EPZ

An export processing zone (EPZ) is defined as a territorial or economic enclave in which

goods may be imported and manufactured and reshipped with a reduction in duties /
and/or minimal intervention by custom officials (World Bank 1999).
EPZ Provides:

 Plots/factory buildings in custom bonded area

 Infrastructural facilities
 Administrative facilities
 Fiscal & non-fiscal incentives
 EPZ attracts : foreign & local investment

Type:

 A - 100% foreign ownership 58%

 B - joint venture 14%
 C - 100% local venture 28%

BEPZA

In order to stimulate rapid economic growth of the country, particularly through

industrialization, the government has adopted an 'Open Door Policy' to attract foreign
investment to Bangladesh. The BEPZA is the official organ of the government to promote,
attract and facilitate foreign investment in the EPZs.

Why zone?

 To provide special areas where potential investors world find a congenial investment
climates, free from cumbersome procedures.
Bangladesh EPZ's at a glance:

1. Chittagong EPZ
2. Dhaka EPZ
3. Mongla EPZ
4. Ishwardi EPZ
5. Comilla EPZ
6. Uttara EPZ
7. Adamjee EPZ
8. Karnaphuli EPZ

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Mode of Investment
Bangladesh adopted pragmatic strategy in order to attract more Foreign Direct Investment
(FDI) by strictly maintaining win-win policy.
Maintain open door policy through active negotiation in the process of globalization to
achieve due targeted share from the overseas potential investment surplus market.

Investment Guarantee
 Foreign Private Investment (Promotion and Protection) Act, 1980 secures all foreign
investment in Bangladesh.
 OPIC's (Overseas Investment Corporation, USA) insurance and finance programmes
operable.
 Security and safeguards available under Multilateral Investment Guarantee Agency
(MIGA) of which Bangladesh is a member.
 Arbitration facility of the International Center for the Settlement of Investment
Dispute (ICSID) available.

Functions of EPZ:
a) One stop service:
 Sanction of projects generally within one week.
 Issuing of import/Export permits within that time.
 Issuing of red work permit for foreign nationals working in EPZ within one
day.
 Providing red infrastructure facilities in EPZ.
 Offers One window same day service to inventors in EPZ.

b) Production oriented labor law:

Low forbids in any labor union in EPZ. BEPZA is vested with responsibility to administer labor
matters for all enterprises in EPZ.

C) Minimum wages (monthly)

Apprentice/Trainee – US 22.00
Unskilled worker -- ” 38.00
Semi-skilled -- ” 45.00
Skilled -- ” 63.00

other benefits includes – convince Allowances

Home Rent
Medical Allowances
Bonus.

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 Incentives & Facilities
Fiscal Incentives
1. 10 years tax holiday for the Industries to be established before 1st January, 2012 and
Duration and rate of tax exemption for Mongla, Ishwardi & Uttara EPZ for the industries set
up after January 01, 2012:
Duration of Tax Exemption Rate of Tax Exemption
First 03 years (1st , 2nd and 3rd year) 100%
Next 03 years (4th , 5th and 6th year) 50%
Next 01 year (7th year) 25%
Duration and rate of tax exemption for Chittagong, Dhaka, Comilla, Adamjee, & Karnaphuli
EPZ for the industries set up after January 01, 2012:
Duration of Tax Exemption Rate of Tax Exemption
First 02 years (1st and 2nd year) 100%
Next 02 years (3rd and 4th year) 50%
Next 01 year (5th year) 25%

2. Duty free import of construction materials

3. Duty free import of machineries, office equipment & spare parts etc.
4. Duty free import and export of raw materials and finished goods
5. Relief from double taxation
6. Exemption from dividend tax
7. GSP facility available
8. Accelerated depreciation on machinery or plant allowed
9. Remittance of royalty, technical and consultancy fees allowed
10. Duty & quota free access to EU, Canada, Norway, Australia etc
Non – Fiscal Incentives
1. 100% foreign ownership permissible
2. Enjoy MFN (most favored nation) status
3. No ceiling on foreign and local investment
4. Full repatriation of capital & dividend
5. Foreign Currency loan from abroad under direct automatic route

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6. Non-resident Foreign Currency Deposit (NFCD) Account permitted
7. Operation of FC account by 'B' and 'C' type Industries allowed.
Facilities
1. No UD, IRC, ERC and renewal of Bond license
2. Work permits issued by BEPZA
3. Secured and protected bonded area
4. Off-Shore banking available
5. Import on Documentary Acceptance (DA) basic allowed
6. Back to Back L/C
7. Import and Export on CM basis allowed
8. Import from DTA (Domestic Tariff Area)
9. 10% sale to DTA (Domestic Tariff Area)
10. Customs clearance at factory site
11. Simplified sanction procedure
12. Sub-contracting with export oriented Industries inside and outside EPZ allowed
13. Relocation of foreign industries allowed
14. Accords Resident-ship and Citizenship
15. One Window same day service and simplified procedure.

Infrastructure & Support Services

Infrastructure
· Basic Infrastructure : Electricity, Water, &Gas
· Fully serviced plots available
· Factory building available on rental basis
· Enclave for workers Dormitory & Day Care Centre
· warehouse / Godown available
Support Services
· Business : Bank, Courier, Post office, C&F Agent, Shipping Agent, MTO etc.
· Administrative : Customs Office, Police Station, In-house Security, Fire Station,
Public Transport, Medical Centre etc.
· Others : Restaurant, Health Club, Investors Club, Recreation Centre, School and
College, Sports Complex, Exclusive Telephone Exchange, Electricity Sub Station,
Business Centre, Anglers Club etc.