Independent University Bangladesh (IUB)

Registration process of Private Limited Company IN BANGLADESH

Submitted To:IftekharMahfuz, Lecturer, School of Business.

11/18/2015

Submitted by:Mohammad Faruq 1330708Sanjay karmokar 1330506Md. Harunar Rashid 1330685Md. RakibulHasib 1330442Md. Al-Maruf 1321455

Table of ContentsIntroduction:..........................................................................................................................................2

Definition:..............................................................................................................................................2

Essential Features of company:.............................................................................................................3

Registering Private limited company in Bangladesh..............................................................................5

Steps of forming a company in Bangladesh...........................................................................................5

Name clearance:................................................................................................................................5

Registration.......................................................................................................................................8

Submission and Payment...................................................................................................................9

Print Submissions............................................................................................................................10

Memorandum of Association:.........................................................................................................10

Articles of Association:....................................................................................................................11

Applicable fees for Registration:......................................................................................................11

Return Filling:..................................................................................................................................13

Winding Up:.....................................................................................................................................14

Issuance of Certified Copies:............................................................................................................16

Struck Off:........................................................................................................................................18

Conclusion...........................................................................................................................................19

Reference:...........................................................................................................................................20

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Introduction:We need to take registration from the Register of Joint Stock Companies and Firms (RJSC)

when we form a company. We think Bangladesh is a suitable place to form a new business

and to get more profit. We generate an idea and form a business then we have to register our

business from RJSC. RJSC is the only authority to approve registration certificate of

incorporation certificate of a company in the country.

After collecting name clearance certificate to prepare Company’s Memorandum of

Association and Articles of Association by following Company Act 1994. Memorandum of

Association describes all kind of business activities and services where company can perform

and mentioning number of shares of every Director, Chairmen, Managing Director and Share

holders. Articles of Association expresses all kinks of internal activity as like material work,

office stuff’s duty, official manner and so on. Also mentioning here number of occupying

share of each Director, Chairman, Managing Director &Share holder’s and qualifying share

of Directorship written down authorized capital and paid up capital of the Company.

Definition:A company is an association or collection of individuals, whether natural persons, legal

persons, or a mixture of both. Company members share a common purpose and unite in order

to focus their various talents and organize their collectively available skills or resources to

achieve specific, declared goals.

Company is a voluntary association of persons formed for the purpose of doing business

having a distinct name and limited liability. It is a juristic person having a separate legal

entity distinct from the members who constitute it, capable of rights and duties of its own and

endowed with the potential of perpetual succession. The Companies Act, 1956, states that

'company' includes company formed and registered under the Act or an existing company i.e.

a company formed or registered under any of the previous company laws.However, company

is not a citizen so as to claim fundamental rights granted to citizens.

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Essential Features of company:

1. Registration:A company comes into existence only after registration under the Companies

Act. But a Statutory Corporation is formed and commence business as notified or stated in

the Act and as passed in Legislature. In case of partnership, registration is not compulsory.

2. Voluntary Association:A company is an association of many persons on a voluntary

basis. Therefore a company is formed by the choice and consent of the members.

3. Legal Personality:A company is regarded by law as a single person. It has a legal

personality. This rule applies even in the case of “One-man Company.”

4. Contractual Capacity:A shareholder of a company, in its individual capacity, cannot bind

the company in any way. The shareholder of a company can enter into contract with the

company and can be an employee of the company.

5. Management: A company is managed by the Board of Directors, whole time Directors,

Managing Directors or Manager. These persons are selected in the manner provided by the

Act and the Articles of Association of the company. A shareholder, as such, cannot

participate in the management.

6. Capital: A company must have a capital, otherwise it cannot work.

7. Permanent Existence: The company has perpetual succession. The death or insolvency of

a shareholder does not affect its existence. A company comes into end only when it is

liquidated according to provision of the Companies Act.

8. Registered Office: A company must have a registered office.

9. Common Seal:A company must have a Common Seal.The company being an artificial

person cannot sign its name on a contract. The common seal is used as a substitute for its

signature. The common seal bears the name and place of the company, and date of its

incorporation engraved on it.

