Approval of Foreign Borrowing Agreements involves authorization from relevant authorities for external loans. This process ensures adherence to regulations while fostering economic growth through international financial collaborations. It’s a vital step in facilitating cross-border investments and maintaining financial stability. The legal basis for this approval process is grounded in the BIDA Act 2016, which provides the framework for overseeing and managing foreign borrowing agreements to align with national economic policies and legal standards.
Issuing authority
Authority: Bangladesh Investment Development Authority (BIDA)
Address: E-6/B, Sher-e-Bangla Nagar, Agargaon, Dhaka 1207, Bangladesh
Email: service@bida.gov.bd
Required list of all documents
- A copy of the BIDA Registration [Original copy duly attested by a First-Class gazette officer]
- Application [A forwarding letter in Organization’s letterhead]
- A loan Agreement [Original copy]
- Application Form [A copy of the form received from BIDA for the foreign borrowing agreement]
- Repayment period [A copy along with repayment schedule in details from bank]
- Grade period [Original copy if required]
- The calculation of effective rate of interest as defined [Original copy]
- The feasibility report of the project [Original copy]
- A Financial Analysis of the borrower [Original copy]
- Memorandum and Articles of Association [Original copy from RJSC, in case of a limited company]
- Certificate of Incorporation [Original copy from RJSC, in case of a limited company]
- It should be “Credit Information Bureau Undertaking of all sponsors/ directors as per latest Form XII” [Updated copy of the form obtained from Bangladesh bank/Scheduled bank]
- A Proforma1 Invoice/Price Quotation [For importing of capital machinery]
- Bank Solvency Certificate [Original copy (information required on the creditworthiness of the borrowing company and its sponsors]
- Description of the use of loan
Step by step all process
Step 1: Form Collection & Submission with other documents: The applicant begins by collecting the prescribed application form from the BIDA office. The form is filled out and submitted along with a forwarding letter and all required documents. The applicant deposits the license fee at the Bangladesh Bank or designated branches of Sonali Bank and collects a copy of the Treasury Challan. This copy of the Treasury Challan is then submitted to BIDA as proof of payment.
Step 2 BIDA Requests CIB Report and Submits Documents to Scrutiny Committee: The BIDA R&I section requests the applicant’s nominated bank to provide a CIB report from the Bangladesh Bank. After receiving the CIB report, the applicant’s documents are submitted to the Scrutiny Committee meeting, headed by the Governor of Bangladesh Bank.
Step 3 Approval Letter: Based on the recommendations by the committee, the applicant receives the necessary clearance. If the applicant’s submission meets the criteria, BIDA issues an approval letter confirming the authorization.
Fee schedule
SI Amount of money fee
1. Up-to 1 Crore BDT 5000.00
2. 1 Crore to 5 Crore BDT 10,000.00
3. 5 Crore to 10 Crore BDT 20,000.00
4. 10 Crore to 25 Crore BDT 50,000.00
5. >25 Crore BDT 100,000.00
Official time limit
Depends on the Scrutiny Committee meeting
Actual time limit
Depends on the Scrutiny Committee meeting