Functions of foreign exchange department

After the relaxation of economic barrier at 90’s, firms become interested to do business globally and banks play a key role in this aspect. For doing foreign exchange business in favor of firm, bank follows some administrative framework and this chapter describes the administration of foreign exchange business of Prime Bank Ltd. and the role of Bangladesh Bank in foreign exchange business.

FUNCTIONS OF FOREIGN EXCHANGE DEPARTMENT

Following are the functions that Foreign exchange department performs to facilitate the transaction of foreign exchange:

Facilitating import and export trades

Providing funded and non-funded credit facility

Providing non-commercial remittance

Maintaining foreign currency accounts

Selling foreign currency bond

Preparing and submitting statements relating to foreign currency

The following sections perform the functions mentioned above:

Import Section

Export Section

Foreign Remittance Section.

3.2 FOREIGN EXCHANGE BUSINESS MECHANISM

Foreign exchange business comprises three areas: export, import and remittance. In order to start a business with the bank involving foreign exchange, a prospective client has to fulfill the following requirements:

Primary requirement

When a company wants to go for any export or import through a bank, he has to fulfill some common criteria. Let us first consider the issue of import. For importing goods through a bank, the importer has to meet the following criteria:

He has to be a customer of the bank; that means, he has to have a CD Account with the bank.

In case of import, he must have an IRC (Import Registration Certificates).

He has to have experience of importing the same goods through the bank. If he has no such experience, the goods that he wants to import have to be approved by the Import policy.

The item of import has to have marketability.

He has to fix a right price for the goods to be imported.

If these requirements are fulfilled by the customer, the banker may proceed to prepare the proposal for the customer. If the board approves the proposal, the authorized banker can open L/C in favor of the customer by taking Pro-forma Invoice or Indent.In cases of export, the customer has to fulfill the following requirements:

The exporter has to be a customer of the bank; that means, he has to have a CD Account with the bank.

The exporter has to give an Export LC or Contact against which he can open L/C.

The goods to be exported must be approved by the Export Policy.

If the customer fulfills these criteria, the authorized banker can go for business with him.

3.2.1 Import Section

The Import Section helps business and other people to import goods. In international environment, buyers and sellers are, in most of the cases, unknown to each other. So a seller always seeks guarantee for the payment for his exported goods. Here comes the

role of bank. It is the bank that guarantees the seller the payment for the goods on behalf of the buyer. This guarantee is called Letter of Credit. Thus the contract between the importer and the exporter is given a legal shape by the banker by its ‘Letter of Credit’.

Legislative Bonding for import

Imports are foreign goods and services purchased by consumers, firms & Government agencies in Bangladesh. To import, a person should be competent to be an ‘importer’. According to Import and Export Control Act, 1950, the office of the Chief Controller of Imports and Exports (CCI & E) provides the registration (IRC) to the importer. Import of goods in Bangladesh is regulated by the

Ministry of Commerce in terms of the Import and Export Control Act, 1950;

Import Policy Order and the Public Notice issued by the Office of the Chief Controller of Imports and Exports (CCI&E)

At present it is regulated by the Import Policy Order (1997-2002), which came into effect on June14, 1998. The duration of the Import Policy Order was extended up to June 2003 by an amendment. This policy directs certain import procedures and administers the whole activity.

Facilities provided by import section

Opening of Letter of Credit

Facilitating payments to the exporter on behalf of the importer

Providing funded and non-funded credit facility

Issuing bank guarantee in foreign currency on behalf of foreign companies.

3.2.1.1 Import Mechanism

Letter of Credits are to be opened with a Bank or Branch of a Bank authorized to deal in foreign exchange. A bank issuing L/Cs has to perform the following functions that are to be done in the different stages:

Figure 3.1

Import mechanism

Applicant’s approach to the bank

Application for letter of credit limit

YES

Rejection

Taking necessary documents from the applicant

Lodgment

If primary requirements

fulfilled

NO

i. Applicant’s approach to the bank

The applicant of Letter of Credit must be a known customer to the bank. He has to approach the bank to open a Letter of Credit for import of goods through an application in the letterhead pad.

ii. Application for letter of credit limit

Before opening Letter of Credit, importer applies for Letter of Credit limit. To have an import Letter of Credit limit, an importer submits an application to the import division of Prime Bank furnishing the following information –