10. Limited Liability: The liabilities of shareholder of a company are usually limited. The

creditors of a company are not creditors of individual shareholders and a decree obtained

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against a company cannot be executed against any shareholders. It can only be executed

against the assets of the company.

11. Transferability: The shareholder of a company can transfer its share and ordinarily the

transferee becomes a member of the company.

12. Statutory Obligations:A company is required to comply with various statutory

obligations regarding management, e.g., filing balance sheets, maintaining proper account

books and registers etc.

13. Not a Citizen: A company is an artificial person, not a natural person. Therefore a

company is not a citizen, although it may have a Domicile

14. Residence: A company has a residence (for taxation and other purpose). A company does

not posses any fundamental rights.

15. Social Objective: The present view as regard the legal nature of Company Law is that the

Company is a social institution having duties and responsibilities toward the community, its

workers, the national economy and progress.

16. Centrally Administrated: The administration of company Law is entrusted to the

Central Government.

As a company’s rules and regulation company has two types like,

1. Public Limited Company

2. Private Limited Company.

We want to form a Private Limited Company .Under the Section 3(1) (iii) defines a private

company as one which:-

has a minimum paid-up share capital of Rs.1 Lakh or such higher capital as may be

prescribed; and

by its Articles Association

limits the number of its members to 50 which will not include:-

A. members who are employees of the company; and

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B. members who are ex-employees of the company and were members while in such

employment and who have continued to be members after ceasing to be

employees;

Registering Private limited company in BangladeshTo register a company manually, one has to go to RJSC office and fill the application form.

One can also register through website of the office of the Registrar of Joint Stock Companies

and Firms (RJSC). The web address is www.roc.gov.bd

Steps of forming a company in Bangladesh

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Name Clearance

Registration

Return Filling

Winding Up

Issuance of Certified Copies

Struck off

Name clearance:

RJSC name clearance is the first stapes for a company formation or registration to start

business in Bangladesh. RJSC (The Registrar of Joint stock Companies and Firms) is the only

legal authority to issue Name Clearance Certificate.

Name Clearance Terms and Condition:

1. The same name is not applicable for Company / formation in Bangladesh, (Which is

certified by RJSC). Its hearing sound, written style and sight will not be same all the

way.

2. Name could not be similar with international company , organization, social &

Cultural organization.

3. Name cannot be permissible any existing company , business body, Social, Cultural,

Entertainment & Sporting organization’s name.

4. Company’s name will not be similar Govt. Organization or Company.

5. Nationally fame person’s name or famous family’s name need to permission from

particular person and take permission to Government.

6. If you interested to take freedom fighter related name for your company must be

essential approval of Freedom Fighter Ministry of Bangladesh.

7. Company’s name could not be similar of Govt. development program or development

organization.

8. No name will applicable of political party’s slogan, political party’s name and

program which are existing now.

9. Slang word, Rebuke or……possible for company formation in Bangladesh.

10. Cannot select any name which is broken Social, Religious and national harmony.

11. Earlier established (at least 10 years old) Social organization’s real name, to attend

personally with organizing Committee resolution for registration of social

organization’s real name.

12. Social, cultural & sporting Organization’s can be limited company by taking Ministry

permission otherwise not possible to do.

13. Violating any name clearance terms & conditions R, RJSC can change providing

name and if name is unchanged a certain time, Registration number will be acquainted

of the company.

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14. Only name clearance is not final settlement of Company Registration/Formation first

stapes.

At first you select a name of your company than submit RJSC and pay 600 (Six Hundred)

taka to schedule authorized bank of name clearance cost. If you get name clearance from

RJSC of submitting company’s name, and make Memorandum of Association & Article

of Association. Memorandum of Association describes all kinds of business & activities

which will be operate by the company and mentioned of shares distribution of every

Director and share holders. All share holder, director, managing director, Chairman

signed it for their proposed share.

 

Article of Association basically written down legal and administrative activities of the

company, as like borrowing powers, power of chairman, managing director, director and

share holders, general meeting procedure, quorum of meeting, vote of member’s,

qualification shares of directors, quorum of board meetings, number of share of directors

and share holder’s and all other operating activities which followed by Company Act

1994.

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After filling up the form you need to click the submit button then you will get a

conformation message like are you successfully registered or not.

