Nationwide, there are 15,000 private hospitals, clinics, and diagnostic centers.
On September 4, 2018, the license and renewal costs of private hospitals and clinics raised from Tk 5,000 to a minimum of Tk 50,000 to Tk 0.2 million. Only 5,000 hospitals, clinics, and diagnostic centres were licensed at the time.
Private hospitals and clinics require environmental certificates, employment information, NOCs from local corporations, and other paperwork for annual license renewal, according to DGHS sources.
In recent years, the healthcare industry in Bangladesh has undergone accelerated expansion. Bangladesh is the only LDC that meets about 98 percent of its domestic demand for pharmaceuticals, with a market size of approximately $3 billion. In addition, Bangladeshi pharmaceutical items were sold to around 150 countries in 2020-21, generating $169 million. With a double-digit yearly growth rate, the Bangladesh pharmaceutical industry is currently on track to meet local demand on its own. More than 300 small, medium, and large businesses create medicines in the United States, with the top ten accounting for nearly two-thirds of the industry.
International firms in Healthcare Business in Bangladesh:
The government of Bangladesh encourages international firms to collaborate with local firms in the production of pharmaceuticals, high-tech, and specialized goods. The regulations have been loosened, allowing international firms to export pharmaceuticals to Bangladesh.
High-tech U.S. exporters of medical equipment, surgical instruments, diagnostic equipment, and services have prospects in Bangladesh. Imported medications and medical devices are subject to customs taxes based on their classification and kind. Importation of anticancer medications, vaccinations, hormonal contraceptives, and other products is tax-free. Currently, the medical device industry is not severely controlled, but a policy to do so has been established and is awaiting approval. To enter the healthcare industry in Bangladesh, a company must submit the relevant application and supporting documentation. Applications from pharmaceutical companies are submitted to the Directorate General of Drug Administration (DGDA).
The Ministry of Health and Family Welfare (MOHFW) is responsible for national-level healthcare and education policy formulation, planning, and decision-making. The policies, strategies, and choices made at the national level are implemented by various implementing authorities and healthcare delivery systems across the nation, from the national to the community level. The Ministry and its relevant regulatory authorities also exercise indirect influence over the NGO and private healthcare systems. The majority of high-quality medical facilities are located in Dhaka, which serves as the country’s centre for the distribution of medical services.
Before getting clearance, each direct foreign investor in Bangladesh must submit a project proposal to the Bangladesh Investment Authority (BIDA). Companies investing in hospitals and medical education must receive a license from the Directorate General for Health Services after registering with BIDA (DGHS). For license, pharmaceutical and medical device businesses must go via DGDA. However, organizations seeking these licenses must undergo vetting by the Ministry of Health and Family Welfare, the primary entity in charge of healthcare sub-sectors.
How to Establish a Healthcare Business in Bangladesh:
Due to its contribution to economic growth and significant reduction in mortality rate, the healthcare business in Bangladesh can be considered one of the most vital industries.
Since our nation’s independence, the average life expectancy has increased from 44 to 72 years. In addition, Bangladesh has made extraordinary strides in achieving the Millennium Development Goals (MDGs). Despite a relatively modest level of healthcare investment, Bangladesh has made significant improvements in the health sector and Healthcare Business in Bangladesh. Bangladesh today looks forward to achieving sustainable development goals (SDGs) through maintaining a healthy lifestyle and promoting the well-being of all age groups.
How to Establish a Healthcare company in Bangladesh:
In Bangladesh, both governmental and private health service providers offer their services. The government administration regulates the basic, secondary, and tertiary health care provided by the public sector in Bangladesh. It begins at the national level and progresses to the district, upazilla, union, and ward levels. Employment and revenue in Bangladesh’s private health care sector have increased steadily over the past few decades. Health care providers, physicians, hospitals and clinics, diagnostic centers, nursing homes, pathology laboratories, etc., are included in both the public and private healthcare sectors. The private healthcare industry has supplemented services offered by the public sector. Among private hospitals, Apollo, United, Square, and Ibn-Sina Hospital are notable, and this private healthcare is gaining appeal among the general population due to its quality, accessibility, and dependability.
