Sometimes when you are creating and modifying External Content Types (ECT), you may see the error Access denied by Business Data Connectivity.
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The normal course of events when setting up an ECT is that after making sure your data source is properly configured, you use SharePoint Designer to set up the ECT. Then, you need to give permissions to specific users and groups for that ECT. You use SharePoint 2010 Central Administration to assign those permissions.
One problem that can produce the above error message is that modifying the ECT in SharePoint Designer clears those permissions. If you modify the ECT in SharePoint designer, you need to go back into Central Administration and set permissions again.
Of course, you could be receiving this error because you’ve never set permissions.
The following procedure shows how to set them.
You open SharePoint 2010 Central Administration on the server that will consume the web service, and click on Manage service applications.
Then you click on Business Data Connectivity Service.
Then you select the ECT and click Set Object Permissions.
Then in the resulting Set Object Permissions dialog box, you add yourself, or someone else, or a group, or All Authenticated Users, and assign them the permissions that you want to give them.