MD. ABU ZAFAR SHAMSUDDIN, SAVP & MANAGER (CR & FX) Trust Bank Ltd.

, Gulshan Corporate Branch

Lodgment of Import Bill, PAD and Bill of Entry
After getting LC, the Beneficiary ship the goods, he receives Bill of Lading drown in accordance with the terms of the Credit, he then prepares commercial invoices ,draws a Draft on the Issuing Bank , certificate of origin, packing list, insurance documents, along with L/C copy the exporter presents the Documents to his Bank for Negotiation. The Bank negotiates the Documents if he satisfied and forwards the Shipping Documents to Issuing Bank for Payment/ Reimbursement. As per Articles 7(a) of UCPDC600 “Provided that the stipulated documents are presented to the nominated Bank or to the issuing bank and that they constitute a complying presentation the Issuing Bank must honour” Now the question arise that what are complying presentation As per articles 2 of UCPDC600 that complying presentation means a presentation that: • It is in accordance with the terms and conditions of the credit. • It is in conform with the applicable provision of UCPDC600 • It is within the frame work of International Standard Banking Practices (ISBP). After receiving the documents from negotiating bank the issuing bank examine the documents in accordance with above articles. If he found the documents in order he lodges the documents and informs the same to Importer. The process of settle of import bill by creating PAD (Interim arrangement for making payment of negotiated Import bill) on complying presentation are known as Lodgment of documents. Before Lodgment of Documents the Bank must ensure that: • • • • Full set of Documents as stipulated in the credit been received; Documents have been negotiated within the country of the beneficiary on or before the expiry of the credit the bill of lading/Air consignment note/railway receipt/post parcel receipt is not dated later than the date of shipment mentioned in the credit; The amount drawn does not exceed the amount stated in the Credit; The credit has not been amended or subjected to any notations or special instructions which might alter the value or character of the Credit.

MD. ABU ZAFAR SHAMSUDDIN, SAVP & MANAGER (CR & FX) Trust Bank Ltd., Gulshan Corporate Branch

Generally the Import Bills Consist of following Documents; • • • • • Bill of Exchange, Commercial Invoice, Insurance Documents, Bill of Lading /Other Transport Documents. Other Documents. Scrutiny of Bill of Exchange• • • • • That the Bill of Exchange is drawn by the Beneficiary as mentioned in the Credit and drawn under the proper Credit. That the face of the Bill of Exchange is inconformity with the Credit. That the amount is identical with that mentioned in the invoice. That the amount in figures corresponds exactly with the amount in word. That the Bill of Exchange is in order and endorsed properly. Scrutiny of Commercial Invoice: • • • • • That the merchandise is properly invoiced by the Beneficiary. That the merchandise is invoiced to the party mentioned on account of whom the credit was opened. That the invoice corresponds with the description of merchandises as expressed in the credit. That the invoices property signed by the Beneficiary. That the relevant license No. along with it’s Bangladesh Bank registration No. are correctly incorporated in the invoice. Scrutiny of Bill of Leading: • • • • • • That the Bill of Lading is clean “Shipped on Board” showing freight prepaid and properly endorsed to the order of the issuing bank. That the Bill of Lading covers the merchandise described in the invoice, by marks and generic term. That the port of shipment, port of destination, date of shipment, the name of consignee are in agreement with those mentioned in the credit. That the Bills of lading are properly signed by their authorized agents. That no clause appears on the Bill of Lading expressed declaring a defective condition of goods packaging. That the Bill of Lading does not indicates merchandise “shipping” “on deck” unless specially authorized in the credit.

