TFSBD

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SORA, SOR AND SIBOR AT A GLANCE

TFSBD updated their address.

𝐆𝐫𝐨𝐰 𝐘𝐨𝐮𝐫 𝐁𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐖𝐢𝐭𝐡 𝐓𝐅𝐒𝐁𝐃
Trade Finance Solution Bangladesh (TFSBD) is a cross border trade financing advisory firm in Bangladesh. We provides cross border trade financing consulting on financial solutions across a diverse range of sectors, supporting businesses and trade worldwide.

Our aim to be at the forefront of innovation in International Trade Finance. We have over the six years also developed an extensive network of global partners and agents, together our goal is to deliver the highest standard of service to our customers.

Grow Your Business With TFSBD
Trade Finance Solution Bangladesh (TFSBD) is a cross border trade financing advisory firm in Bangladesh.

We provide total solution for your Import L/Cs to support your cross-border trade transaction.

Our Service:
1) Confirmation of LC
2) UPAS LC Financing.
3) LC Refinancing.
4) Project Finance.
5) Stand By Letter of Credit
6) Bank Guarantee.

Glad to inform you that we have a global network of more than 60 trade specialists Banks/FI to support your trade needs. . Our comprehensive end-to-end Service include LC advisory, negotiation and confirmation. Our dedicated customer services team provides support for your trade service needs. ./ Our global trade advisory team can help you structure transactions and minimize operational risks. We can provide a very competitive offer rate for all type of transaction under letter of credit.

Grow Your Business With TFSBD
Trade Finance Solution Bangladesh (TFSBD) is a cross border trade financing advisory firm in Bangladesh.

We provide total solution for your Import L/Cs to support your cross-border trade transaction.

Our Service:
1) Confirmation of LC
2) UPAS LC Financing.
3) LC Refinancing.
4) Project Finance.
5) Stand By Letter of Credit
6) Bank Guarantee.

Glad to inform you that we have a global network of more than 60 trade specialists Banks/FI to support your trade needs. . Our comprehensive end-to-end Service include LC advisory, negotiation and confirmation. Our dedicated customer services team provides support for your trade service needs. ./ Our global trade advisory team can help you structure transactions and minimize operational risks. We can provide a very competitive offer rate for all type of transaction under letter of credit.

Service Details:
🛄 Confirmation of Letter of Credit:
We offer total solution for confirmation of LCs to support your cross-border trade transactions as well as borrowing transactions.

Main Features of our Solution :
• For Sight Letter of Credit/Deferred Payment(Usance) Letter of credit/ Standby Letter of Credit.
• Issued from a commercial bank of Bangladesh with an acceptable credit rating to TFSBD network banks/financial
institutions.
• For any amount of value..

🛄 Financing of UPAS LC:
We offer total financing solution (Risk Coverage + Funding) for UPAS (Usance Paid at sight) LC to facilitate your cross-border trade transactions.
Main Features of our Solution:
• Issued from a commercial bank of Bangladesh with an acceptable credit rating to TFSBD network banks/financial
institutions.
• For any amount of value..
• special request from applicant like choice of confirming bank / Negotiation restriction /special structuring.
• 3 (Three) working days for any amount less than USD 5m and 7 working days for any amount more than USD 5m
to arrange confirmation service.

🛄 Re-Financing of UPAS Import Bills:
We offer total financing solution (Risk Coverage + Funding) for refinancing of UPAS import bills for effective
management of your cash cycle.
Main Features of our Solution :
• Bankers acceptance to be issued from a commercial bank in Bangladesh with an acceptable credit rating to
TFSBD network banks/financial institutions.
• For any amount of value..
• Regulatory approval to be obtained by applicant and forwarded to us before ex*****on of transactions.

Deferred Tenor:

1) Capital Machinery - 360 days
2) Raw Materials - 180 days to 360 days
3) Scrap Vessel : 360 days
4) New Ship Financing : 2 Years
5) LC Refinancing : 180 days to 360 days.

If anyone is willing to import through foreign bank investment, please contact us.

Thanks With Best Regards,

Grow Your Business With TFSBD

Trade Finance Solution Bangladesh (TFSBD) is a cross border trade financing advisory firm in Bangladesh.

We provide total solution for your Import L/Cs to support your cross-border trade transaction.

Our Service:
1) Confirmation of LC
2) UPAS LC Financing.
3) LC Refinancing.
4) Project Finance.
5) Stand By Letter of Credit
6) Bank Guarantee.

Glad to inform you that we have a global network of more than 60 trade specialists Banks/FI to support your trade needs. . Our comprehensive end-to-end Service include LC advisory, negotiation and confirmation. Our dedicated customer services team provides support for your trade service needs. ./ Our global trade advisory team can help you structure transactions and minimize operational risks. We can provide a very competitive offer rate for all type of transaction under letter of credit.

If anyone is willing to import through foreign bank investment, please contact us.

TFSBD Solution

Greetings from TFSBD

Trade Finance Solution Bangladesh (TFSBD) provides consulting on cross-border trade financing solutions supporting businesses and trade worldwide.

In the ever-changing business world, TFSBD has developed a business model to effectively meet our client's business objectives and future growth requirements.

At Trade Finance Solution Bangladesh, we aim to be at the forefront of innovation in International Trade Finance solutions. We have over the years also developed an extensive network of global partners and agents, together our goal is to deliver the highest standard of services to our customers.

