Conduct a company name search and reservation
Agency: Company Registry Division – Ministry of Economic Affairs
The entrepreneurs submit a company name search application to verify the uniqueness of the desired company name. The rules for permitted company name is defined by the Chapter 5 of the Companies Act, 2016. No company shall be incorporated with a name which, in the opinion of the Registrar, is undesirable or is identical with, or too nearly resembles the name by which a company in existence has been previously registered.
Since February 2019, there is an option to conduct name search and approval online, which is becoming more popular. Name search is free of charge, and after approval it is possible to reserve the name at a fee of Nu. 2,000.
Time and cost: 1 to 3 days, BTN 2,000
Obtain a Security Clearance Certificate (SCC) from the Royal Bhutan Police
Agency: Royal Bhutan Police
In June 2011, The Ministry of Home and Cultural Affairs launched the Security Clearance Service: an online system to issue Security Clearance Certificates (SCC). The system was developed in coordination with the Department of Information Technology and Telecom at the Ministry of Industry and Commerce in response to the directives issued by the Bhutan Cabinet on March 27, 2009. The security clearance certificate is valid for one year. It is possible to request SCC online at www.sec.rbp.bt.
The SCC clearance given by Ministry of home is now integrated with online single window registry system and verification of a persons SCC status can be availed simultaneously with company registration through online portal of Office of the Registrar (www.cra.gov.bt).
Time and cost: 1 day (simultaneous with previous procedure), no charge
Submit project proposal to the Industrial Department Division (IDD) of the Ministry of Economic Affairs
Agency: Industrial Department Division (IDD) of the Ministry of Economic Affairs
An application form along with the project proposal is submitted to the Industrial Department Division (IDD) of the Ministry of Economic Affairs.
In the case of small and cottage-scale companies with startup capital of up to BTN 10 million, the Regional Trade & Industry Office of the Department of Cottage and Small Industries reviews the project proposal. The project proposal approval is required to verify that the proposed industrial project is in line with industrial development plans of the country, and for issuance of the industrial license. The Doing Business case-study does not need location or environmental clearance.
Online services of the Department of Cottage and Small Industry were introduced at https://www.citizenservices.gov.bt/. After submitting the project proposal online, it may be requested to follow-up in person in order to submit additional documents or provide further clarifications.
Time and cost: 4 days, BTN 600
Register at the Office of the Registrar
Agency: Regulatory Authority for Companies – Ministry of Economic Affairs
Company registration is subject to the Companies Act, 2006. Upon applying for registration, the entrepreneur must present his/her original citizenship identity card and submit the following documents to the Regulatory Authority for Companies:
- Articles of Incorporation
- Company name clearance form
- Consent to act as Directors of the company form
- Declaration of compliance form signed by the company directors
- Sectoral clearance from the concerned sectors (if applicable)
- Name and Address of the first Chief Executive Officer of the company
- Security Clearance Certificates of company directors
The company receives its certificate of incorporation. Once the documents are processed, the Registrar of Companies issues the certificate of registration. The registered company may choose to publish a notice in the Kuensel weekly newspaper announcing its registration.
Registration fees are as follows:
- For an authorized share capital up to BTN 1 million: BTN 1,000
- For an authorized share capital between BTN 1 million and BTN 2 million: BTN 1,500
- For authorized share capital above BTN 2 million: BTN 2,000
Since February 2019, companies can be registered online at www.cra.gov.bt. The payments for the service also can be paid online using payment gateway system, integrated with the system.
Time and cost: 2 days, BTN 1,500
Obtain a business license from the Regional Trade and Industry Office of the Ministry of Economic Affairs
Agency: Regional Trade and Industry Office
To apply for the license, the following documents must be submitted:
- Application Form for Industrial License (Form III)
- Citizenship ID Card
- Sector Clearance (depending on activity)
- Location Clearance obtained from the Thimphu City Corporation (Dzongkhag or Thromde)
- Valid Security Clearance Certificate
- Two recent passport size photographs
- Project Approval from the Department of Cottage & Small Industry for cottage and small industries and from the Department of industry for medium and large scale industries
License fees are as follows:
- For cottage scale industries: BTN 1,600
- For small scale industries: BTN 3,100
- For medium scale industries: BTN 6,100
- For large scale industries: BTN 12,100
Cottage industries are those industries with an investment of less than Nu.1 million and engaging up to 4 people. Small industries are undertakings engaging between 5 and 19 employees with investment from Nu.1 to Nu.10 million. Medium industries employ between 20 to 99 people with investment from Nu.10 to Nu.100 million and large industries are undertakings with an investment of more than Nu.100 million employing 100 or more employees. Where there is a conflict, investment will take precedence over employment in defining the scale of business.
Since July 1, 2005, applications forms for trade and industrial licenses can be downloaded from the Ministry of Trade and Industry’s website (www.moea.gov.bt). Photocopies of application forms are accepted.
Online licensing portal of the government was launched at https://www.citizenservices.gov.bt. However, the majority of entrepreneurs prefer to perform the procedure in person.
Time and cost: 1 to 2 days, BTN 3,100
Register for taxes and obtain the Business Identifier Code (BIC) Number
Agency: Department of Revenue and Customs, Ministry of Finance
Every company must register for corporate income tax. A Business Identification Code (BIC, also called TPN) is then assigned to the company. This BIC number must be presented to participate in public tenders and works.
On January 1, 2015, the Department of Revenue and Customs has launched an online platform RAMIS (available at drc.gov.bt), which can be used to register for income tax and obtain BIC. However, the majority of entrepreneurs prefers to perform registration in person.
Time and cost: 1 day, no charge
Make a company seal
Agency: Seal maker
According to Section 225 of the Companies Act, 2016, companies may have a common seal. The company seal is required to open a bank account.
Time and cost: 1 day, BTN 100 to BTN 1,200
Open a bank account
Agency: Commercial Bank
Majority of companies open the bank account as soon as they register. Company shall submit the bank account details to the Department of Revenue and Customs.
Time and cost: 1 day, no charge