Outstanding Liability Position in a Bank: An In-Depth Guide for Investment Clients
Understanding the outstanding liability position in a bank is pivotal for investment clients seeking transparency and control over their financial engagements. This article delves into the intricacies of outstanding liability, explains its importance for clients, and highlights relevant banking laws and regulations in Bangladesh.
Defining Outstanding Liability Position
The outstanding liability position refers to the contingent liability that arises when a bank accepts a customer’s financial obligation, such as a bill or loan. It represents the bank’s obligation to fulfill the liability on behalf of its customers, typically through guarantees, acceptances, or lending activities. For the customer, it reflects the current dues and commitments, enabling them to manage financial risks effectively.
Importance for Investment Clients
Investment clients benefit significantly from understanding and managing their outstanding liability position. Banks often provide digital dashboards or statements detailing mode-wise and account-wise liabilities across various investment accounts. This empowers clients to:
Evaluate Financial Exposure: By reviewing liabilities, clients can assess their current exposure and adjust their investment strategies accordingly.
Facilitate Compliance: Proper monitoring ensures compliance with financial covenants and banking norms.
Optimize Investments: Clients can identify opportunities to optimize fund allocations by analyzing their net liabilities against assets.
Enhance Decision-Making: Access to detailed liability data aids in informed decision-making, reducing financial risks.
Liabilities and Their Role in Banking
In banking, liabilities primarily comprise deposits from customers. These represent obligations the bank must fulfill upon demand, whether through savings accounts, fixed deposits, or certificates of deposit. Additionally, banks manage contingent liabilities, such as guarantees or letters of credit issued on behalf of customers.
The equation representing a bank’s financial health is:
Here, net worth is the difference between total assets and total liabilities, providing a snapshot of a bank’s financial stability.
Key Components of a Bank’s Liability Position
1. Deposits
Deposits are the backbone of banking liabilities. When customers deposit funds, these become liabilities because the bank must return them upon request. For instance, if a bank holds $10 million in deposits, it owes this amount to its customers.
2. Borrowings
Banks also borrow funds from other financial institutions or central banks to meet liquidity requirements. These borrowings add to the liabilities on their balance sheet.
3. Contingent Liabilities
These include obligations like guarantees and letters of credit issued by the bank. While they may not require immediate settlement, they represent potential liabilities if conditions are triggered.
4. Reserve Requirements
Banks are mandated by central banking regulations to maintain a reserve ratio, a portion of deposits kept in reserve as cash or with the central bank. This ensures liquidity and minimizes systemic risks.
Asset-Liability Management (ALM) in Banks
Effective Asset-Liability Management (ALM) is crucial for maintaining financial stability and ensuring profitability. The ALM desk performs the following functions:
Balance Sheet Analysis: Analyzing the balance sheet to identify gaps in asset-liability matching and recommend corrective actions.
Market Analysis: Assessing economic conditions to forecast interest rate movements and liquidity trends.
Risk Management: Mitigating risks like interest rate risks, liquidity risks, and credit risks.
Strategic Recommendations: Advising on pricing strategies for loans and deposits to achieve competitive advantage.
For example, if the ALM team anticipates a rise in interest rates, they may suggest reducing fixed-rate loan exposures or increasing investment in floating-rate instruments.
Bangladesh’s Banking Regulations and Legal Framework
1. Bank Companies Act, 1991
This act governs the functioning of banks in Bangladesh, including their liabilities and reserve requirements. It mandates banks to maintain a specific liquidity ratio to ensure depositor protection.
2. Bangladesh Bank Guidelines
The central bank, Bangladesh Bank, issues circulars and guidelines on maintaining capital adequacy, provisioning for liabilities, and risk management practices. Banks must comply with the Basel III framework, which prescribes capital and liquidity standards.
3. Negotiable Instruments Act, 1881
This law governs financial instruments like bills of exchange, promissory notes, and cheques. It underpins the contingent liabilities arising from a bank’s acceptance of a customer’s bill.
4. Money Laundering Prevention Act, 2012
This act ensures that banking liabilities are not misused for illicit activities. It mandates due diligence and KYC (Know Your Customer) compliance for all liability accounts.
5. Deposit Insurance Scheme
Under this scheme, Bangladesh Bank provides a safety net for depositors, ensuring protection up to a certain amount in case of bank failure.