At Trade Finance Solution Bangladesh, we aim at securing a platform for international trade that is risk-free, providing you with flexible financing options and extensive knowledge to trade profitably

At Trade Finance Solution Bangladesh is your global partner for facilitating trade.

Our core values and principles are the following:
• Customer-Driven & Customer Satisfaction: Earning customer loyalty is our first priority

• Integrity: We strive to earn enduring credibility with all, which we believe is essential to maintaining long-term personal and business relationships

• Quality & Excellence: Striving for excellence is an important part of the professionalism of our organization. It involves trying to put quality into everything we do.

• Social Responsibility: We care about the environment, both as individuals and our combined impact - as an organization we actively promote social awareness and practices.

Services
Trade Finance Solution Bangladesh provides a flexible range of trade finance advisory services that assist in delivering the most cost-effective and competitive solutions to meet your business objectives.

Our services include:
1) Confirmation of Letter of Credit
2) UPAS LC Financing / LC Discounting
3) UPAS LC Bill Refinancing
4) Export Financing (LC/Invoice)
5) Project Finance
6) Stand By Letter of Credit
7) Bank Guarantee

Type of Letter of Credit

Trade Finance Solution Bangladesh 𝓣𝓕𝓢𝓑𝓓 is cross border trade financing advisory firm in Bangladesh.

We are specialist of arranging import finance for any industrial import under Letter of Credit. We offer total solution for your Import L/Cs to support your cross-border trade transactions as well as borrowing transactions.

TRADE FINANCE SOLUTIONS FOR IMPORTS

Our Service:
1) Confirmation of LC
2) UPAS LC Financing.
3) LC Refinancing.
4) Project Finance.
5) SBLC.
6) BG.

Glad to inform that we are directly connected with more than 35 foreign financial institutions. We can provide a very competitive offer rate for the transaction of UPAS and LC refinance transactions.

Service Details:
🛄 Confirmation of Letter of Credit:
We offer total solution for confirmation of LCs to support your cross-border trade transactions as well as borrowing transactions.

Main Features of our Solution :
• For Sight Letter of Credit/Deferred Payment(Usance) Letter of credit/ Standby Letter of Credit.
• Issued from a commercial bank of Bangladesh with an acceptable credit rating to TFSBD network banks/financial
institutions.
• For any amount of value..

🛄 Financing of UPAS LC:
We offer total financing solution (Risk Coverage + Funding) for UPAS (Usance Paid at sight) LC to facilitate your cross-border trade transactions.
Main Features of our Solution:
• Issued from a commercial bank of Bangladesh with an acceptable credit rating to TFSBD network banks/financial
institutions.
• For any amount of value..
• special request from applicant like choice of confirming bank / Negotiation restriction /special structuring.
• 3 (Three) working days for any amount less than USD 5m and 7 working days for any amount more than USD 5m
to arrange confirmation service.

🛄 Re-Financing of UPAS Import Bills:
We offer total financing solution (Risk Coverage + Funding) for refinancing of UPAS import bills for effective
management of your cash cycle.
Main Features of our Solution :
• Bankers acceptance to be issued from a commercial bank in Bangladesh with an acceptable credit rating to
TFSBD network banks/financial institutions.
• For any amount of value..
• Regulatory approval to be obtained by applicant and forwarded to us before ex*****on of transactions.

Deferred Tenor:

1) Capital Machinery - 360 days
2) Raw Materials - 180 days to 360 days
3) Scrap Vessel : 360 days
4) New Ship Financing : 2 Years
5) LC Refinancing : 180 days to 360 days.

If anyone is willing to import through foreign bank investment, please contact us.

