Guidelines for Foreign Exchange Transactions: Bangladesh Bank

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BANGLADESH BANK

GUIDELINES FOR FOREIGN EXCHANGE TRANSACTIONS

Volume- 1

SUMMARISING Instructions as of 31 May, 2009 issued to Authorised Dealers and Money Changers in Foreign Exchange

To be read in conjunction with other instructions, subsequent amendments and modifications issued from time to time.

2009

Preface This publication, titled 'Guidelines for Foreign Exchange Transactions' is the successor to the last (1996) edition of the same. This is a compilation of the instructions to be followed by the Authorised Dealers & their constituents, Money Changers in transactions relating to foreign exchange. These guidelines come in two volumes. The first volume includes the instructions and the prescribed forms/declarations relating to individual transactions. The second volume delineates the procedure of reporting of foreign exchange transactions by Authorised Dealers to Bangladesh Bank, and includes the proformas for monthly returns, statements, schedules for such reporting. Both volumes include instructions as on the 31 May, 2009 and should be read with FE Circulars/Circular Letters issued subsequently.

Foreign Exchange Policy Department Bangladesh Bank Head Office, Dhaka. June, 2009.

CONTENTS
CHAPTER 1 2 3 4 Introduction and Definitions Authorised Dealers and Money Changers Instructions for Money Changers Bangladesh Bank's Transactions with ADs ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... PAGES 1 4 5 8 10 12 14 15 16 18 19 21 26 32 38 41 44 57 58 61 63 90 100 114 119 121 123 125 126 127 133 135 137 139 146 149 152 156 157

Foreign Currency Accounts of the ADs and Purchase and Sale of Foreign Currency ... ... Forward Dealings in Foreign Exchange ... ... Hedging the Price Risk of Commodities ... ... Non-Resident Taka Accounts of Foreign Bank Branches and Correspondents ... ...

5

6 7

Outward Remittances ... ... ... Inward Remittances ... ... ... Dealings in Foreign Currency Notes and Coins Etc. ... ... ... Import and Export of Currency Notes and Coins, Foreign Exchange, Gold, Silver, Jewellery and Securities Etc. ... ... ... Imports ... Letters of Credit and Remittances against Imports ... Back to Back LCs ... Deposit of Counterpart Fund in respect of Imports under Non Project Commodity Loans/Credits/Grants ... Exports Exports from the Export Processing Zones Foreign Investment in Bangladesh Operations in Securities Commercial Remittances (Other than for Imports) Private Remittances ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...

8 9 10 11 12 13

14

15 16 17 18 19

Travel ... ... ... Private Foreign Currency Accounts ... ... ... Non-Resident Foreign Currency Deposit Accounts ... ... ... Resident Foreign Currency Deposit Accounts ... ... ... Exporter's Retention Quota Accounts ... ... ... Foreign Currency Accounts for the EPZ Companies ... ... ... Convertible and Non-convertible Taka Accounts ... ... ... Private Non-Resident Taka Accounts ... ... ... Non-Resident Blocked Taka Accounts ... ... ... Non-Resident Investor's Taka Accounts (NITA) ... ... ... Borrowing Abroad by Residents ... ... ... Loans, Overdrafts and Guarantees ... ... ... Credit Facilities to Industries in Export Processing Zones ... ... ... Opening of Office and Appointment of Agents in Bangladesh by Non-Residents: Repatriation of Earnings of Commission, Fees Etc. ... Insurance Business ... ... ... Reinsurance ... ... ... Payment Through International Cards ... ... ...

APPENDICES

APPENDIX APPENDIX

1 2

Foreign Exchange Regulation Act, 1947 (VII of 1947). Notifications Issued by the Government of the People's Republic of Bangladesh and the erstwhile Government of Pakistan under Foreign Exchange Regulation Act, 1947 (VII of 1947). Notifications Issued by the Bangladesh Bank and the erstwhile State Bank of Pakistan under Foreign Exchange Regulation Act, 1947 (VII of 1947). List of Bangladesh Bank's Offices and their Jurisdictions....
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