Illustrative Example: Safe and Secure Bank
Let’s consider an example of a hypothetical bank, “Safe and Secure Bank,” to understand liability components:
Deposits: $10 million
Loans (Assets): $5 million
Treasury Securities (Assets): $4 million
Reserves (Assets): $2 million
Here, the bank’s liabilities include the $10 million in customer deposits. The net worth is calculated as:
If a bank cannot meet withdrawal demands due to insufficient reserves, it faces liquidity risk. This is mitigated by maintaining adequate reserves as per regulatory norms.
2. Interest Rate Risk
Changes in interest rates can impact a bank’s profitability. For instance, if a bank has issued low-interest loans but must pay high interest on deposits, it incurs a loss.
3. Credit Risk
Contingent liabilities like guarantees pose credit risks if the underlying party defaults.
4. Market Risk
Adverse market conditions can devalue a bank’s investment portfolio, affecting its net worth.
Benefits of Liability Position Tracking for Clients
Transparency: Clients can view real-time data on their liabilities, enhancing trust in the banking relationship.
Customizable Insights: Mode-wise and account-wise statements provide granular insights into financial obligations.
Proactive Management: Clients can identify potential risks and take timely corrective actions.
Regulatory Compliance: Detailed records simplify compliance with tax and financial reporting requirements.
For investment clients, understanding the outstanding liability position is a cornerstone of effective financial planning. Banks, through their ALM practices and adherence to regulatory frameworks, play a vital role in managing liabilities. Features like mode-wise and account-wise liability statements empower clients to make informed decisions, ensuring financial stability and growth.
In Bangladesh, laws such as the Bank Companies Act and guidelines from Bangladesh Bank provide a robust framework for managing liabilities, safeguarding depositors, and promoting banking stability. By leveraging these insights, investment clients can navigate their financial journeys with greater confidence.
ED-Tech Startup Funding Process in Bangladesh: Insights from TRW Law Firm
The entrepreneurial ecosystem in Bangladesh has witnessed remarkable growth over the past decade. With an influx of innovative ideas and a growing pool of aspiring entrepreneurs, the demand for robust startup funding mechanisms has never been higher. TRW Law Firm, leveraging its expertise in corporate and startup advisory, is dedicated to supporting entrepreneurs in navigating the complex journey of securing funding, from ideation to scaling.
This article explores the essentials of the startup funding process in Bangladesh, drawing from TRW’s insights and strategies to empower entrepreneurs.
1. The Foundation of a Successful Startup
The startup journey begins with an idea, but effort and execution are paramount to transforming that idea into a reality. TRW emphasizes these core principles:
Prototype Over Explanation
An idea becomes more convincing when accompanied by a tangible prototype or sample. Entrepreneurs who invest in building and showcasing their concepts often attract greater interest from investors, as it demonstrates commitment and a clear vision.
Adaptability in Business Models
The startup landscape is dynamic, and initial plans may not always align with market realities. Entrepreneurs must be willing to pivot and adapt their business models to meet evolving demands. Flexibility is often viewed favorably by investors, as it reflects a startup’s resilience and responsiveness.
Research and Networking
Before taking any major step, thorough research and consultation are crucial. Engaging with industry experts, mentors, and peers can provide valuable insights and help refine strategies.
2. Understanding the Funding Journey
TRW advises startups to approach funding as a structured and goal-oriented process. The key stages include:
Setting Clear Goals
Define your objectives and establish realistic milestones. Whether the focus is on product development, market expansion, or operational scalability, having clear goals ensures efficient allocation of resources and attracts investor confidence.
Market Analysis
Understanding your Total Addressable Market (TAM), Serviceable Available Market (SAM), and Serviceable Obtainable Market (SOM) is vital. Investors often assess these metrics to gauge the potential and scalability of a startup.
Identifying Customer Pain Points
A successful startup addresses real problems. Entrepreneurs must delve deep into customer pain points and craft solutions that resonate. For example, in the ed-tech space, TRW highlights challenges like the lack of personalized learning and the high cost of courses. Addressing these issues with affordable and user-friendly solutions enhances market acceptance.
3. Crafting the Perfect Pitch
Investors are not just funding an idea—they are investing in the entrepreneur and their vision. A compelling pitch is critical in securing funding, and TRW emphasizes the following:
Showcase Your Vision: Present a clear roadmap of how your startup will evolve. Articulate your mission, value proposition, and long-term goals effectively.
