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Export Processing Zones (EPZ) in Bangladesh

Bangladesh has established several Export Processing Zones (EPZs) to promote the foreign investment and generate employment opportunities in Bangladesh. Bangladesh Export Processing Zone Authority (BEPZA) is an authorized agency and responsible for promoting, attracting, and facilitating foreign investment in Bangladesh.

List of Export Processing Zones (EPZ) in Bangladesh

Package of Incentives

The Government offers numerous incentives for sitting up factories in EPZs. The major Fiscal and Non- Fiscal incentives are listed below:

1.   Fiscal Incentives

       Tax Exemption

1.   10 years tax holiday for the industries established before January 1, 2012. Separate tax policy is applied to the industries set up afterwards are listed below:

Period and rate of tax exemption for Mongla, Ishwardi & Uttara EPZ for the industries set up after January 01, 2012:

Period and rate of tax exemption for Chittagong, Dhaka, Comilla, Adamjee and Karnaphuli EPZ for the industries set up after January 01, 2012:

2.   Exemption from income tax on salaries of foreign technician for 3 years (in case of Projects approved before March 22, 2009).

3.   Relief from double taxation subject to bilateral agreement.

4.   Complete exemption from dividend tax for tax holiday period for foreign nationals.

Duty Free Facilities

1.    Duty free import of machineries, equipments, and raw materials.

2.    Duty free import of two/three vehicles for A & B type industries subject to certain conditions (Projects approved before March 22, 2009).

3.    Duty free import of materials for construction of factory buildings in the zones.

4.    Duty free export of goods produced in the zones.

5.    Full repatriation of profit, capital, & establishment.

2.   Non-Fiscal

Investment

1.   All foreign investments are secured by the foreign Private Investment (Promotion and Protection) Act-1980.

2.   No ceiling on extent of foreign investment.

3.   100% foreign ownership is permissible.

4.   Repatriation of investment including capital gains, if any, is permissible.

5.   Overseas Investment Corporation (OIC) insurance and finance programs facilities is available. 

6.   Security and safeguards under the provision of Multilateral Investment Guarantee Agency (MIGA)

7.   Arbitration facility under the provision of the International Center for the Settlement of Investment Dispute (ICSID)

8.   Remittances allowed in following cases:

-       All post tax profit and dividend on foreign Capital.

-      Savings from earnings, retirement benefits, personal assets of individual on retirement/termination of services.

-       Approved royalties and technical fees.

Project Financing and Banking

1.   Off-shore banking facilities

2.   Foreign currency loan from abroad under direct automatic route (OBU facilities).

3.   Non-resident Foreign Currency Deposit (NFCD) allowed for 'A' type industries

4.   Local and international banking facilities also wide-open.

Export & Import

1.   Enjoys GSP benefits in EU countries, Japan, Australia, USA & Canada etc.

2.   No UD (Utilization Declaration), IRC (Import Registration Certificate), ERC (Export Registration Certificate), & renewal of bond license is required.

3.   100% backward linkage raw materials and accessories are allowed to sell for export oriented industries inside and outside EPZs.

4.   Import and Export on CIVI/CMP/CMT basis are allowed.

5.   Import from Domestic Tariff Area (DTA) and 10% export to DTA are permitted.

6.   Freedom from national import policy restrictions.

7.   Import of raw materials also allowed on Documentary Acceptance (DA) basis.

8.   Advantage of opening back to back LC for certain types of industries for import or raw materials.

9.   Import of goods from the domestic tariff area is permissible.

Operation

1.   Re-location of existing industries from one zone to another within the country is permissible.

2.   Sub-contracting within EPZ is allowed.

3.   No permission required for expansion of the project or product diversification.

4.   Inter-zone and intra-zone export are permitted

5.   All customs formalities are done at the gate site of the respective factory building within the zone.

6.   Permission for import/export is given in the same day.

7.   Repairing and maintenance of machinery and capital equipment from domestic tariff are allowed.

Employment

1.   Liberal employment of foreign technicians/experts is allowed.

2.   Foreigners employed in the zones enjoy equal rights similar to those of Bangladesh nationals.

3.   Law forbids formation of any labor union in the zones. Strike within the zones is prohibited.

One Stop Facilities

1.   BEPZA offers One Window Same Day service.

2.   Simplified project approval procedure.

3.   Work Permits issued by BEPZA.

4.   Import and Export Permits issued by BEPZA within the same day through automation system.

5.   Customs clearance is done at the factory site.

6.   Investors are required to deal only with BEPZA for Investment and all other operational needs.

Factory Setup Process in EPZs

1.   Collect BEPZA Project Proposal Form on payment of Taka 3000.00. (Payment to be made in the Accounts Department of Executive office, BEPZA, Dhaka.

2.   Submit the filled in BEPZA Project Proposal Form along with some required documents mentioned in the Project Proposal with a forwarding letter addressing to the Executive Chairman, BEPZA.

Required Documents

1.   Letter addressed to the Executive Chairman

2.   Filled in Project Proposal for investment in EPZ

3.   Pro-forma invoice of machinery and equipment to be imported

4.   Bank solvency certificates of the Shareholder Directors

5.   Copy of Money Receipt

6.   Memorandum & Articles of Association along with Certificate of Incorporation duly certified by the RJSC

7.   Joint Venture Agreement (If applicable)

8.   Copy of Passport of Shareholder Directors

9.   Recent Photograph of Shareholder Directors

10. Deceleration of the re-location of machinery (if applicable)

Required Time for disposal: 05 working days

Contact Information