The modular multilevel converter (MMC) employing multilevel submodules (SMs) displeys a reduced footprint size, voltage ripple and an improved efficiency compared to standard SMs. Due to capacitor voltage fluctuations in the SMs of the MMC, circulating current (CC) flows among the phase-legs. These currents can affect the system efficiency and menace the safe operation of MMC. Therefore, an active closed-loop CC controller is imperative for reliable operation of the MMC. The classical methods exhibit an awful steady-state performance, limited harmonic filtering, instability during load variations and complexity in digital implementations. This paper introduces a pseudo-derivative-feedback (PDF) based CC suppression control of the MMC in synchronous dq-frame. The design and implementation of the PDF controller are presented and adapted to minimize the CC. The theoretical analysis and numerical results obtained through simulations in PLECS software platform for seven-level flying capacitor SM based three-phase MMC are presented to verify the advantages of the PDF-based CC control.