Business Startup Process in Bangladesh

 

How to start a Business in Bangladesh?

An entrepreneur has to follow nine specific procedures and legal steps to set up a business in Bangladesh. At the very first, the entrepreneur has to apply to Registrar of Joint Stock Companies and Firms (RJSC) for Name Clearance Certificate. After receiving the certificate, the next step is to pay stamp duty at a Designated Bank and again apply to RJSC for registration. Then the company makes seal and open a bank account and then apply for trade license to respective City Corporation or Municipal Corporations. After completing all those procedures, the entrepreneur has to approach to the National Board of Revenue (NBR) for receiving TIN Certificate and registering with the Customs, Excise, and VAT Commissionerate. Finally, the investor requires to apply to the Board of Investment (BOI) for registration. The  process at very high level looks like the following chart:

Following is the detailed summary of those procedures, along with the estimated time and cost.

 

Procedure 1: Name Clearance Certificate for Company

The first step is to apply to Registrar of Joint Stock Companies and Firms (RJSC) for receiving name clearance certificate. This is a pre-requisite for registration of a new company (other than Foreign Company and Partnership firms) or a society or a trade organization. An applicant needs to apply via RJSC website. The RJSC office will check the database and issue name clearance if it does not closely match or resembles with any of the existing names. It will be valid for next 180 days. An applicant will have to apply for registration within this timeline.

 

Legal Basis of the Certificate

The Companies Act- 1994

Responsible Agency

Registrar of Joint Stock Companies and Firms (RJSC)

Process Step

Step 1: Applicant fills in the online application

Step 2: Opening an E-account an RJSC website

Step 3: Preliminary name search on RJSC website

Step 3:  Makes a payment of fees to designated Bank

Step 4: Submits  the money receipt

Step 5 : Obtain the name clearance certificate

Required Documents

1.     A print out of the name clearance certificate

2.     Original copy of Money Receipt

 

Process Map

Description: E:\Investment Procedures\b.png

 

                                                                                         

Time

Less than one day (online procedure)

Fee

BDT 600.00 for each of the proposed names

BDT 100.00 for each time extension application

Contact

Head Office of RJSC:

TCB Bhaban, 1 Kawran Bazar, Dhaka-1215, Bangladesh

TEL: 8189401, 8189403, FAX: 8189402

Email: rjsc@roc.gov.bd  Website: www.roc.gov.bd

 

Procedure 2: Pay Stamp Duty at a Designated Bank

Payment of stamp duty is made to the account of the Treasury at the BRAC Bank. According to the Stamp Act 1899 as amended on June 30th, 2012, for an authorized share capital of up to BDT 1,000,000, the total stamp duty fees are BDT 4,000. These include BDT 3,000 for affixing stamps on the Articles of Association, and BDT 1,000 for stamps on the Memorandum of Association. In addition, a certified copy of each document costs BDT 50.

Responsible Agency

Designated Bank

Process Step

Step 1: Payment of stamp duty is made to the account of the Treasury at the BRAC Bank

Process Map

Description: E:\Investment Procedures\nnn

 

 

                  

                                                                                      

Required Document

No document is required

Time

1 day

Fee

BDT 3,000 for the Articles of Association + BDT 50 for a certified copy; and BDT 1,000 for the Memorandum of Association + BDT 50 for a certified copy

Contact

Designated Bank’s Branch Office

 

Procedure 3: Register at Registrar of Joint Stock Companies and Firms (RJSC)

The promoters of a new entity (having name clearance, where applicable) apply for registration with necessary documents, prescribed forms & schedules and fees, as appropriate to the entity type. The promoters prepares Memorandum/Articles of Association as appropriate to the entity type, submit the registration application through website and Pay the registration fee at the designated Bank. RJSC issues a Certificate of Incorporation upon satisfaction that the promoters obtained name clearance of the proposed entity prior to the registration application, submitted the registration application the Memorandum & Articles of Association & prescribed forms and provided applicable fees.

