Navigating Business Registration in Bangladesh: A Guide for Foreign Investors

Bangladesh offers a range of business structures for foreign investors, including representative offices, wholly foreign-owned enterprises, joint ventures, branches, subsidiaries, and public limited companies. The Registrar of Joint Stock Companies and Firms (RJSC) oversees the registration of new foreign entities and the local registration of companies established abroad.

Sole Proprietorship

A sole proprietorship is the simplest business form, owned and operated by one individual. It requires minimal registration, making it ideal for freelancers and small businesses. However, the owner bears unlimited personal liability for all business debts, which can put personal assets at risk.

Joint Ventures

Joint ventures involve two or more parties collaborating on a specific project or enterprise. They allow for resource, expertise, and risk sharing between local and foreign entities. A legally binding agreement outlines contributions, responsibilities, and profit-sharing. Approval from the Bangladesh Investment Development Authority (BIDA) is mandatory for foreign-involved joint ventures.

Limited Liability Companies

Limited Liability Companies (LLCs) are popular among medium to large businesses in Bangladesh. They offer limited liability protection to members while providing flexibility in management and taxation. An LLC requires at least two and up to 50 shareholders. Registration involves drafting a memorandum and articles of association, securing approvals, and filing with the RJSC.

Branch Offices

Foreign companies can establish branch offices as extensions of their parent entities. Branches operate under the parent's name but must comply with local tax and regulatory requirements, including registration with the RJSC and obtaining necessary permits.

Required Documentation for Company Registration

Registration requirements vary by business type. For joint ventures or wholly foreign-owned enterprises:

Completed application form
Original certificate of incorporation
Memorandum and articles of association
Proof of land purchase or lease
Details of company directors
List of machinery with quantities and values
Evidence of fund remittance

For public limited companies:

Shareholder register with ownership percentages
Director names and investment amounts
Minutes of shareholder meetings
Three proposed company names
Notarized constitutional documents
Director list and registered address

For branches, subsidiaries, or representative offices:

Application form signed by the parent company's legal representative
Parent's memorandum and articles of association
Parent's certificate of incorporation
Legal representative's details and nationality
Board resolution
Audited financial statements from the previous year
Organizational structure and project plan for the local entity

Step-by-Step Registration Process

Joint Ventures or Wholly Foreign-Owned Enterprises

Submit an application to BIDA or the Export Processing Zones Authority with required documents. After registration, apply for utilities, tax identification, seals, and work permits.

Public Limited Companies

Reserve a company name with the RJSC, then submit registration documents, including notarized constitutional papers. Post-registration steps include obtaining business licenses, tax IDs, and industry-specific permits.

Branches, Subsidiaries, or Representative Offices

Apply to BIDA with authenticated documents from the Bangladeshi embassy in the company's home country. All materials must be legally certified.

Bangladesh's Companies Act: Key Legal Framework

The Companies Act of 1994 governs corporate formation, management, and dissolution. It outlines structures like private limited companies, public limited companies, and branches, each with distinct compliance requirements. Companies must register with the RJSC, establish governance bodies like boards of directors, and adhere to financial reporting and auditing standards. The law also regulates mergers, acquisitions, and liquidations to protect stakeholder interests.

Streamlining Employment in Bangladesh with SailGlobal

For businesses seeking to hire talent in Bangladesh without establishing a legal entity, SailGlobal offers Employer of Record (EOR) services. This solution enables compliant payroll, benefits administration, and legal support, reducing administrative burdens. Case studies show that companies using EOR services can onboard employees in as little as two weeks, avoiding complex registration processes. SailGlobal ensures adherence to local labor laws, making it a efficient alternative for market entry.

Company Registration in Bangladesh: A Guide for Foreign Investors