Thinking about Bangladesh and stuck between a Branch office and a Liaison office? You’re not alone. The choice usually comes down to one question: do you need to sell and invoice locally right now, or do you mainly need a smart, lightweight presence that builds the pipeline and keeps you compliant?
Let’s break it down so you can choose fast and avoid headaches later.
If you want to generate local revenue, sign local contracts, and invoice in taka, a Branch office is your workhorse. If you want a low‑friction footprint to do market research, partner coordination, supplier audits, and support the parent company without earning local income, a Liaison office fits. Under Bangladesh rules, liaison offices are explicitly “no local income,” while branch offices can conduct limited commercial activities that match what BIDA approves for you.
Branch office in one minute
A Branch is an extension of your foreign company. Think of it as your parent company operating on the ground in Dhaka.
What it lets you do: sign local contracts, import parts, deliver services, and earn local revenue in the areas BIDA approves. You will register for taxes and file returns in Bangladesh. Profit repatriation is allowed if you follow foreign exchange rules and have the right paperwork in place. Initial permission typically runs 3 years and can be extended in 2‑year blocks.
Regulatory checkpoints you’ll care about:
BIDA approval for the branch scope.
RJSC filing as a foreign company with a place of business in Bangladesh. You need to deliver the prescribed documents within one month of establishing that place of business.
Tax registrations and ongoing compliance in Bangladesh.
Liaison office in one minute
A Liaison office is your non‑commercial outpost. It keeps you close to customers and suppliers, but without local income.
What it lets you do: market research, local coordination, quality checks, training, and communication between Bangladesh stakeholders and your overseas HQ. The law is clear here: no local source of income for liaison or representative offices. Expenses are funded by inward remittances from HQ. Permission is again 3 years to start, with extensions available.
Good to know: staff visas and work permits are handled through BIDA. E‑visa recommendations can be issued in about 24 hours and standard work permits typically list 16 working days as the processing time, with a government fee posted on BIDA’s service page.
Branch Office vs Liaison Office at a glance
Question | Branch Office | Liaison Office |
|---|---|---|
Can we earn local revenue? | Yes, but within the BIDA‑approved scope | No local income at all |
Can we invoice in Bangladesh? | Yes, for approved activities | No, not for commercial activities |
Primary regulator for setup | BIDA approval, then RJSC filings | BIDA approval, then RJSC filings |
Validity of permission | 3 years to start, extendable by 2 years each time | 3 years to start, extendable by 2 years each time |
Funding day to day | Local revenue plus HQ remittances | HQ remittances only |
Tax impact | Taxed on Bangladesh‑sourced income, must file returns | No local income, but still typical filings and reporting obligations |
Typical use case | You will sell, service, or execute contracts locally now | You will test the market, support partners, or run QC without selling locally |
The “no local income” rule for liaison, the limited commercial scope for branches, and the 3‑year plus 2‑year renewal framework come straight from BIDA’s published procedure. The one‑month RJSC filing window is in the Companies Act, Section 379.
How companies actually decide
Scenario 1: Pipeline now, sales later
A European health‑tech vendor wanted a presence to run hospital trials, train staff, and support tenders. They did not need local invoicing yet. They opened a Liaison office, funded it from HQ, and kept operations lean. Twelve months later, once tenders converted, they upgraded to a Branch to invoice locally. That two‑step path avoided early tax complexity and still kept momentum on the ground.
Scenario 2: Services from day one
A regional engineering firm needed to execute maintenance contracts and bill customers inside Bangladesh. They went straight to a Branch office. They mapped their statement of work to the BIDA application so the approved scope matched the real business. That avoided awkward amendments later and kept the auditors happy.
Scenario 3: Consumer brand testing the waters
A lifestyle brand wanted store checks, distributor audits, and content localization. A Liaison office made sense. They kept sales offshore while fine‑tuning pricing and compliance. When the numbers worked, they incorporated a local subsidiary for full commercial play. Branches and subsidiaries both work for sales, but a branch is faster if you need an extension of HQ rather than a new company.
Useful context for 2024–2025
Bangladesh is still attracting greenfield interest, but net FDI has been choppy. Provisional figures show FY24 net FDI around 1.47 billion dollars, down from the prior year, and press coverage through mid‑2025 notes continued softness. Translation for you: the bar for clean compliance and strong documentation is not getting lower.
What the regulators actually look for
BIDA: scope, people, and money flows
BIDA approves the office type and the activities you can perform. For liaison, the rule is plain language: no local income. For branch, BIDA expects your commercial scope to match your application. Profit repatriation for branches must follow foreign exchange rules and is tied to audited retained earnings, with Bangladesh Bank approval where not generally authorized.
RJSC: file within one month
Once you establish a place of business, the Companies Act requires foreign companies to deliver core documents to the Registrar within one month. Miss that, and you invite fines and practical trouble later. This applies to both branch and liaison.
Bangladesh Bank: foreign exchange guardrails
Moving money in or out needs care. Branch profit remittances and certain payments require Bangladesh Bank approval unless generally authorized by the foreign exchange guidelines or subsequent circulars. Plan your remittance calendar with your auditors before the year closes.
Step by step: from decision to day one
Pick your route and write it down
Describe why you need a Branch or Liaison and map activities to that choice. If your team will install equipment, issue local invoices, and sign SLAs, you need a Branch. If you will run demos, gather market intel, and coordinate, Liaison fits. BIDA applications land better when the story is crisp and the scope is realistic.
Prepare the approval file
Expect to show parent company docs, board resolution, a plan of activities, and evidence of funding. Get the translations and attestations done before you press submit. A tidy file accelerates the inter‑ministerial review that sits behind BIDA’s decision.
Get people in legally
Sequence visas and work permits early. BIDA’s e‑visa recommendation can be obtained quickly, and standard work permits carry a published fee and timeline. Build that into start dates so your country manager is not grounded while contracts go live.
Make the RJSC deadline
Once the office is established, calendar that one‑month RJSC filing window. Deliver the charter documents, director list, local address, and authorized service agent details. Keep certified translations ready.
Open accounts and set up tax
Open the bank account that matches your office type. For liaison, it will mainly receive inward remittances from HQ. For branch, set up tax registrations and VAT if your approved scope needs it, then align your invoicing and withholding logic with local rules. For profit remittance, talk to your bank and auditors well before year end to avoid approval surprises.
Tiny tips that save weeks
Name your activities like a contract
Vague activity lists cause amendment loops. Use the same verbs you would use in a customer SOW. It helps BIDA see what you will actually do and what you will not.
Staff visas beat optimism
Even senior executives need the right visa class and a work permit. Budget the official timelines and fees into your project plan rather than hoping to “sort it on arrival.”
Build the audit trail from day one
Planning ahead is important and Khan Akber & Co. can help you with that Branches repatriate profits against audited retained earnings. Keep clean books, collect DVS‑verified audit reports, and align with the foreign exchange rules before you ask the bank to wire funds out.
So, which one should you choose?
Choose Liaison if you want presence without sales, a light compliance footprint, and room to learn the market.
Choose Branch if you need to sell, bill, and service in Bangladesh now, but do not need a separate Bangladeshi company.
Both routes are well trodden. Pick the one that matches your next 12 to 24 months, not your someday plan. You can always upgrade when the numbers tell you to.