Thanks With Best Regards,
Alaul Karim

CEO
TFSBD
[email protected]
+8801721117665
www.tfsbd.com
https://www.tfsbd.com/

TFSBD Can Help You Grow Your Business

CHAPTER 7
SECTION-I IMPORTS
Bangladesh Bank

Import trade controlImport of goods into Bangladesh is regulated by the Ministry of Commerce in terms of the Import and Export (Control) Act, 1950, through Import Policy Order (IPO) in force and Public Notices issued from time to time by the Office of the Chief Controller of Imports and Exports (CCI&E). The instructions contained in this chapter apply to sales of foreign exchange or transfers to non- resident taka accounts against import of goods into Bangladesh.Registration of importersIn terms of the Importers, Exporters and Indentors (Registration) Order, 1981 no person can import goods into Bangladesh unless he is registered with the CCI&E or exempted from the provisions of the said Order. Before Letter of Credit Authorisation Form (LCAF) is issued or Letter of credit (LC) is opened or remittance is made for imports into Bangladesh the AD should verify that the importer is registered with the CCI&E or otherwise exempted from such registration. The AD should ensure that the registration number of the importer is invariably furnished on the IMP form. Where the importer is exempted from such registration, a suitable mention of this fact should be made on the IMP form.
Dealing with known customerThe ADs must ensure that they deal only with known customers having a place of business in Bangladesh and can be traced easily should any occasion arise for this purpose. Opening of LCs and payments for imports into Bangladesh should be made through an AD in the area where the holder of the LCAF is resident (Appendix-4 lists the areas for foreign exchange regulation purposes). In case the importer is a new customer, the AD should obtain certificate from the AD through which the applicant imported earlier to the effect that no bill of entry is due/overdue for submission by the importer.
Authorisation Form
The ADs are authorised to issue 'Letter of Credit Authorisation Forms' (LCAFs) in conformity with the IPO allowing imports into Bangladesh. Import permits or clearance permits are not required for imports by the Ministries and Government Departments against specific allocation given to them by the government. But all Ministries and Government Departments except the Ministry of Defense shall duly submit LCAF to their nominated banks before opening LC for the purpose of import. The LCAFs, available with the ADs, are issued in sets of 5 copies each. Of these, the one marked "For Exchange Monitoring Purpose" should be used for opening LC and for effecting remittances. The ADs should be very careful about compliance with the instructions of the IPO and relevant Public Notices in the matters of issuance and disposal of LCAFs
The ADs will not issue blank LCAFs to their clients. The importer should himself/herself sign the LCAF in the presence of an officer of the AD, an authorised official of the AD should put his/her signature with date and seal on the LCAF, evidencing verification of the importer's signature and import entitlement as per current IPO.
In no case the ADs will accept authenticated LCAF for opening LC direct from the parties. Normally the AD issuing and authenticating an LCAF would also open the LC but if it requires transfer to another AD this should be done directly by the transferring AD itself. The AD receiving the LCAF must conduct its own verification of the signatures on the LCAF before opening LC.
LCAFs remain valid for remittances for one year subsequent to the month of issuance. For example, if an LCAF is issued on 15th January, 1992 remittances can be made there against upto 31st January, 1993. However, LCAFs issued for import of capital machineries and spares will remain valid for remittances for 18 months subsequent to the month of issuance. The ADs should not, under any circumstance, make remittance against any LCAF after the expiry of the above prescribed validity periods without first obtaining revalidation of the LCAF. They may, however, allow such remittances without obtaining revalidation only against foreign currency funds of Bangladesh nationals working abroad.
Terms of importsAppropriate Incoterms should be incorporated in the letter of credit/purchase contract in compliance with the IPO in force. Import shall usually be made on CFR / CPT basis (as the case may be). However, import on FOB basis shall be subject to the provisions mentioned in para 13 of this chapter.
Imports under special arrangementsSpecific procedural instructions regarding imports under special arrangements or agreements (grants, loans, barters etc.) issued by the Bangladesh Bank from time to time should be followed by the ADs.
Use of correct HS CodeIt is mandatory to use correct HS Code to indicate the classification of goods to be imported as per First Schedule of the Customs Act, 1969. No bank shall issue LCAF or open LC without quoting correct HS Code in the LCAF and LC or purchase contract ( as the case may be). Failure to do so may lead to imposition of penalties by the Customs Authorities. In all cases of doubt, reference should be made either by the AD or the customer direct to the concerned customs authority.
Pre-shipment inspectionUnless otherwise exempted by the Pre-shipment Inspection Act, 1999, all goods to be imported shall be inspected by an NBR designated Pre-shipment Inspection (PSI) company for quantity, quality, description, classification and price. While importing goods, LC or purchase contracts (in case of import without LC) shall include a clause specifying the name of the PSI company.
Endorsement on LCAF
When LCs are opened, full particulars thereof must be endorsed on the back of the exchange monitoring copy of the LCAF under the seal and signature of the AD. The Taka equivalent of the LC opened must be endorsed on the LCAF at the ruling BC selling rate (spot), but if a forward exchange cover is provided the conversion should be made at the actual forward rate. Foreign exchange must not be sold ready if a forward sale is outstanding against an LC.
Details of amounts remitted, whether under LC or otherwise, should be endorsed on the back of the exchange monitoring copy of the LCAF together with the number of the relative IMP form. Appropriate reference to the LCs, the dates on which these were opened and remittances effected should be noted on the back of the LCAF in order to identify the endorsement against any particular LC opened or remittances effected.
Before delivering the import documents to the importers, the AD should invariably endorse on the invoices accompanying the bills the amount both in figures and words that they have remitted from Bangladesh. The endorsement should be under the seal and signature of the ADs. In case of payment on deferred/usance basis, the amount for which the bill has been accepted should be endorsed in the invoices.
