BB eases tenure of LCs for spare parts

Staff Correspondent | Published: 00:05, Nov 20,2017 | Updated: 23:57, Nov 19,2017

 
 

Bangladesh Bank has decided that the letter of credit authorisation forms (LCAF) issued for the import of spare parts shall remain valid for remittances for 30 months after the month of issuance.
In a circular issued on Sunday the central bank said authorised dealers of foreign exchange in Bangladesh may also open LCs on behalf of industrial units to import necessary spare parts of capital machineries for their own industrial use up to 360 days on usance basis. For such deferred payment imports, the prices must be internationally competitive and all costs including usance interest must not exceed 6 per cent annually.
Earlier, according to the guidelines for foreign exchange transaction
LCAFs issued for import of capital machineries and spares were valid for remittances for 18 months subsequent to the month of issuance.
In another circular on Thursday, BB said that ADs, without prior approval of Bangladesh Bank, may open new LCs on behalf of importers who have bill of entry or certified invoices unmatched with international market places (within stipulated time or the allowed extended period) to the tune of up to $ 200 or equivalent to other foreign currencies.
It said ADs shall continue their endeavor for matching such unmatched bills of entry within the shortest time.
Earlier in a circular in March 2005, ADs were barred from opening new LCs for importers who failed to submit the bill of entry/certified invoice within stipulated or the extended period allowed by Bangladesh Bank.
These instructions will be applicable for such IMPs that have remained unmatched till October 31, 2017.

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