Freight forwarders won't be allowed to operate without licences from Sept
Syed Ishtiaque Reza | Thursday, 28 August 2008
Multinational and joint-venture freight forwarders operating in Bangladesh for years face complicated procedures to obtain licences by August 31.
The Chittagong Customs House issued public notice this week that no freight forwarder would be allowed to operate without licence from September 1.
"We are frantically trying to get the licence, but it is not easy because of the complicated procedures," said the CEO of a fully foreign owned logistics company operating in Bangladesh for more than a decade.
International and foreign joint-venture freight forwards and logistics operators started facing this problem when the National Board of Revenue (NBR) came up with a SRO (statutory regulatory order) in January this year.
NBR in its SRO said fully foreign owned freight forwarding companies must register with Bangladesh Registrar of Joint Stock Companies and Firms showing Tk. 10 million as paid-up capital and paying half a million US Dollar as security deposit through any internationally recognised bank or financial institution. The amount of deposit for a joint-venture company is $100,000. Such provisions are not required for locally owned freight forwarders.
Foreign freight forwarders said such provisions are fully discriminatory as per the Article 4 of the Foreign Exchange Regulations Act. "But the problem is not only the payment of large amount of fees and charges, it is otherwise," said another operator.
The NBR SRO stipulates a requirement of approval from either the Bangladesh Bank (BB) or the Board of Investment (BOI) for the registration and setting up of company in Bangladesh. But the problem arose when the authorities said the multinational and joint venture freight forwarders do not require such approval.
The SRO asked the freight forwarders to get their bank guarantees certified/verified by the Bangladesh Bank. But when applied the Bangladesh Bank said any scheduled bank in Bangladesh is authorised to issue bank guarantee.
In view of the responses received from both the Bangladesh Bank and the BOI foreign owned companies feel that they should be given the licence at the earliest subject to the fulfillment of all other criteria without complicating the situation further.
"We are the foreign supply chain operators that contribute a lion's share of taxes (nearly 95 per cent) generated from the sector to the national exchequer. This sector handles half of the export/import trade of the country," said a foreign freight forwarder.
The Chittagong Customs House issued public notice this week that no freight forwarder would be allowed to operate without licence from September 1.
"We are frantically trying to get the licence, but it is not easy because of the complicated procedures," said the CEO of a fully foreign owned logistics company operating in Bangladesh for more than a decade.
International and foreign joint-venture freight forwards and logistics operators started facing this problem when the National Board of Revenue (NBR) came up with a SRO (statutory regulatory order) in January this year.
NBR in its SRO said fully foreign owned freight forwarding companies must register with Bangladesh Registrar of Joint Stock Companies and Firms showing Tk. 10 million as paid-up capital and paying half a million US Dollar as security deposit through any internationally recognised bank or financial institution. The amount of deposit for a joint-venture company is $100,000. Such provisions are not required for locally owned freight forwarders.
Foreign freight forwarders said such provisions are fully discriminatory as per the Article 4 of the Foreign Exchange Regulations Act. "But the problem is not only the payment of large amount of fees and charges, it is otherwise," said another operator.
The NBR SRO stipulates a requirement of approval from either the Bangladesh Bank (BB) or the Board of Investment (BOI) for the registration and setting up of company in Bangladesh. But the problem arose when the authorities said the multinational and joint venture freight forwarders do not require such approval.
The SRO asked the freight forwarders to get their bank guarantees certified/verified by the Bangladesh Bank. But when applied the Bangladesh Bank said any scheduled bank in Bangladesh is authorised to issue bank guarantee.
In view of the responses received from both the Bangladesh Bank and the BOI foreign owned companies feel that they should be given the licence at the earliest subject to the fulfillment of all other criteria without complicating the situation further.
"We are the foreign supply chain operators that contribute a lion's share of taxes (nearly 95 per cent) generated from the sector to the national exchequer. This sector handles half of the export/import trade of the country," said a foreign freight forwarder.