Clarity and Confidence: Writing and practicing your pitch helps refine ideas and build confidence. A well-structured narrative leaves a lasting impression.
Data-Driven Insights: Back your pitch with concrete data, including market research, financial projections, and competitor analysis. Investors appreciate startups that make informed decisions.
4. Funding Sources in Bangladesh
Entrepreneurs in Bangladesh have access to a growing array of funding options. Understanding these options is crucial for selecting the right fit for your startup’s needs.
Angel Investors
Angel investors are individuals who provide early-stage funding in exchange for equity. They often bring industry expertise and mentorship, making them valuable partners in the startup journey. However, entrepreneurs must prioritize accountability and ensure timely returns to maintain credibility.
Venture Capital (VC)
Venture capital firms invest in startups with high growth potential. In exchange for funding, VCs often seek significant equity and active involvement in decision-making. TRW assists startups in negotiating favorable terms with VC firms to ensure balanced partnerships.
Corporate Social Responsibility (CSR) Funding
Many corporations allocate funds to support startups under their CSR initiatives. This is particularly beneficial for startups with social or environmental missions, as it aligns with corporate goals of giving back to the community.
5. The Role of Ed-Tech in Bangladesh’s Startup Ecosystem
The ed-tech sector in Bangladesh has seen substantial growth, inspired by models in neighboring India. Online education platforms cater to diverse audiences, from school students to professionals seeking skill enhancement.
Customer Pain Points
Despite its potential, the sector faces challenges, such as:
Lack of personalized learning experiences.
Limited accessibility for rural and underprivileged communities.
Price disparities in course offerings.
Proposed Solutions
Ed-tech startups can address these issues by offering freemium models, introducing 10-minute micro-courses for affordability, and leveraging data analytics to personalize learning paths. TRW works with startups to ensure their solutions align with regulatory frameworks and market demands.
6. Management and Financial Planning
Effective management and financial discipline are critical for the sustainability of any startup. TRW emphasizes:
Spreadsheets for Clarity: Maintaining organized records of expenses, revenues, and projections helps entrepreneurs track progress and make informed decisions.
Efficient Resource Allocation: Startups must optimize their spending, focusing on areas that directly contribute to growth and market acceptance.
7. The Entrepreneur’s Journey
Starting a business is a transformative journey that requires resilience, learning, and adaptability. TRW highlights the importance of enjoying the process, learning from failures (both personal and from competitors), and maintaining a balance between ambition and well-being.
8. Building for the Future: Corporate Social Responsibility (CSR)
Startups can integrate CSR into their business models to align profitability with social accountability. For instance, an ed-tech platform could allocate a percentage of its revenue to providing free courses for underprivileged students. Such initiatives enhance brand reputation and foster long-term relationships with stakeholders.
9. Global Perspective: Lessons from India’s Startup Ecosystem
Bangladesh’s startup ecosystem can draw valuable lessons from India, which boasts a mature ed-tech market. Key takeaways include:
Collaborating with schools and universities to expand reach.
Adopting localized content to cater to diverse demographics.
Securing funding from international investors who are keen on emerging markets.
10. A Holistic Approach: TRW’s Support for Entrepreneurs
TRW provides comprehensive support for startups, including:
Legal Advisory: Assistance with incorporation, intellectual property protection, and regulatory compliance.
Strategic Planning: Offering insights into market trends, competitor analysis, and growth strategies.
The startup funding process in Bangladesh is evolving rapidly, with increasing opportunities for ambitious entrepreneurs. However, success requires careful planning, resilience, and strategic execution. TRW Law Firm is committed to empowering startups with the legal and strategic tools they need to thrive in an ever-competitive market.
By fostering innovation, supporting funding journeys, and addressing both local and global challenges, TRW plays a pivotal role in shaping the future of Bangladesh’s entrepreneurial landscape.
A complete guide toTrust Registration in Bangladesh in 2025
Our firm provides professional advice and legal solutions pertaining to the establishment and management of trusts, guaranteeing that your goals are fulfilled in complete accordance with Bangladeshi legislation. An outline of the main components of trusts as defined under Bangladesh’s Trusts Act, 1882, is provided below, along with information on how we may help you navigate these complicated legal issues.
A Trust: What Is It?
