EXPORT PROCEDURE

Synopsis prepared by-

Md. Abdul Bari Mollah,
MBA (Finance & Banking)
B.Sc.(Hons.),M.Sc.
(Applied Mathematics), DU
Senior Assistant Vice President &
Manager Operation
Prime Bank Limited
Mohakhali Branch

Introduction
The Imports & Exports Trade of our country is regulated by the Imports and Exports Control Act-
1950.No person who has been granted registration by the Chief Controller of Imports & Exports shall
indent, import or export any thing into or out of Bangladesh except in cases of exemption issued by the
Government. If any person contravenes any provision of the Act or any Order made under this Act is
punishable with imprisonment for a term which may extend to one year or with fine or both. There are a
number of formalities which an exporter has to fulfill before and after shipment of goods. These
formalities or procedures are enumerated as follows:

A. Registration of Exporters:
The exports from Bangladesh are subject to export trade control exercised by the Ministry of Commerce
through Chief Controller of Imports and Exports (CCI & E).No exporter is allowed to export any
commodity permissible for export from Bangladesh unless he is registered with CCI & E and holds valid
Export Registration Certificate (ERC).The ERC is required to be renewed every year. The ERC number
is to be incorporated on EXP forms and other papers connected with exports.

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B. Procedure for obtaining

Export Registration Certificate-(ERC)
For obtaining Export Registration Certificate (ERC), intending Bangladeshi Exporters are required to
apply to the Controller/Joint Controller/Deputy Controller/Assistant Controller of Imports and Exports,
Dhaka/Chittagong/Rajshahi/Khulna/Mymensingh/Sylhet/Barisal/Comilla/Pabna/Bogra/Rangpur/
Dinajpur as the case may be, in the prescribed form along with the following documents:

01. Nationality and assets Certificate of the Proprietor/Directors

02. Registered Partnership Deed in case of Partnership Concerns
03. Memorandum and Articles of Association and Incorporation Certificate in case of Limited Company
04. Bank Solvency Certificate
05. Income Tax Clearance Certificate
06. Tax Identification Number-TIN
07. Copy of valid Trade License
08. Copy of Rent Receipt of the Business Premises
09. Membership Certificate of a Trade Association
10. Affidavit from a 1st Class Magistrate
11. Any other Certificate as required in the Policy etc.
12. No Objection Certificate (NOC) from previous banker
13. Bonded Warehouse License renewed
14. Tax holiday approval from NBR
15. BGMEA membership renewed
16. Fire Protection License from Civil Defense Authority renewed

C. Registration/Renewal
On receipt of necessary advice from the offices of the Controller/Joint Controller/Deputy
Controller/Assistant Controller of Imports and Exports applicants for Export Registration Certificate are
required to deposit requisite Registration fee to the Government Head of Account “42”-Trade and
Commerce-Fee realized under the Imports and Exports Control Act-1950 through Bangladesh
Bank/Government Treasury/Sonali Bank. Copies of Treasury Challans showing payment of fees should
be sent to the concerned offices of the Chief Controller of Imports and Exports for enabling them to
issue Export Registration Certificate-ERC. Once registered, exporters are to make annual payments
for having their Export Registration Certificate renewed.

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D. Securing the Order

Upon registration, the exporter may proceed to secure the export order. He/She can do this by contacting
the buyers directly through correspondence. Some buyers of goods like jute and jute goods maintain
liaison office, representatives or local agents who can be contacted to secure a deal. Sometimes, TCB,
BJMC etc secure bulk contacts and pass or allocate the contracts to the actual exporters. To locate the
foreign buyers the exporter may contract the Local Chamber of Commerce of potential buyers/Buying
house Agent/Out sourcing. The Export Promotion Bureau (EPB) and the Bangladeshi Missions
abroad are also good sources for securing information on the prospective foreign buyers.

E. Signing the Contract

The followings are the points which need to be borne in mind while making a contract.
01. Description of commodity
02. Quantity of the commodity
03. price of the commodity
04. Shipment
05. Insurance and Shipping Marks
06. Inspection
07. Arbitration

F. Receiving the Letter of Credit

The followings are the main points to be looked into:
01. The terms of the L/C are in conformity with those of the contract
02. The L/C is an irrevocable one as per UCPDC-600 ( ICC Pub-2007), preferably confirmed by the
advising bank
03. The L/C allows sufficient time for shipment and a reasonable time for negotiation
04. If the exporter wants the Letter of Credit (L/C) to be transferable, divisible and advisable,
he/she should ensure that these stipulations are specifically mentioned in the L/C

G. Procuring the materials

After making the deal and on having the Letter of Credit (L/C) opened in his favor, the next step for
the Exporter is to set about the task of procuring or manufacturing the contracted Merchandise.

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H. Shipment of Goods
The following are the documents normally involved at the stage of Shipment
01. EXP form
02. Photocopy of the ERC
03. Photocopy of the Contract
04. Photocopy of the L/C
05. Freight Certificate from the Bank in case payment of the Freight is to be made at the port of
loading is involved
06. Railway Receipt/ Barge Receipt /Truck Receipt/B/L/AWB etc.

I. Preparation of Export Documents

01. Bill of Exchange or Draft
02. Ocean Bill of Lading/Air Way Bill/Air Consignment Note/Post Parcel Receipt/Truck
Receipt/Rail Receipt
03. Commercial Invoice
04. Insurance Policy/Certificate
05. Certificate of Origin
06. Inspection Certificate
07. Consular Invoice (as per contract, if any)
08. Packing list
09. Quality Control Certificate
10. G.S.P. Certificate
11. Phyto -Sanitary Certificate
12. Marine Insurance Policy

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J. Submission of the Documents to the Bank for Negotiation

ü If the Presented documents are in order then negotiate the documents.
ü If the documents are not in order immediately advise the exporter to rectify the discrepancies
without any loss of time.
ü After rectification the discrepancies, negotiate the documents

ü If the discrepancies can not be rectified

a) At the request of the exporter send SWIFT cable to the L/C opening Bank advising the nature of
discrepancies in the documents and seeking for their SWIFT/Telex confirmation to accept them.
b) If confirmation is received, negotiate the documents, otherwise send them to the L/C opening
Bank on Collection Basis.
c) Alternatively, at the request of the exporter the documents may be negotiated by the Bank under
Reserve on obtaining an indemnity bond from them, to reimburse the amount to the Bank on
Demand, if the documents are not accepted by the openers of the Letter of Credit.

Accounting Entries at the time of Negotiation-

Debit: FDBP
Credit: Packing Credit
Credit: Project Loan (if any)
Credit: Agent Commission (if any)
Credit: Mailing Charge
Credit: Any other deduction
Credit: Party’s Account (remaining amount)

Accounting Entries at the time of Documents under Collection-

Debit: Customer Liability bills for Collection
Credit: Banker’s Liability bills for collection, and
ü Endorse on the reverse of the L/C, the amount for which the documents are negotiated
ü Endorse the Bill of Exchange, Bill of Lading assigned to the bank as per L/C
ü Dispatch the Documents to the correspondent Bank as per L/C
ü On receipt of payment from the foreign correspondent reverse the entries in the following
manner:
Debit: Prime General account (TBO-Foreign Correspondent’s account)
Credit: FDBP
Credit: Income account Exchange gain.
Credit: AIT(Knit wears, Woven garments, Terry Towels, Cartons & Accessories for all RMG industries,
Jute & Jute Goods, Frozen food, Vegetables, Leather goods, Packed products @0.60% and for others
@0.70%)
Credit: FDR building as BTB Security
Credit: Party’s account (FC held/CD account)

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