How to Open a Buying House in Bangladesh

We congratulate you on your decision to tap into Bangladesh’s booming RMG sector. Bangladesh exported RMG products worth $36.15 billion in the fiscal year of 2023-24. It was 81.29% of the total exports. Opening a buying house in this fast-growing economy is the right decision.

But, the process involves multiple government bodies and trade organizations, so new entrepreneurs may face various complications. Don’t worry, Law Advisor BD will break the process down into simple steps. You may skip any other articles or tutorial videos. This article will cover all the details of how to open a buying house in Bangladesh.

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What Is a Buying House in Bangladesh?

how to open a buying house in bangladesh

Buying House: A buying house works as a trading partner between RMG manufacturers and buyers.

There are two types of buying houses in Bangladesh.

  • Buying Office: It works with various RMG manufacturers, brands, and buyers. These businesses convey order requirements from the buyers to manufacturers and ensure the orders are executed correctly.
  • Buying Agency or Liaison Office: When independent buyers set up their regional office in Bangladesh, it is called a buying agency or liaison office.

Key Steps of Opening a Buying House in Bangladesh

how to open a buying house in bangladesh

As buying houses are business entities, they must follow the regular company registration process and a few additional steps.

  • Step 1: Obtain a Name Clearance Certificate
  • Step 2: Prepare and File MOA and AOA
  • Step 3: Apply for Registration and Obtain the Certificate of Incorporation
  • Step 4: Obtain a TIN Certificate
  • Step 5: Apply for a Trade License
  • Step 6: Obtain a BIN Number
  • Step 7: Open a Corporate Bank Account
  • Step 8: Obtain IRC and ERC
  • Step 9: Obtain a Fire Safety License
  • Step 10: Register with the Department of Textile
  • Step 11: Become a Member of Trade Organizations

Eligibility for Opening a Buying House in Bangladesh

how to open a buying house in bangladesh

The requirements for opening a buying house are the same as opening a company in Bangladesh.

Directors

  • A buying house must have at least two directors who are at least 18 years old, not bankrupt and don’t have any criminal records.
  • Both local and foreign individuals can be company directors.

Shareholders

  • The company can have between 2 and 50 shareholders.
  • Directors can also be shareholders.

Authorized and Paid-Up Capital

  • Authorized capital is the maximum amount a company can raise by selling shares. Bangladesh has no minimum or maximum limit for it.
  • Paid-up capital is the amount a company has collected by issuing shares. In Bangladesh, it must be at least BDT 1.

How to Open a Buying House in Bangladesh: Detailed Steps

how to open a buying house in bangladesh

Follow these steps to start a buying house in Bangladesh that complies with local regulations.

Step 1: Obtain a Name Clearance Certificate

Name Clearance Certificate: It is a document that certifies the proposed business name is available and that no other business has been registered in this name before.

If you are opening a new company, getting a name clearance certificate is a must. But liaison offices or branch offices of foreign companies don’t need this certificate.

You may propose multiple names for the company. After submitting the application and paying the fee, RJSC issues the certificate for one of the proposed names.

This certificate remains valid for 30 days (180 days for society). If you don’t submit the application, necessary documents, and fees for registration, it will be canceled.

Process

  • Step 1: Go to the RJSC e-Service System.
  • Step 2: Click on Apply for Name Clearance under Pre-Registration Activities.
  • Step 3: Create an account with your email.
  • Step 4: Search for the availability of the proposed business names and submit the application to the Registrar.
  • Step 5: Pay the fee for the clearance certificate through any authorized bank and update the payment information through the portal.
  • Step 6: Obtain the name clearance certificate within one or two business days.

Step 2: Prepare and File MOA and AOA

Memorandum of Association: It is a legal document defining the company’s goals, activities, and relationship with shareholders. The MOA is a charter for the company.

Articles of Association: It provides a legal framework for internal management. Also, the AOA rights, responsibilities, and powers of the directors and shareholders.

You should get these documents prepared by an experienced law firm that specializes in company formation.

