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Looking to start a Toys manufacturing business in India? Get the lowdown on the licenses and permissions for toys you need to get started. We’ll guide you through the process, from understanding which licenses and permissions you need, to gathering documents and filing.
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Introductions
When starting a toys manufacturing business in India, it is important to know that, the toy industry is governed by certain regulatory compliances and licensing requirements to ensure the safety, quality, and compliance of toys being manufactured and sold in the market. Obtaining Licensing and permissions for toys business is essential to make sure certain standard of quality and safety is maintained to protect the interests of consumers, especially children.
The role of these licensing authorities is well defined to supervise various aspects of toys manufacturing, including safety standards, manufacturing guidelines, environmental, labelling and packaging regulations, and compliance with specific toy categories.
To avoid any untowardly circumstances, it is always advisable to hire competent authorities and obtain all the necessary licenses and permissions for toys manufacturing business in India.
Start a Toy Business in India. A Quick Guide with 4 Important Points When starting a new toy Startup in India.
A] What are the licenses and permissions for toys business required to be obtain when starting a toys manufacturing business in India
When starting a toys manufacturing business in India you are required to obtain all the necessary licenses and permissions for toys business to comply with regulatory framework. It is important to understand the regulations and rules in place to ensure a smooth process. The right paperwork will help you set up your business quickly and efficiently, ensuring that you are compliant with Indian law. It is highly advisable to consult or hire a competent legal agency or a licensing agent which specialise in industrial licencing that can ease the burden from your shoulder to obtain all the relevant permissions for toys business correctly and on time.
Here are some of the key licenses and permissions for toys business:
1. Business Registration:
Register your toys manufacturing business as a legal entity with Ministry of Corporate affairs under the Companies Act 2013. Business registration gives your business a legal identity that is recognized by the government. It is important to have a legal identity for your business to enter contracts, open bank accounts, and conduct other business transactions.
Depending on the type of business structure you want you could choose the following business structure:
- Sole Proprietorship: A sole proprietorship is the simplest form of business where a single individual owns and operates the business.
- Partnership: A partnership is an association of two or more individuals who agree to share profits and losses of a business.
- Limited Liability Partnership (LLP): An LLP is a separate legal entity where the partners’ liability is limited to their contribution to the business.
- Private Limited Company: A private limited company is a separate legal entity with a minimum of two and a maximum of 200 shareholders.
- Public Limited Company: A public limited company is similar to a private limited company, but it can have more than 200 shareholders, and its shares can be traded on the stock exchange.
- One Person Company (OPC): Introduced in recent years, an OPC allows a single individual to form a company with limited liability.
2. Goods and Services Tax (GST) Registration
GST registration is mandatory for most manufacturing businesses in India. Manufacturing Companies with yearly sales over a specified amount have to register for GST mandatorily. The threshold limit varies so it is important to stay on top of the current government regulations.
If your business has an annual turnover above a certain amount, it’s legally binding to register for GST with the Goods and Services Tax Network (GSTN). Make sure you get this done and stay compliant with the tax department rules.
3. Bureau of Indian Standards (BIS) Certification:
The Bureau of Indian Standards (BIS) is the official body responsible for setting and maintaining the high standards of quality and safety for products and services in India. The BIS Certification ensures that all products meet these standards, guaranteeing consumers that they are getting what they paid for. The certification process helps businesses to demonstrate their commitment to providing safe, reliable products or services in the Indian market. The certification scheme aims to protect consumer interests, promote quality manufacturing practices, and enhance consumer safety.
Toys manufacturing falls under the purview of mandatory BIS certification regime, such as electronic toys or certain categories of toys, obtain the BIS certification to ensure compliance with the safety standards set by BIS.
Here are the basic requirements for BIS certification for toys:
- 1. Standards: The toys must comply with the Indian standard IS 9873, which outlines the safety requirements for toys.
- 2. Testing: The toys must undergo various tests for safety, including tests for mechanical and physical properties, flammability, toxicity, and hygiene.
- 3. Documentation: The manufacturer must maintain detailed records of the manufacturing process and test results for each toy.
- 4. Marking: The toys must be marked with the BIS logo, along with the manufacturer’s name, trademark, and other relevant information.
- 5. Inspection: The manufacturing facility must be inspected by BIS officials to ensure compliance with the certification requirements.
NOTE: All toy importers and manufacturers need to get a BIS certification to use the ISI mark on their products. Toys that don’t have the ISI mark are not allowed to be sold in India.
