How to register a company in Bangladesh
How to register a company in Bangladesh
Before coming in our focus points I would like to share some information, why foreign investors like to invest in Bangladesh! As it is unstable economic country, political instability, corruption, government people’s artificial system and many more problems are live. Yes, problems are there but plenty of opportunities attract investors to invest in preferred business sectors in Bangladesh. Anything can possible in Bangladesh if you know the way!! Anyway, labor cost, transport cost, raw materials & land lease are cheaper that will help out to generate revenue. Our key point is how to register a company in Bangladesh? No legal identity bear of enterprise without registering a company. You can NOT inject money without legal business. So, business registration is the primary job of investment. Normally 4 ways businesses are registered:
- Private Limited Liability Company (wholly owned 100% share by foreign directors or subsidiary or joint venture or merger)
- Branch Office Opening
- Project Permission
- Franchise-Royalty revenue sharing as international policy
Private Limited Company Registration
- Foreign owners or shares holders can hold 100 percent ownership without hiring local director or share holder or partner.
- As Company Act 1994 LLC has to have minimum two directors (share holders as well) and maximum number of them are fifty (50).
- Private limited company is registered through Registrar of Joint Stock Companies and Firms (RJSC).
- Each private or public limited company has to be one Trade License and Trade License (trade_license_application_form_Bangladesh) is given by City Corporation or Union Porishod after submission of application with supporting papers.
- Each company shall have to be corporate income tax number and director’s individual income tax number as well. Income Tax Certificate is given by the local or central income Tax (revenue office, NRB) after application is verified by officer.
- Each company has to have VAT (Value Added Tax) certificate and number. VAT certificate is given by the area office of VAT after application is verified with supporting papers.
- Above 4 (four) permissions (Company Incorporation from RJSC, Trade License, Income Tax Certificate and VAT Certificate) are required for all types of business to start new business in Bangladesh as foreign investors. Service oriented business category is not required more permission apart from list of 4. But, some others permissions are required for all other types of business. Number of permissions depends on type of business.
- Following permissions are required for import and/ or export business: Including above 4 permissions some other permissions are required those are membership from chamber of commerce, export and/ or import license with supporting papers of Lease Deed and Bank Solvency.
- To setup garments factory, manufacture factory more addition permissions are required. To know in detail about that kindly go here
Branch Office Registration
- Branch office of foreign parent company is permitted by Board of Investment (BOI) or BEPZA (Export Processing Zone areas). Branch offices are free from income tax as they are not allowed to trade in Bangladesh but can analysis, research, look after market etc. For detail go here
Project Office Registration
- Like branch office, project office is registered though same channels BUT dissimilarity is income tax applicable. General employees are under tax payer and know-how staffs are tax free upon conditions.
- Its international business policy is accepted by Bangladesh law also. Parent company can receive royalty fees from franchise upon agreement and profit sharing proportion.
Summary: Foreign investors are welcome to Bangladesh to register your business and start your journey to reach your goal. Although corporate income tax rate is high (35%) plus additional 10% tax may applicable for dividend declaration. Double tax is not applicable for sure. Income Tax varies from business to business.
Conclusion: We guide foreign investors, repeating only the foreign investors to setup, register and arrange permission to start new business in Bangladesh. Business permission in Bangladesh is NOT easier like other country but complex indeed. One simple mistake can injure your business and takes long time to be corrected. Very few consultancy firms are expert to guide foreign investors how to register a company in Bangladesh.