Required Documents

  • Name clearance certificate
  • Information about authorized and paid-up capital
  • Office address
  • Share structure among shareholders
  • Detailed info about directors and shareholders (full name, address, and NID or passport)

Process

  • Step 1: Prepare the MOA and AOA with all the necessary information.
  • Step 2: Prepare supporting documents.
  • Step 3: Collect adhesive stamps from the treasury by depositing money in Bangladesh Bank through treasury challan. (treasury officials must seal and sign the stamps)
  • Step 4: Submit the MOA and AOA to the RJSC online.

Step 3: Apply for Registration and Obtain the Certificate of Incorporation

Certificate of Incorporation: This certifies that your company is a legally registered business entity in Bangladesh and authorized to perform certain activities.

Required Documents

Process

  • Step 1: Go to RJSC e-Service System and click Apply for Registration. Log into the account that you created earlier.
  • Step 2: Enter the necessary information, such as name clearance certificate number and any other additional details.
  • Step 3: Upload necessary documents, such as the MOA, AOA, etc., online.
  • Step 4: Finalize the registration application and submit it.
  • Step 5: Pay the registration fee through any authorized bank and collect the payment slip.
  • Step 6: Print the submitted application form along with the uploaded documents. Submit the print copies and the payment slip to the designated RJSC office.
  • Step 7: Collect the Certificate of Incorporation from the same office.

Step 4: Obtain a TIN Certificate

Tax Identification Number (TIN) Certificate: This is an official document containing a unique number to track the tax payments of an individual or business.

You can apply for it online to get the TIN certificate instantly.

Process

  • Step 1: Visit the TIN Registration portal. Register for an account and verify using your email address or phone number.
  • Step 2: Log into the account and fill out the online form.
  • Step 3: Submit the form and your TIN certificate will be generated automatically. Download and print the certificate.

Step 5: Apply for a Trade License

Trade License: A trade license is a permit issued by the local government that allows businesses to operate in a specific area.

You can obtain it from the respective City Corporation, Municipal Corporation, or Union Parishad.

Required Documents

  • Application form
  • NID and recent PP size photo of the shareholders and directors
  • A copy of the lease agreement of the registered office
  • Proof of holding tax payment
  • Certified copies of the MOA and AOA
  • A copy of the Certificate of Incorporation
  • Agreement of partnership (if applicable)
  • A declaration of compliance with City Corporation and Municipal Corporation rules & regulations on non-judicial stamp
  • TIN certificate
  • A statement of bank solvency
  • Work permit from the Board of Investment (if applicable)

Process

  • Step 1: Download the application form or collect it from the designated office.
  • Step 2: Fill out the form and submit it along with the necessary documents.
  • Step 3: A licensing supervisor will visit the business location for inspection.
  • Step 4: Pay the fee at the office or through authorized banking channels.
  • Step 5: Collect the License from the respective office.

Step 6: Obtain a BIN Number

Business Identification Number (BIN): This is a 9-digit unique number issued by the NBR used to identify a taxpayer who wants to do business legally.

To get a BIN number, you must apply for a VAT registration certificate. Any business with an annual turnover of more than BDT 8,000,000 must pay 15% VAT.

Required Documents

  • Filled Mushak-2.1 form

Process

  • Step 1: Download the Mushak-2.1 form and fill out the form accurately.
  • Step 2: Submit the filled form to the Commissioner of the respective tax zone.
  • Step 3: If the application is found correct after primary inspection, your registration will be approved within 3 business days.

Step 7: Open a Corporate Bank Account

You can open a corporate account in any government-authorized bank in Bangladesh. Different banks may need slightly different documents.

Required Documents

  • Certified copies of the MOA and AOA
  • Certified copies of the Certificate of Incorporation
  • List of directors with address, phone number, and Form XII
  • A resolution passed by the board of directors authorizing the opening and operation of the account.
  • A copy of the trade license
  • Two recent PP-size photos of each signatory attested by the introducer
  • TIN certificate

Process

  • Step 1: Go to the selected bank and collect the account opening form.
  • Step 2: Fill out the form and submit it along with the necessary documents.
  • Step 3: Make the initial deposit required by the bank.
  • Step 4: Collect the cheque book after the account is activated.

