Doing business in Bangladesh

Bangladesh is a common law jurisdiction with a unitary government and a Supreme Court made up of the High Court Division and the Appellate Division. Key authorities for an incoming business are BIDA, the Bangladesh Export Processing Zones Authority (BEPZA), the Bangladesh Economic Zones Authority (BEZA), the Registrar of Joint Stock Companies and Firms (RJSC), the National Board of Revenue (NBR), Bangladesh Bank, the Department of Labour and the Department of Inspection for Factories and Establishments, the Bangladesh Securities and Exchange Commission (BSEC), the Bangladesh Competition Commission and the Department of Patents, Designs and Trademarks (DPDT).

Key facts

Corporate income tax

27.5% for non-listed companies, 25% if all transactions go through bank transfer

VAT

15% standard rate

Main entity form

Private limited company registered with the RJSC

Foreign ownership

100% in most sectors; reserved, controlled and local-only lists apply

Exchange control

Current account convertible; capital account restricted

Cyber and data law

Cyber Security Ordinance 2025 replaced the 2023 Act; data protection ordinance status to check

New York Convention

Party since 1992 (in force 4 August 1992)

Foreign investors usually incorporate a private limited company with the RJSC and register the investment with BIDA; projects in special zones deal with the zone authorities (see the licensing area). Branch, liaison and representative offices of foreign companies must be registered with BIDA. BIDA states that 100 percent foreign ownership is permitted in most sectors, with a short list of reserved industries, controlled industries needing a ministry no objection certificate and some businesses requiring local ownership.

Key facts

• Register the investment with BIDA, which is needed for tax incentives, work permits and foreign borrowing.

• Check whether the activity is reserved, controlled (needing a ministry no objection certificate) or limited to local ownership before planning full foreign ownership.

• A private limited company with at least two directors and two shareholders, incorporated with the RJSC, is the usual vehicle; one person companies are not open to foreign investors.

• Liaison offices need BIDA approval, cannot earn local income and are funded by inward remittances.

• Investments have statutory protection, including repatriation rights, under the 1980 Act.

Who handles this in BangladeshSetting up and running a companyLicences, permits and regulatorsContracts and commercial law

The Income Tax Act 2023 replaced the 1984 Ordinance. Corporate tax rates depend on the type of company: 27.5 percent for non-listed companies, or 25 percent where all transactions go through bank transfer, with lower rates for listed companies and higher rates for banks, mobile operators and tobacco companies. VAT is 15 percent standard, and the tax year normally runs from July to June. Transfer pricing documentation applies above a transaction threshold.

Key facts

• Confirm the corporate tax rate for the company type, as rates differ and the lower rates depend on all transactions passing through bank transfer.

• VAT is 15 percent standard, with reduced rates and supplementary duty on some items.

• Plan reporting around the July to June income year unless the company is a bank, insurer or financial institution.

• Cross-border payments to group companies attract withholding tax and transfer pricing duties, with documentation above BDT 30 million of international transactions.

Who handles this in BangladeshTax and structuringAccounting and annual filings

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3 statements on rates, thresholds or deadlines are held back until they are checked against an official source.

Key facts

• Terminating a permanent worker needs 120 or 60 days' notice or pay in lieu plus 30 days' wages per year of service, and foreign staff need a work permit, visa and security clearance within staffing ratios.

Who handles this in BangladeshEmployment, payroll and immigration

This topic was written by AI from general knowledge and is being checked against official sources. Confirm anything you plan to rely on with a qualified local professional.

Export processing zones, economic zones and hi-tech parks offer tax holidays, duty-free import of capital machinery and simpler approvals. Financial services, telecoms, insurance and capital markets have dedicated regulators. Public procurement follows the Public Procurement Act 2006 with electronic tendering.

Key facts

• Compare zone incentives with a domestic tariff area location before choosing a site.

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• Expect to lease industrial land in the special zones.

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• Identify the sector regulator early for banking, telecoms, insurance or capital markets activities.

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• Government tenders are run largely through the e-GP system.

