A Complete Guide to Obtaining Your Factory License (DIFE) in Bangladesh
Dhaka, Bangladesh
For any entrepreneur or corporation looking to establish and operate a manufacturing unit in Bangladesh, securing a Factory License from the Department of Inspection for Factories and Establishments (**DIFE**) is a non-negotiable legal prerequisite. This crucial license ensures that a factory operates in compliance with the Bangladesh Labour Act, 2006, safeguarding workplace safety, worker welfare, and environmental standards.
Operating a factory without this valid license is illegal and can lead to severe consequences, including factory closure, hefty fines, and legal action. This guide, prepared by the experts at LegalSeba LLP, provides a comprehensive walkthrough of the entire process to ensure your business remains compliant and operates smoothly.
The Regulatory Authority: DIFE
The Department of Inspection for Factories and Establishments (DIFE) is the sole government body responsible for issuing and renewing these licenses. Operating under the Ministry of Labour and Employment, DIFE is pivotal in enforcing labour laws.
License Validity Period
All DIFE licenses (Factory, Shop, Commercial, etc.) are valid for **12 months** from the date of issuance. Renewal must be completed annually before **31st December** to avoid late penalties.
DIFE License Fees by Category (as per Schedule 1)
License fees are determined by the category of the establishment and the maximum number of workers/employees engaged on any given day. A **15% VAT** is applicable on the total license fee.
Factory License (Manufacturing Units)
| Class | Max Workers | License Fee (BDT) | Renewal Fee (BDT) |
|---|---|---|---|
| এ (A) | 1–10 | 500 | 500 |
| বি (B) | 11–20 | 2,000 | 700 |
| সি (C) | 21–50 | 3,000 | 1,000 |
| ডি (D) | 51–100 | 5,000 | 1,500 |
| ই (E) | 101–200 | 7,000 | 2,200 |
| এফ (F) | 201–300 | 10,000 | 3,000 |
| জি (G) | 301–500 | 15,000 | 4,500 |
| এইচ (H) | 501–1000 | 20,000 | 6,000 |
| আই (I) | 1001–2000 | 30,000 | 9,000 |
| জে (J) | 2001–3000 | 50,000 | 13,000 |
| কে (K) | 3001–5000 | 70,000 | 17,000 |
| এল (L) | 5001+ | 95,000 | 22,000 |
Shops, Super Stores, Restaurants, & General Commercial Offices
| Class | Max Employees | License Fee (BDT) | Renewal Fee (BDT) |
|---|---|---|---|
| এ (A) | 1–5 | 100 | 50 |
| বি (B) | 6–10 | 200 | 70 |
| সি (C) | 11–20 | 500 | 100 |
| ডি (D) | 21–30 | 800 | 200 |
| ই (E) | 31–50 | 1,000 | 300 |
| এফ (F) | 51–70 | 1,500 | 600 |
| জি (G) | 71–100 | 2,000 | 900 |
| এইচ (H) | 101–200 | 3,000 | 1,000 |
| আই (I) | 201–300 | 5,000 | 1,500 |
| জে (J) | 301–400 | 8,000 | 2,000 |
| কে (K) | 401+ | 12,000 | 3,000 |
Commercial Banks and Insurance Companies
| Class | Max Employees | License Fee (BDT) | Renewal Fee (BDT) |
|---|---|---|---|
| এ (A) | 1–50 | 5,000 | 5,000 |
| বি (B) | 51–100 | 7,000 | 8,000 |
| সি (C) | 101–200 | 10,000 | 9,000 |
| ডি (D) | 201–300 | 12,000 | 9,000 |
| ই (E) | 301–500 | 15,000 | 10,000 |
| এফ (F) | 501–750 | 18,000 | 12,000 |
| জি (G) | 751–1000 | 22,000 | 15,000 |
| এইচ (H) | 1001+ | 25,000 | 17,000 |
Contractor/Agency License (Security Deposit Required)
| Max Workers | License Fee (BDT) | Renewal Fee (BDT) | Security Deposit (BDT) |
|---|---|---|---|
| 1–200 | 20,000 | 5,000 | 2,00,000 |
| 201–400 | 30,000 | 7,000 | 3,00,000 |
| 401–600 | 50,000 | 10,000 | 5,00,000 |
| 601–1000 | 70,000 | 15,000 | 8,00,000 |
| 1001–2000 | 90,000 | 18,000 | 9,00,000 |
| 2001–4000 | 1,25,000 | 20,000 | 10,00,000 |
| 4001+ | 1,50,000 | 25,000 | 10,00,000 |
The Modern Application Process: Step-by-Step Guide
The application process is now streamlined through the Labour Inspection Management Application (LIMA) portal.