A trust is a formal agreement in which one or more people, referred to as trustees, keep and administer assets on behalf of other people, referred to as beneficiaries. A formal transfer of property from the Trust’s originator, known as the Author, to the Trustees establishes a trust, with particular duties associated with the ownership of the property. A trust is defined as an obligation attached to property ownership that results from confidence placed in and accepted by the owner for the benefit of another under Section 3 of the Trusts Act, 1882. In order to safeguard the interests of both Trustees and Beneficiaries, our company makes sure that this procedure is carried out properly and in accordance with the law.
Important Elements of a Trust
A few key words in every trust must be understood:
• Author: The person who establishes the Trust and has faith in the Trustees.
• Trustee: The individual or organization charged with overseeing the Trust Property in line with the terms of the Trust Deed.
• Beneficiary: The person or organization that the trust was created for.
The assets kept in trust are referred to as trust property.
• Instrument of Trust: The formal agreement defining the terms, obligations, and conditions of the Trust.
In order to protect the interests of both Authors and Beneficiaries, our business carefully writes and constructs each Trust, guaranteeing clarity on the duties and responsibilities of all parties.
Section 6 of the Act states that a trust is created when its creator states, with reasonable assurance, in words or deeds:
(a) a desire to establish a trust,
(b) the trust’s objective,
(c) the recipient and
(c) The property held in trust.
Trust Types
There are two primary categories of trusts:
Private trusts are established to benefit a particular person or group of people. They may unintentionally help the public, even when their primary purpose is to serve private interests. population or Charitable Trusts: These are set up to serve larger social goals like welfare or education, benefiting the general population. Our knowledge of both public and private trusts allows us to provide solutions that are specifically designed to satisfy our clients’ needs, whether they be charitable, family, or personal.
The goal and establishment of a trust
A trust needs to have a clear and legal goal, such supporting charity activities, medical care, or education, among other things. A trust may be void due to unclear or illegal goals. We help our clients clearly define the goals of their trust and make sure that all legal requirements are met, including the execution and registration of the trust deed. The legal basis is provided by the Trust Deed, which describes the goals, assets, and duties of the Trustees. To finish the procedure, we also make sure that the Trust Property is transferred in accordance with applicable legislation.
Establishing and registering a trust:
It is not necessary to get approval from any governmental or regulatory body in order to establish a trust. The main prerequisite is that the trust deed be registered with the relevant sub-registrar’s office.
The sort of property involved determines the registration process for a trust. Section 5 of the Trust Act of 1882 states that a trust involving movable property does not need to be registered. On the other hand, a trust involving real estate must be registered. Consequently, the following procedures need to be taken in order to register a trust deed:
Step 1: Choose the Correct Authority to Register a Trust Deed
Like a land document, a trust deed needs to be registered at the Sub-Registrar’s office in the area. According to Section 28 of the Registration Act of 1908, the trust deed for immovable property must be registered in the Sub-Registrar’s office in the jurisdiction where the immovable property is located. On the other hand, a trust deed for moveable property can be recorded in the location of the trust’s registered office or where the trust’s operations will be conducted.
Step 2: Calculate the Registration Fees
The fees for registering a trust deed are listed in the Gazette under No.-S. R. O. No. 254-Law/2014, which was published by the Ministry of Law, Justice, and Parliamentary Affairs’ Law and Justice Division in compliance with Section 78 of the Registration Act, 1908. Article A (1) of the Gazette states that a 2% ad valorem fee, with a minimum charge of BDT 100, is applied if the trust’s worth is less than BDT 5,000. A registration fee equal to 2% of the trust’s worth is assessed for trusts with a value greater than BDT 5,000. The stamp duty that applies to trust deeds is specified in Schedule I of the Stamp Act of 1899. A trust deed’s stamp duty is 2% of the consideration, as stated in Schedule I, serial number 64.
Step 3: Put the Trust Deed in writing.
Both the trustee and the author/creator must sign the trust deed in front of the registering officer. Before the registration officer, the trust’s authors must also sign and put their fingerprints in the register book. In front of the registering officer, the final page of the trust deed must also be signed by two witnesses.
Step 4: Send in a Certified Copy Application
The author or originator of the trust must fill out and sign a certain form, which is then delivered to the Sub-Registrar’s office in order to receive a certified copy of the registered trust deed.
Section 52(1)(b) of the Registration Act, 1908 mandates that the registering officer provide a receipt to the individual presenting the document after they have fulfilled all the requirements and turned it in. On the day of the trust declaration, all pertinent officials must be in front of the sub-registry office.