Cancellation of LCAFOn expiry of an LC unutilised partly or wholly, or on cancellation or reversal of sale of foreign exchange, the endorsements made on the back of the LCAF may be cancelled with appropriate remarks, under the seal and signature of the AD.
Endorsement made mistakenlyIn case an endorsement is made mistakenly on a wrong LCAF, the AD may cancel the endorsement provided the endorsement is transferred simultaneously to the appropriate valid LCAF. Endorsement may be transferred only from one valid LCAF to another valid LCAF where both are identical in all respects.
Amounts for which LC may be opened and remittances made under LCAFThe aggregate amount of foreign exchange sold against an LCAF whether under LC or otherwise, should not exceed the value mentioned in the LCAF, In case where LC was opened and remittance is needed in a floating currency against which no forward booking has been made, the Taka value of the LCAF shall be deemed to have been increased to the extent of appreciation of the foreign currency for the purpose of allowing remittance by the AD.
Remittance in excess of the value of the LCAFRemittance in excess of the value of the LCAF is not permissible without prior approval of the Bangladesh Bank except for payment of normal bank charges of the foreign correspondents. In other words, the ADs need not adjust the amount of bank charges from the LCAF value. Remittances of bank charges should be reported to the Bangladesh Bank as usual with TM forms and necessary supporting documents. The ADs shall endorse the amount of bank charges remitted alongwith the date of remittance on the back of the exchange monitoring copy of the LCAF. They should also quote the approval number and date, if remittance is effected against any specific approval from the Bangladesh Bank. Bank charges of unusual nature i.e., not commonly attributable to transactions against LCs cannot be remitted without Bangladesh Bank's approval. Foreign bank charges in respect of imports in the public sector shall be on the suppliers account and, hence, cannot be remitted from Bangladesh. Bank charges under barter/special trade arrangements (STA) shall be payable in accordance with the relevant provisions therein.
Imports on FOB basisIn case of import on FOB basis, full LCAF value is not remittable. In other words, freight charges payable on imports on FOB basis are to be adjusted against the relative LCAF value. In case of FOB imports the AD should endorse, beside FOB value, the freight payable in Taka as indicated in the bill of lading etc. In cases where miscellaneous charges i.e. handling charges, cartage/surface transportation, documentation charges etc., are required to be paid by the importers on arrival of goods through the Airlines, the ADs shall also endorse on the exchange monitoring Copy of the LCAFs the amount of such charges as indicated in the airway bill alongwith the freight in Bangladesh Taka. The ADs should also give a certificate to the importers in the form given in Appendix 5/8 to the effect that the amount of freight, handling charges etc. have been endorsed on the relative LCAF. The issue of this certificate is essential as the shipping companies etc. are under instructions not to accept payment of freight in Taka unless the above mentioned certificate is produced to them. In cases where the FOB value and the amount of freight payable in Taka exceeds the value of the LCAF the application should be referred to the Bangladesh Bank for consideration with full particulars and supporting documentary evidence.
LCAF issued in the name of a person/firm other than applicantAn AD may not open LC or make remittances of foreign exchange covering imports into Bangladesh in cases where the exchange monitoring copy of the relevant LCAF has been issued in the name of a person or firm other than that of the applicant. Such requests received by an AD should be referred to the area office of the CCI&E.
Remittance of proceeds of dishonoured billsAn AD should not remit the proceeds of bills in cases where the name of the importer on the bill of exchange differs from that on the LCAF. As an exception, where goods are imported under documentary collection (DP or DA) basis or even under LC and the original drawee dishonors the bill and the foreign shipper or his local agent finds another buyer for the goods, the AD may make the remittance without prior permission of the Bangladesh Bank provided he certifies that the applicant remitter is the buyer of the goods and provided the remitter is in possession of a valid LCAF covering the import of the goods in question.
Disposal of fully utilised or unutilised LCAFExchange monitoring copies of the LCAFs submitted by the importers should, when fully utilised, be forwarded by the ADs to the Bangladesh Bank. Exchange monitoring copies of LCAFs, which remain unutilised for the full amount, should also be surrendered by the ADs to the Bangladesh Bank after expiry of the validity period for remittance. Other copies of LCAF are to be disposed of as per instructions laid down in the IPO in force.
Remittance against goods imported under penaltyAn AD may not make remittance in payment of goods if the exchange monitoring copy of a valid LCAF is not produced even though the goods may have been cleared by the Customs. Goods imported in an unauthorised manner are liable to be confiscated by the Government. All applications for remittances of foreign exchange covering such imports should be submitted to the Bangladesh Bank for prior approval and should be accompanied by the attested copy of the Customs Bill of Entry for consumption in Bangladesh, the relative penalty order together with full particulars of the circumstances under which the goods were imported without the requisite LCAF.
Import against LCAF without opening LCSelected items as mentioned in the IPO in force may be imported against registered LCAFs withour opening LC. In such cases, the ADs shall stamp " Import without LC" on the upper right corner of the LCAFs. LCAFS so stamped and forms (as per appendix 5/9) dully filled in must be registered by the issuing bank itself.
Applicable exchange rate on retirement of import billImport bill, unless forward cover has been taken, shall be retired at the rate of exchange prevailing on the date of lodgment in the book of Authorised Dealer.SECTION - IILETTERS OF CREDIT AND REMITTANCES AGAINST IMPORTS
The ADs may not issue, advise, notify or confirm any LC, authority to purchase, guarantee or similar undertaking covering imports into Bangladesh the implementation of which would involve a payment in Taka to a non resident account or a payment in foreign currency except in accordance with the instructions prescribed hereunder.LC covering imports Terms on which LCs may be openedThe AD should establish LCs against specific authorisation only on behalf of their own customers who maintain accounts with them and are known to be participating in the trade. Payments in retirement of the bills drawn under LCs must be received by the ADs by debit to the account of the concerned customer or by means of a crossed cheque drawn on the drawee's other bank. These restrictions shall not apply to import of articles for the private use of the importer as permitted in the Import Policy Order.