Directorate General of Health Services (DGHS) in Bangladesh
The Ministry of Health & Family Welfare provides preventive, curative, and promotive services, in addition to emergency treatment. The government of Bangladesh has established the Directorate General of Health Services (DGHS). Administration is primarily responsible for the implementation of various health programs, management, planning, and execution of various health policies.
In accordance with the open market policy, the government of Bangladesh adopted a liberalized commercial approach to the expansion of the private sector in 1986, resulting in the establishment of hundreds of hospitals and clinics in the private sector. A profitable investment in the healthcare industry, which is one of the most significant areas of the economy, would enable individuals to engage in financial economic activities and raise the country’s GDP.
Procedures for Obtaining a License and Registering Healthcare company in Bangladesh:
Procedures for Obtaining a License and Registering Your Business In Bangladesh, a healthcare business can be operated by founding a corporation:
A Company validly registered in Bangladesh may participate in any business activity permitted under the Object Clause of the Company as stated in its Articles of Association. A firm in Bangladesh may be either public or private. For the formation of a public company, a minimum of seven shareholders are necessary. Alternatively, a minimum of two shareholders is required to incorporate a private corporation.
A private corporation cannot invite the public to subscribe for its shares, but a public firm can offer its shares to the general public. In actuality, private companies are the most preferred business structure for both foreign and domestic entrepreneurs. There are no restrictions on foreign equity involvement for foreign direct investment, hence 100 percent foreign equity is permitted. Foreign investment gets the same level of protection and security as domestic investment in Bangladesh. The laws of Bangladesh guarantee non-discrimination between international and domestic investment, as well as the repatriation of share sales revenues and profits.
Incorporation of Healthcare business in Bangladesh:
The following actions must be taken to establish a company:
- The prospective company must get a Name Clearance from the Registrar of Joint Stock and Companies.
- Drafting and signing the following documents: • Memorandum and Articles of Association of the company; • Form I: Declaration On Registration Of Company; • Form VI: Notice Of Situation Of Registered Office; • Form IX: Consent of director to act; • Form X: List of Individuals Consenting to be Directors; • Form XII: Particulars of the directors, manager, and managing agents.
- Establishing a temporary bank account for the Proposed Company with any Bangladeshi bank on the list
- Transfer the paid-up capital amount from each foreign shareholder’s account to the Bangladeshi bank account of the proposed company.
- Obtain an encashment certificate from the Bank of the Proposed Company for each international transaction.
- Submit the required documentation to the Company House.
- Pay the Government Registration Fees
Obtain the certificate of registration from the RJSC.
Required Company Formation Documents for Healthcare business in Bangladesh:
a) A copy of the company’s Valid Name Clearance;
b) An executed copy of the company’s memorandum and articles of incorporation.
c) Copy of Form I: Declaration On Registration Of Company, duly signed;
d) Copy of Form VI: Notice Of Situation Of Registered Office, duly executed;
e) Copy of Form IX: Consent of director to act, duly executed;
f) Copy of the executed Form X: List of Individuals Consenting to Serve as Directors;
g) Copy of Form XII: Particulars of the directors, manager, and managing agents, duly signed and dated;
h) Copies of shareholder and director identification cards (for Bangladeshi nationals);
I Copies of Shareholder Identification Number (TIN) Certificates (for Bangladeshi Nationals);
j) Copies of shareholders’ and directors’ passports (for foreign nationals);
k) Photos of shareholders and directors in passport format;
l) Bank Encashment Certificate for each international shareholder;
m) Receipt of the government fees’ payment.
In addition to the above-mentioned formats, a company with 100% foreign ownership may also register as a Branch Office to commence healthcare operations. However, a Branch office can only serve the job envisioned by the parent firm if Bangladesh Investment Development Authority has granted prior authorisation. Depending on the expansion/scope of the business, further licenses or approvals may be necessary following the formation of the specific firm.
Additional Permissions for a Healthcare business in Bangladesh:
The following are the additional licenses required to create a healthcare industry:
I. Trade License; II. TIN Certificate; III. VAT Registration Certificate; IV. Industrial Investment Project Registration; V. Factory Layout Approval; VI. Factory License; VII. Membership Certificate; VIII. Import Registration Certificate (applicable for Import Business); IX. Export Registration Certificate (applicable for Export Business); X. Environment Clearance Certificate; XI. Fire License; XII. Trademark Registration.