Step 5: Functioning in Bangladesh as a Trust
A receipt and a copy of the trust deed will be provided by the registering office official upon receipt of the assembled trust documents. To get the original registered trust deed, this receipt needs to be brought to the relevant Sub-Registrar’s office.
The trust officials will be able to carry out the trust’s regular operations and open a bank account in the trust’s name at any bank in Bangladesh with these documents.
After everything is ready to be filed with the Land Registry Office, the registration procedure typically takes seven to ten working days. However, based on particular conditions, this time frame might change.
Step 6: Applying for registration under the 1860 Societies Registration Act:
The Societies Registration Act of 1860 permits the registration of a trust with a benevolent purpose. To register as a society, submit an application to the Registrar of Joint Stock Companies and Firms (RJSC) along with the draft articles and memorandum of association. According to the Societies Registration Act of 1860, a minimum of seven (seven) individuals must be members or trustees in order to be registered. A trust establishes a legal body if it is registered under the Societies Registration Act of 1860. The Trust must be charitable and registered with RJSC Bangladesh in accordance with the Societies Registration Act, 1860, in order to apply to the NGO Affairs Bureau (NGOAB) or Micro Credit Regulatory Authority.
The following are involved in this process:
Step 1: RJSC issues a name clearance.
Step 2: Apply to RJSC with the deed of trust, registration clearance letter, and all other necessary paperwork.
Step 3: Government fee payment
Step 4: The law enforcement organization, such as the National Security Intelligence and Special Branch of Police, does a security check.
Step 5: The relevant authorities inspect, monitor, and review the NGO. (if necessary)
Step 6: The authority will issue a registration if you are pleased.
Depending on how complicated the situation is, this process could take one to two months.
Demise of a Trust
When a trust’s goal has been accomplished, it is no longer legal, or it is otherwise unachievable—for example, when the beneficiaries are no longer alive—it is terminated. We ensure compliance with all legal requirements by providing legal monitoring during the Trust’s existence and helping to properly dissolve it when needed.
Benefits of Creating a Trust
Among the many benefits of a trust are its freedom in administration and management, as well as its capacity to set social or charitable goals free from onerous legal obligations. In order to guarantee that assets are used for their intended purposes, trusts also provide efficient asset management and protection.
Obstacles and Legal Aspects
Trusts have specific restrictions even though they provide flexibility. Board members cannot receive dividends from trust profits, and trustees are held personally accountable for any breaches of trust. Trusts must also register with the NGO Affairs Bureau in order to accept donations from overseas. To overcome these obstacles, our firm offers full legal services and strategic assistance, making sure that all legal and regulatory needs are fulfilled.
(i) Beneficiaries: The trust can be set up to benefit certain, identified people (fixed beneficiaries) or it can be discretionary, meaning the trustee has the power to choose the beneficiaries whenever they see appropriate.
The beneficiaries are the ones who ultimately gain from the Trust. To guarantee that their rights are upheld, they must be named explicitly in the Trust Deed. A trust may be declared void if its beneficiaries are not specified. In order to enable Beneficiaries to fully benefit from the Trust, we make sure that its structure precisely outlines and protects their rights.
(ii) The Trustee’s Role and Responsibilities: The trustee is legally the owner of the trust property and is required to manage it with the same care and caution that a normally prudent person would use over their own property. The trustee is required to maintain accurate and transparent records of the trust assets and is personally liable for any breaches of the trust.
Legally speaking, trustees must administer trust property in line with the author’s instructions or, in some cases, with the beneficiaries’ approval. Their responsibilities include protecting the Trust’s assets, making sure they are managed properly, and with reasonable care, just like they would if they were their own. Our company offers trustees continuous assistance, making sure they fulfill their responsibilities while shielding them from possible legal risks, particularly with regard to property management and fiduciary duties.
(iii) Trustee Compensation: A trustee can only receive compensation if it is specifically included in the trust deed.
(iv) Character of Trust Property: The assets that make up the trust property may be movable (personal property) or immovable (real estate).
(v) Foreign Donations: In accordance with the Foreign Donations (Voluntary Activities) Regulations Act, 2016 (FDRA), the trust must obtain approval from the NGO Affairs Bureau (NGOAB) through a procedure called Foreign Donation Registration (FD Registration) before it can accept or use foreign donations.
(vi) Accountability and Transparency: Trustees must keep accurate and thorough records of the assets under trust. The right to request and get access to these accounts belongs to the beneficiaries.