Terms on which LCs may be opened
All LCs and similar undertakings covering imports into Bangladesh must be documentary LCs and should provide for payment to be made against full sets of onboard (shipped) bills of lading, air way bill, railway receipts, truck receipts, post/courier parcel receipts showing despatch of goods covered by the credit to a destination in Bangladesh. All LCs must specify submission of signed invoices and certificates of origin. If any particular LCAF requires submission of any other document or the remittance of exchange at certain periodical intervals or in any other manner, the LC should incorporate those instructions of the LCAF. Besides, following instructions are to be followed by ADs while importing through land ports:
only one port of entry ( land port) is to be mentioned specifically in the letter of credit/purchase contract ( as the case may be);
ADs shall have to send copies of letter of credit and subsequent amendment(s) if any, including other relevant information to the land port authority;
specimen signatures of the officials working in the import-export desks of the concerned Authorised Dealer bank, contact phone and fax nos. of the ADs are to be sent to all the land ports;
ADs, through their agents or representatives shall collect certified invoice & bill of entry evidencing entry of goods into Bangladesh from the concerned land ports;
letters of credit/purchase contracts shall contain inter alia the following payment terms instead of reimbursement authority/debit authority: "Upon receipt of documents complying with credit terms, we shall effect payment as per instructions of Negotiating Bank/Collecting Bank"
LC covering value more than USD 5000 or equivalent should be sent through SWIFT or other similar arrangements to the advising bank;
NOC(if any) shall contain name of the officials along with P.A. nos. and official seal.
It is not permissible to open clean or revolving letter of credits or LC with realisation clause (except EPZ companies). Applications for opening such LCs should be referred to the Bangladesh Bank with full particulars.
The ADs may open transferable LCs for imports into Bangladesh under cash LCAF without reference to the Bangladesh Bank. They may also allow without reference to the Bangladesh Bank amendments that do not violate foreign exchange regulations and IPO in force.
It is not permissible to open import LCs in favour of beneficiaries in countries from which import into Bangladesh are banned by the competent authority.
LC covering import of goods into Bangladesh against valid LCAF should be opened within the period, if any, prescribed in the current IPO.
Period for which LCs may be openedThe AD should, before opening an LC, see documentary evidence that a firm order for the goods to be imported has been placed and accepted. The AD should ensure while opening an LC that full description of the goods to be imported are given in each Credit alongwith the unit price of the merchandise.
LCs to be opened only against firm contracts Credit report of the foreign suppliersThe ADs should also obtain confidential report on the exporters from their branches or correspondents abroad or in their discretion, satisfy themselves as to the standing of the exporter by consulting standard books of reference issued by international credit agencies of international standing such as Seyds, Dunn and Bradstreet in all cases where the amount of the LC/Contract exceeds BDT 5 lac against proforma invoices issued direct by foreign suppliers and BDT 10 lac against indents issued by local agents of the suppliers. Such reports should be obtained by the ADs themselves and the reports if submitted by the importers should not be accepted. The ADs may also, at their discretion and in their own interest, verify the standing of the beneficiaries even in cases where the value of the credit is lower than the limits mentioned above. Credit report my remain valid for a preiod of maximum twelve months from the date of issuance if no adverse report comes to the notice of the AD. Moreover, credit report of the same supplier collected for one importer may be used for other importers within the same validity.
Approved methods of paymentLC may be established providing for payment to the country of origin of goods or any other country except those countries imports from which are prohibited. The LC may provide for payment or reimbursement in any freely convertible foreign currency, in the currency of the country of the beneficiary or of the country of origin/shipment of goods, or by way of credit to the non resident Taka account of the concerned bank abroad. Payments for imports under barter agreements or under foreign Loans/Grants can be made only in the manner specified for the concerned barter/loan/grant.
Applications for remittances against importsAn AD may approve on behalf of Bangladesh Bank remittance against imports into Bangladesh provided the conditions set out in section-I and elsewhere in this chapter are complied with and provided also that the documents covering the import, whether under LC or otherwise, are received through the AD concerned. In case of import by post/courier, the ADs may make remittance without prior approval of the Bangladesh Bank only if the parcel is addressed directly to the AD. Where the parcel is addressed to an individual care of the AD/ to the individual direct, prior approval of Bangladesh Bank should be applied for, in the manner laid down in para 28 below.
Remittance against discrepant documents/ documents received directly by the importersADs may allow remittance against discrepant documents /documents received directly by the importers after the goods have been cleared from the customs, on the basis of the relative LCAF, the authenticated copy of the customs bill of entry for consumption or customs certified invoice in the case of import by post/courier and the relative invoices.
Advance remittance against imports
Advance remittance for permissible imports of goods and services into Bangladesh may be effected by the Authorised Dealers without prior approval of the Bangladesh Bank, against applications from the importers submitted with signed undertaking in the format of Appendix 5/10 provided that:
the purchase contract with supplier specifically requires advance payment;
the supplier furnishes repayment guarantee acceptable to the Authorised Dealer from a bank abroad, to be invoked for refund of the amount paid in advance in the event of the supplier's default in delivering the goods or services as per contract. Such guarantee need not however be insisted upon in cases of advance payments up to USD2500 for import of books, journals or life savings medicines.
