Company Registration in Bangladesh

Company Registration in Bangladesh

This tutorial will provide you a thorough rundown of the steps, deadlines, and requirements for creating a private limited business in Bangladesh. Bangladesh has a set of initial and continuing regulatory compliance requirements for establishing and running a business, just like the majority of other nations.

Keep in mind that the majority of businesses in Bangladesh are registered as private limited liability companies (often referred to as private limited companies) when thinking about registering a new company or moving your current one there. It is important for you to be aware that One Person Company (OPC) is covered. However, we do not advise our clients to form an OPC due to specific limits.

In Bangladesh, a private limited company is a distinct legal entity, and its shareholders are only responsible for the amount of share capital they have contributed to the business’s debts. Any individual (local or international) above the age of 18 may register a business in Bangladesh, according the Companies Act of 1994.

We suggest reading our page on foreign investment if you are a foreign investor. It will assist you in comprehending Bangladesh’s foreign investment laws.

PRE-REGISTRATION: ESSENTIAL INFORMATION

Crucial Details Regarding Company Formation

Name of Company. The company must first get approval (clearance) for the name before incorporating in Bangladesh.

Directors. There must be a minimum of two directors. Directors may be international or domestic. Directors must be at least eighteen years old, insolvent, and free of prior convictions for any kind of misconduct. A director is required by law to have the qualifying shares specified in the association’s articles of association. A nominee director may be chosen by a shareholder who is not a natural person, such as a corporation.

Owners of shares. In Bangladesh, a private limited corporation may have two or up to fifty shareholders. A shareholder and a director may be one and the same or separate individuals. A person or another legal entity, like a different firm, may be the shareholder. In most sectors, 100% local or foreign shareholding is permitted. Following the Bangladeshi company’s incorporation, shares may be issued again or transferred to a different individual at any moment.

Authorized Capital. The permitted capital must be specified in the association’s articles and memorandum. It is the highest share capital that the business is permitted to distribute to its owners. A portion of the approved capital may not be distributed. Bangladesh does not have a minimum or maximum amount of permitted capital.

Paid-For Capital. Taka 1 is the minimum paid-up capital required to register a business in Bangladesh. Following the company’s incorporation, paid-up capital, commonly referred to as share capital, may be increased at any moment.

Address of Registration. You need to offer a local address as the company’s registration address while registering a business in Bangladesh. A P.O. Box cannot be used as the registered address; instead, it must be a physical address, either residential or commercial.

The association’s articles and memorandum. A memorandum of association (MoA) and articles of association (AoA) must be prepared by the firm that is going to be formed.

Foreigners and Company Registration in Bangladesh

When opening a business in Bangladesh, foreigners need to consider the following factors:

In order to proceed, you must register a bank account in the proposed company’s name, deposit the initial paid-up capital, and receive name clearance from the Registrar of Joint Stock Companies and Firms (RJSC), or the registrar of companies. In Bangladesh, this is a need for company incorporation.
It is possible to complete all company incorporation procedures without needing to travel to Bangladesh. Depending on the bank you select, opening a bank account can be the lone exception.
Foreign nationals may be all of the directors and shareholders.
If your intention is just to incorporate a private limited business and you do not want to move to Bangladesh, you do not need to obtain any special visa for Bangladesh. You are allowed to run your business from abroad and to enter Bangladesh with a business visa whenever necessary to handle urgent business problems.
You need to get a work permit if you intend to move to Bangladesh to run your business.
ESSENTIAL DOCUMENTS

The company registrar needs the following details in order to process the incorporation of a business in Bangladesh:

Name of Company. It is necessary to get a name clearance.
The articles of association and the memorandum of association. According to RJSC, the MoA’s object clause must not exceed 400 words or 7 clauses.
Details about the Shareholder (National ID if the shareholder is a Bangladeshi)
Details on the Directors, including Tax Identification Number
Subscriber Page with Form IX with Registered Address Singed. A scanned copy in PDF format is necessary.
Regarding foreign nationals: A copy of the directors’ and shareholders’ passports.
RECRUPITION METHOD

In Bangladesh, some of the company registration process is computerized.

The process of setting up a business in Bangladesh consists of three separate steps: a) Name clearance; ii) opening a bank account and depositing funds; and, lastly, b) company registration. Only in the event that the proposed firm has any foreign shareholders is step II applicable.

Step 1: Name Clearance of Company

Getting name clearance for the proposed company name would be the first step towards establishing a business in Bangladesh. You must first register for an account at www.roc.gov.bd. After that, you can submit an application for name clearance. You will receive a bank payment slip after submitting your application for name clearing, and you must pay Taka 600 to the specified bank. You will receive the name clearance after logging into your account on the RJSC website and making the payment.

You can read the RJSC-prepared advice for name clearing here.

Use Mozilla Firefox and Internet Explorer when visiting the RJSC website, as a tip. Another browser might not function correctly.

Increase your chances of receiving name approval quickly by ensuring the name:

is not offensive or vulgar; it is not too similar to any already-existing local firm names; it does not violate any trademarks; it is not already reserved;
A name that has been approved will be held for six months following the approval date. Just before the name’s expiration date, you can request an extension in order to keep using it.

Step 2: Opening a bank account and transferring the paid-in capital

This stage is only necessary if there is foreign ownership in the proposed company.

The next step is to register an account with any Bangladeshi scheduled bank under the desired company name. You must deposit funds into the account after it is opened in an amount equivalent to the number of shares that the foreign shareholder from outside Bangladesh would own. RJSC will need an Encashment Certificate, which the Bank will provide, in order to incorporate.

Step 3: Set Up Your Business

The final step is to fill out the RJSC website with all the necessary information. You will also need to upload the Subscriber Page and Form IX. You will be sent a bank payment slip to pay the registration costs and stamp duty after completing the entire process.

You can read the guide that RJSC has created for uploading all of the data to the RJSC website.

You’re done once you’ve made the bank payment. You must now follow up with the RJSC in order to receive the certificate of incorporation. Officials from RJSC will review the material and documents. Once they are satisfied, they will digitally sign the following documents: i) the MoA and AoA; ii) the Certificate of Incorporation; and iii) Form XII. Your email address linked to your RJSC account will get these papers by mail.

Rarely, but occasionally, the incorporation process may be delayed if any of the directors or shareholders are members of a particular nationality. The authorities may request more information in such circumstances.

RECORDS AVAILABLE FROM RJSC:

Certificate of Incorporation:

RJSC will provide the business with a Certificate of Incorporation. The company name, registration number, and incorporation date will all be on the certificate.
Form XII: The incorporated company’s list of directors is located on Form XII.
Certified AoA and MoA copies
Other things that you will most likely require while registering your business in Bangladesh include:

• Certificates of shares for every shareholder.
• Register directors, shares, shareholders, and so forth.
• The company’s seal
• A company’s official seal of approval for trade license, tax identification number, and other license applications

Following incorporation, you ought to purchase or lease real estate in any commercial district.

After that, you must apply for a tax identification number and a trade license. You can require additional business licenses based on the operations of your organization.

REQUIREMENTS FOR RETURN FILING

Annual Return: There must be an Annual General Meeting every calendar year. The AGM must be held within 18 months of the company’s incorporation, and there can be a maximum of 15 months between AGMs after that.

Regular Return: Within a certain timeframe, a pertinent return must be filed with the RJSC in the event that the board of directors, the shareholding structure, or any other change occurs.