Particulars of account maintained with the bank

Nature of business

Required amount of limit

Payment terms and conditions

Goods to be imported

Security offered

Repayment schedule

A credit officer scrutinizes this application and accordingly prepares a credit limit proposal (CLP) and forwards it to the Head Office Credit Committee (HOCC). The committee, if satisfied, sanctions the limit and returns it to the branch. Thus the importer is entitled to an approved credit limit. Once a party succeeds in opening an L/C through Prime Bank Ltd, generally it requires no fresh credit limit on subsequent occasions; however, further approval of the Head Office is required only if it proposes to increase its credit limit.

iii. Taking necessary documents from the applicant

A bank takes the following documents with the application from the applicant while opening a Letter of Credit:

Application for Letter of Credit duly signed by the importer

Letter of Credit Authorization Form (L/CAF)

Import Permit Form (IMP)

Valid Import Registration Certificate (IRC)

Indent or Pro-forma Invoice

Valid Membership Certificate

Documents evidencing payment of fee for current year for Import Registration Certificate (IRC)

Declaration by the importer that he has paid income tax and submitted returns to the Income tax authority for the last three years

Insurance Cover Note and Stamped Tax Insurance Policy

Note: For import of capital machinery and initial spares to set up a new industry, a Letter of Credit can be opened without Import Registration Certificate (IRC). No waiver form the Chief Controller of Imports and Exports is necessary for this purpose.

iv. Lodgment

After the scrutiny, the following steps are taken to process for lodgment of import documents received form the negotiating bank. Lodgment means retirement of funds. Usually payment is made within seven days after the documents have been received. If the payment is deferred, the negotiating bank may claim interest for making delay. However, after receiving the documents, the Motijheel Brach authority collects the documents by contacting the importer.

Lodgment Constitutes the Followings:

Conversion of foreign currency amount of the bill and the charges of the foreign bank into Taka is done separately by applying Bills Collection (B.C.) selling rate ruling on the date of lodgment. If the forward exchange was booked, the booked rate is applied. Payment against Documents (PAD) is made by debiting PAD account and crediting Head Office account. Full particulars of the documents are entered in the prescribed PAD register allotting a consecutive serial number.

Documents are endorsed under seal and signature.

“Inter-Brach credit advice” (IBCA) is sent to the Head Office along with a prescribed

statement to provide them credit for the payment from their overseas account through

Prime Bank Limited General Account.

Head Office (International Division) in receipt of the IBCA and the statement will respond the entry by debit to branch account (through Prime Bank Limited General Account) and contra credit to NOSTRO Account of the negotiating bank abroad. To arrange necessary fund for payment, a requisition is sent to the International Department.

As the T.T & O.D rates are paid to the ID, the differences between these two rates remain as exchange gain for the Branch.

As soon as the above formalities are completed the importers are served with PAD bill intimations for retirement of concerned import document. A letter of intimation (P.A.D. intimation) regarding receipt of the documents should be sent to the applicant with a request to take delivery of the documents on settlement of all dues against it and mentioning the maturity date of P.A.D.

The Import mechanism is completed with the lodgment because most of the import operates by the Prime Bank Ltd. is cash letter of credit.

3.2.2 Export Section

Bangladesh exports a large quantity of goods and services to foreign households. Creation of wealth in any country depends on the expansion of production in the export sector in international trade. By increasing the production of the export sector Bangladesh can improve the employment level of such a highly populated country. Readymade textile garments (both knitted and woven), Jute, Jute-made products, frozen shrimps, tea are the main goods that Bangladeshi exporters export to foreign countries. Garments sector is the largest sector that exports the lion share of the country's export. Bangladesh exports most of its readymade garments products to the U.S.A and European Community (EC) countries. Bangladesh exports about 40% of its readymade garments products to the U.S.A. Most of the exporters who export through Prime Bank are readymade garment exporters. They open export Letters of Credit here to export their goods, which they open against the import Letters of Credit opened by their foreign importers.