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Who handles this in BangladeshLicences, permits and regulatorsTax and structuring

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Exchange controls are based on the Foreign Exchange Regulation Act 1947 and Bangladesh Bank's Guidelines for Foreign Exchange Transactions, applied through authorised dealer banks. Dividends can generally be remitted through an authorised dealer bank with supporting documents, but capital account transactions such as outward investment and foreign borrowing are restricted. Foreign currency availability has been tight in recent years.

Key facts

• Bring investment capital in through banking channels and keep records, as they support later repatriation.

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• Dividends can be remitted through an authorised dealer bank with full documentation.

• Group loans need approval or registration before funds are drawn.

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• Plan treasury for possible delays in large remittances and for export proceeds repatriation.

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Who handles this in BangladeshPayments and currencyBanking and capitalTreasury and funding

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Imports are governed by the Customs Act 2023. Importers and exporters need registration certificates, and many products need certification from the Bangladesh Standards and Testing Institution. Bangladesh is a WTO member and belongs to SAFTA and APTA. Its graduation from least developed country status, scheduled for November 2026, may move to November 2029 after a UN Economic and Social Council recommendation that awaits General Assembly approval.

Key facts

• Obtain IRC or ERC registration before trading and check the Import Policy Order for restrictions.

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• Allow time for BSTI certification of listed products.

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• Exporters relying on least developed country preferences should track the graduation date, which may move from November 2026 to November 2029.

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• Customs duty follows the Customs Act 2023 and its tariff schedule.

Who handles this in BangladeshCustoms, trade and export controls

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3 statements on rates, thresholds or deadlines are held back until they are checked against an official source.

Key facts

• Check the current status of personal data protection legislation before designing data flows.

Who handles this in BangladeshData protection and cyberAccounting and annual filings

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Trademarks, patents and designs are registered with the Department of Patents, Designs and Trademarks, and copyright with the Copyright Office. Patent, design and copyright laws were replaced in 2023. Bangladesh is a member of the Paris and Berne Conventions but not of the Madrid Protocol or PCT, so filings must be made nationally.

Key facts

• File trademarks and patents directly with DPDT, as international routes are not available.

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• IP laws were modernised in 2023, so older guidance may be outdated.

• Register important copyright works with the Copyright Office for evidence.

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Who handles this in BangladeshTrade marks, patents and brands

This topic was written by AI from general knowledge and is being checked against official sources. Confirm anything you plan to rely on with a qualified local professional.

The Competition Act 2012 established the Bangladesh Competition Commission and allows it to review combinations that may harm competition. Listed company takeovers follow BSEC rules. Company winding up is handled by the High Court Division under the Companies Act, and the Bankruptcy Act 1997 also applies.

Key facts

• Assess competition risk and any Competition Commission filing before signing a deal.

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• Listed targets bring BSEC takeover rules.

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• Insolvency usually means High Court winding up, as corporate rescue tools are limited.

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Who handles this in BangladeshBuying, selling and investingContracts and commercial law

This topic was written by AI from general knowledge and is being checked against official sources. Confirm anything you plan to rely on with a qualified local professional.

Bribery and corruption are offences under the Penal Code and the Prevention of Corruption Act 1947, investigated by the Anti-Corruption Commission. The Money Laundering Prevention Act 2012 is supervised by the Bangladesh Financial Intelligence Unit. Listed companies follow the BSEC Corporate Governance Code.

Key facts

• Build anti-bribery controls for dealings with public servants and agents.

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• Expect AML and sanctions screening by banks supervised by the BFIU.

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• Listed companies must meet BSEC governance requirements.

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Who handles this in BangladeshAnti-bribery, sanctions and complianceContracts and commercial law

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Civil disputes go to district courts, with company matters and constitutional writs in the High Court Division and final appeals to the Appellate Division, and cases can take a long time. The Arbitration Act 2001 is based on the UNCITRAL Model Law, and Bangladesh has been party to the New York Convention since 1992. Foreign judgments are enforceable directly only from reciprocating territories.

Key facts

• Use arbitration for cross-border contracts, as awards are enforceable under the New York Convention.

• Foreign judgments are directly enforceable only from reciprocating territories.

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• Lenders recover loans through money loan courts, and mediation is available in civil cases.

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Who handles this in BangladeshDisputes and arbitration