Hospital License from the Directorate General of Health Services (DGDS).
The procedure for acquiring extra licenses is outlined below:
Trade License for Healthcare business in Bangladesh:
The most crucial prerequisite for launching a business in Bangladesh is acquiring a trade license. Every business entity is required to get a Trade License from the appropriate local government body. To obtain a Trade License, a complete application must be submitted to the appropriate local governmental entity (i.e., City Corporation/Municipal Corporation/Union Parishad) along with the required documentation.
To track tax payments, the government of Bangladesh issues TIN Certificates to individuals and businesses. The National Board of Revenue (NBR) is the only organization authorized to issue TIN Certificates. To receive the TIN Certificate, one must submit an online application to the NBR.
Every business is needed to have a Taxpayer Identification Number in order to conduct business (BIN). A BIN can be obtained through the National Board of Revenue’s VAT registration process. Every business organization must get a certificate of VAT registration. To obtain the VAT Certificate, the NBR must receive an online application along with the required supporting documentation.
BIDA Registration of Project for Industrial Investment for Healthcare business in Bangladesh:
Local or foreign industrial businesses in Bangladesh must register with the Bangladesh Investment Development Authority (BIDA). To register an Industrial Investment Project with the BIDA, an application and the required documentation must be submitted.
Factory Layout Acceptance:
The Department of Inspection for Factories and Establishments (DIFE) must grant written permission prior to the use, modification, or enlargement of any dwelling, building, or premises as a factory. The DIFE must receive an application accompanied by the required documentation in order to grant approval for the proposed layout.
License of Manufacturer:
Each owner or occupant must submit an application for registration and licensing of factory to the Department of Inspection for Factories and Establishments (DIFE) within thirty (30) days prior to the start of factory operations.
After establishing the related business, the entrepreneur must become a member of a local Chamber of Commerce and Industry or pertinent Trade Association. The membership application is accessible at the office of the respective Chamber of Commerce or Trade Association.
Certificate of Import Registration and Certificate of Export Registration:
An importer who possesses an Import Registration Certificate (IRC) and an exporter who possesses an Export Registration Certificate (ERC) are able to import and export any permissible goods without any value or quantity restrictions or approval from any authority. The Office of the Chief Controller of Imports and Exports (CCI&E) provides applicants with Import Registration Certificates and Export Registration Certificates. To obtain the IRC or ERC, an online application and supporting documentation must be submitted to CCI&E.
Environment Clearance Certificate
In Bangladesh, the Environment Clearance Certificate (ECC) is one of the essential permits required to launch an industrial unit or project. To get this Certificate, the owner of the industrial unit or project must submit an application to the Department of Environment along with the required documentation.
Fire License for Healthcare business in Bangladesh:
Buildings and commercial organizations are required to obtain a fire license out of consideration for the environment and to safeguard the safety of the facility and its employees. It is issued by the Fire Service and Civil Defense (FSCD) body functioning under Bangladesh’s Ministry of Interior. To receive this license, the concerned entrepreneur of the industrial unit or project must submit a request to the FSCD along with the required documentation.
Application for Trademark Registration
After the registration of the entity, it may apply to the Department of Patents, Designs and Trademarks (DPDT), which is administered by the Ministry of Industries, for the registration of its trademarks and/or any other Intellectual Property. The Trademark Registry Wing of the DPDT must receive the required documentation for the registration of a trademark from a candidate.
General Directorate of Health Services Hospital License
The establishment of a healthcare firm requires registration with the relevant government agency. Through an online site, the Ministry of Health and Public Welfare’s DGHS oversees the licensing and renewal of private hospitals, clinics, blood banks, nursing homes, and diagnostic institutes across Bangladesh.
Legal Issues for Healthcare business in Bangladesh:
Foreign Investment Legislation in Bangladesh:
The liberalized Industrial Policy and export-oriented, private sector-led economic strategy of Bangladesh offer substantial investment prospects to foreign businesses and individuals considering investing in Bangladesh. Except for a few regulated industries, Bangladesh welcomes private investment in all areas.
