Foreign Investment and Business set up
Bangladesh is the 2nd largest garments manufacturer of the world, hence it attracts huge foreign investments in this sector. Foreign Investors who have already invested in Bangladesh are investing in other business sectors. There are other emerging sectors where Foreign Investments is rapidly increasing e.g. construction engineering, power & energy , agriculture, IT, leather etc. To cater the need of Foreign Investors for setting up companies, branch office, liaison office and also to help them in securing employment visa (E-VISA), investor’s visa (PI VISA), business visa (B-VISA), work permit etc., legal assistance is often required. Legal support is also required for setting up business in export processing zones and Economic Zones. Due to considerable political stability in recent years and initiative of government in improving power generation, introducing one stop service etc, new investment particularly in new sectors like LPG, LNG terminals, sea ports, dam & embankment, bridges are also increasing etc.
We have a dedicated and efficient Legal Service Team responsible for catering the need of the clients. We have wide range of expertise when its comes to setting up business. Our lawyers have excellent field level expertise of working in the related office for nearly 12 years and also desk based ability to prepare all documentary works. We provide high speed and expert service in this area. We have long experience of catering need of the clients from almost all Continents hence language and local knowledge is not a barrier.
Mr. Rahman with respected client, Mr. Stephen Christen, a US and German origin foreign investor in Toy industry Bangladesh in an event organised by Rahman’s Chambers.
Please find below the video covering speech on Foreign Investment on Bangladesh by Mr. Stephen Christen, an investor, at our annual Dinner:
Rahman’s Chambers provides all range of services required for setting up business. It has 10 years of experience in setting up more than a dozen of company, branch office, liaison office of foreign origin of investors from USA, UK, Germany, Lithuania, Russia, Indonesia, China, Hong Kong, Singapore etc. We also set up social business, NGOs, society, Cooperative society etc. Our services include obtaining all kinds of visa, security clearance, work permit and citizenship. We do offer quick service for setting up business both within or outside Export Processing Zone. We are also working on setting up business on newly crated Special Economic Zones.
Our service team is highly recommended by clients:
Rahman’s Chambers is a hands on firm, which has a pretty good understanding of the legal and environment in Bangladesh, I will qualify them, as a committed and dedicated group of lawyers, which operates their Chamber with high level of integrity, and with a devoted attitude to customer service.”
Rahman’s Chambers handles foreign investment and disputes involving corporate transactions, finance… “The ‘very responsible, responsive and knowledgeable’ Mohammed Forrukh Rahman heads the firm…”
-Legal 500, 2018
“Their response times are excellent and they make you feel generally very well informed.”
– Chambers & Partners, 2018.
Our Completed Project includes:
- Setting up business for 100% American outsourcing company based in Texas.
- Setting up liaison office for NEPC-1 for construction and engineering of power project from China.
- Setting up branch office for NEPC-3 for construction and engineering of bridges etc. from China.
- Setting up liaison office for the First Engineering Bureau of Henan Water Conservancy (CHWE), China for dam and embankment construction work.
- Setting up IT companies originally from Russia and Lithuania.
- Investment related services to a major Danish Garments.
- Share transfer, exit and repatriation of proceeds of sale to an American shareholder in Toy sector in Chittagong.
- Opening company, originally from UK and India in Dhaka Export Processing Zones.
- Due diligence for a Hong Kong based garments for setting up business in Special Economic Zones and EPZ in Bangladesh.
- Legal services involving JV investment in LPG terminal at Chittagong.
Further details are provided below:
Legal due diligence is important to assess the risk associated with investment. Before major decision making, investors instruct us to carry out legal due diligence work on several aspects involving legal risks, Tax exemption, concession of duties involving importation of capital machinery etc. If an investor is planning to invest in an existing setup by buying shares, we conduct searches with Joint Stock of Companies and Firms (RJSC), concerned land registry, VAT and Tax office to check if any legal risk is involved. Further search is conducted to verify authenticity of documents.
The due diligence is essential in the following areas:
- Land Mutation
- Land registration
- Land revenue record
- Survey Record
- Share Transfer Record
- Change of directors’ report
- Searching relevant police station
- Litigation search (limited circumstances)
- Searching relevant circle and zone.
- Other search
Client often conduct due diligence on number of permits and consent required and its time frame. The type of required permits and consent largely depends on the type of industry, business venture, its location and intended operation in Bangladesh. The Chambers provides services for all basic licenses e.g. Company registration, Liaison office permission, Branch office permission, trade license, export and import permit, membership with chamber and commerce, work permit, bank account opening, IRC, ERC, ad hoc IRC, BIDA registration, BIDA recommendation etc.