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Registration

Click the print icon(s) under the Print Preview to preview the documents submitted online. Make sure data is correct, to submit them and pay the application fee at BRAC Bank.

Click the Continue button and you will see the Submission and Payment Reference

page

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Submission and Payment

Congratulations! You have successfully completed the online submission of

Registration Application.

Please retain this submission reference for future reference.

You can Edit your submission (if you so decide) prior to submission

documents.

Click Back to Home to go the home page.

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Print SubmissionsFor printing, please follow the guidelines hereinafter:

Click the ‘Print Registration Documents’ option under Registration of

home page.

As prompted, enter your submission number and you will be given the option for printing

Memorandum of Association:

Articles of Association:

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Write "clause 1" then Click "Add Clause (1)" button to add clause. To enter similar

clause one by one. To delete entered information of a clause, click "delete clause (...)" link.

After complete the "AOA" page press SUBMIT button to back Registration

Application page.

Applicable fees for Registration:To apply for Name Clearance, Registration, Certified Copies and to submit returns, fees

and stamps are to be provided as under:

Fees of Name Clearance

For NC clearance: @ BDT 600.00 for each of the proposed names.

For time extension: @ BDT 100.00 for each time extension application.

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Stamps and Fees of Registration

  PRIVATE COMPANY (Companies Act, 1994)

Stamps

For affixing on the Memorandum of Association: BDT 500.00

For affixing on the Articles of Association:

For Authorized Capital Stamp (BDT)

Up to 10,00,000.00 2,000.00

10,00,000.00 up to 3,00,00,000.00 4,000.00

More than 3,00,00,000.00 10,000.00

Registration fee

For filing 6 documents (5 filled in forms plus 1 memorandum & articles of

association, @ BDT 200.00 per document): BDT 1,200.00

For the authorized share capital:

Authorized Capital (BDT) Fee (BDT)

Up to 20,000.00 360.00

Additional for every  10,000.00 or part after

first 20,000.00 up to 50,000.00

180.00

Additional for every  10,000.00 or part after

first 50,000.00 up to 10,00,000.00

45.00

Additional for every  10,000.00 or part after

first 10,00,000.00 up to 50,00,000.00

24.00

Additional for every  1,00,000.00 or part

after first 50,00,000.00

45.00

Return Filling:       a. Registered entities are to file to RJSC documents pertinent to management

/operation of the respective entity in prescribed Forms and Schedules (called

Returns Filing).

       b. There are two (2) types of Returns Filing, viz., a) Annual Returns Filing and b)

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Returns Filing for any change in an entity

       c. Entities submit returns for filing at RJSC.

       d. Entities pay filing fee and late filing fee (if applicable) to RJSC counter

       e. RJSC scrutinizes returns.

       f. In case of any incomplete/incorrect submission, RJSC notifies the  entity for

remedial measures.

       g. RJSC archives approved returns.

Returns to be Submitted

     PRIVATE COMPANY (Companies Act, 1994)

     Private companies are to submit the following returns for filing.

         a. Annual Returns

i. Schedule X - Annual summary of share capital and list of

shareholders, Directors: to be filed within 21 days of AGM [Section

36].

ii. Balance Sheet: to be filed within 30 days of AGM

iii. Profit & Loss Account: to be filed within 30 days of AGM

iv. Form 23B Notice by Auditor: to be filed within 30 days of receiving

appointment information from the company [Section 210 (2)].

         b. Returns for Change

i. Filled in Form III - Notice of consolidation, division, subdivision or

conversion into stock of shares: to be filed within 15 days of

consolidation and division etc. [Section 53 & 54].

ii. Filled in Form IV - Notice of increase share capital: to be filed within

15 days of increase of share capital/member [Section 56].

iii. Filled in Form VI - Notice of situation of Registered Office and of

any change therein: to be filed within 28 days of establishment or

change [Section 77].

iv. Filled in Form VIII - Special Resolution/ Extraordinary Resolution

including name change, conversion into public company, alteration

of the memorandum of association, alteration of articles of

association etc : to be filed within 15 days of the meeting [Section 88

(1)].

v. Filled in Form IX - Consent of Director to act: to be filed within 30

days of appointment [Section 92].

