Update 21/10/2015: after to the recent amendment in the Finance Act 2015 and recent meetings between RJSC and NBR, it is no longer required for the foreign directors to obtain TIN.
Registrar of Joint Stock Companies and Firms (RJSC) and National Board of Revenue (NBR) now requires eTIN number for foreign Directors to incorporate a new company. Without an eTIN, RJSC does not issue the Certificate of Incorporation and NBR does not issue eTIN for the newly incorporated company. Previously only the Bangladeshi Directors require eTIN number for company incorporation.
Unfortunately both NBR and RJSC introduced this new requirement for foreign director without any prior notice. It creates an uproar and confusion among various parties who deal with company incorporation. Obtaining eTIN for foreigner is also confusing and difficult in the absence of any clear guideline.
We understand that NBR will soon introduce a new system for verifying eTIN for various services. Some 25 services will require mandatory submission of eTIN. Those include issuance of trade license, company incorporation, car registration, submission of tender documents, loans and credit cards from banks, obtaining gas and electricity connection for commercial purpose etc.
The Finance Bill 2014 has a provision for introduction of eTIN verification system from the beginning of the current fiscal year, however, it is yet to be launched.
NBR is planning to add a new section ’64BB. Verification of the authenticity of twelve-digit taxpayer’s identification number’ in the Income Tax Ordinance. As per the rule, service agencies will have to apply for user identification online to the NBR.
It is yet to be seen how the system will work and what are the implications of it for the foreign investors. We will keep you updated on this issue.