DOING BUSINESS IN BANGLADESH IN 2023
Since 2003, Healy Consultants Group has assisted our Clients with business registration in Bangladesh. Our services include i) Bangladesh company registration ii) government license registration iii) business bank account opening iv) employee recruitment v) visa strategies and vi) office rental solutions.
Although Bangladesh is not particularly known as a business hub in Asia and registering a company in Bangladesh can be fairly time consuming, the country’s rapidly growing economy and the Board of Investment’s renewed efforts to attract foreign investment makes Bangladesh an attractive country for our Clients interested in Asia.
|Compare different Bangladesh entities||Tax resident LLC||Free zone LLC
||R&D company||Representative office||Branch office|
|Also known as||Private corporation||Economic zone LLC||R&D company||Liaison office||Branch office|
|Best use of company?||All products and services||Manufacturing and export trading||Research & Development||Marketing & research||Specific projects|
|How soon can you invoice Clients\sign sales contracts?||5 weeks||2 months||2 months||6 weeks||6 weeks|
|How soon can you hire staff?||5 weeks||2 months||2 months||6 weeks||6 weeks|
|How soon can you sign a lease agreement?||1 week||1 week||1 week||1 week||1 week|
|How long to supply corporate bank account numbers?||3 months||3 months||3 months||3 months||3 months|
|How long to supply company registration/tax numbers?||5 weeks||2 months||2 months||6 weeks||6 weeks|
|Corporate tax rate on annual net profits?||35%||0%||35%||0%||35%|
|Limited liability entity?||Yes||Yes||Yes||No||No|
|Government grants available?||Yes||Yes||Yes||No||No|
|Government approval required for foreign owners?||No||No||No||No||No|
|Resident director/partner/manager/ legal representative required?||No||No||No||Yes||Yes|
|minimum paid up share capital?||US$1||US$100,000||US$1||US$50,000||US$50,000|
|Can bid for Government contracts?||Yes||Yes||Yes||No||Yes|
|Corporate bank account location?||HSBC||Dutch-Bangla Bank||IBBL||Sonali Bank||Standard Chartered|
|Can secure trade finance?||Yes||Yes||Yes||No||Yes|
|VAT payable on sales to local customers?||15%||0%||15%||Cannot trade||15%|
|Average total business set up engagement costs?||US$14,710||US$22,720||US$18,740||US$18,380||US$17,950|
|Average total engagement period?||3 months||3 months||3 months||3 months||3 months|
Bangladesh business setup summary
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Advantages and Disadvantages
Advantages of Bangladesh company registration
- Over the past 5 years, Bangladesh has been growing at an annual rate of approximately 6%, mainly due to its limited but progressing industrial and services sectors;
- The Government encourages investment in manufacturing and export oriented businesses through tax rebates, subsidies, tax holidays and various other incentives;
- Our Clients can freely repatriate their profits from the Bangladesh resident company to their home country;
- Bangladesh business registration allows for 100% foreign ownership;
- There is no minimum capital to form a company in Bangladesh;
- Entrepreneurs who register a business in Bangladesh enjoy tax exemptions including interest on loans, capital gains tax and costs incurred from remuneration paid for foreign technicians in certain sectors;
- Healy Consultants supports Clients who are starting a Bangladeshi company by opening a corporate bank account. Major international banks are present in Bangladesh, including HSBC, Standard Chartered, and Citibank;
- Bangladesh has a literacy rate of 73% (UNESCO, 2016). This together with a low minimum wage of US$18 per month is attractive for investors that can hire skilled labour at affordable prices.
Disadvantages of Bangladesh company registration
- Company registration in Bangladesh can be hindered by taxation requirements. The corporate taxation rate is 35%. However, tax holidays and other Bangladeshi tax incentives are available;
- According to the World Bank’s Doing Business 2015 Survey, Bangladesh is negatively ranked as the world’s 172nd easiest place to start a business. Starting a business in Bangladesh requires several procedures, taking up to five weeks to complete;
- Bangladesh suffers from a substandard international business reputation. The Bangladeshi economy ranks a poor 109th out of 148 countries in the World Economic Forum’s Global Competitiveness Report 2014-2015;
- According to the 2015 Index of Economic Freedom by the Heritage Organisation, Bangladesh’s economy is the 131st freest in the world, although improvements to free trade and investment policies have resulted in improvements within aspects related to business freedom;
- The economy of Bangladesh witnesses widespread corruption and has been poorly ranked at the 143rd position (out of 176 countries) in the 2017 Corruption Perceptions Index by Transparency International.
Best uses for a Bangladesh companyMany international fashion brands use Bangladesh as a manufacturing base thanks to a large labour force and low wages.
Import/export companies are also popular in Bangladesh due to the volume of commodities required to fuel the local manufacturing industries.
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Useful links for Bangladesh
Government and public authority websites:
- Ministry of Finance
- Bangladesh Tax Authority
- Ministry of Commerce
- Central Bank of Bangladesh
- Dhaka Stock Exchange
- Investment Authority
- Bangladesh airport
- An Investment Guide to Bangladesh
- Foreign Direct Investment in Bangladesh: Problem & Prospects.
- Cost of Doing Business in Bangladesh
- Private Sector Development Program in Bangladesh
- World Bank: Bangladesh Economic Update.
- The World in 2050
- Investing In Bangladesh: A Guide for new investors