(vii) Liability for Breach of Trust: If the trustee violates the trust, he is responsible for compensating the beneficiary or the trust property for any losses incurred. This is unless the beneficiary deceived the trustee into breaking the trust, or the beneficiary, who is capable of entering into contracts, consented to the breach or later acquiesced in it after being fully informed of the case’s facts and his rights against the trustee. A civil lawsuit may be filed against a trustee who violates the terms of the Limitation Act of 1908 in order to recover damages.
How TRW law firm Can Assist Bangladesh in Registering Trusts
We at TRW are ready to assist you with the establishment, management, and dissolution of trusts, making sure that your interests are completely safeguarded and that your trust effectively fulfills its intended function. We provide custom legal solutions that are suited to your unique requirements, ensuring that every facet of your trust complies completely with all applicable laws and rules.
Why should you hire TRW law firm to open your trust:
Expert Consultation: We evaluate your company’s needs and help you meet the requirements specified by the many regulatory organizations involved in the trust registration procedure. Document Preparation: In order to guarantee adherence to the relevant regulations, our staff helps to gather and prepare all required documentation. Application Management: From submission to approval, we manage the complete application process, making sure every step is carefully completed. Constant Follow-up: To monitor the status of your application and quickly respond to any questions or extra needs, we keep in close contact with the regulatory agencies. Inspection Preparation: To make sure your activities and infrastructure adhere to all legal requirements, we assist you in getting ready for any regulatory inspections. Lobbying with officials: To expedite the registration procedure, we help government officials communicate effectively.
By selecting TRW law firm, you can concentrate on growing your trust operations while confidently navigating the intricate regulatory landscape.
It takes several processes and strict regulatory compliance to secure a trust registration and operation in Bangladesh. The TRW legal office is dedicated to helping you at every stage, making sure that your application procedure runs smoothly and successfully.
Establishing a company in Bangladesh is a straightforward process when you understand the steps involved. With proper guidance from professional company registration consultants like TRW Law Firm, you can navigate this process smoothly and efficiently. Their expertise allows you to focus on other critical aspects of your business, while ensuring the registration process progresses quickly and complies with all local regulations.
Company registration with the Registrar of Joint Stock Companies and Firms (RJSC)
Provision of a local company secretary and a registered address
Assistance with opening local or international corporate bank accounts
Tax registration
Annual accounting and tax services
Why should you register your company in Bangladesh?
Bangladesh has become an attractive location for foreign investors who seek to establish businesses due to its strategic location, competitive production costs, and robust workforce. The country’s Companies Act of 1994 allows foreign investors to register new companies with the Registrar of Companies, making the incorporation process accessible and straightforward. With recent government initiatives to streamline the registration process, forming a business in Bangladesh has never been easier.
How Long Does It Take to Start a Business?
Typically, TRW Law Firm can complete the company registration process within two weeks. After gathering the necessary due diligence documents from directors and shareholders, TRW assists with the initial step of company name registration, ensuring your preferred name is available through a Bangladesh company search.
The process is convenient for foreign investors, as it does not require traveling to Bangladesh for company registration or corporate bank account opening; these steps can be handled online. After your company is incorporated, TRW will courier the corporate documents, including the Certificate of Incorporation, Articles and Memorandum of Association, and an RJSC-certified copy, to your preferred address.
TRW’s legal team also assists with obtaining a business license in Bangladesh, if necessary. Once the registration is completed, their banking team will open a corporate bank account for your business, which typically takes about four weeks. A bank-issued encashment certificate is required for foreign entities to incorporate in Bangladesh. Within six weeks of engagement, you can expect your business to be fully operational, with a corporate bank account and VAT registration number if applicable.
Types of Business Entities in Bangladesh
In Bangladesh, several business structures are available. Choosing the one that best aligns with your business needs and long-term objectives is crucial. TRW Law Firm can help assess your requirements and recommend the optimal structure. For foreign investors, the most popular choice is the Private Limited Company (PLC). Other options include joint-stock companies and branch offices.
Private Limited Company (PLC)
A Private Limited Company in Bangladesh is a separate legal entity from its owners and shareholders. This structure provides limited liability protection, meaning directors and shareholders are not personally liable for the company’s debts or obligations. Instead, their liability is limited to the capital they have invested or guaranteed.
