New policy restricts CIP status for environment polluters

The commercially important person (CIP) status will no longer be granted to individuals convicted of environmental pollution, under the new CIP (export and trade) policy-2023.

If a company is responsible for pollution, its owners will also be subjected to the same restriction. It will remain in place for five years after the date of conviction. The same is applicable to those convicted of money laundering.

The new policy, which came into effect on 30 April, replaces the previous CIP (export) policy-2013, which did not have any restrictions for polluters and money launderers.

The new policy has two categories: CIP (export) and CIP (trade), with the status granted based on earnings from commodity and service exports.

The CIP status, which was previously only for commodity exporters, has been expanded in the new policy to service exporters and foreigners.

The policy allows CIPs to enjoy various privileges, such as a reserved seat in government vehicles, special recommendations by the foreign ministry to the embassies regarding their foreign trips, entry passes to the secretariat, and the use of VIP lounges and cabins at public hospitals.

Commerce secretary Tapan Kanti Ghosh said the new policy has been introduced after considering various issues. More people will now be eligible for the CIP status due to the inclusion of new sectors. Besides, low-profile exporters will no longer be eligible for the privilege due to the new conditions in the policy.

Under the previous policy, a total of 188 people used to enjoy the CIP status. Of them, 48 were ex-officio and 140 were on the basis of their export income.

The new policy does not specify a limit for the number of CIPs. It said all FBCCI directors will be considered as CIPs under CIP (trade) category, and the maximum number of CIPs under CIP (export) will be determined based on income levels.

As per the trade organisation regulations issued last week, the FBCCI will have 68 directors from now on. It means all the 68 directors will be considered as CIP.

Under the CIP (trade) category, a maximum of five people with export earnings of more than USD 50 million will get the CIP status from each sector. A maximum of four people will get the CIP status from the export income group of USD 10 to 50 million. The maximum count is three for the income group of less than USD 10 million.

The number of export sectors has also increased from 22 to 35, with the inclusion of new commodity export sectors such as all types of non-denim yarns and synthetic fibers, denim fabrics and denim garments, terry towels, flowers and foliage, all types of electric and electronics products, printing and packaging products, garment accessory products, products and services of women entrepreneurs, and computer hardware.

Additionally, consultancy services and maintenance, software and ICT-enabled services, tourism and hospitality, buying houses, outsourcing, and other service sectors have been added as export sectors under the service category.

The threshold of minimum export income for the sectors of agricultural and agro-processed products, light engineering products, medicine, plastic products, melamine, and computer software was USD 150,000 in the previous policy. The lower ceiling was USD 1.5 million for other sectors.

Under the new policy, the minimum income ceiling for all sectors has been set at USD 1 million, while the upper ceiling is USD 70 million.

Fazlul Haque, the former president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said it is good if people with high export incomes become CIPs. The condition regarding environment polluters is also time-befitting.

He also hailed the inclusion of foreigners in the facility.

The policy prohibits loan and tax defaulters from becoming CIPs, and aspirant exporters must submit a report verified by the Bangladesh Bank and the National Board of Revenue (NBR) stating that they have no due.

Money launderers are also prohibited, and applicants must submit a declaration stating that they have no issues related to defaulting or money laundering.