Foreign investors seeking to establish a presence in Bangladesh have two options: establishing a Branch, Liaison, or Project Office or incorporating a Bangladeshi subsidiary company. The former is commonly utilized as a short-term and temporary arrangement, serving as an extension of the parent company without constituting a separate legal entity. It is often employed for specific projects or market exploration. Conversely, a subsidiary company offers a more enduring business structure with increased flexibility and shareholder protection.

A branch office of a foreign company in Bangladesh is permitted to engage in commercial activities following prior approval from BIDA. However, the range of activities allowed for a branch office is more limited compared to those for a subsidiary company. Furthermore, a branch office may generate local income within the approved business activities in Bangladesh with prior approval from BIDA. Outward remittances for the branch office are permissible with prior approval from BIDA.

In Bangladesh, both Liaison Offices and Representative Offices, established by foreign corporations, have limited operational scope and are not allowed to generate local revenue. The foreign parent company is responsible for all setup and ongoing expenditures, including staff remuneration. Outward remittances from Bangladesh are generally not permitted, except for repatriating unutilized funds brought in from abroad.

The operation period of a Branch, Liaison, or Project office should not surpass the specified duration in the approval correspondence issued by BIDA. Should a company seek to extend its office beyond the approved term, it is mandatory to submit an application for renewal or extension, accompanied by requisite documentation, in the prescribed format at least 2 months before the current term expires.

The scope of activities for a Branch, Liaison, or Project office is to be strictly aligned with the parameters outlined in the approval correspondence issued by BIDA. Any intention to broaden the scope beyond the approved ambit necessitates an application for amendment to include the new activities.

In the event of employing foreign nationals, the company must obtain work permits from BIDA. Furthermore, detailed quarterly reports on the income and expenditures derived from remittances received from abroad are to be tendered to BIDA, the relevant bank, the National Board of Revenue, and Bangladesh Bank with supporting documentation.

Notification of any proposed address change must be conveyed to BIDA for review and approval prior to implementation. In addition, the sanctioned office must procure clearances and licenses as mandated by the extant regulations of the country from the relevant government bodies. 

Permit for office operations and foreign national work permits are contingent upon obtaining security clearance from the Ministry of Home Affairs. Renewal of the office and work permits will not be effected until security clearance is secured. In the event that a foreign company intends to establish multiple offices of the sanctioned Branch or Liaison Offices in Bangladesh, separate prior authorization from BIDA is required.