Bangladesh is developing into a dynamic country for entrepreneurs and investors who want to set up a locally incorporated company — a limited company. 

From startups to SMEs, or multinational subsidiaries, Bangladesh provides an environment that supports scalability — enabling companies to adapt to market demands, while benefiting from tax incentives, simplified compliance, and a growing economy.

Local incorporation of a company requires registration under the Companies Act of 1994 along with the Registrar of Joint Stock Companies and Firms (RJSC), providing a legal framework for businesses to operate within the regulatory environment of Bangladesh. 

Here’s an outline on the types of locally incorporated companies, their key features, registration procedure and advantages and challenges of incorporating these companies.

Key features of a private limited company in Bangladesh:

• Limited Liability: Shareholders’ liability is limited to the amount they have invested in the company, and their personal assets may be protected in case of the company’s debts or legal issues. 
• Separate Legal Entity: The company has a distinct legal entity who can own property, enter contracts, and sue or be sued in its own name.
• Membership Limits: The number of shareholders must be two.
• Perpetual Succession: Company continues to exist regardless of changes in shareholders/directors and the ownership can be transferred through share transfer.
• Share Transfer Restrictions: Shares of this company cannot be freely transferred and requires approval from the board of directors.
• Registration Requirements: The company must be registered with RJSC, requires Articles and Memorandum of Association, trade license and TIN certificate.
• Compliance: It must hold annual general meetings and file annual returns and tax returns.
• Name Requirements: The name of the company must end with “Private Limited” or “(Pvt.) Ltd.” The name must be unique and approved by RJSC.

If you are considering setting up other business structures, explore these guides below for more details:

• partnership firm
• Sole Proprietorship
• one person company
• joint venture
• All Foreign business options.
• Non profit company 

Step by Step Registration Procedure of Companies in Bangladesh

Required documents for company formation:

• Memorandum and Articles of Association
• Form I: Declaration on registration of Company;
• Form VI: Notice of situation of registered office;
• Form IX: Consent of director;
• Form X: List of persons consenting to be directors;
• Form XII: Particulars of the directors, manager and managing agents.
• Particulars of Directors i.e. name, parents’ name, passport number, email ID, mobile number

In addition, the following documents are also required: 

i. Name of Managing Director; ii. Name of Chairman; iii. NID; iv. TIN; v. Limit of paid-up capital; vi. Limit of authorized capital; vii. Photo of all shareholders; viii. Address of company; ix. Signatories of the bank account; x. Registered Office Documents; xi. Treasury Challan; xii. Power of Attorney

Step 1: Name Clearance

Obtaining name clearance for the proposed company name from the Registrar of Joint Stock Companies and Firms (RJSC) is the first step in setting up a company in Bangladesh. After the application for name clearance is made, you will receive a bank payment slip and you will get the name clearance from the RJSC website.

Step 2: Drafting the Memorandum and Articles of Association

The Memorandum of the Company should state the primary business objectives, the amount of capital, and state the list of the shareholders along with their respective shareholdings. The Articles of Association should include the list and number of directors, the functions and powers of the board, the roles and powers of the Managing Director and Chairman, the meeting process, notice procedures, the appointment of auditors, and the management of bank and company accounts. You should draft all of the credentials initially before registering a company.

LegalBD can assist you in drafting a professionally written Memorandum and Articles of Association.

Step 3: Bank account opening 

This step is only applicable if the proposed company has foreign shareholding. After opening a bank account, foreign shareholders must deposit the shareholding value into the account, which must be remitted accordingly. The bank will then issue an Encashment Certificate, which the RJSC will require for incorporation.

Step 4: Registration of the Company

As the next step, you must submit all the required information on the RJSC’s website. Once all the documents are submitted, you will receive bank payment slips for paying the registration fees along with stamp duty.

After making the payment to the RJSC bank account, the application for registration will be completed. RJSC officials will then verify the submitted documents and information. If they are satisfied, they will issue the Certificate of Incorporation. You may need to follow up with the RJSC regularly to obtain the Certificate of Incorporation.

Post-Registration Formalities:

The following documents are issued after the completion of registration formalities:

• Certificate of Incorporation: The RJSC will issue a Certificate of Incorporation, which includes the registration number, company name, and date of incorporation.
• Form XII: This document contains the list of directors of the incorporated company.
• Certified Copies of the Memorandum and Articles of Association.
• After incorporation, the company must either purchase or lease commercial space in a designated business area. 
• Subsequently, it must apply for various Trade Licenses, obtain VAT registration number, and a Tax Identification Number (TIN).
• Fire certificate and Environment Clearance Certificate are also required depending on the nature of the company.
                                                          

Detailed FAQ on Company Registration in Bangladesh

1. How long does the incorporation process of a company take?

Generally it takes 3-30 working days, depending on documentation completeness and RJSC processing time.

2. Can a single person start a company in Bangladesh?

Yes. A single person can form a One Person Company (OPC) under the Companies (Amendment) Act 2020.

3. Can a private limited company have one director in Bangladesh?

A private limited company must have at least two directors. Local or foreign nationals both may serve as director subject to necessary permits and security clearances.

4. What are the annual compliance requirements?

• Filing annual returns with RJSC
• Holding Annual General Meeting 
• Maintaining statutory books and registers
• Filing income tax returns
• Audit of financial statements

5. Can a company name be reserved before incorporation?

Yes, a company’s name can be reserved through RJSC’s online portal following the naming guidelines which shall be valid for 180 days.

6. What are the costs involved in incorporation?

• Registration fees based on authorized capital
• Name clearance fees
• Bank account opening fees
• Professional fees for company secretary/lawyer
• Annual filing fees

7. What documents are needed to start a business in Bangladesh?

• Memorandum of Association
• Article of Association
• Certificate of Incorporation
• Trade License
• TIN
• VAT Registration Certificate
• Name Clearance
• Environmental Clearance Certificate
• Fire Certificate

8. Can a company be converted from private to public limited company?

Yes, a company can be converted from a private limited company to a public limited company by passing a special resolution by the board of directors, amending the company’s Memorandum and Articles of Association, and filing the required forms with the RJSC.

9. Are there any special requirements or restrictions in incorporating a company in Bangladesh?

Although there are no limitations on the kinds of business exercises, some companies, like running a travel service, register office, monetary administrations company, school or other exceptional cases require licenses from a supporting authority before you can begin business.

10. Can foreigners incorporate a company in Bangladesh?

Yes, foreigners can incorporate a company in Bangladesh according to the Companies Act, allowing them to fully own a company as a foreign investor. Foreign investors need to register with the Bangladesh Investment Development Authority (BIDA) to operate a business in the country.