Best New Business Formation Lawyers in Chittagong

1. About New Business Formation Law in Chittagong, Bangladesh

Chittagong is a major port city and commercial hub in southeastern Bangladesh. Forming a new business there requires following national formation laws administered mainly through the Registrar of Joint Stock Companies and Firms (RJSC). Typical steps include selecting a business structure, obtaining name clearance, and registering with RJSC, followed by post formation obligations such as tax registration and local licensing. For foreign or joint ventures, the Bangladesh Investment Development Authority (BIDA) provides investment approvals and facilitation.

According to the Registrar of Joint Stock Companies and Firms, all companies and firms must be registered with RJSC to obtain legal recognition to operate in Bangladesh.

Source: RJSC - Registrar of Joint Stock Companies and Firms

Bangladesh Investment Development Authority (BIDA) offers streamlined investment approvals and investor facilitation for both local and foreign entities establishing operations in Bangladesh.

Source: BIDA

2. Why You May Need a Lawyer

Starting a business in Chittagong involves precise compliance with corporate law, taxation and local licensing. An advocate can prevent costly errors and secure timely approvals. Here are real-world scenarios where legal counsel is essential.

• Drafting and filing the Memorandum of Association and Articles of Association for a private limited company, ensuring accurate object clauses and shareholding provisions.
• Negotiating shareholder agreements and minority protections when multiple local partners form a private limited company in the Chittagong area.
• Obtaining regulatory clearances for foreign investment through BIDA, including ensuring repatriation and equity requirements comply with current policy.
• Managing post-incorporation obligations such as annual returns to RJSC, and timely TIN and VAT registrations with NBR.
• Handling a share transfer or restructuring, including due diligence, statutory notices, and filing amendments with RJSC.
• Securing a local trade license and aligning with municipal and port-area regulatory requirements for a new retail or manufacturing venture.

3. Local Laws Overview

Formation in Chittagong is governed by national statutes and supported by local regulatory bodies. Understanding these laws helps ensure a smoother launch and ongoing compliance. The most commonly invoked statutes cover incorporation, taxation, and licensing.

The Companies Act, 1994

This act governs incorporation, share structure, and director obligations for private and public companies. It requires filing of the Memorandum and Articles of Association with RJSC and ongoing corporate compliance. Amendments over time have modernized filing requirements and reporting obligations.

Value Added Tax and Supplementary Duty Act, 2012

This framework regulates VAT on goods and services and sets registration and return obligations for businesses operating in Bangladesh. Businesses with taxable activities must register with the National Board of Revenue and file periodic VAT returns.

Income Tax Ordinance, 1984

Corporate entities must assess and pay tax on profits, with various withholding and reporting requirements. Corporate tax returns are filed with the National Board of Revenue as part of routine compliance after incorporation.

In addition to these statutes, local licensing may require a trade license from the Chittagong City Corporation for operations within city limits. Always verify city-level requirements with local authorities before commencing business activity.

Source: RJSC, NBR, BIDA

Local licensing and regulatory compliance are essential for city operations and can impact project timelines if not anticipated early in the planning phase.

Source: Chittagong City Corporation

4. Frequently Asked Questions

What is the first step to form a company in Chittagong?

The first step is choosing a business structure and checking name availability with RJSC. You then prepare the Memorandum and Articles of Association for filing.

How long does RJSC registration typically take?

Online filings usually proceed within a few weeks, depending on document readiness and completeness. Delays occur if any documents are missing or require corrections.

What is the difference between private limited and partnership in Bangladesh?

A private limited company has a separate legal personality and limited liability for shareholders. A partnership has joint liability among partners and typically fewer formal filing requirements.

Do I need a lawyer for name clearance with RJSC?

Yes. An advocate can verify name availability, avoid conflicts with existing entities, and prepare supporting documents to speed clearance.

How much does company formation cost in Bangladesh?

Costs vary by structure and services, including RJSC filing fees, stamp duties, and legal drafting charges. Budget for several thousand taka plus administrative costs.

What documents are required to register a company in Chittagong?

You typically need proposed name, Memorandum and Articles of Association, director and shareholder details, registered office address, and a company objective. Additional documents may apply for foreign investment.

Is foreign investment allowed in Chittagong?

Yes, foreign investment is allowed with approvals from BIDA and compliance with related regulations. A local advocate can navigate licensing and repatriation rules.

What is the difference between VAT and income tax for a new business?

VAT applies to the sale of goods and services and is filed with NBR. Corporate income tax is applied to profits and is filed annually with NBR.

How long does it take to get a trade license in Chittagong?

Trade license processing times vary by locality and project type. Expect several days to a few weeks after submission, depending on inspections and compliance checks.

Do I need to register for VAT if my turnover is low?

Most businesses with taxable activities must consider VAT registration, though thresholds and exemptions may apply. Consult NBR guidance to determine eligibility.

Can I open a branch office in Chittagong?

Yes. A branch can be formed by filing appropriate amendments with RJSC and obtaining necessary local licenses, while maintaining compliance across the parent and branch entities.

Should I hire a local advocate for business formation?

Yes. A local advocate familiar with Chittagong procedures helps with document drafting, regulatory submissions, and timely compliance.

5. Additional Resources

• RJSC - Registrar of Joint Stock Companies and Firms: registration of companies and firms, name clearance, and annual filings. Source: https://www.roc.gov.bd/
• BIDA - Bangladesh Investment Development Authority: investment facilitation, foreign investment approvals, and one-stop services for investors. Source: https://bida.gov.bd/
• NBR - National Board of Revenue: tax registration, VAT registration, and corporate tax filings. Source: https://nbr.gov.bd/

6. Next Steps

1. Define your business structure and expected timeline; gather founders details, proposed name, and initial objectives.
2. Consult a local advocate with Bangladesh company formation experience in Chittagong; request references and sample engagements.
3. Request a written engagement plan and quote covering MoA, AoA drafting, and RJSC filing; compare at least two law practices.
4. Prepare initial documents: proposed MoA and AoA, director and shareholder information, and proposed registered office address.
5. Confirm regulatory requirements early: TIN, VAT registration, and trade license; plan for BIDA approvals if foreign investment is involved.
6. Sign the engagement and begin due diligence; your lawyer coordinates name clearance, document drafting, and RJSC submissions.
7. Establish a compliance calendar with annual returns, board meetings, and tax filings; schedule periodic legal reviews with your counsel.