The healthcare industry is completely open to international investment. The government’s objective is to facilitate the increase of domestic and international private investment by fostering an enabling environment. The policy framework for foreign investment in Bangladesh is based on the Foreign Private Investment (Promotion & Protection) Act of 1980, which provides legal protection against nationalization and expropriation for foreign investment in Bangladesh. This also provides a non-discriminatory handling of international and local investments, as well as the repatriation of capital gains and income.
The Foreign Exchange Regulations Act of 1947, the Bangladesh Export Processing Zones Authority Act of 1980, the Bangladesh Private Export Processing Zone Act of 1996, the Bangladesh Economic Zone Act of 2010 and the Bangladesh Investment Development Authority Act of 2016 also address foreign investment.
Employment Law: The Labour Act of 2006 primarily governs employment law in Bangladesh. In addition to this Statute, the Labour Rules 2015, the National Labour Policy 2012, the Bangladesh Labour Welfare Foundation Act 2006, the Bangladesh Labour Welfare Foundation Rules 2010, the National Occupational Health and Safety Policy 2013, the Domestic Workers Protection and Welfare Policy 2015, and the National Child Labour Elimination Policy 2010 all contain rules and regulations pertaining to this issue.
The Labour Act of 2006 addresses employment of labor, employer-employee relations, payment of wages and compensation for injuries to workers, leaves, benefits, formation of trade unions, resolution of industrial disputes, welfare, health, safety, and working conditions in the establishment, amongst other matters. Additionally, maternity benefits are provided to female employees. Note that if the company is established within an EPZ, the Bangladesh EPZ Labour Act 2019 will apply.
Contract Law for Healthcare business in Bangladesh:
The center of the economic world is contractual agreement. It specifies the obligations and responsibilities of the parties on the subject of the contract. A contract binds both parties to its agreed-upon and stipulated conditions, such as the party’s liability in the event of a breach of contract and the extent to which it would reimburse the other party’s damages. It is advisable to take the utmost care while drafting the contract’s terms and conditions so that they accurately reflect the parties’ intentions. Additionally for Healthcare Business in Bangladesh, the Contract Act of 1872 governs all contracts in Bangladesh.
A force majeure event is an extraordinary occurrence or scenario beyond the parties’ control, such as an act of God, war, or natural disaster. Generally, a successful use of the force majeure clause releases the parties from their respective contractual responsibilities and/or liability. A force majeure clause does not totally excuse a faction’s failure to comply, but merely suspends it for a period of time. Section 56 of the Contract Act of 1872 of Bangladesh outlines the notion of frustration. According to this doctrine, a contract is null and void if its performance becomes impossible owing to the occurrence of an event or if it becomes unlawful after it has been entered into.
Compliances of the business entities – The entities must comply with the annual filing requirements, such as updating trade license at the respective city corporation, renewal of chamber membership, renewal of IRC & ERC, filing taxes, updating the annual filings at the RJSC, reporting to Bangladesh Bank, NBR, etc.
Relevant Property Law for healthcare business in Bangladesh:
In order to finalize the registration of the lease or purchase of the land, property laws must also be applied. The Land Reform Act of 2014, the East Bengal Tenancy Rules of 1954, the Survey Act of 1875, the Non-Agricultural Tenancy Act of 1949, the Registration Act of 1908, and the Transfer of Property Act of 1882 are the major statutes in these sectors.
A description of the Tahmidur Rahman Remura Wahid TRW and its services.
TRW Associates (Tahmidur Rahman Remura Wahid TRW) is a full-service corporate law firm that attempts to provide customers with a wide range of legal services rather than specializing on a single field of law. It is one of the largest and most reputable law companies in Bangladesh, providing domestic and international customers with legal counsel that fulfills their needs and expectations. Tahmidur Rahman Remura Wahid TRW provides all services associated with Company Incorporation, Sole Proprietorship, Partnership, and Foreign Company Registration, among others. Tahmidur Rahman Remura Wahid TRW law office has legal professionals that can guarantee a smooth legal process and assist in getting Certificates or Licenses required for Company Incorporation, including VAT Certificate, IRC/ERC, Name Clearance, Factory/Fire/Environmental License, TIN, Trade License, and other certificates.
