Bangladesh is attracting a steady amount of interest from international companies who wish to establish a presence in South Asia. In many cases, the first step is not to set up full commercial operations but instead to register a liaison office in Bangladesh: this is a less risky method of investigating the market, remaining in close contact with local partners, and laying the foundation for a larger investment at a later stage.
To set up a liaison office you have to go through a number of government organisations, beginning with the Bangladesh Investment Development Authority (BIDA). This guide explains what a liaison office really is, the reasons why companies select this option, and the practical steps involved in registering and operating one.
Key Takeaways
• The liaison office is not able to generate income in Bangladesh; its function is restricted to carrying out communication, coordination, and market research.
Approval is obtained first from BIDA, then from RJSC, after that a TIN is acquired from the NBR and finally a local trade license is obtained.
• Generally, it is necessary to send at least USD 50,000 from the parent company via official banking channels.
The BIDA approval typically lasts for two to three years and must be renewed about two months before it expires.
• A liaison office is suitable for carrying out market research and for building relationships, while a joint venture or a branch office is appropriate for companies that are ready to trade or issue invoices locally in Bangladesh.
What a Liaison Office Is — and Isn’t
A liaison office is not a commercial organisation; it cannot earn money, prepare invoices, or enter into sales contracts within Bangladesh, its only function being that of carrying out communication, coordination, and market research for the parent company based abroad. This distinction is the reason for almost all the rules that come next: those relating to what BIDA will approve, the taxes that will apply, and the actions which your local representative is permitted or not permitted to take.
It helps to see how this compares with two other common structures:
Structure What it’s for Legal status
Liaison Office Communication and market research, no local revenue Non-commercial extension of the parent company
Branch Office Direct operational activity in-country Extension of the parent company
Joint Venture Commercial partnership with a local firm Independent legal entity
A liaison office is generally the simpler option if you are still at the stage of carrying out research and building relationships; however, if your aim is to sell, invoice or manufacture in Bangladesh a joint venture or a branch office would be more appropriate.
Why Companies Choose This Route
A liaison office enables a foreign company to have a real physical presence—such as an address, a local team, and a means of being contacted—without having to set up a complete commercial operation right from the start. There are several reasons why this is useful.
• This allows you to test the market and check your assumptions before putting in serious capital.
• It provides headquarters with local partners a direct and continuous means of communication.
• It increases its visibility and builds credibility among the people whom you will eventually want to do business with.
For a company which is still deciding if Bangladesh is worth making a bigger investment, adopting this lighter structure is usually the sensible first step.
Step 1: Confirm the Structure Actually Fits
It’s worthwhile carrying out some stress testing to determine whether a liaison office really fits your plans, since these offices are not allowed to generate local income and any situation that appears to involve a sale, a service charge, or a local transaction puts both your application and your future compliance position at risk.
By this stage you should be able to:
Make sure that the parent company is correctly incorporated and is in good standing in its home country.
• Explain the planned activities in Bangladesh using language that is clearly not commercial.
Find a local representative who will be in charge of submitting the documents and dealing with the regulators.
If you get it right from the start, you’ll be able to avoid a considerably more difficult discussion with BIDA later on.
Step 2: Secure BIDA’s Approval
A liaison or representative office cannot function without BIDA’s approval. This is the key stage at which the main amount of examination takes place—approval usually takes between four and six weeks once the application is complete and thoroughly documented.
You submit your application through BIDA’s online portal by uploading the company’s documents together with a description of the activities you plan to carry out. BIDA then evaluates the application based on a number of key factors.
What BIDA looks at What it’s checking for Weight in the decision
Financial position Audited statements from the parent company High
Track record The company’s global standing and reputation Medium
Planned activities Whether the scope described is genuinely non-commercial High
Compliance history Any past regulatory issues Medium
The greater the precision with which you describe the activities you intend to carry out, and the clearer your financial statements make it that the parent company can afford the office, the smoother this stage tends to be.
Step 3: Prepare and Authenticate Your Documents
When you know what BIDA expects, your next step is to put together a full set of corporate documents. This typically involves:
• A certified copy of the Certificate of Incorporation
• A board resolution specifically authorizing the liaison office
• The Memorandum and Articles of Association
• Recent audited financial statements
• A written description of planned activities and organizational structure
Since the documents in question are foreign, they must undergo notarization and attestation — usually carried out via your embassy or consulate — before they will be accepted by Bangladeshi authorities. The fact that the attestation process can be a lengthy one often surprises many applicants, which is why it’s advisable to begin it early rather than putting it off until later.
Step 4: Register with the RJSC
Once you have the approval letter from BIDA, your next step is to go to the Registrar of Joint Stock Companies and Firms (RJSC)—the organisation responsible for keeping the official record of every business that is registered in the country.
You have to submit the BIDA approval together with the certified documents of the company via RJSC’s portal, pay the relevant government fees, and when all the details have been verified, obtain a registration certificate. This certificate then serves as your legal evidence of registration and forms the basis for the subsequent steps — such as opening a bank account or applying for a TIN, etc.
The registration of RJSC also involves a number of continuing obligations, such as making annual submissions and reporting to the office or its representatives if there are any changes. Far from being merely minor administrative tasks, failing to meet these requirements could put your registered status in danger.
Step 5: Get a Taxpayer Identification Number (TIN)
A liaison office may earn no income locally, yet it still requires a Taxpayer Identification Number from the National Board of Revenue (NBR). You will need this number for banking and for various administrative filings.