Legal Basis of the Registration

The Companies Act- 1994

Responsible Agency

Registrar of Joint Stock Companies and Firms (RJSC)

Process Step

Step 1: Preparing Memorandum of Association (MOA) and Articles of Association (AOA) as appropriate to the entity type

Step 2: Visiting RJSC website to apply for company registration

Step 3: Filling in Name Clearance Submission number and letter number

Step 4: Filling in the prescribed forms 

Step 5: Attaching the MOA and AOA

Step 6: Submitting the Registration Application

Step 7: Depositing the required fee & receiving the payment slip form designated bank

Step 8: Uploading document in online

Step 9: Printing the uploaded documents and Submitting those documents & payment slip to RJSC office

Step 10: Receiving a Certificate of Incorporation from the RJSC Office

 

 

Process Map

 

 

 

 

 

 

 

 

 

 

 

 

 

Description: E:\Investment Procedures\Raw Process Map\Regstration

Required Document

1.     Name clearance certificate

2.     Memorandum and Articles of association

3.     Filled in Form I: Declaration on Registration of Company

4.     Filled in Form VI: Notice of Situation of Registered Office and of Any Change therein

5.     Filled in Form IX: Consent of Director to act

6.     Filled in Form X: List of Persons Consenting to be Directors

7.     Filled in Form XII: Particulars of the Directors, Manager and Managing Agents and of any change therein Evidence of Name Clearance

8.     Proof of payment (i.e. receipt from the designated bank) for Treasury Stamps

9.     TIN Certificate of all Directors

 

Time

Less than one day (Online Procedure)

Fee

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Private Company (Companies Act, 1994)

Stamps

For affixing on the Memorandum of Association: BDT 500.00

For affixing on the Articles of Association:

For Authorized Capital (BDT)

Stamp (BDT)

Up to 10,00,000.00

 2,000.0

> 10,00,000.00 up to 3,00,00,000.00

 4,000.0

> 3,00,00,000.00

 10,000.0

 

Registration fee

For filing 6 documents (5 filled in forms plus 1 memorandum & articles of association, @ BDT 200.00 per document): BDT 1,200.00

For the authorized share capital:

For Authorized Capital (BDT)

Fee (BDT)

(Up to 20,000.00 )

 360.00

Additional for every 10,000.00 or part after first 20,000.00 up to 50,000.00

 180.00

Additional for every 10,000.00 or part after first 50,000.00 up to 10,00,000.00

 45.00

Additional for every 10,000.00 or part after first 10,00,000.00 up to 50,00,000.00

 24.00

Additional for every 1,00,000.00 or part after first 50,00,000.00

 45.00

 

Contact

Head Office of RJSC:

TCB Bhaban, 1 Kawran Bazar, Dhaka-1215, Bangladesh

TEL: 8189401, 8189403, FAX: 8189402

Email: rjsc@roc.gov.bd , Website: www.roc.gov.bd

 

 

Procedure 4: Make a Company Seal

Business founders can make a company seal at the Seal maker for BDT 100-200

Process Step

An entrepreneur will go to any seal making shop and order a company seal

Required Document

No documentation is required

Time

2-4 hours

Fee

BDT 100-200

Contact

Any seal making shop

 

Procedure 5: Open a Bank Account

A company must first open a bank account In order to register for VAT. An entrepreneur will go to the concerned Bank and open a Bank account.

Responsible Agency

Bank

Process Step

In order to register for VAT, the company must first open a bank account. Detailed procedures should be discussed with the Bank.

Time

1 day (simultaneous with previous procedure)

Fee

Usually no charge

Contact

Entrepreneur can communicate with  any public or private bank in Bangladesh

 

Procedure 6: Obtain a Trade License

Getting a trade license is one of the important steps of starting  business in Bangladesh. An entrepreneur needs to receive the trade license from City Corporation or City Council of the respective business area. The trade license filled-in application form must be accompanied by the required documents.