4. Department for Promotion of Industry and Internal Trade (DPIIT) Industrial License:
For certain industries that are listed under the Industrial Licensing regime, a DPIIT Industrial License is necessary. As these industries must follow specific regulations and a prior approval from DPIIT has to be sought before commencing business operations. The purpose of this license is to regulate and promote balanced industrial growth in India.
Toys manufacturing unit is one of the subjects that is on the list of DPIIT Licensing list, hence you’ll need to obtain an industrial license from the Department for Promotion of Industry and Internal Trade (DPIIT).
5. Industrial Safety Certificate or Factory License
Ensuring safety in industrial settings is paramount, and having an Industrial Safety Certificate is one way to ensure that all standards are being followed. A Factory License or Factory Permit is a document issued by the relevant regulatory authorities to certify that all safety regulations and standards have been met. With this certificate, companies can be sure that their staff are operating in a safe environment. It is a mandatory requirement for certain types of industries and factories in India.
You need to obtain a certificate from the Inspector of Factories certifying that your manufacturing unit complies with all the safety standards and protocols set by the Factories Act.8.
6. Environmental Clearances from MoEFCC:
India has certain regulations which require certain factories with environmental impacts to get clearance from the MoEFCC (Ministry of Environment, Forest and Climate Change). This is done to protect and monitor our environment from pollutant discharge. These clearances ensure that factories are established and operated in compliance with environmental regulations and practices, minimizing any adverse effects on the environment and promoting sustainable industrial development.
If you’re running a toys manufacturing factory unit, it’s quite possible that you’ll need to obtain environmental clearances from the State Pollution Control Board or MoEFCC. This will depend on the size and type of your business and its footprint of industrial activities.
7. Import Export Code (IEC) license
If you are running a Toys business that imports or exports toys or any of its components, you need to register for an Import Export Code (IEC) license the registration is mandatory. This code is issued by the Directorate General of Foreign Trade (DGFT).
It is a 10-digit code that is issued by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India. The IEC registration is a one-time process and is valid for the lifetime of the business. It is a prerequisite for obtaining various benefits such as availing export incentives, opening a bank account, and clearing customs.
Here are some of the other licenses and permissions for toys business required from different states in India.
- Trade License: You need a trade license from your local authorities, i.e. the municipal corporation or council. This license means that you can conduct business that follows the laws and directives of those in power.
- Trademark Registration: Consider registering your brand name or logo as a trademark with the Trademark Registry in order to provide legal protection for your brand and prevent others from using similar marks.
- Patent Registration: If you have invented a new toy or a new process to manufacture toys, you can apply for a patent to protect your invention from being copied by others.
- FSSAI License: If you are manufacturing food-related toys, you need to obtain a license from the Food Safety and Standards Authority of India (FSSAI).
Future of The Toys Business in India. Opportunities Ahead and Choosing the Business Model for toys startup?
B] What is the Toy association of India and its objectives?
The Toy Association of India (TAI) is a non-profit organization that represents the Indian toy industry. It was established in 1995 with the aim of promoting growth and development of the toy industry in India. The TAI represents manufacturers, traders, distributors, and retailers of toys and games, as well as other stakeholders in the industry. TAI contributes to the overall advancement and success of the toy industry in India.
The primary objectives of the TAI are as follows:
- To promote the growth and development of the Indian toy industry
- TAI advocates for the interests of the Indian toy industry at various levels, including policy-making bodies, government agencies, and trade organizations.
- To provide a platform for networking and collaboration among industry stakeholders. It fosters partnerships among members, encourages business alliances, and promotes cooperation for mutual benefits.
- To promote the use of safe and quality toys in India. It promotes innovation, quality, and safety in toys manufacturing and trading.
- The association facilitates training programs and workshops to enhance the skills and knowledge of professionals working in the toy industry.
- TAI is active on the global stage as well by organising toy fairs, showing off the best India has to offer and fostering collaborations with other countries. It is a great way of helping Indian toy makers get more recognition.
- To create awareness about the importance of play in child development
The Toy Association of India is a key body in the Indian toy sector. It helps unify industry professionals, enabling them to work together and boost the sector’s growth. They also create an atmosphere which encourages business success across all platforms.
In Conclusion
You must obtain all necessary and additional licenses and permission before commencing your toys business. This is important to stay compliant with government regulation and avoid any consequences. It’s also important to note that the specific licenses and permissions for toys business required may vary based on the location, scale, and nature of your toys manufacturing business so it’s better to consult the relevant authority regarding the same.
Start a Toy Business in India. A Quick Guide with 4 Important Points When starting a new toy Startup in India.
What is the process of Toys Manufacturing| Here are 7 Important Points you Must Read Before Starting a Toys Manufacturing business.
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