How to Setup a Liaison Office in Bangladesh | Process, Eligibility?

Liaison Office Registration in Bangladesh – An Overview

A liaison office works as a communication channel between the parent company settled abroad and their parties in Bangladesh. Foreign companies’ setup liaison office in Bangladesh to explore and support business prospects in Bangladesh.

Such an office acts as a communication bridge. It promotes import and export from/to Bangladesh, promotion of technical and financial participation of foreign parents, conducting market research, customer/supplier coordination/relationship, providing feedback, etc.

Permitted Activities of Liaison Office in Bangladesh

    • Establish communication and coordination between the foreign principal company and the parties in Bangladesh with an intension to create market opportunities.
    • Promotion of import/export relationship between countries.
    • Form a financial and technical collaboration between Bangladesh and overseas companies.
    • Represent the foreign parent company in Bangladesh.

Important points to consider before setting up Liaison office in Bangladesh

    • Minimum Investment Requirement – A parent company must invest $50,000 or 6-months operative expenses including initial office setup cost whichever is higher.
    • Age of the Parent Company – The foreign parent company shall be at least 2 years old as a registered company outside Bangladesh.
    • No Income Generating Activity – The parent company provides financial aid to all the operations of the liaison office since the liaison office is not allowed to earn any income in Bangladesh.
    • Name & Approval of Liaison Office – The name must be similar to that of the foreign parent company. In addition, an approval is needed for liaison office from Bangladesh Investment Development Authority (BIDA).
    • Taxation In Bangladesh – As Liaison office does not generate revenue in Bangladesh, so that no profit tax. Except the profit tax, all regular tax compliances are applicable to Liaison Office in Bangladesh.

 List of Documents to Open a Liaison Office

    Requisite Documents for BIDA Permission:

      1. Certificate of Incorporation of Foreign Company.
      2. Memorandum & Article of Association.
      3. Audited financial statements of Parent Company (last two years).
      4. Board Resolution for opening the Liaison office in Bangladesh.
      5. Complete details of Directors.
      6. Complete details of shareholders of the applicant company.
      7. A declaration stating the nature of the activity Parent Company.
      8. A declaration stating the nature of the activity of the proposed Liaison office in Bangladesh
      9. Employee list of the proposed Liaison office.
      10. Authorization letter to consultant who shall process the application on behalf of applicant.

  Documents mentioned in point 1-4 must be translated in English and attested by the concerned Bangladesh High Commission of the respective country.

Requisite Documents for Bank Account Opening:

    • Certificate of Incorporation of Foreign Company.
    • Memorandum & Article of Association.
    • Audited financial statements of Parent Company (last year).
    • Board Resolution for opening Bank Account.
    • Share Tree Analysis of Foreign Parent Company.
    • Complete details of shareholders of the applicant company.
    • BIDA Permission Letter.
    • Tax Registration Certificate of Bangladesh Liaison Office.
    • Photograph & Passport Copy of the bank signatories.
    • Photograph & Passport Copy of the Director & Shareholder of Foreign Parent Company.

Procedure to Setup Liaison Office

Following are the steps to be followed to setup a Liaison Office in Bangladesh:

Step-1:  Obtaining BIDA Permission

Following process shall take to obtain Permission –  

  • Account creation with BIDA web portal – Before filing application, to create a user id is pre-requisite after depositing the govt. fees for account creation.
  • Filling of application to BIDA – A foreign company’s liaison office application is filed with BIDA. The application is submitted through Online.
  • Approval of application by EC – The meeting of the executive committee (EC) of BDIA hold twice in every month. Upon documents verification results and decision by the executive committee, BIDA shall approve the Liaison Office application.
  • BIDA Permission Letter – In two (2) weeks after approval from Executive Committee, BIDA issue an e-letter for BIDA permission. This permission letter is the key and primary legal documents for Liaison Office as approved Liaison Office.
Step-2:  Tax Identification Number

The income tax department of Bangladesh issues a unique 12-digit number, known as E-TIN. Once the E-TIN is obtained, the liaison office is eligible to open its bank account.

 Step-3:  Bank Account Opening

A bank account can be opened in any commercial schedule bank in Bangladesh. The initial investment for $ 50,000 must be remit to Bangladesh by 2 months from BIDA permission letter date.

Step-4:  Inward Remittance of Initial Investment

The initial investment for $ 50,000 must be remit to Bangladesh within 2 months from date of BIDA permission. An additional 5% of total remittance shall require bringing to Bangladesh as penalty in case of non-compliance of the said 2 months tenure.

Step-5: VAT Registration

After receiving the initial remittance, a 13-digit online VAT registration / BIN (Business Identification Number) shall obtain. 

After receiving the above permission and registration a Liaison Office in Bangladesh is eligible to start its activities in Bangladesh.

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