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vi. Filled in Form XII - Particulars of the Directors, Manager and

Managing Agents and of any change therein: to be filed within 14

days from the date of appointment or change [Section 115].

vii. Filled in Form XV - Return of allotment: to be filed within 60 days of

allotment [Section 151].

viii.Filled in Form XVIII - Particulars of mortgages or charges: to be

filed within 21 days of creation of the mortgage or charge [Section

159 & 391].ix. Filled in Form XIX - Particulars of Modification of Mortgage or

Charge: to be filed within 21 days of the date modification [Section

167(3) & 319].x. Filled in Form XXVIII - Memorandum of satisfaction of mortgage

charge: to be filed within 21 days of the date satisfaction [Section 12

& 391].xi. Filled in Form 117 - Instrument of Transfer of Shares.xii. Digital copy of original Memorandum & Articles of Association

Winding Up:   1. Mode of Winding Up

The Winding up of a company may be either

i. By the court; or

ii. Voluntary

a. Sub-Divisions of Voluntary Winding Up

i. MembersVoluntary Winding Up: wherein a declaration of solvency to

pay debts is made

ii. CreditorsVoluntary Winding Up: wherein a declaration of solvency is not made

iii. Subject to supervision of court: wherein a company has resolved to

wind up voluntarily and the court makes an order on consideration of a

petition by the member (s) or the creditor (s) that the Voluntary

Winding up shall continue but subject to supervision of the court

      2. Winding Up by the Court

i. The Company or any creditor or creditors or the Registrar submits petition

to the court for Winding up of the company by the court.

ii. Winding up of a company by the court is deemed to commence at the time

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of presentation of the petition for the Winding Up.

iii. The petitioner/the company files with the Registrar a copy of the Court

order within thirty (30) days of the court order.

iv. The Registrar notifies in the official gazette that such a court order has

been made.

v. The court may, at any time after an order for Winding up, in consideration

of an application of any creditor or contributor, make an order staying the

Winding up proceedings either altogether or for limited time.

vi. The court may appoint other than the official receiver a person or persons

as official liquidator or liquidators for the purpose of conducting the

proceedings of winding up.

vii. The official liquidator files with the Registrar audited accounts.

viii. When the affairs of the company is completely wound up the official

liquidator files with the Registrar court order of dissolution within fifteen

(15) days of such an order.

      3. Voluntary Winding Up

i. A company may adopt resolution, special resolution or extraordinary

resolution for Voluntary Winding up.

ii. A Voluntary Winding up is deemed to commence at the time of passing of

the resolution.

iii. The company within ten (10) days of resolution notifies in the official

gazette and in newspaper that such a resolution has been taken..

iv. Members Voluntary Winding up: In this case, prior to passing of the

resolution of Voluntary Winding up, the directors at a meeting make a

declaration of solvency that the company is capable to pay its debts within

a period not exceeding three (3) years. The declaration is filed with the

Registrar.

v. Creditors Voluntary Winding up: In this case, a declaration to pay debts is

not made.

vi. The company shall appoint one or more liquidators.

vii. As soon as the affairs of the company are fully wound up and final meeting

held, the liquidator within one (1) week of the meeting files with the

Registrar final accounts and returns of the final meeting.

viii. The company shall be deemed to be dissolved on expiration of three (3)

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months of registration of returns of the final meeting.

ix. The dissolution period may however be extended by the court on

consideration of any petition.

x. Winding up subject to supervision of court: At any stage of the Voluntary

Winding up process, the court may make an order, on consideration of a

petition by the member (s) or the creditor (s), that the Voluntary Winding

up shall continue but subject to supervision of the court.

Issuance of Certified Copies:      a. RJSC is the sole authority that keeps records of all registered entities (companies,

trade organizations, societies and partnership firms).

      b. Anyone can apply for certified copy of any of such records of an entity

      c. However, the profit & loss account of a company is not open to all. Only authorized

personnel of the respective company can apply for it.

      d. On receipt of an application and requisite fee, RJSC issues certified copy of the

records applied for.

