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Bangladesh-Bank

Bangladesh Bank now requires inclusion of Value, Unit Price, and Quantity in Pro Forma Invoice/Indent.

As per the Guidelines for Foreign Exchange Transactions, Volume-1, Chapter-7, Section-2, Para-20, Authorized Dealer banks are required to verify the importer-exporter’s details, the country of origin of the goods, and the competitive price of the respective goods in the international market before opening any Letters of Credit (LCs).

FDI report must be submitted within 20 days after each quarter.

On 16 February 2023 Bangladesh Bank issued SD Circular No. 02/2023 informing all AD banks and their offshore unit about the change.  

What has changed?  

  • The circular requires all FDI receiving companies to submit the FDI reporting form (Form Fl-1) along with supporting documents to their authorized dealer bank within 20 days instead of one month after each quarter. Similarly, outward FDI sending companies are required to submit the FDI reporting form (Form F1-2) with relevant documents within the same time frame. 
  • Additionally, all FDI receiving and outward FDI sending organizations are required to submit the FDI reporting forms (Form FI-1 and Form FI-2) through the Rationalized Input Template (RIT) on the Web Portal within one month instead of 15 days after the next quarter. Hard copies of the reporting forms should also be submitted to the FIED Management Cell of the Statistics Department of Bangladesh Bank.

Share money deposit of foreign investor must be converted into share within 1 year – Bangladesh Bank

Equity investment from foreign shareholders (kept as share money deposit) in a Bangladeshi registered company must be converted into shares within 1 year from the date of receipt. On February 05, 2020, Bangladesh Bank issued FEID Circular No. 02 to this effect. Previously there was no time limit to convert the share money deposit of the foreign shareholders into shares.

NBFIs allowed to hold meetings via video conference with BB approval

Non-Banking Financial Institution can now hold board meeting, executive committee meeting or audit committee meeting through video conference if necessary while their chairman or any director are staying outside Bangladesh. However, they must obtain prior approval of Bangladesh Bank.

NBFI can invest in Alternative Investment Fund – Bangladesh Bank

Non-banking financial institutions (FI) can now invest in the non-listed special purpose funds (e.g. Alternative Investment Fund, Special Purpose Vehicle, or any other similar fund) which are registered with Bangladesh Securities and Exchange Commission (BSEC). Through DFIM Circular No.04 dated 30 March 2016, Bangladesh Bank allows such investment.

Bangladesh Bank introduces new rules for investment in Alternative Investment Fund by banks

Through DOS Circular No. 02 dated 24 November, 2015, Bangladesh Bank introduces the new rules.

The rules applicable to investment in non-listed special purpose fund/funds (Special Purpose Vehicle, Alternative Investment Fund or similar, stated as such fund(s) henceforth) which are registered with Bangladesh Securities and Exchange Commission (BSEC).

Foreign Exchange Regulation Act amended

The much awaited amendment is here folks. Finally the Parliament has passed the Foreign Exchange Regulation (Amendment) Act, 2015 and on September 9, 2015, the gazette has been published.

Let’s take a look what has changed and how you might be affected.

New list of required documents for 18A and 18B approval from Bangladesh Bank

Update September 15, 2015: Recently Bangladesh Parliament has amended the Foreign Exchange Regulations Act 1947. The requirement of and 18A and 18B Approval from Bangladesh Bank has been removed. 

You can read about the amendment here.

Foreign shareholders can now remit fair value of their sold shares

From now on Bangladesh Bank will allow foreign shareholders to repatriate fair value of shares in unlisted public companies and private limited companies as on the date of sale based on appropriate combination of three valuation approaches (net asset value approach, market value approach and discounted cash flow approach) depending on the nature of the company.

Foreign owned companies allowed to obtain Taka loan from local banks

From now on foreign owned companies may avail loan in Taka from local market. Bangladesh Bank on March 11, 2014 through FE Circular No. 12 notified this decision. A foreign company operating for three or more years would be eligible for this facility.