Trade License

Trade License is being introduced in Bangladesh under The Municipal Corporations [Taxation] Rules, 2009. It is issued when any entrepreneur applied through the license form. The process is managed by the City Corporation or city council where the business operates. A license is issued exclusively in the name of the company and such a license is not transferable. A renewed license is provided by the concerned staff of the zonal taxation office. A fee for trade license has to be deposited at any Bank as indicated in the form.    

Required Documents for Trade License:

1. In the case of general Trade License - Attested Copy of Rent Receipt or Rental Agreement and also the copy of the Holding Tax payment receipt.
2.  In the case of  industries - Everything mentioned in serial no. 1 plus:

• No objection declaration on the surrounding
• Location Map
• Copy of fire certificate
• Declaration on the non-judicial stamp of Tk. 150/- to abide by the rules and regulation of DCC
• One copy of passport size photograph

  3 In the case of Clinic/Private Hospital: permission from the Director-General of Health. 4. In the case of Limited Company:

• Memorandum of Article
• Certificate of In-Corporation

5. In the case of Printing Press and Residential Hotel- Permission from Deputy Commissioner (DC). 6. In the case of a Recruitment Agency - License from Manpower export Bureau (BMET). 7. In case of Arms and Ammunition - Copy of Arms License. 8. In the case of Drug and Narcotics - Copy of Drug/Narcotics License. 9. In the case of Travelling Agency - Approval from civil aviation authority.

Renewal of Trade License

• Contact concerned zonal Taxation office along-with the previous License
• The concerned staff of the zonal taxation office will provide a new Trade License
• Fees: Fees for trade license renewal is same as applicable for a new License, which has to be deposited at any Bank indicated on the Trade License

Trade License is mandatory for every form of business entity in Bangladesh. It is issued by the local government of the respective areas. Every business entity must obtain a Trade License from each local government where it operates. If a business entity has more than one place of business, it must obtain a Trade License from each local government.  It is issued for one year and has to be renewed annually. Trade License attracts some government fees, which usually depends on the types of business. Below, we have described the process of obtaining a license for businesses that operate within the Dhaka City Corporation area. Other local governments have similar rules. You are advised to contact the respective local government for more information.

TRADE LICENSE FOR A COMMERCIAL FIRM

PROCESS STEPS:

STEP 1: PROCURE THE PROPER FORM FROM THE PROPER OFFICE.

Dhaka City Corporation (DCC) has two forms for a trade license depending on the type of business. A commercial firm must use the “K” Form. Even though the ten zonal offices use the same K Form, a business must buy the form from its respective zonal office. A seal and the initials of the officer selling the form is what distinguishes it from that of other zones. The form costs Tk. 10.

STEP 2: GET CERTIFICATION FROM THE LOCAL WARD COMMISSIONER.

After the form is completed it has to be submitted to the local ward commissioner for validation.

STEP 3: COLLECT LICENSE BOOK BY TK. 50 AND SUBMIT APPLICATION WITH SUPPORTING DOCUMENTATION TO DCCS ZONAL OFFICE.

For the K Form, a rent receipt for the premises where the business is operating from or, if owned, the municipal tax payment receipt has to be provided. Supporting documents include:

• 3 copies of PP size photo of the owner
• Rent receipt or premises ownership proof
• Step 4: Await inquiry by the Licensing Supervisor (LS).
• Upon submission of the form, the LS usually goes to the business entity for a visit to verify the information provided.

STEP 4: PAY PREDETERMINED FEE AND COLLECT TRADE LICENSE.

After inspection by the LS is concluded, the business is asked to go to the DCC office to pay the predetermined fee and collect their trade license. The fee schedule depends on the business category under which the application was filed.

STEP 5: SIGNBOARD FEE FOR TRADE LICENSE

When collecting the trade license, a signboard fee has to be paid as well. For all types of business, the signboard fees will payable 30% of the License fee.

