Capital ceiling for one-person firm to come down to 5 lakh

The government will lower the minimum paid-up capital ceiling for one-person companies to 5 lakh from the present 25 lakh as per the Companies Act (2nd Amendment) Bill, 2020 to allow more small businesses to get registration for enabling their formalization.

 

Besides, it will take the initiative to issue trade licenses for e-commerce businesses so that they can avail access to finance as well as other opportunities as the e-commerce entities are automatically recognized as enterprises.

 

Commerce Minister Tipu Minshi said this at a meeting with the representatives of Business Initiative Leading Development (BUILD) at his office at the secretariat in Dhaka on Monday.

 

BUILD Chairperson Abul Kasem Khan led the BUILD delegation.

 

The minister added that the high-potential e-commerce sector is not getting promoted as expected since they need trade license for availing of the facilities. The ministry is already working with the local government ministry in regard to issuing trade licenses.

 

Stressing on the importance of enabling business environment in Bangladesh, he stated that the Commerce Ministry is always open to extend all forms of logistical support to make the private sector vibrant. He appreciated the role of private sector in creating a platform like BUILD for evidence-based public-private dialogue between government and trade and industry to create a business-friendly environment through policy reforms.

 

BUILD Chairperson Abul Kasem Khan said that Bangladesh's export is heavily concentrated on one sector. Other sectors like leather and leather goods, plastic and light engineering need greater policy attention for diversifying export basket. All the non-RMG sectors immediately need bonded warehouse facilities besides other policy benefits, he added.

 

Earlier Asif Ibrahim, Chairman of Chittagong Stock Exchange and former Chairman of BUILD  informed about the situation of RMG sector and thanked the government for extending the provision for allowing utilization declaration (UD) through the BGMEA, which has helped businesses carry out export-oriented manufacture efficiently without bureaucratic hassles. In regard to raising coverage of small business as OPCs, he suggested allowing tax benefits and tax exemption for at least three years to encourage them to be registered in the Companies Act.

 

BUILD CEO Ferdaus Ara Begum informed that Bangladesh and Vietnam started export diversification journey almost at the same time in 1990. However, Vietnam has made tremendous progress so that if their RMG sector is adversely affected, only 14 percent of its export would be impacted. Export of Vietnam stood at USD 263.45 billion in 2019, out of which RMG export was USD 39 billion. A different picture has emerged in Bangladesh where RMG singularly contributes about 85 percent of export. She also informed that BUILD will seek supports from the ministry for policy advocacy for Medical and Personal Protective Equipment (MPPE) products and identify gaps in the list of standards developed by BSTI in terms of export potential.

 

Joint secretary for commerce Md Abdus Samad Al Azad informed that the ministry is working to prepare protocol for honey and tishi oil so that health certificates of these products are delivered. In this respect he requested BUILD to send a list of potential products for which standards and certification are important.

 

Hafizur Rahman, additional commerce secretary and Project Coordinator EC4J raised the issue of the need for halal certificate. In that respect health compliance rules need to be prepared.

 

Hafizur Rahman, additional commerce secretary and DG WTO cell of the ministry at the request of the minister shared updates on the issue of the trade license for e-commerce and informed that they are coordinating with the LGRD to address the issue through an expeditious process.

Tipu Munshi tells BUILD delegates