Export Policy

Export policies formulated by the Ministry of Commerce, GOB provide the overall guideline and incentives for promotion of exports in Bangladesh. Export policies also set out commodity-wise annual target. It has been decided to formulate these policies to cover a five-year period to make them contemporaneous with the five-year plans and to provide the policy regime. The export-oriented private sectors, through their representative bodies and chambers, are consulted in the formulation of export policies and are also represented in the various export promotion bodies set up by the government. However, Exports forms Bangladesh are regulated by the following Acts, Guidelines and authorities:

Bangladesh Bank by issuing guidelines and circulars in compliance with Foreign Exchange Regulation Act-1974 under the authority given to it by the aforesaid Act. It controls physical and payment aspects of exports.

Ministry of Commerce by issuing Export Policy Order under the authority given to it by Export –Import Act, 1950; It outlines the Government’s export development strategies and lays down the package of incentives to promote exports. It also provides the list of items, which are either banned for export or whose export is subject to fulfillment of certain conditions.

Controller of Export and Import

Export Promotion Bureau

National Board of Revenue (Regarding duties and customs issues)

Ministry of Finance by providing Financial Assistance (like cash incentives, fixation of lower interest rate of export credit etc.)

3.2.2.1 Export Mechanism

The mechanism of letter of credit under export has been shown in Figure 3.2 in the next page. The description of the mechanism is stated after the figure.

Figure 3.2

Export Mechanism

Obtaining export registration certificate (ERC)

Securing the order

Advising of L/C to the exporter

Realization of advising/conformation charges

Verification about the genuineness of the letter of credit

Receiving the letter of credit

Signing of the contract

Obtaining EXP

Application for Opening Back to Back L/C

Shipment of goods

Procuring the materials

Examination of document

Presentation of export documents for negotiation

BTB L/C Issue

Bill for acceptance

Payment made by the importer (Client of bank)

Exporter can import raw materials to complete the export order by L/C against the Export L/C.

BTB

L/C

MECHANI

SM

OK

i. Obtaining export registration certificate (ERC)

No exporter is allowed to export any commodity from Bangladesh unless he is registered with the Chief Controller of Imports and Exports (CCI & E) and holds a valid Export Registration Certificate (ERC). After applying to the CCI&E in the prescribed from along with the necessary papers, concerned offices of the Chief Controller of Imports and Exports issues ERC. Once registered, exporters are to get the ERC renewed every year. For registration the following documents are required:

Nationality and Assets Certificate;

Memorandum and Article of Association and Certificate of Incorporation in case of Limited Company;

Bank Certificate;

Income Tax Certificate;

Trade License etc.

ii. Securing the order

After getting ERC, the exporter may proceed to secure the export order. He can do this by contracting the buyers directly through correspondence. In this purpose, exporters can get help form Liaison Officer of foreign companies, buyer’s local agent, buying house, RPB, Bangladesh Mission Abroad, Chamber of Commerce and other Trade Associations like BGMEA, Chamber of Commerce of the Foreign Courtiers, Trade fair, searching internet/websites. After communicating with buyer, exporter has to get contracted for exportable item(s) form Bangladesh dealing commodity, quantity, price, shipment, insurance and marks, inspections & arbitration.

iii. Obtaining EXP

After having the registration, the exporter applies to Prime Bank with the trade license, ERC and the Certificate from the concerned Government Organization to get EXP. If the bank is satisfied, an EXP is issued to the exporter.

iv. Signing of the contract

After communicating with buyer, the exporter has to get contract for exporting exportable items from Bangladesh detailing commodity, quantity, price, shipment, insurance and mark, inspection, arbitration etc.

v. Receiving the letter of credit

After getting contract for sale, exporter should ask the buyer for Letter of Credit clearly stating terms and conditions of export and payment. The export is normally, executed against letter of credit opened by buyers. Sometimes, exports are made on CAD, DP, and DA on Consignment Sale basis without cover of letter of credit. On receipt of Letter of Credit, it is checked thoroughly by advising bank.

vi. Verification about the genuineness of the letter of credit

In case of receipt of L/C other than form the issuing bank, the advising bank must confirm the genuineness of the L/C .In all the cases, the bank must ascertain the authenticity of the Letter of Credit received before acting upon that.

vii. Advising of L/C to the exporter

Having ascertained the genuineness of the Letter of Credit, the Advising bank takes the following steps:

The concerned branch of the bank communicates with the beneficiary and advices him about the Letter of Credit received.

The Branch enters full particulars of the Letter of Credit in the Letter Credit Advising Register (Performance Register) allotting separate serial number for each Letter of Credit

Particulars of all amendments (if any) are also to be recorded in the same Register before advising the same to the beneficiary.

