FAQ , Overseas Remittance/ Repatriation

What is the procedure for repatriation of royalty, franchise, technical license/ know- how/ assistance fees?

Oct 11, 2021

BIDA issued a new guideline on 3 Mar. 2021 for outward remittance/ repatriation of royalty, franchise, technical license/ know-how/ assistance fees (see the link for detailed information- https://www.bb.org.bd/mediaroom/circulars/fepd/apr112021fepdl07e.pdf). The new guideline stipulates the permissible amount of such fees (including O&M service fees) as follows:

i) Royalty, technical license/ know-how/ assistance fees:

• For the projects under implementation, not exceeding 6% of total accumulated C&F value of imported machineries of the concurrent year(s) before going into commercial operation,
• For the projects under commercial operation, not exceeding 6% of the previous year’s sales (excluding VAT) as declared in the income tax returns audit report. ii) Franchise fees: Fees more than USD 0.1 million can be remitted in installments. 50% of the approved claim can be remitted in the first year, followed by 30% in the second, and the rest of 20% in the third year. iii) Fees payable to contractors: In case of recurring payments required by agreement, maximum 6% of sales revenue (excluding VAT) as declared in the previous year’s income tax return or VAT return (considered only for the first year in case of new project) can be remitted. • The AGREEMENT for outward remittance of royalty, franchise, and technical license/ know-how/ assistance fee must be approved by BIDA. A procedure for approving the agreement has been issued from BIDA. • No approval of BIDA is needed for outward remittance up to 6% of previous year’s sales revenue each year. • Authorized Dealer bank will process outward remittance of royalty, franchise, technical license/ know-how/ assistance fee based on the agreement approved by BIDA. • Advance payment for the above fees is allowed (must be accompanied with bank guarantee) but with prior approval of BIDA.

• Prior approval of BIDA must be obtained for outward remittance of more than 6% for any given year for royalty, franchise, and technical license/ know-how/ assistance fee. • Application for endorsement of the agreement can be made manually for the time being but will be serviced soon through BIDA’s OSS portal.