 

Legal Basis of the License

1.     Dhaka City Corporation Ordinace - 1983

2.     Municipal Taxation Rules – 1986

Responsible Agency

City Corporation/ Municipal Corporation/ Union Parishad

 

Process Step

Step 1:  Collect prescribed Application Form from the City Corporation/ Municipal Corporation/ Union Parishad’s Office

Step 2: Submit completed Application Form with supporting documents to the concerned section

Step 3: Inspection by the Licensing Supervisor  

Step 4: Deposit required fees at the concerned office

Step 5: Obtain Trade License form the City Corporation/ Municipal Corporation/ Union Parishad office

 

Process Map

Description: E:\Investment Procedures\Raw Process Map\Trade License

 

 

Required Document

1.     Application Form

2.     National ID Card of the Entrepreneur

3.     Holding Tax Payment receipt

4.     Recent Passport Size Picture of the Entrepreneur

5.     Declaration  of  non –Judicial stamp to abide by the rules & regulation of City Corporation & Municipal Corporation

6.     A certified copy of the memorandum and articles of association

7.     A copy of the certificate of incorporation

8.     Agreement of Parthership

9.     Tax Identification Number certificate

10.  A copy of the lease agreement of the registered office

11.  Work Permit from Board of Investment

12.  Statement of Bank Solvency

 

Time

7 days

Fee

Application Fee: BDT 10.00

License Fee: Ranges from BDT 1000-20000 which depends on the nature /type of the business (Informatin can be collected form City Corporation/ Municipal Corporation/ Union Parishad)

For Limited company, License fee is determined on the basis of paid up capital.

Contact

City Corporation, Municipal Corporation& Union Parishad Office

For Dhaka City

Dhaka South City Corporation (DSCC)

Nagar Bhaban, Fulbaria, Dhaka-1000

Phone:- +8802 9563504, +8802 9563506

Email: administrator@dhakacity.org

Website: http://www.dhakasouthcity.gov.bd/

Dhaka North City Corporation (DNCC)

Nagar Bhaban, House # 81, Gulshan, Dhaka 1212

 Phone: +88-02-9896111

 Fax:  +88-02-9894391

Email: cro@dncc.gov.bd

Website: http://www.dncc.gov.bd

 

 

Procedure 7: Obtain a Tax Identification Number (TIN) Certificate for Company

In order to start business operations, every company must receive TIN Certificate from NBR. An entrepreneur can apply in online filling out prescribed online form and obtain TIN Certificate instantly. Alternatively, the entrepreneur can register for taxes at the appropriate taxation authority (Deputy Commission of Taxes of Company Circle, Zonal Taxation Department) under the National Board of Revenue (NBR) and obtain a tax identification number.

Legal Basis of the License

3.     Dhaka City Corporation Ordinace - 1983

4.     Municipal Taxation Rules – 1986

Responsible Agency

City Corporation/ Municipal Corporation/ Union Parishad

Process Step

Step 1:  Collect prescribed Application Form from the City Corporation/ Municipal Corporation/ Union Parishad’s Office

Step 2: Submit completed Application Form with supporting documents to the concerned section

Step 3: Inspection by the Licensing Supervisor  

Step 4: Deposit required fees at the concerned office

Step 5: Obtain Trade License form the City Corporation/ Municipal Corporation/ Union Parishad office

Process Map

Description: E:\Investment Procedures\Raw Process Map\Trade License

Required Document

13.  Application Form

14.  National ID Card of the Entrepreneur

15.  Holding Tax Payment receipt

16.  Recent Passport Size Photo of the Entrepreneur

17.  Declaration  of  non –Judicial stamp to abide by the rules & regulation of City Corporation & Municipal Corporation

18.  A certified copy of the memorandum and articles of association

19.  A copy of the certificate of incorporation

20.  Agreement of Parthership

21.  Tax Identification Number certificate

22.  A copy of the lease agreement of the registered office

23.  Work Permit from Board of Investment

24.  Statement of Bank Solvency

 

Time

7 days

Fee

Application Fee: BDT 10.00

License Fee: Ranges from BDT 1000-20000 which depends on the nature /type of the business (Informatin can be collected form City Corporation/ Municipal Corporation/ Union Parishad)

For Limited company, License fee is determined on the basis of paid up capital.

Contact

City Corporation, Municipal Corporation& Union Parishad Office

For Dhaka City

Dhaka South City Corporation (DSCC)

Nagar Bhaban, Fulbaria, Dhaka-1000

Phone:- +8802 9563504, +8802 9563506

Email: administrator@dhakacity.org

Website: http://www.dhakasouthcity.gov.bd/

Dhaka North City Corporation (DNCC)

Nagar Bhaban, House # 81, Gulshan, Dhaka 1212

 Phone: +88-02-9896111

 Fax:  +88-02-9894391

Email: cro@dncc.gov.bd

Website: http://www.dncc.gov.bd

 

 

Procedure 8: VAT Registration

For VAT purposes, companies register with the Customs, Excise, and VAT Commissionerate under the National Board of Revenue. The company's VAT is regulated by the Customs, VAT and Excise Department of the region in which it operates. When an enterprise submits a VAT Registration application to the VAT authority an application must accomplish or enclosed the Trade License, Bank Solvency Certificate, TIN Certificate, Copy of BOI Registration & Deed of Agreement.

