Transactional procedures for import trade on phase-out of LCAF — BB — BD

Foreign Exchange Policy Department
Bangladesh Bank
Head Office
Dhaka www.bb.org.bd
FE Circular No. 29 Date: October 20, 2022
All Authorized Dealers in
Foreign Exchange in Bangladesh
Dear Sirs,
Transactional procedures for import trade on phase-out of LCAF Attention of Authorized Dealers (ADs) is invited to Import Policy order 2021-2024 issued vide SRO No. 92-Law/2022 dated April 20, 2022 by the Ministry of Commerce. To bring simplification in import transactions, requirement of Letter of Credit Authorization Form (LCAF) has been phased out through IPO 2021-2024
2. In accordance with IPO 2021-2024, it has been decided that registration of LCAF by
ADs as per instructions contained at chapter 7 of the Guidelines for Foreign Exchange Transactions-2018 (GFET) and subsequent circulars shall stand repealed. On phase-out of LCAF registration, ADs shall observe the following procedures for relevant import transactions:
(a) Before establishment of letters of credit (LCs) or initiation of permissible imports, ADs shall obtain underlying indents, proforma invoices, purchase or sales contracts from relevant importers. (b) For imports on FOB or similar other terms, ADs shall obtain applicable transport charges against the shipments to facilitate issuance of certificate as per paragraph 16, chapter 7 of GFET. (c) ADs shall provide primary import information based on (a) above to online import monitoring system of Bangladesh Bank. (d) In case of permissible imports without LCs by industrial imports, and commercial imports within authorized limits, ADs shall report to Bangladesh Bank as per (c) above with indication of imports without LCs. (e) Payments for relative imports shall not exceed the amount of LCs or other underlying arrangements, as the case may be.
3. ADs shall also ensure the import payments on maturity against permissible usance
imports without LCs in terms of IPO.
4. As usual, ADs shall observe due diligence of import transactions and adhere to relevant
regulations without limiting to requirement of advance payments, admissible imports under usance terms, credit reports of suppliers, matching of import payments with bill of entry, provisions of IPO and so on.
5. Other relevant instructions on import trade shall remain unchanged. The contents of this
circular shall be effective from November 20, 2022.
Please bring the above instructions to the notice of all your concerned clientele. Yours faithfully, (Md. Sarwar Hossain) Director (FEPD) Phone: 9530123

Lineage: No known changes

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amendssupersedesissued underrefers todashed card: not in RegAlert (or proposed)arrows run from the older text to the one that changes it

The links and the sentences they come from (2)

Amends

Guideline of 2018Not in RegAlert
“registration of LCAF by ADs as per instructions contained at chapter 7 of the Guidelines for Foreign Exchange Transactions-2018 (GFET) and subsequent circulars shall stand repealed.”

Basis for

FEPD Circular Letter No. 23: Usance import under purchases/sales contracts2025 · BB
“s under purchases/sales contracts considering themselves to be responsible for effecting payments as per paragraph 3 of FE Circular No. 29/2022. This is to clarify that ADs do not take exposure on i”

Mentions (1): 1 document mentions this one without changing it

Referred to by

FEPD Circular No. 24: Usance import under purchases/sales contracts2024 · BB
“ontracts need to be submitted to designated ADs for onward submission to Bangladesh Bank online reporting portal as per FE Circular No. 29, dated October 20, 2022; (b) The usance period shall not ex”