Business Startup Process in Bangladesh

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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 outset, 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 theBangladesh Investment Development Authority (BIDA) for registration.

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 (Click here) 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
Time	Less than one day (online procedure)
Fee	BDT 200.00 for each of the proposed names BDT 200.00 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

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
Required Document	No document is required
Time	1 day
Fee	For affixing on the Memorandum of Association: BDT 1,000.00 for affixing on the Articles of Association: BDT 2,000.0-10,000.0
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

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 1,000.00

For affixing on the Articles of Association:

For Authorized Capital (BDT)	Stamp (BDT)
Up to 10,00,000.00	3,000.0
> 10,00,000.00 up to 3,00,00,000.00	8,000.0
> 3,00,00,000.00	20,000.0

Registration fee:

For filing 6 documents (5 filled in forms plus 1 memorandum & articles of association, @ BDT 400.00 per document): BDT 2,400.00

For the authorized share capital:

For Authorized Capital (BDT)	Fee (BDT)
(Up to 20,000.00 )	0.00
Additional for every 10,000.00 or part after first 20,000.00 up to 50,000.00	0.00
Additional for every 10,000.00 or part after first 50,000.00 up to 10,00,000.00	0.00
Additional for every 10,000.00 or part after first 10,00,000.00 up to 50,00,000.00	50.00
Additional for every 1,00,000.00 or part after first 50,00,000.00	80.00

Fee

Public Company (Companies Act, 1994)

Stamps:

For affixing on the Memorandum of Association: BDT 1000.00

For affixing on the Articles of Association:

For Authorized Capital (BDT)	Stamp (BDT)
Up to 20,00,000.00	4,000.0
> 20,00,000.00 up to 6,00,00,000.00	8,000.0
> 6,00,00,000.00	20,000.0

Registration fee:

For filing 8 or 9 documents (7 or 8 filled in forms plus 1 memorandum & articles of association, @ BDT 400.00 per document): BDT 3,20000 or 3,600.00

For the authorized share capital:

For Authorized Capital (BDT)	Fee (BDT)
(Up to 20,000.00 )	0.00
Additional for every 10,000.00 or part after first 20,000.00 up to 50,000.00	0.00
Additional for every 10,000.00 or part after first 50,000.00 up to 10,00,000.00	0.00
Additional for every 10,000.00 or part after first 10,00,000.00 up to 50,00,000.00	50.00
Additional for every 1,00,000.00 or part after first 50,00,000.00	80.00

Fee

Foreign Company (Companies Act, 1994)

Fee:

For filing 6 document (1 memorandum and articles of association @ BDT 400.00 and 5 other documents @ BDT 400.00 per document): BDT 2,400.00

ii . For the Memorendum of Association & the Article of Association = BDT 2,000.00

Fee

Trade Orgainzation (Companies Act, 1994)

Stamp Fee:

For the Memodendum of Association: BDT 1,000.00
For the Articles of Association: BDT 2,000.00

Registration Fee:

For filing 6 documents (5 filled in forms @ BDT 200.00 per document plus 1 memorandum & articles of association, @ BDT 600.00): BDT 1,600.00
For the number of members of association:

For up to 20 :	BDT 1,000.00
For >20 up to 100 :	BDT 2,500.00
For every 100 or part above the first 100 (limited member) :	BDT 300.00
For unlimited members :	BDT 7,500.00

Fee

SOCIETY (Societies Registration Act, 1860)

Registration Fee: BDT 1000.00
Registration Filing Fee: BDT 400
For issuance of digital certificate = BDT 00.00

Fee

PARTNERSHIP FIRM (Partnership Act, 1932)

Registration fee: BDT. 1000.00
Registration Filing Fee: BDT 400.00
For issuance of digital certificate = BDT 00.00

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 Ma
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.

In case of online registration for TIN, you have to click on this link first. Then a page will open. On this page you have to enter user name, password, email id, phone number etc. Fill in the information correctly and capture the code letter or number indicated in the box below. Then click on the registration button. Soon an activation code will come on the mobile phone. You have to write it online. Then you have to log in and fill the TIN registration form. After filling in all the information, click on the "submit application" button, then the TIN number and certificate will be created.

Legal Basis of the License	THE INCOME TAX ORDINANCE, 1984
Responsible Agency	National Board of Revenue (NBR)
Process Step	Step 1: Apply along with NBR through e-TIN Registration Website (http://secure.incometax.gov.bd/TINHome) Step 2: Fill out the prescribed online form Step 3: Accepting TIN certificate
Time	Instantly for online method 2 days for manual processing
Fee	No Charge
Contact	National Board of Revenue (NBR) Segunbagicha, Dhaka-1000 Phone: +88-02-8318120-26 Website: http://www.nbr-bd.org/

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
Required Document	Fill-up an application form Enterprise Trade License. Bank Solvency Certificate. Owners 02 photograph National ID/Passport copy of owners. IRC/ERC if enterprise is doing Import and Export Business Article & Memorandum of Association (if enterprise is Limited Company.) TIN Certificate Location map of Enterprise premises Copy of BOI Registration 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 Bangladesh Investment Development Authority (BIDA)

A foreign investor is required to be registered with BIDA . 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 BIDA registration is also mandatory for obtaining an industrial plot in the special economic zone. The investor needs to collect the application form from BIDA and submit the filled up form along with supporting documents to the respective department of BIDA.

Legal Basis of the Registration

The Investment Board Act-1989

Responsible Agency

Bangladesh Investment Development Authority (BIDA)

Process Step

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

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

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

Step 4: BIDA reviews the application and documents

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

Process Map

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/-