Step 8: Obtain IRC and ERC

Import Registration Certificate (IRC): An Import Registration Certificate is an official document allowing a company to import items from foreign countries.

Export Registration Certificate (ERC): This certificate allows companies to export items from Bangladesh.

You need to apply for these certificates to the Office of Chief Controller of Import and Exports (CCI&E).

Required Documents

  • Passport-size photograph of the entrepreneur/managing partner/managing director
  • Valid Trade License
  • Valid Membership Certificate from a local Chamber of Commerce and Industry or from concerned Trade Associations
  • Financial solvency certificate
  • Citizenship Certificate
  • Treasury Challan
  • TIN Certificate
  • Partnership Deed
  • Certificate of Incorporation, Memorandum, and Articles of Association

Process

  • Step 1: Visit https://olm.ccie.gov.bd/ and create an account.
  • Step 2: Log into the account and select the desired certificate from the list on the left.
  • Step 3: Fill out the necessary information and upload scanned copies of the original documents. Then, click Save & Submit.
  • Step 4: Click Online-Challan Payment and pay the fee through online/mobile banking. Once the payment is successful, the application will be submitted.
  • Step 5: After you get the SMS notification, log into your account and download the certificate.

Step 9: Obtain a Fire Safety License

Fire Safety License: A fire safety license is a document that certifies the compliance of a company with the fire safety regulations of the Fire Service and Civil Defence.

Required Documents

  • Filled application form
  • Copy of the MOA, AOA, and Certificate of Incorporation
  • Building plan/layout
  • Deed of agreements for rental properties
  • Valuation certificate from City Corporation/Municipal Corporation/Union Parishad

Process

  • Step 1: Download the form and fill it out.
  • Step 2: Submit the application along with the necessary documents to the respective Fire Service & Civil Defense office.
  • Step 3: An inspector from the Fire Service & Civil Defense will physically inspect the business location.
  • Step 4: Pay the license fee to the bank account of Fire Service & Civil Defense.
  • Step 5: Collect the fire safety license.

Step 10: Register with the Department of Textile

All businesses related to the garments sector in Bangladesh must register with the Department of Textile (DoT) before commencing operations.

Required Documents

  • Filled registration form
  • Copy of the trade license
  • Copies of the MOA, AOA, and Certificate of Incorporation
  • Copy of the TIN certificate
  • Pay Order/Bank Draft in favor of the Director of DOT
  • Name, address, and NID of the directors on the letterhead pad of the company.
  • Updated fire safety license

Process

  • Step 1: Download the application form and fill it out.
  • Step 2: Attach the necessary documents and submit the form to the office of the Director of DoT.
  • Step 3: After reviewing the application and documents, the authority will issue a Registration Certificate.

Step 11: Become a Member of Trade Organizations

To operate a buying house in Bangladesh, you must become a member of BGMEA.

Required Documents

  • Application for Associate Member in the Letter Head Pad according to the prescribed form supplied by BGMEA
  • Pay order/ Bank draft in favor of BGMEA
  • Photocopy of Trade License attested by Lien Bank.
  • Photocopy of Memorandum and Articles of Association & Incorporation Certificate/Partnership deed attested by Lien Bank
  • Specimen Signature of Shareholders/ Partners /Proprietor with 2 copy photographs of all attested by Lien Bank
  • National ID/Passport Photocopy
  • Photocopy of TIN certificate attested by Lien Bank.
  • Rent agreement/ Purchase documents of the Buying office.
  • Copy of DoT Registration Certificate
  • Copy of IRC and ERC
  • Copy of Fire Safety License

Process

  • Step 1: Download the application form and fill out the information.
  • Step 2: Complete the payment of the membership fee.
  • Step 3: Attach all the necessary documents to the application and submit them to BGMEA.
  • Step 4: After careful consideration, BGMEA will grant the membership.

Fees for Opening a Buying House in Bangladesh

how to open a buying house in bangladesh

Check out the following chart to get a clear idea about the fees for opening a buying house.

