Cabinet Approves Draft 'Foreign Exchange Regulation (Amendment) Act, 2015'

The new law proposed for giving authority to the government to ask any local or foreign resident to come up with information about their foreign exchange or securities and immoveable or other properties abroad.

The approval was given in the regular meeting of the cabinet held at the cabinet room of Bangladesh Secretariat with Prime Minister Sheikh Hasina in the chair.

Briefing reporters after the meeting Cabinet Secretary M Musharraf Hossain Bhuiyan said the law proposed for waiving the existing mandatory provision of taking Bangladesh Bank's prior permission in the case of taking license of a foreign exchange agency and opening a branch or liaison office of any foreign organization.

In this case, he said, the Board of Investment (BoI) will issue the permission, and Bangladesh Bank will be informed in this regard within 30 days so that the central bank can monitor the transaction of foreign exchange and securities of the concerned organization.

Purchase and selling of foreign currencies and bullion (gold and other precious metal bar) are now regulated under the 'Foreign Exchange Regulation Act, 1947' which was amended in 1976 and 2003, Musharraf Hossain said.

He said the size of transaction of foreign exchange has expanded to a large extent in the backdrop of expansion of foreign investment and volume of the international trade. In view of this it was required to amend the existing law to make it befitting to time.

A committee headed by an Executive Director of Bangladesh Bank prepared the proposal of the law reviewing the existing laws of other countries particularly of neighbouring ones. Later, the proposal was shared with different ministries and stakeholders. To make the draft more participatory, the cabinet secretary said the draft was given on the website but response was very low.

Highlighting the salient features of the new law the cabinet secretary said the amendment narrowed the ambiguity of the existing law about its enforcement making it clear that the law will be enforced on both local and foreign citizens living in Bangladesh.

Besides, the draft updated and widened definitions of many terminologies keeping pace with the time, he said adding non-physical concept of transactions were included in the definitions of currency, export, import, goods etc. aimed at covering the electronic transactions in the backdrop of development of the information and communication technologies.

The law also proposed for empowering Bangladesh Bank to impose fine against the foreign exchange dealers in case of violation of the law, the cabinet secretary said.

The law proposed for waiving the mandatory provision of taking prior permission of Bangladesh Bank before taking license of foreign exchange agency. In this case Board of Investment (BoI) or concerned authorities can issue the permission to work as agent.

In case of opening branch or liaison office of any foreign organization, the law also proposed for waiving the provision of taking permission of Bangladesh Bank giving the task only on Board of Investment aimed at saving time and creating investment friendly atmosphere.

The cabinet has given nod to a proposal for ratification of the "Agreement between Bangladesh and Malaysia on Partial Abolition of Visa Requirement for Diplomats and Official Passports." The two countries inked the agreement during Prime Minister Sheikh Hasina's Kuala Lumpur visit in December 2014.