FEPD Circular No. 40: Export subsidy against export of Crabs and eel

Foreign Exchange Policy Department
Bangladesh Bank
Head Office
Dhaka.
Ref. No. FEPD Circular No. 40
All Approved Dealers of Foreign Exchange Transactions.

Dear Sir,

Regarding the provision of subsidy against the export of Crabs and Eel (Live, Frozen, and Soft-shell).

Attention is drawn to all concerned regarding the subject matter. It is informed that the Government has decided to provide subsidy against the export of domestically produced Crabs and Eel (Live, Frozen, and Soft-shell) to encourage the country's export trade. This facility will be applicable to goods shipped during the 2018-2019 fiscal year. The following paragraphs outline the guidelines to be followed by approved dealer banks regarding the payment of subsidy:

2. Recipient of Subsidy and Extent of Entitlement: In the case of exporting live, frozen, and soft-shell crabs and eels processed in own factories, the processor-exporter will be entitled to a subsidy at the rate of 10% on the net FOB value. This facility will not be applicable for exports from establishments located in Special Areas (EPZ, IZ).

3. Extent of Local Value Addition: In the case of exporting locally collected crabs and eels, the rate of local value addition must be at least 30%. The export subsidy and duty drawback/bond facility will not be applicable simultaneously in the said sector.

4. Deadline for Submission of Export Subsidy Application:
   (a) The said subsidy will be paid according to the DUS Rules against the expenses incurred for handling, quality control, processing of exported goods, and domestic and international transportation and freight charges.
   (b) Exporters may submit application Form-C to the approved dealer bank branch for export subsidy against the repatriation of export proceeds prepared after export under the export letter of credit/contract or through Documentary Collection. For exports against advance payment of export price under the export letter of credit/contract with TT, the approved dealer bank branch must ensure the authenticity/reliability of the foreign buyer, accuracy of price, and actual export from Bangladesh based on the TT cancellation opinion and other documents. Advance payment of price through TT must be made directly through banking channels (excluding Exchange Houses) by the exporter or importer, and the TT cancellation opinion 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 price) at the concerned bank abroad. However, regarding the submission of subsidy applications against exports through different shipments of the same export, the instructions of FEPD Circular No. 12, dated December 20, 2012, will be followed. (c) The application for each export must be accompanied by the permission letter from the Environment and Forest Department. (d) Necessary documents for export, such as the full set of Bill of Lading/Air Waybill issued and acknowledged by the carrier as proof of shipment, Commercial Invoice, Packing List, Bill of Exporter (issued and examined by Customs authorities and acknowledged by the carrier for the purpose of 'Dh-ndr-dthf' [likely 'Dhaka-Narayanganj' or similar route context, kept as transliterated or standard term if known, here kept as per source structure]), etc., must be submitted.

5. Receipt, Verification, and Payment Decision of Application by Approved Dealer Bank Branch:
   (a) The approved dealer bank must ensure in the initial verification that all documents, certificates, and acknowledgments mentioned in various sections of the export subsidy application form are attached with the application in complete and full form. A certificate must be submitted along with the subsidy application according to the attached table (Form-B) from the Bangladesh Live and Chilled Food Exporters Association. The concerned bank branch must also ensure the authenticity of the documents processed by the bank branch and the accuracy of the information mentioned therein. If any defect/incompleteness is found during initial verification, the approved dealer bank branch must inform the applicant institution in writing within 03 (three) working days of receiving the application.

