FEPD Circular No. 28: Export subsidy against export of intestines, horns and tendons of cow & buffalo (except bone)

Foreign Exchange Policy Department
Bangladesh Bank
Head Office
Dhaka.
Ref. No. FEPD(Circular)-28

Date: 10 Agrahayan, 1423
FEPD Circular No. 28 Date: ---------------------- November 24, 2016

To All Approved Dealers.
Dear Sirs,

Necessary instructions regarding the provision of subsidy against the export of hides and skins were issued through FEPD Circular No. 25, dated December 12, 2002. Subsequently, through letter no. FEPD(Export-1)291/Hides & Skins/2004-539, dated July 25, 2004, it was informed that subsidy under FEPD Circular No. 25, dated December 12, 2002, would be provided for the export of various parts (frozen) of cow and buffalo bodies such as intestines, bones, nasal cartilage, legs, and other parts. According to the government decision, the subsidy for the export of hides and skins will not be applicable for the ongoing fiscal year 2016-2017. However, the export subsidy will be applicable for the export of cow and buffalo tendons, intestines, horns, sinews (excluding bones), etc. The following guidelines are provided for Approved Dealer Banks to follow regarding the payment of subsidy in the aforementioned sector:

Regarding the provision of subsidy for the export of cow and buffalo tendons, intestines, horns, and sinews (excluding bones), etc.

2. Recipient of Subsidy and Extent of Entitlement: In the case of export through processing in own factories of cow and buffalo tendons, intestines, horns, sinews (excluding bones), etc., collected entirely from local sources, the producer-exporter will be entitled to a subsidy of 10% on the net FOB value.

3. Deadline for Submission of Export Subsidy Application:
   (a) The aforementioned subsidy will be provided according to the DUS Rules against the expenses incurred for handling, inspection, processing of exported goods, and domestic and international transportation and freight charges.
   (b) Exporters may submit application forms in Form-C at the Approved Dealer Bank branch against the repatriation of export proceeds generated through documents prepared after the subsequent export under the export letter of credit/contract or through documentary collection. In the case of export against advance repatriation of export price through TT under export letter of credit/contract, the Approved Dealer Bank branch must satisfy itself regarding the authenticity/reliability of the foreign buyer, correctness of price, and actual export from Bangladesh based on the TT banker's comment and other documents. Advance payment through TT must be made directly through banking channels (excluding exchange houses) by the exporter or importer, and the TT banker's comment must mention information related to the import. In all cases, the subsidy application must be submitted to the concerned Approved Dealer Bank branch within 180 days from the date of assessment of export price (repatriation of export proceeds). However, regarding the submission of subsidy application forms for exports through different shipments against the same export, the instructions of FEPD Circular No. 12, dated December 20, 2012, will be followed. (c) Necessary documents for export, such as Bill of Lading/Air Waybill as proof of shipment, Commercial Invoice, Packing List, Bill of Exporter (Issued by Customs Authority) (2nd page) etc., must be submitted.

4. Receipt, Verification, and Payment Decision of Application by Approved Dealer Bank Branch:
   (a) The Approved Dealer Bank must satisfy itself in the initial verification that all documents, certificates, and acknowledgments mentioned in various sections of the export subsidy application form are attached completely and in full. Certificates must be submitted according to the attached table (Form-B) from the "Export Promotion Bureau". The concerned bank branch must also satisfy itself regarding the authenticity of the documents processed by the bank branch in the export and the accuracy of the information mentioned therein. If any defect/incompleteness is observed in the initial verification, the Approved Dealer Bank branch must inform the applicant institution in writing within 03 (three) working days of receiving the application. (b) To ensure consistency between the production capacity of the applicant institution and the export mentioned in the application, the Approved Dealer may determine the payable amount of subsidy after the application form is completed and fully received by attaching additional explanations/information from the applicant and information/certificates collected from the bank branch's own records or other bank branches as necessary. This process will be completed by following the instructions provided in the designated section of the application form for use by the Approved Dealer Bank branch sequentially. (c) Each application must be inspected by the appointed external audit firm regarding the correctness of the amount to be paid according to the subsidy application. After completing the inspection, the claim for the amount payable as export subsidy must be sent to the Accounts and Budgeting Department of the Head Office of Bangladesh Bank through the Head Office of the Approved Dealer Bank in Form-D. The statement of amounts paid in favor of the applicant institution against the released subsidy must be submitted to the Foreign Exchange Inspection Department of the Head Office of Bangladesh Bank through the Head Office of the bank in Form-E within the second week of the following month. (d) Along with the approval of subsidy payment, the concerned export proceeds repatriation certificate (according to Guidelines for Foreign Exchange Transaction-2009, Volume-1, Appendix-5/23), Bill of Lading/Air Waybill as proof of shipment, Commercial Invoice, Packing List, and Bill of Exporter certified by the Customs Authority must be stamped with the seal of the concerned institution where the subsidy payment is easily visible, and the signature of the authorized officer must be placed so that there is no scope for misuse of those documents. The Approved Dealer Bank branch must take special care that the same facility is not issued multiple times for the same export under the same facility. Additionally, the Approved Dealer Bank must satisfy itself through the Bangladesh Bank's Online Exporter Monitoring System that the export proceeds of the concerned exporter have not been unrepatriated, according to the instructions of
   FEPD Circular-31, dated December 27, 2001. (e) All documents related to the decision of subsidy payment must be preserved at the branch for at least 03 (three) years from the date of payment for inspection by the Bangladesh Bank's inspection/government commercial audit department. (f) If any ambiguity arises regarding export or if information is needed, the concerned bank and audit firm will seek advice from the Export Promotion Bureau, TSCB Building, 1 Karwan Bazar.

