Non-Listed Co Shares
Rules eased for repatriation of sales proceeds by foreigners
Bangladesh Bank on Sunday relaxed the guidelines for foreigners for repatriating their equity investments in non-listed and private limited companies in Bangladesh after selling the shares. The BB issued the guidelines and a circular to authorised dealer branches of all scheduled banks in this regard. The BB will accept fair value of the shares based on appropriate combination of three valuation approaches — net asset value approach, market value approach and discounted cash flow approach, depending on the nature of the company.
The BB in the circular gave details about the three approaches with examples.
Earlier, the sale proceeds of non-resident equity investment in non-listed companies and private limited companies could be repatriated with prior approval from the BB based on the net asset value of the shares as per the latest audited financial statements, the central bank circular said.
Banks will now have to submit applications for repatriation of sale proceeds of shares to foreign exchange investment department of the BB with a valuation certificate of shares issued by a merchant banker licensed by the Bangladesh Securities and Exchange Commission or a chartered accountant experienced in company valuation, it said.
The valuation certificates by eligible merchant banker or chartered accountant will have to be supported by full explanation justifying the fair value arrived at, the BB said.
Full set of audited financial statements of the company will have to be submitted to the BB along with application for remittance approval.
If the BB is not fully satisfied with the valuation arrived at, the central bank reserves the right to obtain second opinion from another qualified merchant banker or chartered accountant of its choice.
-With New Age input