In order to establish a Healthcare Business in Bangladesh, Tahmidur Rahman Remura Wahid TRW can give the following services:
Tahmidur Rahman Remura Wahid TRW offers an outstanding and capable team that can set up a healthcare business smoothly and quickly. Tahmidur Rahman Remura Wahid TRW’s legal counsel can assist clients through consultations and meetings and offer them with incorporation rules for any sort of business.
In order to incorporate any form of business, a number of deeds, contracts, and other documents must be created. The legal staff at Tahmidur Rahman Remura Wahid TRW can assist customers with the preparation and drafting of these documents.
Before establishing a business, it is necessary to find an appropriate piece of land. Tahmidur Rahman Remura Wahid TRW can give a service to the client by searching for an ideal location for the client’s business establishment. In addition, Tahmidur Rahman Remura Wahid TRW can assist with the drafting of lease agreements, the inspection of land by the appropriate land registry office, and the preparation for the acquisition of land, including registration.
Ø Tahmidur Rahman Remura Wahid TRW can also assist with making payments of government fees to the proper authorities, such as BIDA or RJSC, and liaising with them to get incorporation documentation. Tahmidur Rahman Remura Wahid TRW, legal professionals have excellent working relationships with government authorities, making it simpler to obtain any certificate or license.
Trademark/Copyright/Patent registration is sometimes required to incorporate a business in order to obtain protection against infringement, to add value to the organization, and to increase legal protection. Tahmidur Rahman Remura Wahid TRW helps its customers gain registration for
Trademark/Copyright/Patent from the Department of Patents, Designs, and Trademarks (DPDT), providing the legal protection of the company.
Tahmidur Rahman Remura Wahid TRW also offers services for obtaining or renewing any form of license; for conducting business in the healthcare industry, multiple licenses are required. The legal staff at Tahmidur Rahman Remura Wahid TRW can help obtain these licenses and, if necessary, renew them on time.
Tahmidur Rahman Remura Wahid TRW provides clients with labor-related services, such as preparing employment agreements, resolving labor-related issues, and rendering legal opinions on labour legislation, among others.
Tahmidur Rahman Remura Wahid TRW is able to provide guidance and assistance in meeting routine legal requirements in order to facilitate the smooth operation of a firm.
Impact of COVID-19 on Healthcare Business in Bangladesh:
In Bangladesh, the fourth stage of the Corona virus pandemic has been achieved, and the number of infected patients increases daily. Due to a scarcity of testing kits, PPE, and other protective gear, patients suspected of being infected with coronavirus were denied treatment by local doctors.
According to public health experts and campaigners, as well as other reports, the strategy of refusing to test patients other than those returning from COVID-19-affected nations has created a catastrophe for all patients seeking care. In spite of the government’s decision to declare a general holiday and enforce social separation, the number of cases is rising at an alarming rate. The hospitals and clinics lack an adequate number of intensive care units, ventilators, isolation wards, personal protective equipment, and testing kits. Inadequate service by IEDCR, lack of coordination, and mismanagement are also contributing factors to the rise in patient population.
Furthermore, the number of deaths exceeds the number of individuals who have recovered from the virus, which is dangerous for the nation.
According to the World Health Organization (WHO), Bangladesh already bears financial and humanitarian costs and will incur additional health costs in the future; therefore, greater emphasis must be placed on public health response funding and the need for international medical assistance in countries with underdeveloped health systems. Secondary health care in Bangladesh is underfunded and inadequately regulated, despite the contribution of primary health services to the achievement of significant results.
In addition, the BMA says that 11 percent of coronavirus cases in the country involve medical workers, which is a cause of grave worry at the moment. As the number of cases among healthcare professionals has increased, the BMA has urged a sufficient supply of personal protective equipment (PPE), masks, and other protective gear. In addition, they urged that private clinics and hospitals in Bangladesh provide enough housing, food, and safety measures for medical staff.
For their frontline roles in the fight against coronavirus, the government of Bangladesh has developed a unique insurance and incentive package for doctors and nurses of government hospitals, field administration officers, law enforcement officers, health and relief workers.
The government has granted special incentives for Covid-19 frontline employees, including health insurance ranging from Tk5 to 10 lakh according on position. If a healthcare worker is at a higher risk of mortality or dies while giving service to a patient, this amount will be multiplied by five. In addition, the government would pay for the treatment of frontline workers who get a virus while on duty.
