In Bangladesh, there are two types of limited company such as (i) Private Limited Company and (ii) Public Limited Company. To register a Private Limited company, minimum two and maximum fifty directors are required. On the other hand, for Public Limited Company minimum member should be seven and the maximum is unlimited. For incorporating a Joint Venture Company by foreign investors there must be at least one Bangladeshi and one foreigner. However, the foreign investor is required to make an inward remittance of no less than $50,000 if they intend to hire foreign employees. In order to remit this amount a bank account in any Bangladeshi scheduled bank in the name of proposed company is required. After receiving the remitted amount the bank will issue an encasement certificate.
In order to register a company one needs to complete few steps. At first, one must search into the RJSC database to check whether the desired name is vacant or available. If it is available, he/she must apply for the name clearance by paying the govt. fees.
As we already said, minimum two directors are mandatory. Directors can be either local or foreign. Directors must be at least 18 years of age and must not be bankrupt or convicted for any malpractice in the past. The law requires that a director must own qualification shares stated in the Articles of Association. A shareholder who is not a natural person (i.e. a company) can select nominee director.
In a company there are two types of capital as such Authorized Capital and Paid-up Capital. One must state the authorized capital in the Memorandum of Association and Articles of Association. The registration fee depends on the amount of authorized capital. It is the maximum amount of share capital that the company is authorized to issue (allocate) to shareholders. Part of the authorized capital can remain un-issued. There is no minimum or maximum limit for authorized capital in Bangladesh. Minimum paid-up capital for registration of a Bangladeshi company is Taka 1. Paid-up capital (also known as share capital) can be increased anytime after the incorporation of the company.
In order to register a company in Bangladesh, a local address as the registered address of the company will also be required. The registered address must be a physical address (can be either a residential or commercial address) and cannot be a P.O. Box.
Finally, after getting the incorporation certificate from RJSC, in order to initiate business one must obtain primarily the following certificates and licenses.
- Trade License
- TIN Certificate
- VAT Certificate
- IRC (For Import Business)
- ERC (For Export Business)
Bangladesh government encourages the foreign investors to invest in Bangladesh. Many investors from different countries come here to invest & setup a company. Advocacy Legal provides complete legal services to its foreign and local clients to setup and run a new business in Bangladesh.