A rule that makes Bangladesh Bank’s permission mandatory to pay off foreigners playing for teams in the Bangladesh Premier League (BPL) in foreign currency seems to have been often violated.
A Bangladesh Bank official said if a franchise pays a foreign player in foreign currency without its permission; it is tantamount to money laundering.
The 65 foreign players who played the BPL tournament between Nov 22 and Dec 15 included stars like Chris Gayle, Kumar Sangakkara, Shahid Afridi, and Sunil Narine.
They had contracts of between $30,000 and $70,000 each with the six BPL franchises.
The teams were formed on Oct 22 through lottery-based players-by-choice system.
Besides the lottery on Oct 22, the franchises signed contracts with several players for more payments.
They did not reveal the amount involved in these contracts.
Bangladesh Cricket Board (BCB) has said the National Board of Revenue (NBR) had been informed about the amounts to be paid to the foreign players.
On Dec 20, BCB President Nazmul Hassan told a media briefing that Comilla Victorians and Chittagong Vikings had already made full payments to their players.
Rangpur Riders had paid all foreign players in full and local players had been paid 75 percent of their contracted amount, he said.
He also said the other franchises had paid 75 percent players by that time.
In line with the BPL Governing Council rules, the players were supposed to be paid 50 percent of their contracted amount before the tournament, 25 percent during it and the rest within a month after the tournament ended.
Bangladesh Bank Executive Director Subhankar Saha told bdnews24.com on Friday that only one franchise had sought permission to pay nine foreign players in foreign currency until Dec 15.
“We have given them permission,” he said.
Bangladesh Bank’s Foreign Exchange Operation Department looks after such issues.
An official of the department, requesting anonymity, said Barisal Bulls sought permission to pay nine foreign players $225,000 in foreign currency.
The central bank gave them the permission on BCB’s recommendation, he said.
So, have the other franchises paid foreign players without the Bangladesh Bank’s permission?
BCB Director Jalal Yunus said the franchises know the rules to pay the foreign players.
“The method of payment is also included in the contracts. Payments are supposed to made through proper channels and I hope that has been done,” he said.
Barisal Bulls is the largest franchise when it comes to paying foreign players.
Its owner MA Awal Chowdhury said they have taken permission from the Bangladesh Bank for payment of their foreign players.
“We knew about the rule and we are following it,” he said.
Referring to the Foreign Exchange Transaction Guideline, Saha said all such transactions, except for a few preferential ones, need Bangladesh Bank’s permission.
A Statutory Regulatory Order (SRO) issued by the NBR has also specified how a foreign player should be paid after playing in Bangladesh.
It says a foreigner will have to pay 30 percent tax if he or she gets paid in foreign currency from Bangladesh.
And a Bangladeshi organisation or individual making such a payment will have to pay 15 percent Value Added Tax (VAT).
It is considered money laundering if a foreign player takes his payment in foreign currency from any Bangladeshi franchise to his country without the central bank’s permission.
Bangladesh Bank’s Subhankar Saha said they did not have the information on the deadline of payments mentioned in the contracts.
“We can’t call it money laundering if someone seeks permission tomorrow and the Bangladesh Bank gives it.”
But Saha made it clear that “if a franchise pays a foreign player in foreign currency without permission, it will be a violation of the Money Laundering Act.”EditorDesk | Published On:January 2, 2016