Bond Management

Overview, Role, Prospect & Challenges

Md. Mashiur Rahaman, ACMA

A-1084, Joint Commissioner ,
Customs House Pangaon, Dhaka,
National Board of Revenue.
What Bonded warehouse
 Bonded Warehouse

 Bonded warehouse means Customs-controlled

warehouse for the retention of imported goods until
the duty owed is paid
 This concept was first introduced by Robert
Warpool in 1733 for tobacco and liqure related
products
 Formally it was introduced in Europe in 1803
 This type of incentive is given by any Government
for any organization to facilitate its working capital
as well as expedite business growth.
 Bonded Warehouse & its legal background

 Private bonded warehouse means any warehouse where

goods may be kept without paying imposable duties &
taxes, after getting license from the Commissioner of
Bond or any other Commissioner authorized by NBR
 Legal Provision is given under Section 12 & Section 13 of
The Customs Act, 1969
 Bonded Warehousing facility is accorded following the
provisions under Sections 84-119 of the Customs Act,
1969 (Chapter 11)
 considerable number of SROs/standing orders and office
orders issued by the NBR
Types of Bonded warehouse
Major Administrative Work for Bond
Getting a Bond License
 Lodgment of Application

Collect the application form from Customs Bond

Commissionerate or download it from Website

submit the dully filled up form along with necessary

documents’ addressing respective Commissioner, Customs
Bond Commissionerate
Attach necessary documents along with the
application as per Bonded Warehouse Licensing Rules,
2008
Some extra documents may be required depending on the type
of industry the intending licensee belongs to
Scrutiny of
Documents

During
receipt of
application

After the
application is
received
 Physical Verification
Layout of the factory Safety and security compliance

Production capacity
Existence and workability of Relevance of raw material &
machineries finished goods

Access to the factory and its surroundings

Any other onsite
Number of workers observation
 Risk
Assessment

File
Processing

Approval
Administrative work of 100% Percent export-
oriented Garments Industry

Getting Export Master Export LC or Sales

order Order from buyer

Utilization Inclusion all the kinds raw materials

Declaration (UD) & services

Pass- Book Materials import or export

through Custom Authorities
Recording

Exportation of
Finished Goods
Administrative work of Deemed Exporters

import
during getting license or
entitlement completion annual audit
permission

Imported raw materials should be

In-To-Bond In-To-Bond in Bond Register

Utilization BBLC, Consumption Sheet,

permission input-output coefficient have
to be attached
(UP)

Ex-Bond & Delivery

of Goods
 Role of export related Industries on our economy

We are the Second largest apparel exporter of the

World
S/L Trade year of Exports (Expressed Imports (Expressed
Bangladesh in Billions of US $) in Billions of US $)

1 1975 0.327 1.321

2 1980 0.793 2.599
3 1985 0.999 2.772
4 1990 1.671 3.598
5 1995 3.173 6.497
6 2000 5.493 7.6111
7 2005 9.332 12.631
8 2010 19.231 30.504
9 2021 41.734 68.2
10 2022 46.56 78.059
 40th 36rd
largest largest
export import
economy er with
with
$53.8B
$68.2B

Year RMG export (in Total Export (In Contribution in

million us$) million us$) total export (%)

1983-84 31.57 811.00 3.89

1989-90 624.16 1923.70 32.45
1995-96 2547.13 3882.42 65.61
2001-02 4583.75 5986.09 76.57
2007-08 10699.80 14110.80 75.83
2020-21 41515.73 47027.36 79.61
2021-22 44491.88 50186.62 81.13
 In 1980, exported Under Bond
US$0.793 billion, I facility the tax
In 1990 and it was benefit of Tk.
US$1.671 billion 15,223.72 crore in FY
2008-09,
In FY-17 overall
export earning stood at Tk. 20,277.40 crore
US$34.83 billion in FY 2009-10
It is 44 times higher Tk. 5,071.95 crore
than the amount in in FY 2015-16
1980

Policy Support and revenue expenditure for

Band facilities to promote export
Major Challenges regarding Bond Management

Misuse of
Bond

Revenue
earnings
of NBR
 Misuse of bonded warehouse facilities

Exporters sometimes misuse this bonded facilities by supplying

the imported materials to local market which created instability
in the market

genuine traders those who do not get the bonded warehouse

facility are facing imperfect competition in the local marke t

government deprives from legitimate revenue earnings

which may hamper essential the development activities
of the country
 Misuse of bonded warehouse facilities

Other law Non

enforcing conplient
agencies Bonder

Customs
Officials

It can’t be ignored that lack of capacity & corruption

of Customs officials are equally responsible for misuse
of bonded facilities
 Way forward & role of Bond Commissionerate to
Prevent misuse of Bond

Monitor the licensees and train them to become compliant

Proper monitoring and proper vigilance by the

bond enforcement team

Shifting export industries of Domestic Tariff Area (DTA) to

Export Processing Zone (EPZ), Economic Zone (EZ),
Special Economic Zone (SEZ) could be an option to create
a secure business environment

Full automation of whole bonded warehouse system

Thank You