Buying House Setup Process in Bangladesh
A buying house acts as a liaison between international buyers and local manufacturers, primarily in the Ready-Made Garments (RMG) and textile sector. It plays a crucial role in sourcing, quality control, and logistics. Setting up a buying house in Bangladesh involves registration with several government bodies and adherence to compliance standards. Below is a step-by-step overview of the legal process and requirements.
Legal Structure
A buying house is typically established as a:
- Private Limited Company under the Companies Act, 1994, registered with the Registrar of Joint Stock Companies and Firms (RJSC)
Foreign nationals or companies can hold 100% ownership, subject to sectoral regulations and approvals.
Step-by-Step Setup Process
Step 1: Incorporate the Company with RJSC
Requirements:
- Minimum 2 shareholders and 2 directors
- Registered office in Bangladesh
- Memorandum and Articles of Association
Documents:
- Name clearance certificate
- MoA and AoA
- Form IX, X, XII
- National ID/passport of shareholders and directors
- TIN of directors
Timeline: 5–7 working days
Cost: BDT 5,000–30,000 (depends on authorized capital)
Step 2: Obtain Trade License
Apply for a trade license from the City Corporation or Municipality in the jurisdiction of the office.
Documents:
- RJSC incorporation certificate
- MoA and AoA
- National ID/passport of owner
- Office rental agreement
- Photograph of signboard
Timeline: 2–5 working days
Annual Renewal Required
Step 3: Tax and VAT Registration
- TIN (Tax Identification Number): Apply to the National Board of Revenue (NBR)
- BIN (Business Identification Number for VAT): Apply to the local VAT office
Documents:
- RJSC certificate
- Trade license
- Bank account
- Office address proof
Step 4: Bank Account Opening
Open a corporate bank account in the company’s name. A bank account is mandatory for VAT, customs clearance, and BIDA approval (if foreign investment is involved).
Documents:
- Incorporation certificate
- Trade license
- MoA/AoA
- TIN
- Board resolution
Step 5: Membership with Export Promotion Bureau (EPB)
To operate as a registered buying house, membership with EPB is essential.
Documents:
- RJSC and trade license
- TIN and BIN
- Bank solvency certificate
- Office rental deed
- Profile of the company
- Undertaking not to engage in direct export
Timeline: 15–20 working days
Membership is renewable annually
Step 6: Membership with BGMEA/BKMEA (Optional)
While not mandatory, membership with the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) or Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) is useful for networking, compliance support, and trade facilitation.
Step 7: BIDA Approval (For Foreign Investors)
Foreign entities or joint ventures must register with the Bangladesh Investment Development Authority (BIDA).
Documents:
- RJSC documents
- Shareholding structure
- Board resolution
- Passport of foreign investors
- Lease agreement
- Investment details
Timeline: 2–4 weeks
Approval needed for remittance, work permits, and visa support
Compliance Requirements
- Regular submission of tax returns to NBR
- Monthly VAT returns (if registered)
- Annual return filing with RJSC
- Audit report by a Chartered Accountant
- Renewal of trade license and EPB membership
Summary Checklist
| Requirement | Mandatory | Issuing Authority |
|---|---|---|
| RJSC Company Registration | ✔️ | RJSC |
| Trade License | ✔️ | City Corporation/Municipality |
| TIN Registration | ✔️ | NBR |
| VAT Registration (BIN) | ✔️ (if VAT applicable) | VAT Circle |
| EPB Membership | ✔️ | Export Promotion Bureau |
| Bank Account | ✔️ | Scheduled Bank |
| BIDA Registration (for foreigners) | ✔️ (if foreign investment) | BIDA |
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