Requests for advance remittance where the suppliers are unwilling or unable to furnish the repayment bank guarantee referred to at para 27(i)(b) may be forwarded by the Authorised Dealers, along with their recommendations, for specific decision of Foreign Exchange Policy Department, Bangladesh Bank on merit of each case.
Authorised Dealers shall report to the Bangladesh Bank the cases where the goods/services against advance payments are not received in Bangladesh within due time.
In addition to usual reporting to Bangladesh Bank, ADs within one week of advance remittance, shall submit attested copies of (i) undertaking (as per Appendix 5/10) (ii) repayment bank guarantee provided by bank abroad (iii) credit report of the guarantee providing bank abroad to the Foreign Exchange Policy Department, Bangladesh Bank, Head Office mentioning the probable date of import of goods/services. However, advance payment for import from ERQ account may be done as per instruction mentioned in chapter 13, section -IV of this guidelines.
Forms on which applications for remittances should be madeAll applications for payments against imports into Bangladesh (including imports from EPZs) should be made on IMP forms (See Appendix 5/11). The IMP forms must be submitted in duplicate by the importer or his duly authorised agent. In cases where empowered to approve the remittances on behalf of the Bangladesh Bank, the AD shall endorse its approval on the reverse of the IMP form in the space provided for the purpose. In other cases, the AD shall submit the IMP form together with required supporting documents to the Bangladesh Bank for approval.
Indication on IMP form for Government ImportsThe AD should mark with a bold letter "G" the IMP form for remittance against an import in the name of a government department or office for which LCs are opened by the AD. In other cases, where LCAFs are issued to private parties and are marked "On Government Account", the IMP forms should be similarly marked with bold "G".
Submission of the authenticated copies of 'Bill of Entry' and 'Certified Invoices'In all cases of remittances for imports into Bangladesh, the importer must submit within 4 months from the dates of remittances the relevant authenticated copy of the customs bill of entry. In case of import by post/courier, the importer must submit the invoice certified by the customs authorities in lieu of the authenticated copy of the bill of entry. Where the value of an import by post/courier is less than £ 5 or its equivalent in other foreign currency, the customs authorities will issue a certificate instead of certifying the invoices. In such cases, the certificate may be submitted in place of the certified invoices.
Extension of time limit for submission of bill of entry etc.The Bangladesh Bank is prepared to consider applications for extension of the time limit beyond 4 months in cases of genuine difficulties, such as delay in the arrival of the ship or difficulties in clearing the goods already landed at a port in Bangladesh etc.
Disposal of IMP Forms
The ADs will obtain invoice, in duplicate, both of which will be certified by them as usual. After recording in the IMP form the particulars of the remittance effected, the original IMP form alongwith a copy of the customs certified invoice shall be forwarded to the Bangladesh Bank with the usual monthly returns.
The duplicate copy of IMP form will be retained by the AD. Subsequently when the authenticated copy of the bill of entry/customs certified invoice is submitted by the importer, the particulars therein should be matched and checked with those in the IMP form and invoice filed earlier, to see if the merchandise for which remittance was made has been duly received in Bangladesh. If no material discrepancy is detected, the case should be considered closed, with the duplicate IMP form, invoice and custom bill of entry/custom certified invoice filed together for eventual inspection and disposal instruction from inspection team of Bangladesh Bank.
Cases with material discrepancy between the particulars of merchandise for which remittance was made and the merchandise actually received as evidenced by the authenticated copy of bill of entry/customs certified invoice, and cases of non submission of bill of entry/customs certified invoice within four month of remittance should be reported quarterly to the area office of Bangladesh Bank, in proforma as given at Appendices 5/12 and 5/13, by 15th day of the month following the quarters ending March, June, September and December. The ADs should also follow up with the importers the cases of material discrepancies and of non submission of bills of entry/ customs certified invoices within due time. Importer who has failed to submit bill of entry/certified invoice against any earlier remittance for import within the stipulated time ( or within the extended period allowed by Bangladesh Bank ) will be barred from opening new letter of credit without prior permission of Bangladesh Bank. Bangladesh Bank may instruct AD to abstain from opening new LC in favor of those in whose cases major discrepancy between the description, quantity etc. of goods stated in Bill of Entry/customs certified invoice and the same declared on the eve of remittances of value thereof is detected by the Bangladesh Bank from the quarterly statement of the AD concerned.
In respect of all imports in the public sector the forms should be kept in separate importer-wise folders till final disposal.
Loss of goodsIn the event goods are completely lost, duplicate copy of the IMP form should be forwarded to the Bangladesh Bank giving full particulars of the loss and the manner in which the insurance claim has been collected. In the event of partial loss, the authenticated copy of the customs bill of entry for the goods actually cleared should be submitted giving full particulars of the loss and the manner in which the insurance claim has been collected.
LCs on deferred payment basis
Subject to compliance with other conditions laid down in this chapter and in the current IPO, import LCs may be opened on deferred payment/usance basis in the following cases:
Import of capital machinery on upto 360 days usance basis;
Industrial raw material imports for own use of industrial importers (including back to back imports discussed in detail in the next section) on upto 180 days usance basis;
Import of coastal vessels including oil tankers and ocean going vessels including those procured for scrapping on upto 360 days usance basis;
Import of agricultural implements and chemical fertilizers on upto 180 days basis;
Import of life saving drugs (certified/declared as such by Drugs Administration Authority) on upto 90 days usance basis.
For such deferred payment imports, the prices must internationally competitive and usance interest, if any, should be at rate higher than the LIBOR for the relative period or equivalent rate prevailing in the currency of the country of supplier.