The current general tax rate in Bangladesh is 32.5 percent, as stipulated by its legislation. Locally created limited liability companies are required to submit a variety of reports to the National Board of Revenue (NBR), including: opening a Tax Identification Number (TIN), submitting an annual return, and submitting an annual return for the previous year. Monthly Tax Deduction Statement, Semi-Annual Withholding Tax Statement, Annual Statement Relating to Employee Tax Return Filing, Annual Statement Relating to Salary Paid by the Company to Employees. Quarterly Advance tax deposit, Annual tax return submission, representing the company at appeal/hearing sessions, Monthly VAT return, etc. Tahmidur Rahman Remura Wahid TRW may provide guidance and assistance to ensure that all regulatory compliances are met, allowing the business to operate without difficulty.
The country has remained an appealing location for foreign corporations to conduct business due to its accommodating business policies, cheaper production costs, and lower labor wages in comparison to other Asian nations. To assure quality outcomes from both the commercial and public health care industrial sectors, effective policy guidelines with robust execution are essential. There would be an increase in the number of hospitals and clinics in Bangladesh due to the growing population and increased demand for quality health care. This will encourage foreign investors to invest for economic gain in the healthcare industry.
Healthcare Management Summary:
Due to its contribution to economic growth and significant reduction in mortality rate, the healthcare business in Bangladesh can be considered one of the most vital industries. The nation has made extraordinary strides toward achieving the Millennium Development Goals (MDGs).
The government of Bangladesh chose a liberalized commercial approach to the expansion of the private sector, resulting in the establishment of hundreds of private hospitals and clinics in accordance with the open market policy. To do healthcare-related business in Bangladesh, it is necessary to obtain approval from the relevant authorities or department. Incorporation may be utilized to conduct a healthcare business. Obtaining licenses, such as a Trade license, Fire license, Environment and factory license, etc., is required to incorporate a business.
The DGHS, which falls under the Ministry of Health and Public Welfare, will issue licenses and registrations via its online portal. Through an online platform, the DGHS oversees the licensing and renewal of private hospitals, clinics, blood banks, nursing homes, and diagnostic institutions across Bangladesh. Trademark and Patent Registration shall be secured to protect the company from infringement and increase its value. The liberalized Industrial Policy and export-oriented, private sector-led economic strategy of Bangladesh offer substantial investment prospects to foreign businesses and individuals considering investing in Bangladesh. The healthcare sector is open to private investment, and the government’s goal is to facilitate the increase of domestic and foreign private investment by fostering an enabling environment.
The policy framework for foreign investment in Bangladesh is based on the Foreign Private Investment (Promotion & Protection) Act of 1980, which provides legal protection against nationalization and expropriation for foreign investment in Bangladesh. In Bangladesh The pandemic caused by the Corona virus has reached its fourth stage, and the number of afflicted persons increases daily. Due to a scarcity of testing kits, PPE, and other protective gear, patients suspected of being infected with coronavirus were denied treatment by local doctors. For their frontline roles in the fight against coronavirus, the government of Bangladesh has developed a unique insurance and incentive package for doctors and nurses of government hospitals, field administration officers, law enforcement officers, health and relief workers.
Effective policy guidelines with robust execution are essential in Bangladesh to achieve quality outcomes from both the private and public health care industries. In Bangladesh, The number of hospitals and clinics would increase as a result of a growing population with rising demands for quality health care. This will encourage foreign investors to invest for economic gain in the healthcare industry. In order to continue with a healthcare business, the Tahmidur Rahman Remura Wahid TRW legal team can provide a variety of incorporation services. Tahmidur Rahman Remura Wahid TRW is a full-service legal firm with an exceptional and knowledgeable team that can easily establish a business in this industry.
Are you planning to do Healthcare Business in Bangladesh?
The legal team of Tahmidur Rahman, The Law Firm in Bangladesh: TRW, The Law Firm in Bangladesh are highly experienced in providing all kinds of services related to forming and incorporating a Healthcare Business in Bangladesh. For queries or legal assistance, please reach us at:
E-mail: [email protected]
Phone: +8801847220062 or +8801779127165
Address: House 410, Road 29, Mohakhali DOHS