Continued on page-2
11 December 2018
Date:-------------------
27 Agrahayan 1425

-2-
(b) To ensure consistency between the production capacity of the applicant institution and the export mentioned in the application, additional explanations/information may be required from the applicant, and information/certificates collected from the bank branch's own records or other bank branches regarding export and repatriation of export price may be attached. After the application form is received in complete and full form, the approved dealer will determine the amount payable. This process will be completed by following the instructions in the designated section of the application form for use by the approved dealer bank branch sequentially. (c) The appointed external audit firm must inspect each application according to the subsidy application form. After completing the inspection, the claim for payment of the subsidy amount by the approved dealer bank must be sent to the Accounts and Budgeting Department of the Head Office of Bangladesh Bank in Form-C through the Head Office of the approved dealer bank. Regarding the subsidy drawn from Bangladesh Bank, the statement of amount paid in favor of the applicant institution must be submitted to the Foreign Exchange Policy Department of the Head Office of Bangladesh Bank through the Head Office of the bank in Form-D by the second week of the following month. (d) Along with the approval of subsidy payment in each case, the export price repatriation certificate (Appendix-5/36 of Guidelines for Foreign Exchange Transaction-2018, Volume-1), Bill of Lading/Air Waybill as proof of shipment, Commercial Invoice, Packing List, and Bill of Exporter acknowledged by Customs authorities must be stamped with the amount of subsidy paid in an easily visible place and signed by the authorized officer, so that there is no scope for misuse of those documents. The approved dealer bank branch must take special care that a PRS is not issued multiple times for the same facility under the same export. Additionally, before processing the application, the approved dealer bank must ensure from the Bangladesh Bank's Online Exporter Monitoring System that the export price of the concerned exporter has not remained unrepatriated, following the instructions of FEPD Circular No. 30, dated August 16, 2017. (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 may take advice from the Audit Firm, Export Promotion Bureau, TSCB Building, 1 Kawran Bazar, Dhaka.

6. Punitive Measures for Illegal Payment of Subsidy:
   (a) If subsidy is paid illegally, the paid amount will be recovered by adjusting it from the account of the paying bank kept with Bangladesh Bank.
   (b) Appropriate punitive measures will be taken against the bank officers/employees involved in the committed irregularity.
   (c) If any officer of the Exporters Association is involved in the committed irregularity or assists in the irregularity by providing false information, appropriate punitive measures will be taken against the Exporters Association/officer.

7. 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 drawn against the government budget allocation.

All concerned parties are requested to be informed about the matter.

Yours faithfully,

Attachment: As per description.

(Md. Harun-ur-Rashid)
Deputy General Manager
Phone: 9530625

(Note: See FEPD Circular No. 40/2018 in Paragraph 04(b))

Form-'C'
Application for Subsidy against Export of Crabs and Eel (Live, Frozen, and Soft-shell)

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

(b) Export Letter of Credit/Contract Number, Date, and Price ------------------------------------- (Must submit a legible certified copy)

(c) Source, Quantity, and Price of Locally Collected Products Used in Producing Exported Goods:
Name and Address of Supplier | Quantity | Price | Payment Method 1 | 2 | 3 | 4

(Must submit certificate from Bangladesh Live and Chilled Food Exporters Association regarding description, price, and source of export goods. Must submit necessary documents for payment method.)

(d) Imported Materials Used in Producing Exported Goods:
Name and Address of Supplier | Name and Quantity of Product | LC/Back-to-Back LC/Documentary Collection Number, Date | Price 1 | 2 | 3 | 4

(Must submit legible certified copy of LC in column 3. Must submit declaration of exporter regarding whether bond facility for duty drawback was availed for materials used in production process/not, whether duty drawback facility was taken/not, and whether application will be made in future [subject to Ministry's decision].)

(e) Details of Export Shipment:
Description of Product | Quantity | Name of Importer's Country | Invoice Price (Foreign Currency) | Date of Shipment | EXPI Number | Repatriated Export Price (Foreign Currency) and Date of Repatriation 1 | 2 | 3 | 4 | 5 | 6 | 7

(Must submit legible certified copy of full set of Commercial Invoice, Packing List, Bill of Lading/Air Waybill issued and acknowledged by carrier as proof of shipment, Bill of Exporter (issued and examined by Customs authorities and acknowledged by carrier for 'Dh-ndr-dthf'), and export price repatriation certificate.)

(f) Amount Applied for Subsidy:
Amount of Ship Hire (if applicable for repatriated export price) | Commission, Insurance, etc. payable in Foreign Currency (if any) | Net FOB Export Price | 1-(2+3) 1 | 2 | 3 | 4

(Must submit legible certified copy of Freight Surcharge containing mention of ship hire, if applicable)

Rate of Local Value Addition based on Price of Products Used in Producing Export Goods [(4-6)/4] x 100

Entitled Subsidy
4 x 10%

Domestic Product | Imported Product
5 | 6 | 7 | 8

(Subsidy will be entitled if the rate in column 7 is consistent with Paragraph 3 of the said Circular. If imported products are unused or previously imported products are used, the relevant production cost calculation must be mentioned in column 6 above. Production cost calculation must be submitted in this regard.)