Step

Item

Class

Fee (In BDT)

Name Clearance Certificate

For each proposed name

200

MOA and AOA

MOA of private company

1,000

MOA of a public company

5,00

AOA of private company

Authorized capital up to BDT 20,00,000

3,000

Authorized capital from BDT 20,00,000 to BDT 6,00,00,000

8,000

Authorized capital over BDT 6,00,00,000

20,000

AOA of a public company

Authorized capital up to BDT 20,00,000

4,000

Authorized capital from BDT 20,00,000 to BDT 6,00,00,000

8,000

Authorized capital over BDT 6,00,00,000

20,000

Registration

For private and public companies

Authorized capital up to BDT 20,000

No fee

For every additional BDT 10,000 up to BDT 50,000

No fee

For every additional BDT 10,000 up to BDT 10,00,000

No fee

For every additional BDT 1,00,000 up to BDT 50,00,000

50

For every additional BDT 1,00,000 after BDT 50,00,000

80

For partnership firm

1,000

Documents filing for private company

6 documents

2,400

Documents filing for public company

8-9 documents

3,200-3,600

Documents filing for partnership firm

400

TIN Certificate

 

No fee

Trade License

Application fee

10

License fee

Depending on the nature/type of business/paid-up capital

1,000-2,000

BIN Number

 

No fee

Bank Account Opening

Initial Deposit

Depending on bank

2,000-20,000

IRC and ERC

IRC Registration

Annual import up to BDT 5,00,000

5,000

Annual import up to BDT 25,00,000

10,000

Annual import up to BDT 50,00,000

18,000

Annual import up to BDT 1,00,00,000

30,000

Annual import up to BDT 5,00,00,000

45,000

Annual imports above BDT 5,00,00,000

60,000

ERC Registration

Exporter

7,000

Indentor

40,000

Fire Safety License

Application fee

Approx.

1,000

Inspection fee

Approx.

3,000

License fee

Approx.

5,000

DoT Registration

Registration fee

Paid-up capital from BDT 1-10,00,00,000

5,000

Paid-up capital from BDT 10,00,00,000-25,00,00,000

10,000

Paid-up capital from BDT 25,00,00,000-50,00,00,000

25,000

Paid-up capital from BDT 50,00,00,000-1,00,00,00,000

50,000

Paid-up capital above BDT 1,00,00,00,000

1,00,000

BGMEA Membership

Membership fee

40,000

Note: There can be miscellaneous fees associated with preparing and making copies of documents, and additional charges for service providers.

Get Help from Law Advisor BD

Opening a buying house in Bangladesh can be a hectic process, especially for those doing it for the first time. The process demands a clear understanding of local regulations, accurate form fill-up, proper submission, correct payment methods, and more.

Law Advisor BD is highly experienced in registering a buying house in Bangladesh. It handles each of the steps with maximum accuracy and utmost care. To ensure your dream buying house is set up properly, let Law Advisor BD handle the process.

FAQs

Only the Registrar of Joint Stock Companies and Firms can issue a valid Certificate of Incorporation.

Yes. Any foreign investor can open a buying house in Bangladesh. However, the fees and required documents for foreign investors are slightly different.

Registering a buying house as a private limited company is suitable because shareholders enjoy limited liability. Only the directors have unlimited liability.

It may take about 25-30 business days to complete all the steps mentioned above. However, the process can be delayed due to additional requirements or other reasons.

If a buying house keeps clothing items or other flammable materials within its premises, obtaining a fire safety license is a must for the company.

The total cost depends on the business type, authorized capital, paid-up capital, import-export limits, and other factors. It may cost about 2,00,000-3,00,000 to open a buying house in Bangladesh.

No. Some of the steps can be completed online. But, other steps require you to submit application forms and documents physically. You must do it by yourself or appoint a representative. Experienced law firms like Law Advisor BD can also help.

Fire safety license, trade license, IRC, ERC, and BGMEA membership must be renewed after specific intervals to continue operating a buying house.

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