Instructions regarding opening of import LCs on longer usance terms against supplier's credits obtainable by industrial enterprises in the private sector as per general or specific BOI approval are contained in chapter 15 of this Guidelines.
Payment of import liabilityADs shall make payment of import liabilities as per LC/ contracts (both local and foreign) on maturity. Failure in settlement of import liability as per credit/contract terms may result in punitive actions including revocation of AD licence by Bangladesh Bank.SECTION-IIIBACK TO BACK LCs
GeneralThe ADs may open back to back (BTB) import LCs against export LCs received by export oriented industrial units operating under the bonded warehouse system, subject to observance of domestic value addition requirement (stated in terms of permissible limit of value of imported inputs as percentage of FOB export value of output) prescribed by the Ministry of Commerce from time to time.
Opening of back to back import LCFurther to the relevant general instructions in the foregoing sections of this chapter, the following instructions should be complied with while opening back to back import LCs:
Only recognised export oriented industrial units operating under bonded warehouse system will be allowed the back to back LC facility. The unit requesting for this facility should possess valid registration with the CCI&E and valid bonded warehouse licence.
The master export LC (against which opening of back to back LC is requested) should have validity period adequate to cover the time needed for importation of inputs, manufacture of merchandise and shipment to consignee.
The back to back LC value shall not exceed the admissible percentage of net FOB value of the relative master export LC (as per prescribed value addition requirement) and the price of goods to be imported must be competitive. For computation of net FOB value of a master export LC, the freight charge, insurance cost and commission if payable by the exporter shall be deducted from the LC value. If the freight element is not shown separately, a certificate from the shipping company or the shipping agent should be asked for.
The back to back import LCs shall be opened on usance basis for a period not exceeding 180 days. Interest for the usance period shall not exceed LIBOR or the equivalent interest rate of the currency of settlement. Back to back LCs opened against (a) Export Development Fund (EDF) administered by Bangladesh Bank and/or against (b) balances on Non-Resident Foreign Currency Deposit (NFCD) Accounts may be on sight basis subject to the instructions at Para 20, Chapter 13 of this Guidelines
All amendments of the master export LC should be noted down carefully to rule out chances of excess obligation under the back to- back import LC.
Back to back import LC should not be opened against LCs received for export under Barter/STA, without prior approval of Bangladesh Bank.
Inland back to back LCInland back to back LCs denominated in foreign exchange may be opened in favour of local manufacturer-cum- suppliers of inputs, against master export LCs received by export oriented manufacturing units operating under the bonded warehouse system, upto value limits applicable as per prescribed value addition requirement/utilisation permit. However, EXP/IMP form will not be applicable in such cases unless EPZ unit is associated.BTB import LC against inland BTB LCBack to back LC may in turn be opened for import of necessary inputs, against inland back to back LC in favour of a local manufacturer- cum- supplier operating under the bonded warehouse system, in accordance with the instructions, mutatis mutandis, at para 35 & 36 above.
Payment settlement against BTB LCsPayment abroad in settlement of usance bill against the back to back import LCs shall be made at maturity, out of proceeds of the relative export repatriated in foreign exchange; the required foreign exchange will be set aside, out of the export proceeds, in a separate foreign currency account in the subsidiary ledger of the AD. Before making remittance against the back-to-back import bill, the AD should see that the authenticated copy of bill of entry for bond in evidence of actual arrival of the relative imports has been submitted. Usance bills against back to back import LCs should be settled at maturity even where for some reason export has not taken place, or where the export proceeds have not been realised, or where the realised export proceeds net of value addition requirement is not adequate to cover the back to back import payment. In such cases post facto approval of Bangladesh Bank (Foreign Exchange Operation Department) will have to be sought for, explaining fully the circumstances of export failure or non-realisation/short realisation of export proceeds, with relevant supporting documents. Cases of failure of export against the relative master LCs should also be reported to the National Board of Revenue (NBR) and the concerned Commissioner of Customs so that they may monitor closely the level of stock of the relative goods in the bonded warehouse. A copy of the letter to NBR reporting the export failure should be submitted to Bangladesh Bank alongwith the application for post facto approval of remittance towards back-to-back import payment. Also, all applications for post facto approval of such remittance in the event of export failure and short realisation/non-realisation of export proceeds should be accompanied by the authenticated copy of the relative bill of entry evidencing actual receipt of the back to back imports. The AD should maintain effective watch on the stock of inputs procured under the back to back arrangement and of finished products made therewith; any indication of illegal disposal of stocks from the bond coming to the knowledge of the AD should immediately be reported to the concerned commissioner of customs and NBR.
Retention of foreign currency in single pool for back to back import payments under bonded warehouse system On encashment of export proceeds equivalent to the portion of value addition, residual portion of export proceeds against different export bills of the same export unit operating under bonded warehouse system may be maintained in foreign currency in a single pool by the ADs . Funds from this pool may be used for different back to back import payments of the same exporting unit on maturity basis to keep minimum involvement of AD's own fund under the exchange position as well as to keep exporter free from debt burden.
