Bangladesh’s growing economy, youthful workforce, and strategic location make it an attractive destination for foreign businesses. Whether you’re looking to expand operations or explore new markets, this vibrant country offers vast opportunities.
To start a company in Bangladesh, foreign investors must go through a recommended process. There are many steps to complete. While the government encourages foreign investment, challenges like documentation and banking regulations may arise.
In this article, we will explore the entire process of how to register a company in Bangladesh. We’ll provide expert tips and step-by-step guidance.
Procedure to Start a Foreign-owned Company in Bangladesh
Complete these steps properly to ensure that you meet all requirements without unnecessary delays or complications:
1. Register Your Business Name
Start by choosing a unique name for your company. It must not be identical or similar to any existing business names registered with the Registrar of Joint Stock Companies and Firms (RJSC). Conduct a name clearance search on the RJSC portal and reserve the name by paying a small fee.
2. Prepare the Articles of Association and Memorandum of Association
Draft the Articles of Association (AoA) and Memorandum of Association (MoA), which outline the company’s objectives, governance structure, and operational procedures. Ensure these documents comply with the Companies Act 1994 of Bangladesh.
3. Obtain Digital Signatures
The online company registration in Bangladesh requires some digital signatures. Each of your company’s directors must have a digital signature certificate. This is necessary for submitting documents online and can be acquired from certified agencies in Bangladesh.
4. Open a Temporary Bank Account
Opening a bank account is essential to deposit the required minimum paid-up capital, as outlined in your MoA. Banks typically ask for the incorporation certificate and board resolutions to set up the account.
5. Submit Company Incorporation Application
Submit the required documents, including the MOA, AOA, proof of name reservation, shareholder details, and director information to the RJSC to complete the RJSC company registration Bangladesh. Pay the applicable government fees during this process.
6. Obtain a Trade License and TIN
After incorporation, apply for a trade license from the local municipal office and obtain a Taxpayer Identification Number (TIN) from the National Board of Revenue (NBR) to ensure legal operations and tax compliance.
7. Register for VAT and Secure Business Permits
Register for Value Added Tax (VAT) with the NBR. Depending on the nature of your business, you may also need specific permits, such as environmental clearances or export licenses, to legally operate.
Key Considerations for Starting a Foreign Company in Bangladesh
If you're planning to register a company in Bangladesh as a foreign company, note these key considerations:
- Your company must have a physical address in Bangladesh, as shelf companies are not permitted.
- Both directors and shareholders can be foreigners.
- If a foreign investor intends to manage the company from Bangladesh, a work permit is required.
- You must pay the necessary corporate income tax.
- A local-to-foreigner employment ratio of 20:1 must be maintained.
- You can make a 100% Foreign Direct Investment (FDI) in the company.
- Full repatriation of profit and investment is allowed.
- Investors in Bangladesh's Economic Zones can enjoy higher financial incentives.
Conclusion
Establishing a foreign company in Bangladesh involves careful execution. From securing name clearance to understanding investment policies, each step demands attention to detail.
Opening a company in Bangladesh could be one of the best decisions for your business. With the right guidance, you can successfully expand and thrive in the dynamic economy of Bangladesh.
If you’re looking to open a company in Bangladesh, have a clear roadmap and a reliable partner like Law Advisor BD to streamline the process. This not only saves time but also avoids costly errors.
FAQs
1. Can a Foreigner Fully Own a Company in Bangladesh?
Yes, foreign investors can own 100% of the company in most sectors. However, some industries may have restrictions or require joint ventures with local partners.
2. Do Foreign Investors Need a Local Director to Incorporate a Company in Bangladesh?
No, a local director is not mandatory. Foreign investors can appoint directors from their own country, but it’s often beneficial to hire local professionals to ensure compliance with local regulations.
3. Are There Any Tax Incentives for Foreign-owned Companies in Bangladesh?
Yes, the government offers various tax incentives, such as exemptions or reductions in taxes for companies involved in export-oriented industries, manufacturing, and specific economic zones.
4. How Long Does It Take to Register a Company in Bangladesh?
The entire process typically takes about a month, including name clearance, document submission, and receiving the Certificate of Incorporation.
