Before building works begin, a manufacturer usually needs secure title or a registered lease of the site, building plan approval from RAJUK or the relevant local authority, DIFE approval of the factory layout plan, and site or environmental clearance from the Department of Environment depending on the industry category. Fire safety design should also be agreed with the Fire Service and Civil Defence. Projects normally register with Invest Bangladesh or BEPZA at an early stage. We prepare a factory establishment approvals map at the start, so that construction does not run ahead of approvals that later prove difficult to obtain.

Timing depends on the completeness of the application, the type of factory, the inspection schedule and whether other approvals, such as building and fire clearances, are in place. Where documents are in order, DIFE's online process can move reasonably quickly, but missing drawings, inconsistent records or safety queries often cause delays of weeks or months. Apply well before the planned start of production. We review applications before filing to reduce the risk of queries, and follow up with the department during processing so that issues are dealt with promptly. Good factory establishment planning builds this into the timetable.

Factories within EPZs are regulated by BEPZA, which has its own framework for labour, safety and licensing matters inside the zones, including its own labour legislation for zone enterprises. In practice, enterprises in EPZs deal primarily with BEPZA rather than DIFE for approvals and inspections. Economic zones are subject to different arrangements, now administered by Invest Bangladesh following the 2026 merger. The precise position should be checked for each zone and activity. We advise zone investors on factory establishment requirements specific to their location and on how zone rules interact with national laws. Zone documentation should be confirmed early.

Operating a factory without the required licence or approved layout plan can lead to penalties under the Labour Act, enforcement notices, and in serious cases closure orders, particularly if safety risks are identified. It can also cause practical problems: banks may refuse facilities, insurers may question cover, customs entitlements may be affected and international buyers may suspend orders after an audit. If production has already begun, the safest course is to regularise the position quickly. We advise on the steps to bring the factory into compliance and on dealing with any notices received. Gather existing approvals and receipts first.

Yes. Most manufacturing sectors are open to full foreign ownership, subject to limited restrictions in certain regulated or reserved activities. A foreign investor typically incorporates a Bangladeshi company, registers the project with Invest Bangladesh or BEPZA, brings in capital through banking channels with the required encashment documents, and then obtains the same factory licences as a local manufacturer. Work permits are needed for foreign staff. We handle the corporate, foreign exchange and investment steps alongside the factory establishment approvals, so that the two tracks move in parallel rather than one after the other. Keep the capital inflow documents.

Usually yes. An expansion that changes floor area, layout, machinery, capacity or workforce numbers generally requires an amended DIFE layout approval and licence, and may require updated environmental clearance, fire safety approval and building permissions. A relocation to a new site is treated much like new factory establishment, although existing registrations can sometimes be amended rather than replaced. Investment registrations and import entitlements may also need updating. We review the planned change, identify what must be amended and in what order, and help avoid gaps that could interrupt production. Amendments should be planned early. Check loan terms for notice requirements.

Under the Environment Conservation Rules 2023, industrial units are classified into categories according to their potential environmental impact. Lower-risk categories follow a simpler process, while higher-risk industries, such as dyeing, tanning, chemicals and many heavy industries, require site clearance, an environmental impact assessment, an approved effluent treatment plant and, before operation, environmental clearance. Clearances must be renewed and their conditions monitored. Weak environmental compliance is a common reason for buyer concerns and enforcement action. We work with environmental consultants to prepare applications and manage conditions throughout the project. Site clearance generally precedes construction. Consultants should be engaged early.

A licensed factory must renew its licence and other approvals on time, keep the registers and notices required by the Labour Act and Rules, maintain safety and welfare facilities, form safety and other committees where the workforce size requires them, and comply with conditions attached to environmental, fire and boiler approvals. Changes in capacity, ownership or address must be notified or approved. Inspections can happen at any time. We help clients set up compliance calendars and internal audits, and represent them if notices or prosecutions follow an inspection. Factory establishment does not end with the first licence.