comply with customs laws and regulations can result in penalties and legal action.
• Registration cum Membership Certificate (RCMC) – Businesses engaged in export activities are required to obtain a Registration cum Membership Certificate (RCMC) from the Federation of Indian Export Organizations (FIE). RCMC is a certificate issued by the FIEO which is required by the Directorate General of Foreign Trade (DGFT) for various purposes such as availing benefits under export promotion schemes, obtaining licenses, etc. This is mandatory for businesses engaged in export activities.

Legal and Compliance Requirements in the United States:

• Foreign Corrupt Practices Act (FCPA) – prohibits businesses from bribing foreign officials to obtain or retain business. This law is strictly enforced in the United States and non-compliance can result in severe penalties and legal action.
• Federal Trade Commission (FTC) Act – regulates advertising and marketing practices and prohibits deceptive and misleading advertising. This ensures that customers are not misled or deceived by false advertising and protects their rights as consumers.
• U.S. Foreign Agents Registration Act (FARA) – it is required agents of foreign principals to register with the U.S. Government and disclose their activities. This is to ensure transparency in the actions of foreign agents operating in the country and to prevent any illegal activities.
• State and Local Laws and Regulations – Businesses must also comply with state and local laws and regulations, including sales tax laws and regulations. This can vary from state to state and it is important to be aware of the laws specific to the state where you plan to sell. Failure to comply with state and local laws can result in penalties and legal action.
• Amazon Policies and Guidelines – Businesses must comply with Amazon’s policies and guidelines, including those related to product listing, pricing, and customer service. Amazon also has strict rules regarding the importation and sale of certain types of products, such as those that are counterfeit, hazardous, or restricted. It is important to ensure that your products comply with these policies to avoid any issues with Amazon.

In conclusion, selling on Amazon USA from India can be a great way for businesses to expand their reach and tap into a global market. However, it’s important to understand and comply with the legal and compliance requirements in both India and the United States. Businesses should ensure that they have obtained the necessary licenses, registrations, and certifications such as Importer Exporter Code (IEC), Registration cum Membership Certificate (RCMC), and GST Registration and abide by the laws and regulations such as Foreign Corrupt Practices Act (FCPA), Federal Trade Commission (FTC) Act, U.S. Foreign Agents Registration Act (FARA), State and Local Laws and Regulations, and Amazon Policies and Guidelines. Non-compliance with these laws and regulations can result in severe penalties and legal action, so it’s crucial to be aware of the requirements and take the necessary steps to comply with them.