I hereby declare that subsidy is applied against the export of live, frozen, and soft-shell crabs and eels processed in our own factory from locally collected crabs and eels. All information/declarations provided in this application are complete and accurate. If any wrong/false information/fraud/forgery is discovered later, the entire amount of subsidy taken or part thereof will be recovered from me/us and/or from my/our bank account.

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

(g) To be filled by the Subsidy-Providing Bank Branch:
Amount of Ship Hire (if applicable for repatriated export price) | Commission, Insurance, etc. payable in Foreign Currency (if any) | Net FOB Export Price | 1-(2+3) 1 | 2 | 3 | 4

Rate of Local Value Addition based on Price of Products Used in Producing Export Goods [(4-6)/4] x 100

Amount of Subsidy Payable (in Taka)
Domestic Product | Imported Product | 4 x 10% | 5 | 6 | 7 | 8

(Subsidy will be entitled if the rate in column 7 is consistent with Paragraph 3 of the said Circular.)

Amount of Subsidy --------------- Taka (In words: -----------------).
Date of Payment: --------------------

Signature, Name, and Title of Authorized Bank Officer for Subsidy Approval (At the date of export price repatriation, the ODI rate of the concerned foreign currency)

(Note: See Paragraph 04(a), FEPD Circular No. 40/2018)

Form - 'B'
Certificate of Verification Issued by Bangladesh Live and Chilled Food Exporters Association Certificate of Verification for Receiving Export Subsidy against Export of Crabs and Eel (Live, Frozen, and Soft-shell)

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 and Price of Products Mentioned in Invoice:
6. Source of Local Materials for Producing Exported Crabs and Eel (Live, Frozen, and Soft-shell) (Name and Address of Supplier): Quantity: Price:
7. Source of Imported Materials Used in Producing Exported Crabs and Eel (Live, Frozen, and Soft-shell) (Name and Address of Supplier): Quantity: Price:
8. Details of Export Goods: Quantity: Price:
9. Date of Shipment: Destination Port:
10. EXPI Number: Price: Date:
11. Total Repatriated Export Price (Foreign Currency): Net FOB Export Price (Foreign Currency):
12. Certificate Number of Repatriated Export Price: Date:

Signature and Date of Exporter

Hereby certify that the statements mentioned in the above paragraphs are correct and true regarding the collection of crabs and eel (and other materials) from the sources mentioned in serial numbers 6 and 7 above, and the export of live, frozen, and soft-shell crabs and eels processed in our own factory against export subsidy. The authenticity/reliability of the purchase order of the foreign buyer/importer has also been ensured.

Signature and Date of Exporter

The authenticity of the above declaration of the exporter has been verified and found correct. The declared export price in serial number 7 is found consistent with the actual and prevailing domestic market price, and the authenticity/reliability of the foreign buyer has also been ensured. It is recommended to pay export subsidy on the repatriated export price (Net FOB Price).

Signature, Date, and Seal of Two Appropriate Officers of Bangladesh Live and Chilled Food Exporters Association

[If any rubbing, cutting, or correction is made, this certificate will be considered void.]

Form-'G'
(Note: See Paragraph 5(g), FEPD Circular No. 40/2018)

According to FEPD Circular No. 40/2018
Claim Proposal for Payment of Amount for Export Subsidy in the Export Sector of Crabs and Eel (Live, Frozen, and Soft-shell)

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

Name and Address of Subsidy Applicant Institution | Export Related Information | Date of Application Receipt by Branch | Amount Applied | Amount of Claim Payable | Description of Product | Date of Shipment and Destination | EXPI Number | Total Repatriated Export Price (Foreign Currency) | Net FOB Price (Foreign Currency) | Date of Price Repatriation 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10

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

Form-'D'
(Note: See Paragraph 05(g), FEPD Circular No. 40/2018)

According to FEPD Circular No. 40/2018
Statement of Account for Paid Amount for Export Subsidy in the Export Sector of Crabs and Eel (Live, Frozen, and Soft-shell) for the Month of.......... of the Year.........

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

Name and Address of Subsidy Applicant Institution | Export Related Information | Paid Subsidy (Taka) | Date of Payment | Pending Applications at Branch | Description of Product | Date of Shipment and Destination | EXPI Number | Total Repatriated Export Price (Foreign Currency) | Net FOB Price (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