Responsible Agency

National Board of Revenue (NBR)

Legal Basis of the Registration

The Value Added Tax Act, 1991

Process Step

Step 1:  Collecting prescribed application form from the NBR Zonal Office or NBR website

Step 2: Submitting filled in application form with supporting documents to the Zonal Office

Step 3: Verifying the documents by NBR officials 

Step 4: Physical inspection of the business premises

Step 5: Obtaining a VAT Registration Certificate

 

 

 

 

Process Map

Description: E:\Investment Procedures\Raw Process Map\VATn

Required Document

  1. Fill-up an application form
  2. Enterprise Trade License.
  3. Bank Solvency Certificate.
  4. Owners 02 photograph
  5. National ID/Passport copy of owners.
  6. IRC/ERC if enterprise is doing Import and Export Business
  7. Article & Memorandum of Association (if enterprise is Limited Company.)
  8. TIN Certificate
  9. Location map of Enterprise premises
  10. Copy of BOI Registration
  11. Deed of Agreement 

 

Time

1-2 Working day

Fee

No Charge

Contact

National Board of Revenue (NBR)

Segun Bagicha, Dhaka-1000

Phone: +88-02-9358223

Website: http://www.nbr-bd.org/

 

Procedure 9: Registration with the Board of Investment (BOI)

A foreign investor is required to be registered with BOI. It is essential to obtain many licenses and permits such as Import Registration Certificate, Export Registration Certificate, Bond License, etc to run business in Bangladesh. The BOI registration is also mandatory for obtaining industrial plot in the special economic zone. The investor needs to collect the application form from BOI and submit the filled up form along with supporting documents to the respective department of BOI.

Legal Basis of the Registration

The Investment Board Act-1989

Responsible Agency

Board of Investment (BOI)

 

Process Step

Step 1:  Collect a local investment registration form from Registration & Investment Division of BOI

Step 2: Deposit the Registration fee, as per fee schedule from any scheduled bank in favor of Executive Chairman and Member Secretary of BOI and collect a pay order/bank order

Step 3: Submitt the completed application form with supporting documents to the concerned section

Step 4: BOI reviews the application and documents

Step 5: If the application is approved, the Regisrtation Certificate will be issued

 

Process Map

Description: E:\Investment Procedures\Raw Process Map\BOI

Required Document

1.     Application in duly filled in prescribed form

2.     Trade License

3.     Certificate of Incorporatin along with Memorandum of Association (MOA)

4.     Partnership Deeds

5.     Deeds of the proposed land

6.     Project profile,if the total project cost exceeds BDT 100 million

7.     Background of the proprietors in officials letter head pad

8.     Pay Order/Bank Order for applicable registration fee in favor of Executive Chairman and Member Secretary of BOI

9.     TIN Certificate

 

Time

15-30 working days

Fee

 

 

 

 

 

 

 

 

 

 

 

 

Registration fee for local Investment

Registration fee for foreign Investment

Amount (BDT)

 Required fee(BDT)

 Amount (BDT)

 Required fee(BDT)

Up to 1 Crore

 5,000/-

 Up to 10 Crore

 5,000/-

10-25 Crore

 10,000/-

 10-25 Crore

 10,000/-

25-50 Crore

 25,000/-

 25-50 Crore

 25,000/-

50-100 Crore

 50,000/-

 50-100 Crore

 50,000

Over 100 Crore

 1,00,000/-

 

 

 

Contact

Board of Investment

Prime Minister’s Office

JibanBima Tower (19th Floor)

10 Dilkusha C/A, Dhaka-1000, Bangladesh

PABX: +880 2 957 7271-2, Fax: +880 2 956 2312

Email : service@boi.gov.bd, Website : www.boi.gov.bd