MOEA/FRONT/117/2021-2022/161

16" July, 2021

Notification on Fronting

The Ministry of Economic Affairs would like to bring to the kind notice of the general public and businesses that the Fourth Session of the 3rd Parliament with the objective to reinvigorate the government's efforts to control fronting, and mitigate the economic and social impact on the country, has classified the act of business fronting as a criminal offence in the Penal Code (Amendment) Act of Bhutan (PCAAB) 2021. As per Section 284G of the PCAAB, “A defendant shall be guilty of an offence of fronting, if the defendant leases or subleases, hires orotherwise permits another person to use or operate one's license unless otherwise permitted by laws or policies.” Hence, the defendant that contravenes Section 284G of the PCAAB will be criminally charged as per the Civil and Criminal Procedure Code of Bhutan 2001 and liable under Section 284H of the PCAAB as follows:

(a) if the fronting takes place between Bhutanese nationals: (i) a violation for the first conviction; and (ii) petty misdemeanor and cancellation of license for the second conviction; and

(b) a felony of the fourth degree, or a value-based sentencing, whichever is higher, if the fronting takes place: (i) between Bhutanese and a person other than a Bhutanese national; and (ii) between persons other than a Bhutanese national”

In view of the above, the Ministry hereby cautions the general public and businesses to refrain from engaging in fronting and also requests for immediate termination of such arrangements (if any) to avoid unnecessary implications. Further, the Ministry notifies that any cases of fronting activities detected after 31st December 2021 shall be dealt as per the above provisions of the Penal Code (Amendment) Act of Bhutan 2021.
Issued for strict compliance by all concerned.

Secretary

The Ministry of Economic Affairs would like to bring to the kind notice of the general public and businesses that the Fourth Session of the 3rd Parliament has classified the act of business fronting as a criminal offence in the Penal Code (Amendment) Act of Bhutan (PCAAB) 2021.

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