If the L/C contains any request by the opening bank, it has to be complied with under intimation to the beneficiary; the approval of Head Office required for this.

Any amendment to a Letter of Credit received form Issuing Bank should be advised to the beneficiary promptly. Only request of the Issuing bank for any amendment should be accepted.

A suitable clause should be incorporated at the bottom of the L/C stating that the L/C is subject to the provision of UCPDC- ICC Publication No. 5000.

viii. Realization of advising/conformation charges

For advising Letter of Credit to the beneficiary, the branch records Letter of Credit advising commission at the prescribed rate from the beneficiary. If the beneficiary is the bank’s client the charge is debited to his count under advice to him. If the beneficiary is not the bank’s client; the Letter of Credit is delivered to him against cash payment. Letter of Credit conforming charges should be recovered either form the beneficiary or the opening bank depending on the terms of the Letter of Credit

ix. Procuring the materials

Before the export forms are lodged by the exporters with the customs/postal authorities, they should get all the copies endorsed by Prime Bank. Before shipment, exporter submits export form (EXP) with commercial invoice. Then Prime Bank officer checks it properly, if satisfied, certifies the export form. Without it exporter cannot make shipment. The customer must declare all exports goods on the EXP issued by the authorized dealers.

x. Shipment of goods

After certification of EXP forms issued by the AD, the next steps for the exporter to make necessary arrangements for shipment of goods.

xi. Presentation of export documents for negotiation

After shipment, exporter submits the following documents to Prime Bank for Negotiation.

Beneficiary’s declaration about the shipment of goods as per Letter of

Credit /Contract Terms

Bill of Exchange or Draft

Bill of Lading

Certificate of origin

Consular Invoice

Freight Certificates in case of FOB contract

G.S.P. certificate (if required)

Inspection Certificate

Insurance Policy/Certificate arranged to cover transit risk

Invoice

Packing List

Photo – Sanitary Certificate.

Quality (Control) Certificate

Shipping Advice

xii. Examination of document

Banks deal with documents only, not with commodity. As the negotiating bank is giving the value before repatriation of the export proceeds it is advisable to scrutinize and examine each and every document with great care whether any discrepancy (ies) is observed in the documents. The bankers are to ascertain that the documents are strictly as per the terms of Letter of Credit.. Bank officers assigned for examining the export documents may use a checklist for their convenience.After examining the document; the bank sends them to the importer’s bank through DHL. Here the export procedure is completed.

3.2.2.2 Back-to-back Letter of Credit

There is another area of export. In readymade garments sector the exporter has to import the raw materials for completing the order. In that case the exporter may seek financing facility from the bank. In this situation the bank finance the exporter by opening back to back L/C against the Export L/C. There are four types of Back-to-Back L/Cs. These are

Back to Back Local (Within Bangladesh)

Back to Back EPZ

Back to Back EDF

Back to Back Foreign

3.2.2.3 Back-to-back L/C mechanism

i. Application for Opening Back to Back L/C

At first the exporter applies for opening BTB L/C against the Export L/C. He has to write an application to the Branch Manager stating the amount of the L/C along with a L/C form and Pro-forma Invoice.

ii. BTB L/C Issue

The authorized officer issues the L/C if the document is OK and sends the L/C to the bank of the beneficiary.

iii. Bill sent by the beneficiary’s bank for acceptance

When the exporter gets an L/C he sends his goods to the importer and the bill for the export sends to the importer bank. If there is no discrepancy in the document then the opening bank give acceptance and fix the due date of payment according to the tenor.

iv. Payment made by the Importer

When the bill is due, the bank pays it with the money that the importer receives from the export. The proceeds are given to the exporter (importer for BTB L/C). This is his profit. The Back-to-Back L/C Mechanism is completed here.

3.2.3 Remittance section

Our economy depends highly on foreign remittance. The people who are working abroad send currency through the help of bank. Prime Bank Ltd. follows three ways to collect foreign remittance. The mechanism is presented in Figure-3.