5. Penal Measures for Payment of Subsidy Outside the Rules:
   (a) If subsidy is paid illegally, the amount paid will be recovered by adjusting the account of the paying bank kept with Bangladesh Bank.
   (b) Appropriate penal measures will be taken against the bank officials/employees involved in the committed irregularity.
   (c) If any officer of the Exporter Association is involved in the committed irregularity or assists in the irregularity by providing false information, appropriate penal measures will be taken against the Exporter Association/officer.

6. Process of Payment of Amount for Subsidy: The amount will be provided in favor of the concerned bank against the submitted application for subsidy from the fund released against the government budget allocation.

It is requested to inform all concerned parties about this matter.

Yours faithfully,

Enclosure: As per description.

(Md. Zakir Hossain Chowdhury)
Deputy General Manager
Phone: 9530250

(See paragraph 03(b) of FEPD Circular No. 28/2016) Form-'C' Regarding the provision of subsidy for the export of cow and buffalo tendons, intestines, horns, and sinews (excluding bones), etc.

(a) Name and Address of the Applicant Institution: ---------------------------------- Export Registration Certificate (ERC) Number: -----------------------------------------------

(b) Export Letter of Credit/Contract Number, Date, and Price ------------------------------------- (A legible certified copy must be submitted)

(c) Local sourcing source, quantity, and price of goods used in the production of exported goods:
Name and Address of Supplier | Quantity | Price 1 | 2 | 3 (Certificate from "Export Promotion Bureau" regarding the description, price, and sourcing of exported goods must be submitted.)

(d) Imported ancillary materials used in the processing of exported goods:
Name and Address of Supplier | Name and Quantity of Goods | LC/Back-to-Back LC/Documentary Collection Number, Date | Price 1 | 2 | 3 | 4 (Certified legible copy of the LC in column 3 must be submitted.)

(e) Details of Export Shipments:
Description of Goods | Quantity | Name of Importer's Country | Invoice Price (in Foreign Currency) | Date of Shipment | EXPI Number | Repatriated Export Proceeds in Foreign Currency and Date of Repatriation 1 | 2 | 3 | 4 | 5 | 6 | 7 (Certified legible copies of Commercial Invoice, Packing List, Bill of Lading/Air Waybill as proof of shipment, Bill of Exporter (Issued by Customs Authority) (2nd page) etc., and export proceeds repatriation certificate must be submitted.)

(f) Amount of Subsidy Applied:
Repatriated Export Proceeds | Amount of Ship Hire (if applicable) | Commission, Insurance etc. payable in Foreign Currency (if any) | Net FOB Export Proceeds 1-(2+3) | Payable Subsidy | 10/100 | 4 | 5 1 | 2 | 3 | 4 | 5 (Certified legible copy of the Freight Surcharge Certificate mentioning ship hire, if applicable, must be submitted.)

I hereby declare that subsidy is applied for the export of cow and buffalo tendons, intestines, horns, and sinews (excluding bones), etc., collected entirely from local sources and processed in our own factory. All information/declarations provided in this application are complete and correct. If any error/false information/fraud/forgery is discovered subsequently, the entire amount of subsidy received or a part thereof will be recovered from me/us and/or from my/our bank account.

