'No petroleum imports without BERC licence'

Bangladesh Bank has asked the commercial banks to check whether the petroleum product importers hold Bangladesh Energy Regulatory Commission (BERC)-issued licence before they open any letter of credit.

It has told the banks to strictly follow Bangladesh Import Policy Order 2012-2015 and Bangladesh Energy Regulatory Commission Act 2003.

On Oct 14, Bangladesh Bank issued a circular in this regard.

The circular says all the importers of petroleum products must have BERC licence, as per the laws stipulated by Bangladesh Energy Regulatory Commission Act 2003.

Clause 27 of Chapter 6 in Bangladesh Import Policy 2012-2015 also stresses on possession of such licence.

Earlier, on Sept 9, BERC sent a letter to Bangladesh Bank urging the central bank to instruct commercial banks to make sure importers who intend to open LCs for petroleum products (under HS code 27.09, 27.10, 27.11, 27.11 and 27.13) have the BERC licence.

Following the request, Bangladesh Bank issued the circular.

In recent months, customs officials blocked many consignments of petroleum goods as importers lacked the proper licence.

Importers then rushed to BERC for a licence to clear their blocked consignment.

But BERC requires that one disclose details of their warehouse location, its safety standards, submit no objection certificates from deputy commissioner and district fire department among other things to get the licence.

The whole procedure is very time-consuming. But due procedures cannot be followed when licences are issued quickly to importers under pressure from Customs.

So BERC told the central bank to instruct the scheduled banks to scrutinise the licences of importers who want to open LCs for importing petroleum goods.

Key products of the HS codes mentioned in the letter include naptha, kerosene, lubricants, diesel, jet fuel, furnace oil and petroleum jelly. Quick rental power plants use diesel and furnace oil to generate power.

According to a study by the Bangladesh Institute of Development Studies (BIDS), around half of the country's quick rental power plants depend on furnace oil to generate electricity.