Some key characteristics of a Bangladeshi PLC include:
Limited Liability: Shareholders are only liable up to their share value, protecting their personal assets.
Separate Legal Entity: The company is legally distinct from its shareholders, giving it the ability to own assets, incur liabilities, and enter contracts.
Flexible Membership: A PLC can have between 2 to 50 shareholders. Additionally, there is no residency or nationality restriction for directors, and they only need to be over 18 years of age with no bankruptcy or criminal record history.
No Minimum Capital Requirement: There is no mandated minimum capital, making it easier for smaller companies to establish themselves.
Choosing a PLC structure provides the benefits of limited liability, protecting personal assets, and a straightforward formation process.
Steps to Register a Company in Bangladesh
Company Name Registration:
The process begins by securing your desired company name. TRW Law Firm will perform a Bangladesh company search to verify name availability and submit a name clearance application to the RJSC.
Preparation of Documents:
Next, TRW will help prepare the necessary incorporation documents, including the Articles and Memorandum of Association and other supporting documents required by the RJSC.
Submission of Documents and Payment of Fees:
The prepared documents are submitted to the RJSC, along with the required registration fees. Once these documents are reviewed and approved, your company will be issued a Certificate of Incorporation, making it a legal entity in Bangladesh.
Tax Registration:
Following incorporation, your company must register with the National Board of Revenue (NBR) to obtain a Tax Identification Number (TIN). TRW will assist with this process to ensure compliance with local tax regulations.
Opening a Corporate Bank Account:
To fully operate as a business in Bangladesh, opening a corporate bank account is essential. TRW will facilitate this process, enabling the company to handle transactions and meet regulatory requirements. The bank issues an encashment certificate, which is mandatory for foreign-owned companies.
Obtaining a Business License:
Depending on your company’s nature, specific licenses may be required for operation. TRW Law Firm’s legal team will assist you with obtaining the necessary business licenses.
VAT Registration:
If your company will conduct taxable activities in Bangladesh, VAT registration is also required. TRW’s team of Chartered Accountants can help you obtain a VAT registration number and ensure compliance with all tax obligations.
Post-Registration Compliance
After registration, maintaining compliance with Bangladeshi laws and regulations is essential. TRW provides ongoing services to ensure your company stays compliant, including:
Annual Accounting: Preparing and submitting annual financial statements to ensure transparent financial reporting.
Tax Filing: Ensuring timely submission of tax returns and VAT filings.
Corporate Secretarial Services: Maintaining a registered address and corporate secretary to meet regulatory obligations.
Periodic Compliance Reviews: Regularly reviewing your compliance status to avoid penalties or legal issues.
Why Bangladesh is a good place to start your business?
Bangladesh has emerged as an ideal location for foreign investors for several reasons:
Strategic Geolocation: Bangladesh is well-positioned to serve as a hub for regional trade, particularly with South Asia and Southeast Asia.
Affordable Workforce: The country has a large pool of skilled yet inexpensive labor, making it cost-effective for companies looking to reduce operating costs.
Competitive Production Costs: Lower production costs compared to other countries in the region make Bangladesh a favorable choice for manufacturing and export-oriented businesses.
Incentives for Foreign Investment: The Bangladeshi government actively encourages foreign investment by offering various incentives, simplifying company registration, and allowing full foreign ownership in most sectors.
Registering a company in Bangladesh can be an efficient and rewarding experience when guided by experienced consultants. TRW Law Firm’s in-depth knowledge of the local legal and regulatory framework allows businesses to streamline their registration process, minimize administrative hassles, and stay compliant with local laws. With TRW’s expert support, you can focus on growing your business in Bangladesh’s dynamic market while they handle the legal and administrative requirements on your behalf.
Ans: হেবা দলিল হোক আর কবালা দলিল হোক সব দলিলের নামজারী পদ্ধতি একই, আলাদা কোন সিস্টেম নেই।
২. দাতার কি কি ডকুমেন্টস লাগবে?
Ans: দাতার ডকুমেন্ট বলতে যদি সে ওয়ারিশ সূত্রে মালিক হয় তাহলে তার ওয়ারিশ সার্টিফিকেট লাগবে। দলিল করার সময় যেসব কাগজপত্র একসেট ফটোকপি দলিলের সাথে অফিসে জমা দেয়া হয়, তারই হুবহু একসেট ফটোকপি রাখলেই সেটা নামজারী আবেদনে কাজে লাগে
৩. গ্রহিতার কি কি ডকুমেন্টস লাগবে?
