Entity Setup & Support

Limited Company

There are two types of limited liability companies available under the Companies Act, 1994 in Bangladesh:

• Private Limited Company – This is the most preferred form of business entity. There is no minimum paid up capital required but there needs to be a minimum of 2 shareholders and 2 directors. Bangladesh laws allow 100% foreign ownership (except for reserved industries) and there is no requirement for local directors.
• Public Limited Company – This is usually used for a larger set up with view of potential public listing in the future. The requirements are similar to that of a private limited company with the exception of a minimum of 7 shareholders and 3 directors of any nationality.

Sole Proprietorship

A sole proprietorship business in Bangladesh can be started and conducted using only a trade license and does not constitute a separate legal entity therefore it is not distinct from the owner/proprietor. A sole proprietorship does not provide limited liability protection and owner’s personal assets are not protected from business risks.

Partnership Firm

A partnership is a business structure where two or more partners start an entity to do business together. A partnership firm is formed under the Partnership Act, 1932. A partnership firm does not provide limited liability protection and partner’s personal assets are not protected from business risks.

Local Office of Foreign Entity

There are three options, Branch Office, Representative Office or Liaison Office in Bangladesh. There is minimal distinction between the three options with the primary difference being that a Branch Office is allowed to obtain waiver for restrictions on local commercial operations while the other two are restricted from such activities.