Regulatory Alerts2014-04-16
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FEPD Circular No. 18: Issuance of guarantee in foreign currency favoring local project authorities on behalf of residents
Authorized Dealers are permitted to issue bid bonds, performance bonds, or guarantees in foreign currency on behalf of residents in favor of local project authorities for goods or services procurement tenders financed by the Government. This authorization is subject to the condition that any claim resulting from the invocation of the guarantee must be paid only in Taka equivalent and not in any other currency. The directive applies to tenders previously covered under guidelines for international or foreign donor agencies and extends this allowance to Government-financed tenders.
Foreign Exchange Policy Department Bangladesh Bank Head Office Dhaka www.bb.org.bd FE Circular No. 18 Date : April 16, 2014 All Authorized Dealers of Foreign Exchange in Bangladesh Dear Sirs, Issuance of guarantee in foreign currency favoring local project authorities on behalf of residents. Please refer to paragraph 11, chapter 16 of Guidelines for Fore ign Exchange Transactions, Vol-1, 2009 in term s of which Aut horized Dealers (ADs) are allowed to issue, on behalf of residents, bid bonds/performance bonds/guarantees in foreign currency in favor of local project authorities against goods/services procurement tenders financed by international/foreign donor agencies, on the condition that in case the guarantee is invoked th e claim there against would be paid only in Taka equivalent and not in any other currency. 02. It has now been decided that AD s may, on behalf of resident s, issue bid bonds/performance bonds/guarantees in foreign currency favoring local project authorities against goods/services procurement tenders financed by Government subject t o observance of the instructions stipulated in the paragraph mentioned above. Please bring the content of this circular to the notice of all concerned.
Yours faithfully,
(Md. Zakir Hossain Chowdhury) Deputy General Manager Phone:9530250
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