NBR moving to ensure transparency in bond activities

The National Board of Revenue (NBR) is going to formulate the Standard Operating Procedure (SOP) to ensure transparency and accountability in bond-related activities.

SOP will allow export-oriented industries to get bond licence in one month and licence holder entities will get utilisation permission (UP) in three working days.

Besides, the temporary and maximum tenure will be fixed for issuing general bond, changing or inclusion of lien bank, ownership transfer, inter-bond transfer of raw materials of machinery and changing of factories.

A Bond Commissionerate official said NBR is formulating SOP to resolve the misunderstanding between its officials and businessmen.

But businessmen said that the SOP alone will not bring massive changes unless punishment for violating the procedure by NBR officials is included in it. They pointed out that the earlier initiative of Citizen Charter did not yield any result.

NBR sources said that the SOP draft had been sent to export-related trade bodies. The BGMEA, BGAPMEA, BPGMEA and a number of other organisations have already sent their observations.

A committee, comprising officials from Dhaka and Chittagong Bond Commissionerates, has been formed to scrutinise these observations. The SOP will be finalised with this committee’s recommendations.

The Bond Commissionerate was formed on November 1, 2000, to speed up export-related activities and complying with the demands of the businessmen. A second office was set up in Chattogram on November 10, 2010.

They were established mainly to avoid duty complexities for importing raw materials by the exporters. Currently, the commissionerates issue bond licence for export-oriented industries, UP, and carry out annual audits. They also issue passbooks for foreign diplomats, audit diplomatic bonds and monitor supervised bond.

An export-oriented industry will need to submit 29 types of documents to obtain new bond licence, according to the SOP draft.

The documents include BIDA or related certificate, updated trade licence, IRC or ERC certificate, company TIN or BIN, fire license, boiler certificate, certificate from the Department of Environment, NID, return submission copy of the directors of the company, copies of gas and electricity bill of respective industry, design of the proposed bonded warehouse, LC of the installed machines, bill of entry and catalogue mentioning the production capacity of the machine.

The same procedure has to be followed for factories set up in the EPZs. No fee is required for the application.

Approval for the general bond will be given in five working days and no fee is required for this.

Companies, whose audits have not been done in two years and who did not submit audit documents, can apply for general bond licence for three months. If the auditing is not done by this time, then they will be given 21 more days based on their requests. The additional time will be extended by seven days if audit is not done even by then.

For readymade garments industry, the audit will be done by 90 days and related documents need to be submitted for that.

Except for the RMG industries, the licence renewal fee will be Tk 9,000.

For UP, documents such as back-to-back LC, sales contract or advance TT, pro-forma invoice, utilisation declaration, master LC or master sales contract and EXP have to be submitted.

A Bond Commissionerate official said that they had a meeting with stakeholders and received proposals from some trade bodies after preparing the SOP draft.

“Sometimes the businessmen tried to get licence or do the audit without submitting proper documents. At that time they felt being harassed when the officials ask for all documents,” he said.

“The SOP will clearly mention all type of procedures for getting any type of service. Once it is implemented, the activities in the Bond Commissionerate will get a boost,” he added.