Online Registration and Application Submission
- Visit the LIMA Portal: The process begins on the LIMA online portal.
- Create an Account: You will need to create a User ID and Password to access the system.
- Complete the Application Form: Fill out the designated application form (Form 77) with all the essential information.
- Upload Required Documents: Scan and upload all the necessary documents.
- Submit the Application: Once complete, submit the application and note the tracking number.
Fee Payment
You must pay the requisite government fees as determined by the tables above, plus 15% VAT.
Payment Method: Via a Treasury Challan at a designated bank.
Treasury Challan Code: 1/1136/0005/1854 (Must be verified at the time of application).
Document Review and Physical Inspection
- Review and Assignment: The application is reviewed by the Deputy Inspector General (DIG).
- On-Site Inspection: A DIFE inspector will visit the premises to verify information and assess compliance with safety and environmental standards.
License Issuance
- Final Approval: If all standards are met, the DIG approves the application.
- License Grant: The license is issued and is available for download on the LIMA portal.
The official processing time is approximately 15 working days, provided all requirements are met.
Required Documentation for a New Factory License
Gathering the correct documentation is critical. Attestation by a First-Class Gazetted Officer may be required for some copies.
- Completed Application Form (Form 77) submitted via the LIMA portal.
- Original Treasury Challan as proof of fee and VAT payment.
- Copy of a valid Trade License.
- Copy of Company’s Tax Identification Number (TIN) Certificate.
- For Limited Companies: Certified copies of the Memorandum and Articles of Association, and Certificate of Incorporation.
- Ownership/Tenancy Documents: Copy of the rental agreement/lease deed or land ownership documents.
- National ID Card of the factory owner, Managing Director, or CEO.
- Factory Layout Plan: An approved layout plan of the factory premises.
- Proof of Compliance: Valid Fire License, Environmental Clearance Certificate (ECC), etc.
Renewing Your Factory License
Since the license is valid for 12 months from the date of issue, renewal must be initiated well before the end of the year, usually by 31st December, to maintain compliance.
Required Documents for Renewal:
- Completed Renewal Application Form.
- Original Factory License (previous year).
- Original Treasury Challan for the renewal fee and VAT.
- Copy of the updated Trade License.
- Updated list of employees.
- Copy of the renewed Fire License and ECC.
Late Renewal Penalties:
Failure to renew on time incurs significant penalties on the renewal fee:
- Within 3 months of expiry: 25% penalty
- Within 6 months of expiry: 50% penalty
- Beyond 6 months of expiry: 100% penalty
Consequences of Non-Compliance
Forced Closure
DIFE has the authority to shut down the factory immediately.
Financial Penalties
Substantial fines can be imposed on the factory owner.
Legal Action
The government can initiate legal proceedings against the owner.
Reputational Damage
Operating illegally damages business credibility with buyers and partners.
How LegalSeba LLP Can Assist You
The expert team at LegalSeba LLP provides end-to-end solutions to make this process seamless for you.
- Document Preparation and Vetting: Assisting in gathering, preparing, and verifying all necessary documentation.
- Application Management: Managing the entire application process on the LIMA portal on your behalf.
- Renewal Services: Proactively managing your annual license renewal to ensure you never miss a deadline.
Business Notification Process
A Step-by-Step Flowchart
Register Online & Get Tracking Number
Pay Fees at Designated Bank
Submit Application & Documents to DIFE
DIG Reviews Documents
Inspector Checks Premises
Inspector Reports to DIG
DIG Approves?
License Issued
Contact Us Today
Take the stress out of managing compliance and corporate governance. Contact our team of experts for personalized assistance.
📞 Phone/WhatsApp: +8801753718223
📧 Email: [email protected]
🌐 Book A Meeting: LegalSeba.com/book-now