Date: --------------------- ---------------------------------- Signature and Title of the Owner/Authorized Officer of the Applicant Institution.

(g) To be filled by the Subsidy Providing Bank Branch:
Repatriated Export Proceeds (in Foreign Currency) | Total Deduction for Commission, Insurance, and Ship Hire in Foreign Currency (if applicable) | Net FOB Export Proceeds (1-2) | Amount of Payable Subsidy (in Taka): 10/100 of 3 | 1 | 2 | 3 | 4 Subsidy Amount --------------- Taka (In Words: -----------------). Date of Payment: -------------------- Signature, Name, and Title of the Authorized Bank Officer for Subsidy Approval (At the date of repatriation of export proceeds, the ODI site purchase price of the concerned foreign currency)

(See paragraph 04(a) of FEPD Circular No. 28/2016) Form - 'B' "Export Promotion Bureau" Issued Certificate Certificate of Entitlement to Export Subsidy for the Export of Cow and Buffalo Tendons, Intestines, Horns, and Sinews (excluding bones), etc.

1. Name, ERC Number, and Address of Applicant:
2. Export Letter of Credit/Contract Number: Date: Price:
3. Name and Address of Foreign Buyer:
4. Name and Address of Foreign Buyer's Bank:
5. (a) Invoice Number: Date:
   (b) Quantity of goods mentioned in Invoice: Price:
6. Sourcing source of local materials used in the production of exported goods (Name and Address of Supplier):
   Quantity: Price:
7. Sourcing source of imported ancillary materials used in the processing of exported goods (Name and Address of Supplier):
   Quantity: Price:
8. Description of Exported Goods: Quantity: Price:
9. Date of Shipment: Destination Port:
10. EXPI Number: Price: Date:
11. Total Repatriated Export Proceeds (in Foreign Currency): Net FOB Export Proceeds (in Foreign Currency):
12. Certificate Number of Repatriated Export Proceeds: Date:

Signature and Date of Exporter

I hereby certify that the information mentioned in the above paragraphs is correct and reliable regarding the export of cow and buffalo tendons, intestines, horns, and sinews (excluding bones), etc., collected entirely from local sources (mentioned in serial no. 6) and processed in our own factory. The authenticity/reliability of the purchase order of the foreign buyer/importer has also been satisfied.

Signature and Date of Exporter

It is verified that the above declaration of the exporter is correct. The declared export price mentioned in serial no. 8 is found to be reasonable and consistent with the current international market price, and the authenticity/reliability of the foreign buyer has also been satisfied. It is recommended to pay export subsidy on the repatriated export proceeds (Net FOB Value).

Signature, Date, and Seal of Two Suitable Officers of the "Export Promotion Bureau"

[This certificate will be considered void if any erasure, cutting, or correction is made.]

(See paragraph 4(g) of FEPD Circular No. 28/2016) Form-'D' According to FEPD Circular No. 28/2016 Claim Proposal for Amount Payable as Export Subsidy in the Export Sector of Cow and Buffalo Tendons, Intestines, Horns, and Sinews (excluding bones), etc.

.............................................. Bank, Head Office, Dhaka.

Name and Address of Subsidy Applicant Institution | Date of Receipt of Application by Branch | Amount Applied | Amount of Claim Payable | Description of Goods | Date of Shipment and Destination | EXPI Number | Total Repatriated Export Proceeds (Foreign Currency) | Net FOB Value (Foreign Currency) | Date of Price Repatriation 1 | 2 | 3 | 4 | 5 | 6 | 6 | 7 | 8 | 9

Official Seal, Signature, Date, Name, and Title of Authorized Bank Officer

(See paragraph 04(g) of FEPD Circular No. 28/2016) Form-'E' According to FEPD Circular No. 28/2016
Statement of Amount Paid as Subsidy for the Export of Cow and Buffalo Tendons, Intestines, Horns, and Sinews (excluding bones), etc. for the Month.......... of the Year.........

Name of Approved Dealer Bank Branch:..............................................................................

Name and Address of Subsidy Applicant Institution | Paid Subsidy (Taka) | Date of Payment | Pending Applications at Branch | Description of Goods | Date of Shipment and Destination | EXPI Number | Total Repatriated Export Proceeds (Foreign Currency) | Net FOB Value (Foreign Currency) | Number | Claimed Amount (Taka) 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 -------- -----------------------------

Official Seal, Signature, Name, Title, and Date of Authorized Officer