The application is completed online and the details that you provide—such as company information, BIDA approval, and the registered address—must exactly match those in your other filings; any discrepancy tends to delay the process. When it has been approved you are given a digital TIN certificate.
The fact of holding a TIN means that you will have to file annual tax returns in future situations, even if no tax is actually due, just to keep your status up to date with the NBR.
Step 6: Apply for a Trade License
An office that has a physical address must obtain a trade license from the appropriate City Corporation or Municipality—namely, the one that has authority over the actual location of the office. It is a frequent mistake yet completely preventable to file with the wrong authority, so it is essential to verify the address against the municipal boundaries before submitting the application.
The application generally needs:
• The BIDA approval letter
• The office lease or rental agreement
• A completed, signed application form from the authorized representative
• Proof that municipal fees have been paid
• The company’s Memorandum and Articles of Association
As in the case with everything else involved in this process, it’s important to be consistent—if the application for the trade licence does not match what was told BIDA, further questions will be asked.
Step 7: Work Out Your VAT and BIN Position
It is often thought that liaison offices are automatically exempt from VAT, but that is not exactly correct. Whether or not a Business Identification Number (BIN) is required will depend on the actual activities carried out by the office:
Activity VAT/BIN status What to do
Pure liaison work (communication, coordination) Generally exempt Keep BIDA records current
Procuring local services Depends on the arrangement Check withholding tax obligations
Importing office equipment Registration required Apply for a BIN
Providing any taxable service Registration required Full VAT compliance
Registration becomes a necessity if the office pays VAT on services or is in charge of withholding tax on payments made to local vendors. It would be a good idea to get an opinion from a local tax advisor on this as early as possible since the distinction between ‘pure liaison work’ and ‘taxable activity’ is not always clear in practice.
Step 8: Open a Bank Account and Bring In Funds
It is necessary for the office to have a corporate account with an authorized dealer branch of a Bangladeshi commercial bank—this is not optional—and it is in this way that the central bank ensures that foreign investment is transparent and traceable.
To open the account you generally have to provide the BIDA approval, the incorporation documents, and the board resolution. All the funds must come via official banking channels—therefore no informal transfers and nothing should be introduced outside the banking system. A large amount is often paid in advance (figures of about USD 50,000 are frequently mentioned) to meet the costs associated with setting up the company and with its initial operations, although it is advisable to check directly with your bank about the present requirement.
Step 9: Set Up the Office and Appoint a Local Representative
At this point, you’re moving from paperwork into actual operations. The office needs to be located in a recognized commercial zone with a properly documented lease, plus the basics — reliable internet, secure record storage, and enough space for the team.
The local representative is arguably the most important hire in this entire process. They’re the bridge to BIDA, the RJSC, and the NBR, and typically handle:
- Day-to-day communication with government agencies
- Making sure reports and tax filings go in on time
- Overseeing the office and staff records
- Acting as the point of contact during any audit or inquiry
Choosing someone who genuinely understands the local regulatory landscape — not just someone who happens to be available — saves a lot of trouble later.
Staying Compliant Over Time
Registration isn’t a one-off event; it’s the start of an ongoing relationship with several regulators. A few things worth keeping on the calendar:
- Regular reporting to BIDA to confirm activities remain within the approved scope.
- Accurate financial record-keeping, since the books need to show funds are used only for approved operational costs.
- Renewals, since BIDA approval typically runs two to three years. Applications should go in roughly two months before expiry, with updated financials and remittance evidence attached.
- Staying current on policy changes — regulations shift, and what was compliant last year may need adjusting this year.
Many companies bring in a local consultant for this ongoing work rather than tracking every deadline internally, especially once the compliance calendar gets more complex after the first couple of years.
Frequently Asked Questions
What are the main steps to register a liaison office in Bangladesh?
In order: BIDA approval, RJSC registration, a TIN from the NBR, and a trade license from the relevant City Corporation.
What exactly can’t a liaison office do?
It can’t generate revenue or engage in any profit-making activity. It needs a physical office and a local representative, and the parent company covers all costs.
What documents do BIDA and RJSC actually require?
Notarized copies of the Certificate of Incorporation, Memorandum and Articles of Association, and a board resolution — all attested by the Bangladeshi embassy or high commission in the home country.
How does BIDA decide whether to approve an application?
Mainly on the parent company’s financial health and reputation, plus how clearly the planned — and strictly non-commercial — activities are described.
What does setup typically cost?
Beyond registration and notarization fees, expect to remit a meaningful sum from abroad, commonly cited around USD 50,000, to fund initial setup and operations.
Would a joint venture make more sense instead?
If the goal is eventually trading, manufacturing, or invoicing locally — yes. A joint venture or wholly foreign-owned subsidiary allows commercial activity in a way a liaison office simply doesn’t.
How often does this need renewing?
BIDA approval usually runs two to three years. Renewal applications, with updated reports and remittance evidence, should be filed about two months before expiry.
Is a consultant necessary?
Not strictly, but most companies use one — the process touches several agencies (BIDA, RJSC, NBR), and someone who tracks current requirements can meaningfully speed things up.
What tax obligations come with a representative office?
Both a TIN and, depending on activities, a BIN. Even without local profit, returns still need filing, and VAT applies to eligible local expenses and salaries.
How does the bank account get opened?
Once BIDA approval and RJSC registration are in place, a corporate account can be opened at an authorized dealer bank — this account becomes the channel for all foreign fund transfers into the office
