Regulatory Alerts2023-12-13
Added
FEID Circular No. 01: Issuance of No Objection Certificate for Foreign Company Offices and Bank Account Closure Notification
Authorized Dealers must ensure each Branch, Liaison, Representative, or Project office of a foreign company uses a single nominated Authorized Dealer for all remittances and reporting. Authorized Dealers are required to process No Objection Certificate applications within 15 days and notify the Foreign Exchange Investment Department of dormant account status by the 15th day of the following month. Local currency accounts may be declared dormant due to inactivity or expired permission, requiring fund transfers to the nominated Authorized Dealer and compliance with Section 35 of the Banking Companies Act, 1991.
Foreign Exchange Investment Department Bangladesh Bank Head Office Dhaka www.bb.org.bd FEID Circular no.01 Date :13/12/2023 Head Offices/ Principal Offices of all Authorized Dealers in Bangladesh Dear Sirs, Issuance of No Objection Certificate (NOC) in favor of Branch, Liaison, Representative, Project office of foreign companies and notification of Closure of Bank Accounts. Please refer to Paragraph 3(c), Chapter 17, Section II of the Guidelines for Foreign Exchange Transactions-2018 (GFET), Vol-1, FEID Circular Letter No. 01 dated 16-05-2021 and BRPD Circular No. 23, dated 28/12/2021 which outline the guidelines for Authorized Dealer (AD) nominated by Branch Offices or Liaison Offices or Representative Offices or Project Offices (B/L/R/P) established by companies incorporated outside Bangladesh with regard to dealing with such offices, mode of operation of dormant account and the change of nominated AD. To facilitate smoother transactions, ADs shall adhere to the following instructions- (1) Each B/L/R/P office shall have only one nominated AD through which all inward and outward remittances have to be executed and all payments payable abroad and receivable from abroad shall be monitored and reported to Bangladesh Bank. (2) No payments arising from activities in Bangladesh shall be made or received outside Bangladesh without general or special permission from Bangladesh Bank and/or competent authority. (3) B/L/R/P office can open and operate two or more local currency accounts in different branches of same bank or any other bank by obtaining NOC from the nominated AD. Information related to local currency accounts shall be notified to FEID, FEOD and concerned offices of Bangladesh Bank through the nominated AD. However, the branches operating local currency accounts shall meticulously follow the instructions in the permission letter regarding debits for local purpose and credits from local source as well as AML and CFT rules issued by BFIU. (4) AD shall dispose of application for NOC within 15 days from the date of receipt. Continued page-02
-2- (5) ADs and other branches operating local currency account can make an account dormant in case of long term inactiveness of transactions as per instruction laid down in BRPD circular No. 23, dated 28-12-2021 and/or expiry of office permission period subject to compliance of the followingsa. Branches operating local currency accounts shall give intimation and transfer the funds lying in the dormant accounts to the nominated AD. b. The AD shall intimate the dormant status of accounts operated by itself or other bank’s branches to FEID by the 15th day of next month. c. If the account remains dormant for a long period, actions have to be taken by the AD in compliance with provision of Section 35 of Banking Companies Act, 1991 (amended up to 2023). Please bring the content of this circular to the notice of all concerned. Yours Faithfully, (Abu Saleh Mohammed Shahab Uddin) Director (FEID) Phone: +88-02-9530144