Bangladesh Bank (BB) has relaxed import declaration requirements for intercompany transactions, allowing Bangladeshi importers to conduct business with parent companies, approved foreign subsidiaries, and branch offices under strengthened compliance conditions. The central bank issued the revised instructions through its Foreign Exchange Policy Department (FEPD-1) on August 4, 2026, amending the earlier requirement that importers declare they have no direct or indirect connection or financial interest in foreign exporters.
Background and Rationale
The policy change acknowledges that many legitimate international trade transactions occur between related corporate entities, such as multinational groups operating through subsidiaries and branches across borders. Previously, the prescribed IMP Form required importers to declare under clause 1(c) that they had no relationship with the foreign exporter, a condition that did not align with standard corporate structures in global trade.
Bangladesh Bank stated the amendment was introduced “in recognition of the fact that many international trade transactions are legitimately conducted between related companies,” reflecting a shift toward facilitating legitimate trade while maintaining robust oversight.
Key Changes to Import Declaration Requirements
Under the revised rules, importers engaged in intercompany transactions must now submit a different declaration, affirming that:
- The transaction is conducted on an arm’s length basis at competitive market prices.
- All applicable transfer pricing regulations and relevant laws are complied with.
- Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) standards are fully met.
In such cases, the earlier declaration regarding the absence of any relationship between the importer and the exporter will no longer be applicable. Bangladesh Bank has amended the IMP Form accordingly to reflect these changes.
Compliance and Verification Obligations for Banks
The circular directs Authorized Dealers (ADs)—licensed foreign exchange banks—to obtain the required declarations from importers before processing intercompany import transactions. ADs have also been instructed to verify the legitimacy of the relationship between the Bangladeshi importer and the foreign exporter through appropriate documentary evidence.
This verification step is intended to ensure that intercompany transactions are genuine and not being used to circumvent foreign exchange controls or facilitate illicit financial flows.
Extension to Export Transactions
Bangladesh Bank specified that the revised instructions for intercompany transactions will also apply, mutatis mutandis, to export transactions. This modifies the provisions of FEPD-1 Circular No. 26 issued on July 30, 2026, bringing export declaration requirements in line with the updated import rules.
All other foreign exchange regulations remain unchanged, and Authorized Dealers have been asked to inform their concerned clients of the revised instructions and ensure their immediate and strict compliance.
Implications for Trade and Compliance
The policy adjustment is expected to streamline documentation for multinational corporations and groups with legitimate intercompany trade, reducing administrative friction while preserving transparency and regulatory oversight. By requiring arm’s length pricing declarations and compliance with transfer pricing and AML/CFT standards, Bangladesh Bank aims to balance trade facilitation with financial integrity.
For compliance officers and trade finance professionals, the changes underscore the importance of maintaining robust transfer pricing documentation and AML/CFT controls to satisfy both bank verification and regulatory expectations.