Figure 3.3

Mechanism of remittance collection

Foreign Remittance

By Exchange House having agreement with PBL

Directly by Telephonic Transfer

By Exchange House having no agreement with PBL

Non A/C holder

For A/C holder

Directly deposited in A/C

Sender will give a pin code to receiver

Receiver will tell the pin code to the authorized officer

Officer will check

Disburse the cash

Only for A/C holder

That bank issue PO to PBL

Only for A/C holder

Remittance come in another bank with whom they have agreement

Directly deposited in A/C

PBL receive cash by the clearing house and deposits it to receiver’s A/C

3.2.3.1 Mechanism of remittance collection

Prime Bank Ltd. follows three ways for collecting remittance. These are: exchange houses with which bank has agreement, direct telephonic transfer and the exchange house with which bank has no agreement.

i. Exchange House with which PBL has agreement

In this way the remittance can come for anyone. He can be an A/C holder can be not. If the receiver is an A/C holder the remittance directly deposited to his account. If he is not an A/C holder then the procedure is different. The sender’s bank will give a pin code that the sender has to inform the receiver. The receiver than tell the pin code, his name and other information to the authorized officer. The officer will check and if everything is alright, the officer will give the cash to the receiver.

ii. Telephonic Transfer

The bank provides this service only to its A/C holders. When the remittances come it is directly deposited to receiver’s account.

iii. Exchange house having no agreement with PBL

This is another way that the bank follows. This service is also limited to its A/C holders. If a remittance is sent through an exchange house having no agreement with PBL, it comes to the bank that has an agreement with the exchange house. After getting the remittance, the bank issues a pay order in favor of Prime Bank Ltd. Then PBL collects the cash through clearing house and deposits it to receiver’s account.

This is the administration of foreign exchange business. In this process the foreign exchange department accomplishes its responsibilities. Let us now discuss the perspective of Bangladesh Bank in the business of foreign exchange.

3.3 BANGLADESH BANK PERSPECTIVES

Bangladesh bank is the controller of all banks and every department of a bank has to follow the rules and regulations of Bangladesh bank. Foreign exchange is not out of this regulation. Bangladesh Bank publishes these rules and regulations regarding Export, Import and Remittance in its Export-Import Policy which is the guideline for doing foreign exchange business in Bangladesh.

Bangladesh Bank has a different department for controlling foreign exchange business named Foreign exchange department. Though this name is similar to the nomenclature followed in commercial banks, its functions are totally different from its namesakes. This department controls the foreign exchange department of every bank. There is a list of imported and exported goods published by Bangladesh Bank and there is also a list of some prohibited goods that can not be exported and imported. So while the bank operates export and import, this has to be considered. The list of goods has been enclosed in the appendix.

Foreign exchange department of each bank has to send returns within the 5th day of every month stating all the transactions related to Export, Import and Remittance. At the end of the month the balance of export and import is stated in this return. The branch of the bank directly sends these statements to Bangladesh Bank. The branches also have to send the IMP form and the EXP form to the Bangladesh Bank. There are some other consolidated statements that the Head Office has to send to Bangladesh bank. Beside this every year an audit team of Bangladesh Bank comes to examine the bank’s activity.

Some rules and regulations of Bangladesh Bank are stated here. These are related to export, import and remittance.

3.3.1 Some important rules and regulations of import imposed by Bangladesh Bank

1. Import of goods into Bangladesh is regulated by the Ministry of Commerce in terms of the Import and Export (Control) Act, 1950; with Import Policy Orders issued biannually, and Public Notices issued from time to time by the office of the Chief Controller of Imports and Exports (CCI&E). In terms of the Importers, Exporters and Indentors (Registration) Order, 1981 no person can import goods into Bangladesh unless he is registered with the Chief Controller of Imports and Exports or exempted from the provisions of the said Order.

2. The Authorized Dealers (ADs) must ensure that they deal only with known customers having a place of business in Bangladesh arid can be traced easily should any occasion arise for this purpose.

3. The ADs are authorized to issue 'Letter of Credit Authorization Forms'(LCAFs) in conformity with the IPO allowing imports into Bangladesh.

4. Opening of L/Cs and payments for imports into Bangladesh should be made through an AD in the area where the holder of the LCAF is resident.

5. Specific 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.

6. The ADs should take all precautions to quote the correct ITC nos (HS Codes) of the goods to be imported, in the LCAF and the L/C.

7. When L/Cs are opened, full particulars thereof must be endorsed on the back of the exchange control copy of the LCAF under the stamp and signature of the AD.