Payment of import bills (other than back to back) from direct and deemed export earningsIf import bills (other than back to back LC) fall due for payment within 30 days from the date of receipt of export proceeds by the exporters/deemed exporters, the ADs may, on application by the manufacturers-cum-exporters retain such proceeds in foreign exchange for a maximum period of 30 days for making such import payments even it exceeds the allowable retention quota limit. However, export proceeds so retained (in excess of the usual retention quota entitlement) shall be encashed compulsorily in Taka if the same is not utilised for such import payment within 30 days from the date of receipt. To identify such transactions distinctly, ADs are required to maintain appropriate register and other necessary records. Furthermore, Head Office /Principal Office shall gather information of retention and utilisation of foreign currency as per Appendix 5/14, shall prepare a consolidated statement as per Appendix 5/15 and submit the same to Foreign Exchange Operation Department, Bangladesh Bank, Head Office on monthly basis.SECTION-IVDEPOSIT OF COUNTERPART FUND IN RESPECT OFIMPORTS UNDER NON-PROJECT COMMODITYLOANS/CREDITS/ GRANTS
Clean documents against LCCounterpart funds against all clean documents except in cases of discrepant documents received on collection basis or negotiated by the foreign banks under reserve, shall be deposited by the designated bank in Bangladesh to Govt. Account No. IV A (or such other account of the Govt. of Bangladesh as prescribed in respect of the relative loan/credit/aid) maintained with the Bangladesh Bank within three working days from the date of receipt of documents; the said period shall be deemed to be inclusive of the date of receipt of documents and the date of deposit of counterpart funds to the Bangladesh Bank.
Documents against LC received on collection basis/negotiated under reserve due to discrepancyIn cases where due to discrepancy, the negotiating bank abroad sends the documents on collection basis or under reserve or otherwise the bank should forthwith arrange acceptance of the documents by the importers and deposit counterpart funds within 5 days from the date of receipt of the documents. In case of non- acceptance, the bank should return the documents to the negotiating bank or dispose of the documents in accordance with the instructions of the negotiating bank abroad.
Documents received direct by the ERD or designated banks without opening of LCUnder some loans, credits and grants, LCs are not opened by the utilising agencies; instead goods are procured and shipped by the loan giving agencies themselves or by their nominated agencies. After shipment of such goods the documents are mailed either to the Economic Relations Division (ERD) of the Ministry of Finance or to the designated banks, as the case may be, for retirement of documents and clearance of consignment from the customs authorities. On receipt of these documents, the bank should forthwith arrange with the relevant agency to pay the proceeds of the bills within a period of 7 days for deposit to the Bangladesh Bank. The agency should be warned that it would be required to pay interest at penal rate in the event of delay in the deposit of the funds within the stipulated period of 7 days; cases of default should be brought to the notice of the Bangladesh Bank promptly. Documents against LCs opened by designated banks on application through the banks of the importers
In case of LC opened by the designated bank against application through the importer's bank, the latter must retire the documents not later than 24 hours from the time of receipt thereof from the designated bank. If payment is not made within this time limit, the designated bank will be entitled to recover from the importer's bank any penal interest the former may have to pay to the Bangladesh Bank.
In case, however, the documents are not found in accordance with the terms of the LC, the importer's bank should within 5 days from the date of receipt, either retire the documents or send back the same to the designated bank. Any delay on this score will forfeit their right to raise objection on the ground of discrepancies.
In all the above cases, the designated bank must send the documents to the importer's bank within 24 hours of receipt. For any delay at the designated bank's end, the penal interest relating to the period of delay made by them will have to be borne by them.
The designated bank will deposit Taka funds to the Bangladesh Bank within the time limit as in the foregoing paragraphs. In all cases of delay it will be the responsibility solely of the designated bank to deposit the Taka funds to the Bangladesh Bank at the earliest alongwith interest at prescribed rate.
Application of rate of exchange
Counterpart funds under foreign commodity loans, credits and grants where forward contract has been booked will be required to be deposited at the rate at which the relevant contract has been booked.
Counterpart funds under foreign commodity credit agreements with barter component where no forward contract can be booked, are required to be deposited at the B.C. selling rate prevailing on the date of opening of LC.
Unless specified otherwise, in all other cases deposit of counterpart funds will be made at the B.C. Selling rate ruling on the date of lodgement of the bill as applicable to cash import without forward cover facilities.
Penal interest
An AD who has either opened an LC as designated bank or forwarded it to the appropriate designated bank should be in all preparedness to follow the schedule for deposit of counterpart funds as mentioned in the foregoing paragraphs. In case of delay in making the deposit within the prescribed period, the funds should be deposited to the Bangladesh Bank alongwith penal interest computed on the following basis:
5% above the bank rate-for the first seven days beyond the prescribed period.
6% above the bank rate-for the subsequent period after the expiry of first seven days beyond the prescribed period.

All designated banks under foreign commodity loans, credits and grants will send, by the 15th of the following month, a monthly statement of all LCs opened (Loan/Credit/Grant wise) as per proforma in Appendix 5/16 to the office of the Bangladesh Bank with which counterpart funds will be deposited.
Submission of particulars of LCs opened and discrepant billsIn case any bill is received by any designated bank/importer's bank on collection basis due to discrepancy in the bills or otherwise, from the negotiating bank abroad/loan giving agency/ ERD, notice of retirement should be served upon the importer concerned within 24 hours of receipt of such documents, for retirement of the bills against payment within the prescribed time limit, under advice to the office of the Bangladesh Bank with which counterpart funds will be deposited, as per proforma at Appendix 5/17.
At the time of deposit of counterpart funds designated banks will furnish to the Bangladesh Bank a statement as per Appendix 5/18.
Instructions contained in the above paragraphs shall also be applicable in respect of documents received at places where there is no office of the Bangladesh Bank.
LCs opened by the designated banks for imports under loans, credits and grants should not provide for payment on deferred basis.