Documents Constituting an Issuance of Certified Copies Application

    i.  One applies for certified copy of record (s) through website

Documents for which certified copies are issued

    PRIVATE COMPANY (Companies Act, 1994)

        a. Identified by unique nature

i. Articles of  Association or part thereof

ii. Memorandum of Association or part thereof

iii. Certificate of incorporation

iv. Declaration on registration of company

v.  List of persons consenting to be directors (1st Directors)

        b. Identified by the applicable year

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i. Annual summary of share capital and list of shareholders, Directors

ii. Balance Sheet

iii. Profit & Loss Account (only to the authorized person of the

respective company)

iv. Notice by Auditor

        c. Identified by the effective date

i. Notice of consolidation, division, subdivision or conversion into

stock of shares

ii. Notice of increase of share capital

iii. Notice of situation of registered office and of any change therein

iv. Special Resolution/Extraordinary Resolution

v. Consent of director to act

vi. Particulars of the Directors, Manager and Managing Agents and of

any change therein

vii. Return of allotment

viii. Particulars of mortgage or charges

ix. Particulars of modification of mortgage or charge

x. Memorandum of satisfaction of mortgage charge

xi. Instrument of Transfer of Share

xii. Alteration of Memorandum of Association

xiii. Alteration of Articles of Association

xiv. Name change

xv. Conversion of private company into public company

xvi. Certificate of Registration of mortgage or charge

xvii. Certificate of Registration of modification of mortgage or charge

xviii. Certificate of Registration of satisfaction of mortgage or charge

xix. Struck off certificate

xx. Wound up certificate

Struck Off:i. Where the Registrar has reasonable cause (like annual returns are not submitted for a

long period etc.) to believe that a company is not carrying on business or in

operation, sends to the company a notice (1st notice) inquiring whether the company

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is carrying on business or in operation.ii. If the Registrar does not within thirty (30) days of sending the notice receive any

answer thereto, shall within fourteen (14) days, after the expiration of the said thirty

(30) days send to the company a 2nd notice stating that if an answer is not received to

the 2nd notice within thirty (30) days from the date thereof, a notice will be published

in the official Gazette with a view to striking the name of the company off the

register.iii. If the Registrar either receives an answer from the company to the effect that it is not

carrying on business or in operation, or does not within thirty (30) days after sending

the 2nd notice receive any answer, he may publish in the Official Gazette, and send to

the company a notice that, at the expiration of ninety (90) days from the date of that

notice, the name of the company mentioned therein will, unless cause is shown to the

contrary, be struck off the register and the company will be dissolved, andiv. In such a case the Registrar may send a copy of the notice to the company while

sending it to the concerned authority for its publication in official Gazette.

ConclusionAs is documented in this report, failings in institutions, government agencies, legal

enforcement, and market behavior have resulted in weak corporate governance in

Bangladesh. The report is designed as a diagnostic tool from which a consensus will emerge

regarding the way forward for Bangladesh. The authors hope that this report will start a

dialogue amongst stakeholders about specific measures that can be taken to improve the

transparency and accountability of the corporate sector and strength then institutional support

for good corporate governance. At this stage, only very broad recommendations are provided,

identifying institutions or sectors that should be studied further. Specific recommendations

will be framed in subsequent stages of this project. Corporate Governance is a term that

describes the interaction of government regulators, shareholders, and boards of directors,

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independent observers, auditors, accountants and managers to provide quality Information to

shareholders, the market, and society at large. Each stakeholder plays an important part to

Creating an environment where transparency and accountability are encouraged, enforced,

and rewarded

Reference: http://www.roc.gov.bd/ http://www.rjsc.org/ http://www.rjsc.org/index.php/rjsc-name-clearance-rjsc-entity-name-search http://shailallb.blogspot.com/2009/01/registrar-of-joint-stock-companies-and.html http://en.wikipedia.org/w/index.php?

search=steps+of+forming+a+company+in+bangladesh&title=Special%3ASearch&go=Go

http://www.roc.gov.bd:7781/Guidlines/Download/FORM%20IX.htm http://www.roc.gov.bd:7781/Guidlines/Download/FORM%20X.htm http://www.roc.gov.bd:7781/Guidlines/Download/FORM%20XII.htm

Textbook: Commercial law and industrial law (business law). By- Arun Kumar Sen and Jitendra

Kumar Mitra

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