8. On expiry of an L/C unutilized partly or wholly, or on cancellation or reversal of a sale of foreign exchange, the endorsements made on the back of the LCAF may be canceled with appropriate remarks, under the seal and signature of the AD.

9. Remittance 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.

10. An AD may not open L/C or make remittances of foreign exchange covering imports into Bangladesh in cases where the Exchange Control 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.

11. L/C 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.

12. Bangladesh Bank would be prepared to consider approval for advance remittance against goods to be imported into Bangladesh where such goods are of specialized or capital nature.

13. All applications for payments for imports into Bangladesh should be made on IMP forms. The IMP forms must be submitted in duplicate by the importer or his duly authorized agent.

14. In all cases of remittances for imports into Bangladesh, the importer must submit within 4 months from the dates of remittances the relevant exchange control copy of the customs bill of entry.

15. The Bangladesh Bank is prepared to consider applications for extension of the time limit beyond 4 months in cases of genuine difficulties.

16. An 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.

3.3.2 Rules related to Back to Back L/C

1. Only recognized export oriented industrial units operating under bonded warehouse system will be allowed the back to back L/C facility.

2. The master export L/C (against which opening of back to back L/C is requested) should have validity period adequate to cover the time needed for importation of inputs, manufacture of merchandise, and shipment to consignee.

3. The back to back L/C value shall not exceed the admissible percentage of net freight on boat value of the relative master export L/C (as per prescribed value addition requirement) and the price of goods to be imported must be competitive.

4. The back to back import L/Cs shall be opened on upto 180 days usance (DA) basis except in case of those opened against Export Development Fund (EDF) administered by the department of banking operation and development of Bangladesh Bank in which case the back to back L/C will be opened on sight (DP) basis.

5. All amendments of the master export L/C should be noted down carefully to rule out chances of excess obligation under the back to back import L/C.

6. Back to back import L/C should not be opened against L/Cs received for export under Barter/STA, without prior approval of Bangladesh Bank.

7. The back to back import L/C shall contain condition of pre‑shipment inspection by an internationally reputed inspection firm regarding quality and quantity of the merchandise.

3.3.2 Some Rules related to Export

1. All exports to which the requirement of declaration applies must be declared on the EXP Form. These forms will be supplied by the ADs to their exporter clients.

2. Payment for goods exported from Bangladesh should be received through an AD in freely convertible foreign currency or in Taka from a non‑resident Taka Account.

3. The ADs should, before certifying any export form, ensure that the exporter is registered with the CCI&E under the Registration (Importers and Exporters) order 1952. The registration number should be quoted on the relative EXP forms.

4. Before lodging the EXP Forms with the Customs /Postal Authorities, the exporter should get copies of the forms certified by an AD.

5. The period prescribed by the Bangladesh Bank within which full foreign exchange proceeds of exports must be received by exporters is four months (Vide Bangladesh Bank Notification No. FE 1/77‑BB dated the 16th April, 1977). If the receipt of the full proceeds of any shipment is delayed beyond this period without a special or general authorization from the Bangladesh Bank, the exporter will be liable to action under the FER Act.

6. General authorization has been accorded to ADs for allowing exports of raw jute and jute goods on upto 360 days usance basis a against irrevocable LCs confirmed at buyer's cost from first class international banks abroad.

7. Head offices/ principal offices of the ADS will submit the monthly statements of export to the Foreign Exchange Policy Department, Bangladesh Bank. Head Office monthly statements include the total figures of all export bills including partly unrealized relating to all their AD branches outstanding at the end of each month in the proforma prescribed by the 15th of the month following the month to which it relates.

8. If shipments from Bangladesh are lost in transit for which payment has not already been received either by a direct remittance or by negotiation of bills under an L/C, the ADS must see that an insurance claim is made as soon as the loss is known.

9. Sales of Bangladeshi goods or raw materials to the enterprises in EPZ against payment in foreign currency shall be treated as exports from Bangladesh and normal foreign exchange regulations concerning declaration of exports on EXP Forms and repatriation of proceeds is applicable to these exports to die EPZ enterprises.

These are some rules and regulation of foreign exchange business imposed by Bangladesh Bank. Any exporter or importer and their negotiating banks have to be within this regulation while operating the foreign exchange business.



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