TRADE LICENSE FOR A MANUFACTURING FIRM

PROCESS STEPS:

STEP 1: PROCURE THE PROPER FORM FROM THE PROPER OFFICE.

The “I” Form will have to be purchased for Tk. 10 from the DCC zonal office where the manufacturing firm has to submit its application.

STEP 2: GET CERTIFICATION FROM THE LOCAL WARD COMMISSIONER.

The completed form has to be validated by the local ward commissioner.

STEP 3: SUBMIT APPLICATION WITH SUPPORTING DOCUMENTATION.

Supporting documents include:

• 3 copies of PP size photo of the owner
• Rent receipt or premises ownership proof
• No objection certificate from the neighborhood
• A written undertaking on a Tk 150 non-judicial stamped paper
• Fire License from the local fire department Environmental Certificate from DOE

STEP 4: AWAIT ENQUIRY BY THE LICENSING SUPERVISOR (LS).

Upon submission of the form, the LS usually goes to the business entity for a visit to verify the information provided.

STEP 5: PAY PREDETERMINED FEE AND COLLECT TRADE LICENSE.

After inspection by the LS is concluded, the business is asked to go to the DCC office to pay the predetermined fee and collect their trade license. The fee schedule depends on the business category under which the application was filed.

STEP 6: SIGNBOARD FEE

When collecting the trade license, a signboard fee has to be paid as well. For all types of business, the signboard fees will payable 30% of the License fee.

RENEWAL OF TRADE LICENSE

The renewal process is comparatively routine and no inspection is required. When the license comes up for renewal the business has to go the LS.

PROCESS STEPS:

STEP 1: PICK-UP DEMAND BILL FROM THE LICENSE BOOK (THIS BOOK IS VALID FOR FIVE YEARS)

Upon checking the expiring trade license, the LS fills in the particulars in a demand bill and gives the booklet to the business. The demand bill is a four-page booklet similar to a bank deposit slip. The same information is filled into all the pages: one page is for the bank and one is for the business.

STEP 2:  PAY RELEVANT FEE AT DESIGNATED BANK

Deposit designated bank through demand bill and it will automatically renew the license. One of the important steps in starting a business in Bangladesh is acquiring a license. A businessman must obtain a business license from the respective business area’s City Corporation or City Council. Here, in this post in detail, we will explain the procedure of obtaining a trade license in Bangladesh, the fees, and finally the renewal process of trade license in Bangladesh.  

Step by Step Process of acquiring Trade

License for any Business Entity

  The acts/legal authorities which overseen the process of obtaining the trade license in Bangladesh are 1) The Companies Act- 1994, 2) Dhaka City Corporation Ordinance – 1983, 3) Municipal Taxation Rules – 1986. And, the responsible organization’s which authorize the trade license are Municipal/City Corporation or Union Parishad.  

Step by Step Process:

Below is an overview of the process of obtaining a trade license for companies operating within the zone of Dhaka City Corporation. Many local authorities have similar rules.

• Step 1:  Collect the prescribed Application Form from the City Corporation/ Municipal Corporation/ Union Parishad’s Office.
• Step 2: Submit the completed Application Form with supporting documents to the concerned section.
• Step 3: Inspection by the Licensing Supervisor.
• Step 4: Required fees to deposit at the concerned office.
• Step 5: Obtain Trade License from the City Corporation/ Municipal Corporation/ Union Parishad office.

The trade license filled-in application form must be accompanied by the required documents.

Required Documents:

1. Application Form
2. National ID Card of the Entrepreneur
3. Holding Tax Payment receipt
4. Recent Passport Size Picture of the Entrepreneur
5. Declaration  of  non –Judicial stamp to abide by the rules & regulation of City Corporation & Municipal Corporation
6. A certified copy of the memorandum and articles of association
7. A copy of the certificate of incorporation
8. Agreement of Partnership
9. Tax Identification Number certificate
10. A copy of the lease agreement of the registered office
11. Work Permit from Bangladesh Investment Development Authority
12. Statement of Bank Solvency.