Ans: গ্রহিতার শুধু ছবি আর আইডি কার্ডের ফটোকপি লাগে।
৪. দাতা কোন সূত্রে মালিক হয়েছেন এই দলিল কি লাগবে?
Ans: দাতা দলিল সূত্রে মালিক হলে অবশ্যই তা লাগবে, এবং তার নামে নামজারী খতিয়ান এবং খাজনার দাখিলা লাগবে।
৫. প্রতিনিধি হলে কি কি কাগজ লাগবে?
Ans:নামজারীর ক্ষেত্রে গ্রহিতা উপস্থিত না থাকতে পারলে, তার ছবি আইডি কার্ডের ফটোকপি এবং অন্যান্য কাগজপত্র নামজারীর জন্য লাগবে। প্রতিনিধি হিসাবে যিনি কাজ করবেন তার শুধু এককপি ছবি এবং এন আইডি কার্ডের ফটোকপি লাগবে।
৬. ওয়ারিশ সনদ কি লাগবে? যেহেতু ২ জনের নামে জমি রেজিষ্ট্রেশন করে দেওয়া ওয়ারিশ হলে ৫ জন এ ক্ষেত্রে করনিয়?
Ans:হস্তান্তরিত জমি ওয়ারিশ সূত্রে মালিক হলে অবশ্যই ওয়ারিশ সার্টিফিকেট লাগবে।
৭ . প্রতিনিধি হলে সব কিছু উনার মাধ্যমে হবে না কি গ্রহিতা শুনানির দিন উপস্থিত থাকা লাগবে?
Ans: আবেদনকারীর প্রতিনিধি হিসাবে যিনি থাকবেন তিনিই সব কিছু করবেন, এক্ষেত্রে আবেদনকারী কে কোথাও উপস্থিত থাকা লাগবেনা। শুনানীতেও না, প্রতিনিধি শুনানীতে হাজির হলেই হবে।
“Transfer of certain existing moveable or immovable property made voluntarily and without consideration, by one person, called the donor, to another, called the donee, and accepted by or on behalf of the done” is what the Transfer of Property Act (1882) defines as a gift. As long as the donor is competent and in good mental health, the transfer must take place during their lifetime. In order to transfer a gift of real estate, a registered document that is signed by the donor or on their behalf and attested by two or more witnesses must be used.
Regarding the gift’s maintainability, suspension, or revocation, the donor and donee may agree that the gift may be suspended or revoked in the event of a specified event that is not subject to the donor’s will, such as an event over which the donor does not necessarily have control. However, a gift that the parties agree is revocable in whole or in part at the donor’s sole discretion is void in whole or in part, depending on the circumstances.
When a gift is given to the same person in the form of a single transfer of multiple items, one of which is burdened with an obligation while the others are not, the donee is not allowed to take anything from the present unless he accepts it completely. Even though the former may be advantageous and the latter burdensome, the donee is free to accept one of the gifts where they consist of two or more distinct and independent transfers of various items to the same individual. When a gift includes the entirety of the donor’s assets, the donee has personal responsibility for all obligations and liabilities of the donor at the time of the gift, up to the amount of the assets included.
A gift or heba deed must be registered in accordance with the Registration Act (1908). According to the Registraion Act, all necessary transfer instruments must be registered. The details required to express the parties’ intentions must be included in the transfer document, which in this case is the deed impacting the gift. A detailed description of the properties to be transferred and the nature of the transaction—that is, the fact that it is being transferred as a gift—should also be included. Every executor’s and recipient’s photo must be adhered to the deed, and the parties must sign it and indicate their left thumb impressions across the photos. Any party who is unable to sign the deed will not be obliged to do so; in such cases, thumb impressions will be sufficient.
The Sub-Registrar’s office is where the gift deed must be registered. The registration process would require payment of a set number of fees. In the past, oral declarations could have an impact on the Heba according to Muslim law. But such procedure is no longer acceptable. Since there is no consideration paid against the gift itself and the doner does, unless otherwise stated, extinguish his or her rights on the land, both the donee and the donor must typically be present when the deed is registered at the Sub-Registrar’s office to ensure that both parties are in good mental health at the time of the transfer. Since a gift procedure involves the transfer of rights, it must be carried out with particular legal checks to make sure the donated land is not contested in any way or falls outside the donor’s gifting authority.
