How to Register Your Pharmaceuticals Company

How to Register Your Pharmaceuticals Company in Bangladesh

Overview of the Pharmaceutical Industry in Bangladesh

Pharmaceutical manufacturing in Bangladesh has emerged as one of the country’s largest capital-intensive and technologically advanced industries. Over the past few decades, the sector has experienced exponential growth, producing life-saving medications such as insulin, hormones, and cancer drugs. These products fulfill 98% of the local market’s medical requirements, while exports continue to grow, achieving a 27% increase in earnings annually. Favorable factors, including inexpensive labor, readily available raw materials, World Trade Organization (WTO) policies, and a skilled workforce, make Bangladesh an attractive destination for pharmaceutical investments.

This guide provides a step-by-step process for setting up a pharmaceutical company in Bangladesh, highlighting regulatory requirements, legal frameworks, and compliance considerations.

Steps to Register a Pharmaceutical Company

1. Choose a Business Structure

The first step is to decide on the structure of your business. In Bangladesh, pharmaceutical businesses can operate as:

• Private Limited Company: Requires at least two shareholders and restricts public share offerings.
• Public Limited Company: Requires a minimum of seven shareholders and can issue shares to the public.
• Branch Office: Suitable for foreign companies looking to establish a presence.

Most investors opt for a Private Limited Company due to its flexibility and minimal regulatory burdens.

2. Obtain Name Clearance

Before registering your company, secure a name clearance from the Registrar of Joint Stock Companies and Firms (RJSC). This ensures the uniqueness of your company name and avoids future disputes.

3. Prepare and Submit Required Documents

Draft and sign the following documents:

• Memorandum of Association (MOA) and Articles of Association (AOA)
• 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 Personal Consenting to Be Directors
• Form XII: Particulars of Directors, Manager, and Managing Agents

You will also need:

• National IDs (for Bangladeshi nationals) or passports (for foreign nationals) of shareholders and directors
• Tax Identification Numbers (TIN) for Bangladeshi nationals
• Bank encashment certificates for foreign investments

4. Open a Temporary Bank Account

Open a temporary bank account in the name of the proposed company. Shareholders must deposit the initial paid-up capital into this account. For foreign investors, the remitted funds must be converted into Bangladeshi Taka, and an encashment certificate must be obtained.

5. Submit Documents to RJSC

Submit all necessary documents, along with the government registration fees, to the RJSC. Upon approval, you will receive a Certificate of Incorporation.

6. Post-Incorporation Tasks

After incorporation, complete additional tasks, including:

• Obtaining a Trade License from the local City Corporation
• Registering with the National Board of Revenue (NBR) for VAT and TIN certificates
• Opening a permanent bank account

Licensing and Approvals for Pharmaceutical Companies

In addition to company registration, pharmaceutical businesses require several licenses and approvals:

1. Drug License

Issued by the Directorate General of Drug Administration (DGDA), this license is mandatory for manufacturing and selling pharmaceuticals. Submit the following documents:

• Application form
• Certificate of Incorporation
• MOA and AOA
• Trade License
• Factory layout approval
• Environmental Clearance Certificate
• Details of equipment and manufacturing processes

2. Environmental Clearance Certificate (ECC)

Pharmaceutical companies must secure an ECC from the Department of Environment. The application requires:

• Project profile
• Site clearance certificate
• Factory layout and design
• Environmental impact assessment report

3. Fire License

Obtain a Fire License from the Fire Service and Civil Defense (FSCD) to ensure safety standards. Required documents include:

• Application form
• Building layout plan
• NOC from local authorities

4. Bangladesh Standards and Testing Institution (BSTI) Certification

For quality assurance, pharmaceutical products must meet BSTI standards. Apply for the Certification of Marks (CM) License with:

• Application form
• Product specifications
• Factory inspection reports

5. Factory License

The Department of Inspection for Factories and Establishments (DIFE) issues factory licenses. Submit the following:

• Application form
• Trade License
• Factory layout approval
• Worker safety measures documentation

Additional Licenses and Memberships

To operate smoothly, pharmaceutical companies must also obtain:

• Import Registration Certificate (IRC) and Export Registration Certificate (ERC): For importing raw materials and exporting finished products.
• Trademark Registration: Protect your brand identity by registering with the Department of Patents, Designs, and Trademarks (DPDT).
• Membership in Industry Associations: Join the Bangladesh Association of Pharmaceutical Industries (BAPI) to access industry resources and networking opportunities.

Compliance and Legal Considerations

1. Labor Law Compliance

The Bangladesh Labor Act, 2006, governs employment relationships, ensuring worker rights, safety, and welfare. Key considerations include:

• Drafting employment agreements
• Adhering to minimum wage regulations
• Providing maternity and health benefits

2. Foreign Investment Regulations

Foreign investors enjoy full protection under the Foreign Private Investment (Promotion & Protection) Act, 1980. This includes rights to:

• Non-discriminatory treatment
• Repatriate profits and capital

3. Contractual Agreements

Ensure all contracts with suppliers, distributors, and partners comply with the Contract Act, 1872. Include force majeure clauses to address unforeseen disruptions.

4. Annual Filing Requirements

Comply with annual filing obligations, including:

• Updating trade licenses
• Renewing IRC and ERC
• Submitting tax returns
• Filing financial statements with RJSC

5. Property Acquisition

For factory setup, adhere to property laws, including the Registration Act, 1908 and Transfer of Property Act, 1882. Conduct land vetting to avoid disputes.

Challenges in the Pharmaceutical Industry

Despite its growth potential, the pharmaceutical sector in Bangladesh faces challenges such as:

• Regulatory complexities
• High competition
• Maintaining quality standards
• Export barriers due to differing international regulations

Why Choose TRW Law Firm?

TRW Law Firm specializes in guiding entrepreneurs and investors through the intricacies of pharmaceutical company registration in Bangladesh. Our services include:

• End-to-end support for company incorporation
• Assistance with licensing and approvals
• Drafting and reviewing legal documents
• Ensuring compliance with labor, tax, and environmental laws
• Resolving disputes and providing legal representation

With a deep understanding of the pharmaceutical industry and Bangladeshi regulations, we ensure a seamless experience for our clients.

Conclusion

Establishing a pharmaceutical company in Bangladesh offers immense opportunities, given the industry’s growth trajectory and favorable investment climate. However, navigating the legal and regulatory requirements demands careful planning and expert guidance. By partnering with TRW Law Firm, you can focus on growing your business while we handle the legal complexities.

Summary Table of Requirements

For a hassle-free registration and legal process, consult TRW Law Firm today!