Wholly foreign own share holding company registration in Bangladesh
Required documents are:
a. Application Forms
b. Certificate of Incorporation
c. Memorandum of Association – MOA
d. Article of Association – AOA
e. Joint Venture Agreement (if any)
f. Attested copy of deed agreement for rental premises
g. Project Profile
h. Background of the promoters (shareholders)
i. List of Machineries indicating quantity and price
j. Copy of the relevant Loan documents
k. Pay Order/Bank draft for the fee
Other:
1. Factory: Approval of Factory Plan
2. Bonded Warehouse License
3. Registration of Local Investment Project
Industrial Registration Application
Application for BOI Industrial Registration with following supporting documents:
a. Project Profile
b. MOA
c. AOA
d. Land Information & Document
e. Machinery Details
f. Financing sources
g. TIN (Tax Identification Number)
h. Import Registration Certificate- IRC
i. Export Registration Certificate – ERC
j. BOI Recommendation Letter (for Visa)
k. Visa Application
l. Work permit
m. Environment Certificate
n. Social Compliance
Joint Venture Company Registration in Bangladesh
• Memorandum & Article of Association
• Trade License
• Tax Certificate (Company & Individual)
• Encashment Certificate against Paid Up Capital (Encashment shall be issued by schedule bank of Bangladesh)
• Passport copy
• Address in Bangladesh & Contact detail
• PI Visa (For investors) & EI Visa (For foreign employee) from BOI
• USD 50,000 has to deposit in terms of PI & EI Visa & inward remittance, Office expenses & so on as government rules.
Branch Office open in Bangladesh, Liason Office open in Bangladesh
The following papers & information are required to open branch office:
1. Government of Bangladesh (Ministry of Industries), BOI- Dhaka;
2. Bangladesh Bank, Dhaka;
Government of Bangladesh (Ministry of Industries)/ BOI
1. Full name, address, telephone, fax numbers of the principal company, with country of origin;
2. Intended field of business in Bangladesh through proposed Branch Office;
3. Function of the principal company/firm in brief;
4. Date of operation of the proposed Branch Office;
5. Period for which permission is sought;
6. Proposed organizational set up of the company’s Branch Office;
7. Initial approximate expenditure and operational expenses of the company’s Branch Office and source and nature of inflow of money required for running the Branch Office for the purpose;
8. Certificate of Incorporation of the principal company and resolution of the Board of Directors to establish a Branch Office in Bangladesh, duly notarized and authenticated by the High Commission/Embassy of Bangladesh in the country of origin
9. Power of Attorney given in favour of The Law Assistant duly notarized and authenticated by the High Commission of Bangladesh in the country of origin.
10. Memorandum and Articles of Association of the principal company, duly executed, notarized and authenticated by the High Commission/Embassy of Bangladesh in the country of origin
11. USD 50,000 has to deposit in bank initially as rules of government of Bangladesh for inward remittance, Work Permit, Office expenses & so on.
Bangladesh Bank
1. Full name, address, telephone, fax numbers of the principal company, with country of origin;
2. Place of incorporation and registration of the principal company in the country of origin;
3. Name, address and nationality of the Directors of the principal company as well as their place of permanent residence;
4. Authorized and paid-up share capital of the principal company, both equity and preferential (if applicable);
5. Any share held in the principal company by Bangladeshi national or company registered in Bangladesh with full particulars (name of the shareholder, nationality, number and value of shares held);
6. Particulars of the activity (trading/commercial/industrial/consultancy) of the Principal Company;
7. Name and address of the Bangladeshi agent/representative if any (including nature of activities undertaken or the services rendered by Bangladeshi agent/representative and term including remuneration payable to agent/representative);
8. Source of finance to the Branch Office in Bangladesh;
9. Whether surplus earning, if any in Bangladesh, to be remitted abroad;
10. Whether any foreign personnel will be employed; if so, a list giving the names and nationalities of such persons, their designation, period of employment, for working in Bangladesh and particulars of government approval for their employment;
11. Certificate of Incorporation of the principal company, duly notarized and authenticated by the High Commission/Embassy of Bangladesh in the country of origin-two copies including one original;
12. Memorandum and Articles of Association of the principal company, duly notarized and authenticated by the High Commission/Embassy of Bangladesh in the country of origin – two copies including one original;
13. Resolution passed by the Board of Directors for establishment of branch/liaison office in Bangladesh duly notarized and authenticated by the High Commission/Embassy of Bangladesh in the country of origin-two copies including one original;
14. Appointment letter of the local Manager/Branch Representative, if any, in the line of a Board Resolution duly notarized and authenticated by the High Commission/Embassy of Bangladesh in the country of origin;
15. List of local employees if appointed;
Power of Attorney favouring the legal representative duly executed.
What are the conditions given from BOI (normally) in case of opening branch office in Bangladesh BUT it varies upon activities & types of company?
• You have to strictly follow foreign exchange regulations of government
• All operational , functional and establishment costs including salaries of the expatriates and local employees in your office will be met on receipt of remittance from abroad
• No outward remittance of any kind from Bangladesh sources will be allowed
• Quarterly return of any income and expenditure out of remittance from abroad shall have to be submitted to this Board , Dept Commissioner of Taxes , Companies Circle -17 and Bangladesh Bank
• No outward remittance of any kind from Bangladesh sources will be allowed
• You shall have to obtain security from the Ministry of Home, govt. of Bangladesh
• The company shall have to bring inward remittance of at least USD 50,000 within 2 (two) months from date of issue of permission letter as establishment cost and 6 months operational expenses. Failing which the company shall have to remit 5% additional amount for each month.