We also assist in obtaining other licenses or permit. We often do it ourselves or outsource it from our known vendors and service providers if client so desire.
Share purchase in unlisted private and public company involve several documentation work, e.g. signing Form 117, affidavits, etc. Besides, several resolutions are required in compliance with the Memorandum and Articles of association along with drafting of Share purchase Agreement. We advise clients for the entire process so that the transfer is completed smoothly. We also advised both buyer and seller in taking over of several companies e.g. FAKIR KNIT, SATURN TEXTILES, OOCL etc. Besides, we have advised individual Shareholder in buying and selling shares. Our service includes not only assist with documentation work but also assist with actual recording and obtainng certified copy from RJSC.
Either joint venture or 100% foreign owned, our experienced service department complete the process with ease. Small mistakes can cause substantial delay in the process, e.g. remittance advises of USD 50,000/- if quoted wrongly can lead to return of fund and reinvest. Professional legal hands are vital for company formation from drafting joint venture agreements, preparing Memorandum and Articles to obtaining certified copy of incorporation certificate. Over the last 10 years, we have formed several companies in IT, General Trading, Garments, Textiles and Power sectors both local and foreign or originated in the UK, USA, China, and other European countries.
Opening Liaison office requires some critical preparatory work and documentation work which requires experience. We have significant experience of getting BIDA registration for both liaison and branch office for several foreign principals. Legal documentation involves authentication of parent company’s Memorandum and Articles of Association, list of directors etc. Often the authentication process is cumbersome. We try our best to make the process smooth and hustle free. In recent time we have opened several branch and liaison offices for construction and engineering companies whose principal is located in China and other neighboring countries.
Industrial enterprises, opening subsidiary company are also required to register themselves with Bangladesh Investment Development Authority to avail various tax exemptions and other concession over customs duties. Commercial ventures may register if they desire. In recent times, BIDA has been automated and all registrations and related process are made online. We have advised Surjin, Korea and China Communication, CCCC over availing different exemption on income tax and also concession on customs duties for import of capital machinery.
Work permit is required for investors planning to become resident in Bangladesh by taking a full time position or for expatriate employee of the company, branch office, liaison office. Upon arrival in Bangladesh under two types of visa for short period, the person is required to apply for work permit with BIDA and extension from Department of Passport and Visa, subject to successful completion of security clearance. The process can be very hectic and time consuming if not handled skillfully. We assist our client to make it simple and hassle free. We often assist our client with finding commercial address required for trade license and security clearance.
Setting up company for EPZ is comparatively easier, as one stop service is provided by BEPZA. However involvement still make difference in terms of saving times and money. The Firm assisted clients on setting up companies, its expansion, securing lease and obtaining other licenses, visa etc for EPZ based companies.
Investments in Economic Zones are comparatively new. There are only a few EZ e.g. Abdul Monem Abdul Monem Economic Zone (AMEZ) which have commenced operation and leasing out plot. We have conducted due diligence for one of our client Hong Kong and Korea based client on legal risk, tax exemption and other concession and benefits.
The Foreign investors who are planning to do market research, attend meetings, etc and willing to visit Bangladesh are invited by us. Upon our invitation, Bangladesh Mission abroad grant short time Business visa.
Due to foreign exchange regulations and stringent guidelines from Central Banks, exit and repatriation of share value and profit is a complex work, which requires various assessments and reports. The Firm has effectively completed a deal for an American shareholder in the Toy sector in Chittagong.
Our notable clients in this area
- Data Path Limited, Texas, USA
- A major Danish garments company in Dhaka, Liasion office
- Perseus Limited
- Rehmania International Ltd
- Zhongmei Engineering Group Ltd., China
- Bangladesh Equipment and Mineral Company Ltd.
- IT Grow Division Ltd, Russia
- Water & Sanitation for the Urban Poor (WSUP), UK
- NEPC International Limited
- NRD Bangladesh Limited, Lithuania
- NEPC 1 & 3, Liasion office, China
- NEPC International Ltd
- DongFong Engineering Ltd.
Our Related Links
- Speech on Foreign Investment in Bangladesh by Mr. Stephen Christen, an investor at our annual Dinner.
- Speech by Mr. Towfiq Ali, president of BGCCI on foreign Investment at our Annual Dinner
- Speech by Mr. Michael Schulthaz, deputy Head of mission of German Embassy on Foreign investment as Guest of Honour.
- Chambers honoured a client, textile company, for making significant investment
- Recommendation from Mr. David Ramos of Gildan.