MD. ABU ZAFAR SHAMSUDDIN, SAVP & MANAGER (CR & FX) Trust Bank Ltd., Gulshan Corporate Branch

That the date on the Bill of Lading is not stale i.e not dated very long time prior to presentation. Steps for Lodgment: 1. 2. 3. 4. 5. 6. 7. Intimation to client. Purchase/arrange fund from H.O Conversion of foreign currency into Bangladesh currency. Entry into PAD Registers. Entry into L/C Registers. Endorse LCAF IMP from duly sign by importer. Accounting procedure: Debit Credit PAD HO A/C

For reversal of Contra entry Debit Credit Bankers liability Customers liability Steps Retirement: 1. Calculation of bill value, 2. Calculation of interest and other charge. 3. Mark on PAD register. Accounting Procedure: Debit Debit Credit Credit Customer A/C Margin A/C PAD Income A/C

The following endorsement is to be given at the time of retirement. • • • Draft is to be endorsed as “Received Payment” The invoice to be certified as “Certified invoice value for USD… Transport documents to be endorsed “deliver to the order of………

MD. ABU ZAFAR SHAMSUDDIN, SAVP & MANAGER (CR & FX) Trust Bank Ltd., Gulshan Corporate Branch

Bill of Entry
Bills of Entry issued by Custom Authority as evidence of goods enter into the country against specific remittance. It is prepared by importer or his representative. Details of commodity, mode of shipment, value, duty structure, name of importer, name of vessels, H.S code No. etc are incorporated in Bill of Entry. Regulatory Requirement for Submission Bill of Entry: As per chapter 15 Para 23,26-28 of Foreign Exchange transactions Guideline that:
23. ADs may allow remittance against discrepant documents/ documents received directly by the importers after the goods have been cleared from the customs, on the basis of the relative LCAF, the exchange control copy of the customs bill of entry for consumption or customs certified invoice in the case of import by post, and the relative invoices. 26. In all cases of remittances for imports into Bangladesh, the importer must submit within 4 months from the dates of remittances the relevant exchange control copy of the customs bill of entry. In case of import by post, the importer must submit the invoice certified by the customs authorities in lieu of the exchange control copy f the bill of entry. Where the value of an import by post is less than £ 5 or its equivalent in other foreign currency, the customs authorities will issue a certificate instead of certifying the invoices. In such cases, the certificate may be submitted in place of the certified invoices. 27. The Bangladesh Bank is prepared to consider applications for extension of the time limit beyond 4 months in cases of genuine difficulties, such as delay in the arrival of the ship or difficulties in clearing the goods already landed at a port in Bangladesh etc. 28. (a) The ADs will obtain invoice, in duplicate, both of which will be certified by them as usual. After recording in the IMP form the particulars of the remittance effected, the original copy of the IMP form along with a copy of the certified invoice shall be forwarded to the Bangladesh Bank with the usual monthly returns. (b) The duplicate copy of IMP form will be retained by the AD. Subsequently when the exchange control copy of the bill of entry/customs certified invoice is submitted by the importer, the particulars therein should be matched and checked with those in the IMP form and invoice filed earlier, to see if the merchandise for which remittance was made has been duly received in Bangladesh. If no material discrepancy is detected, the case should be considered closed, with the duplicate IMP form, invoice and custom bill of entry/custom certified invoice filed together for eventual inspection and disposal instruction from inspection team from the Foreign Investment and Inspection Department of Bangladesh Bank. (c) Cases with material discrepancy between the particulars of merchandise for which remittance was made and the merchandise actually received as evidenced by the exchange control copy of bill of entry/customs certified invoice, and cases of non submission of bill of entry/customs certified invoice within four month of remittance should be reported to the area office of Bangladesh Bank quarterly, in proformas given at Appendices 5/14 and 5/15, by 15th day of the month following the quarters ended March, June, September and December. The ADs should also follow up with the importers the cases of material discrepancies and of non-submission of bills of entry/ customs certified invoices within due time. (d) In respect of all imports in the public sector the forms should be kept in separate importer wise folders till final disposal

As per Bangladesh Bank Circular No. FE Circular 4 dated March 05,2005 all AD’s were advised to refrain from opening fresh LC who failed to submit the Bill of Entry within the stipulated time.

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