Income Tax, Remittance of Foreign Investors
Investment in Bangladesh
Bangladesh offers generous opportunities for investment under its liberalised Industrial Policy and export-oriented, private sector-led growth strategy. All but four sectors (i.e. (1) arms and ammunition and other defence equipment and machinery, (2) forest plantation and mechanised extraction within the bounds of reserved forests, (3) production of nuclear energy, and (4) security printing and mining) are open for private investment in Bangladesh. The government’s role is that of a facilitator which helps create an enabling environment for expanding private investment, both domestic and foreign. The Board of Investment (BOI), established by the government for accelerating private investment, provides institutional support services to intending investors.
Tax-holiday
Tax holiday facilities will be available for 5 or 7 years depending on the location of the industrial enterprise. For industrial enterprises located in Dhaka and Chittagong Divisions (excluding Hill Tract districts of Chittagong Division) the tax holiday facility is for 5 years while it is 7 years for locations in Khulna, Sylhet, Barisal, and Rajshahi, Divisions and the 3 Chittagong hill districts. Tax holiday facilities are provided in accordance with existing laws. The period of tax holiday will be calculated from the month of commencement of commercial production. Tax holiday certificate will be issued by NBR (National Board of Revenue) for the total period within 90 days of submission of application.
Tax exemption
Tax exemptions are allowed in the following cases:
* Tax exemption on royalties, technical know-how fees received by any foreign collaborator, firm, company and expert.
* Exemption of income tax up to 3 years for foreign technicians employed in industries specified in the relevant schedule of the income tax ordinance.
* Tax exemption on income of the private sector power generation company for 15 years from the date of commercial production.
* Tax exemption on capital gains from the transfer of shares of public limited companies listed with a stock exchange.
Accelerated depreciation
Industrial undertakings not enjoying tax holiday will enjoy accelerated depreciation allowance. Such allowance is available at the rate of 100 per cent of the cost of the machinery or plant if the industrial undertaking is set up in the areas falling within the cities of Dhaka, Narayangonj, Chittagong and Khulna and areas within a radius of 10 miles from the municipal limits of those cities. If the industrial undertaking is set up elsewhere in the country, accelerated depreciation is allowed at the rate of 80 per cent in the first year and 20 per cent in the second year.
Concessionary duty on imported capital machinery
Import duty, at the rate of 5% ad valorem, is payable on capital machinery and spares imported for initial installation or BMR/BMRE of the existing industries . The value of spare parts should not, however, exceed 10% of the total C & F value of the machinery. For 100% export oriented industries, no import duty is charged in case of capital machinery and spares. However, import duty @ 5% is secured in the form of bank guarantee or an indemnity bond will be returned after installation of the machinery. Value added Tax ( Vat) is not payable for imported capital machinery and spares.
Foreign Investment
Private investment from overseas sources is welcome in all areas of the economy with the exception of the four reserved sectors (mentioned earlier). Such investments can be made either independently or through venture on mutually beneficial terms and conditions. Foreign investment is, however, especially desired in the following major categories of industries:
* Export oriented industries
* Industries in the Export Processing Zones ( EPZs)
* High technology products that will be either import substitute or export oriented.
Facilities/Incentives
(a) For foreign direct investment, there is no limitation pertaining to foreign equity participation, i.e. 100 percent foreign equity is allowed. Non-resident institutional or individual investors can make portfolio investments in stock exchanges in Bangladesh. Foreign investors or companies may obtain full working loans from local banks. The terms of such loans will be determined on the basis of bank-client relationship.
(b) A foreign technician employed in foreign companies will not be subjected to personal tax up to 3 (three) years , and beyond that period his/ her personal income tax payment will be governed by the existence or non-existence of agreement on avoidance of double taxation with country of citizenship.
(c) Full repatriation of capital invested from foreign sources will be allowed. Similarly, profits and dividend accruing to foreign investment may be transferred in full. If foreign investors reinvest their repatriable dividends and or retained earnings, those will be treated as new investment. Foreigners employed in Bangladesh are entitled to remit up to 50 percent of their salary and will enjoy facilities for full repatriation of their savings and retirement benefits.
(d) Foreign entrepreneurs are, therefore, entitled to the same facilities as domestic entrepreneurs with respect to tax holiday, payment of royalty, technical know-how fees etc.
(e) The process of issuing work permits to foreign experts on the recommendation of investing foreign companies or joint ventures will operate without any hindrance or restriction. Multiple entry visa” will be issued to prospective foreign investors for 3 years. In the case of experts,” multiple entry visa” will be issued for the whole tenure of their assignments.
Other Incentives
• Citizenship by investing a minimum of US $ 500,000 or by transferring US$ 1,000,000 to any recognised financial institution ( Non-repatriable ).
• Permanent residentship by investing a minimum of US$ 75,000 ( non-repatriable).
• Special facilities and venture capital support will be provided to export-oriented industries under “Thrust sectors” . Thrust Sectors include Agro-based industries, Artificial flower-making, Computer software and information technology, Electronics, Frozen food, Floriculture, Gift items, Infrastructure, Jute goods, Jewellery and diamond cutting and polishing, leather, Oil and gas, Sericulture and silk industry, Stuffed toys, Textiles, Tourism.
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Email contact@sfconsultingbd.com
S & F CONSULTING FIRM LIMITED
S & F CONSULTING FIRM LIMITED 