What Is a Factory Licence?
A factory licence is issued by DIFE (Department of Inspection for Factories and Establishments) under the Bangladesh Labour Act 2006. It authorises a factory to operate and confirms that minimum workplace safety, health, and welfare provisions are in place.
Who Needs a Factory Licence?
| Establishment Type | Criteria | Licence Required |
|---|---|---|
| Factory with power | 5 or more workers + uses power-driven machinery | Yes — factory licence |
| Factory without power | 10 or more workers + no power-driven machinery | Yes — factory licence |
| Commercial establishment | Shops, offices, restaurants with employees | Registration (simpler) |
Documents Required
| # | Document | Detail |
|---|---|---|
| 1 | Application form | Prescribed DIFE form |
| 2 | Trade licence | Current trade licence from city corporation |
| 3 | Building plan | RAJUK/CDA approved building plan |
| 4 | Layout plan | Factory floor layout showing machinery, workers, exits |
| 5 | Fire licence | Current FSCD fire licence |
| 6 | Structural integrity certificate | From licensed structural engineer (mandatory post-Rana Plaza) |
| 7 | List of machinery | All power-driven machinery with specifications |
| 8 | Worker count | Total workers by gender and category |
| 9 | Welfare provisions | Evidence of canteen (250+ workers), rest room, toilets, drinking water |
| 10 | Environmental clearance | DoE clearance for applicable category |
Application Process
1
Obtain Prerequisites
Trade licence, fire licence, structural integrity certificate
↓
2
Prepare Layout Plan
Factory floor layout showing machinery, workers, exits, ventilation
↓
3
Submit to DIFE
Application form with all documents to DIFE office
↓
4
DIFE Inspection
Inspector checks safety, health, welfare, structural conditions
↓
5
Address Deficiencies
Rectify any issues identified during inspection
↓
6
Licence Issued
Valid for 1 year; annual renewal with re-inspection
| Step | Activity | Timeline |
|---|---|---|
| 1 | Gather all prerequisite documents (trade licence, fire licence, structural cert, etc.) | 2-4 weeks |
| 2 | Complete DIFE application form | Day 1 |
| 3 | Submit to Chief Inspector of Factories (district level) | Day 1-3 |
| 4 | Pay prescribed fee | Day 1-3 |
| 5 | DIFE inspector assigned for inspection | 2-4 weeks |
| 6 | Site inspection — safety, health, welfare provisions checked | Half to full day |
| 7 | Inspection report — pass or deficiency notice | 1-2 weeks |
| 8 | Rectification of deficiencies (if any) | 2-8 weeks |
| 9 | Re-inspection (if needed) and licence issuance | 1-3 weeks |
Total timeline: 2-4 months (assumes prerequisites are in hand).
Structural Integrity Certificate (Post-Rana Plaza)
Since the 2013 amendment (Section 51A of the Labour Act), every factory building must have a structural integrity certificate issued by a licensed structural engineer (PE). This must be:
- Issued by: A licensed Professional Engineer (structural) registered with IEB
- Content: Assessment that the building is structurally adequate for its current use and loading
- Renewal: Periodic reassessment recommended (typically every 3-5 years or after any modification)
- RMG factories: Additionally subject to RSC (formerly Accord/Alliance) structural assessments
What DIFE Inspects
- Structural: Structural integrity certificate, any visible structural distress
- Fire safety: Fire exits (minimum 2), extinguishers, alarm, exit signs, emergency lighting, fire drill records
- Electrical: Wiring condition, earthing, insulation, overload protection
- Ventilation: Adequate ventilation and temperature control
- Lighting: Sufficient natural and artificial lighting
- Sanitation: Toilets (1:25 workers), clean drinking water, waste disposal
- First aid: First aid box per 150 workers, trained first-aider
- Welfare: Canteen (250+ workers), rest room, prayer room, childcare (40+ female workers)
- Working conditions: Working hours, overtime, worker register
- Safety committee: Factory safety committee if 50+ workers
Fees and Renewal
| Worker Count | Annual Fee (BDT approx.) |
|---|---|
| 5-50 workers | 500-1,500 |
| 51-200 workers | 1,500-3,000 |
| 201-500 workers | 3,000-5,000 |
| 500+ workers | 5,000-10,000 |
Renewal: Annual. Apply before expiry with updated documents and fee.
Penalties for Non-Compliance
- Operating without licence: Fine up to BDT 25,000 and/or imprisonment up to 4 months
- Repeat offence: Fine up to BDT 1,00,000 and/or imprisonment up to 1 year
- Closure order: DIFE can order factory closure for serious safety violations
- Incident liability: Operating without licence in a workplace accident = criminal negligence
References
- DIFE — Department of Inspection for Factories and Establishments
- Bangladesh Labour Act 2006 (amended 2013, 2018)
- Bangladesh Labour Rules 2015
- ILO — Bangladesh Workplace Safety
Insights & Guidance
- Factory licence is mandatory for any factory with 5+ workers (with power) or 10+ workers (without power).
- Structural integrity certificate is mandatory since 2013 (Section 51A) — must be issued by licensed structural PE.
- DIFE inspects structural safety, fire, electrical, ventilation, lighting, sanitation, welfare, and working conditions.
- Timeline: 2-4 months if prerequisites (trade licence, fire licence, structural cert) are in hand.
- Operating without licence: fine up to BDT 1,00,000 and imprisonment. Closure order for serious violations.
The factory licence is the legal authorisation for industrial operations. Post-Rana Plaza, it has become significantly more rigorous — the mandatory structural integrity certificate requirement directly addresses the root cause of Bangladesh's worst industrial disaster. No factory should operate without it.
- No structural certificate — the most critical post-Rana Plaza requirement, yet still missing in many smaller factories.
- Prerequisites missing — can't get factory licence without trade licence, fire licence, and structural certificate.
- Current factory licence
- Structural integrity certificate from licensed PE
- DIFE inspection report
- Safety committee meeting records
- Is the factory licence displayed?
- Is the structural integrity certificate available?
- Are welfare provisions (toilets, drinking water, first aid) adequate?
- Is the factory licence current? When was the last DIFE inspection?
- Is there a structural integrity certificate? When was it last updated?
- Is there a safety committee? How often does it meet?
- Structural certificate — licensed PE (structural engineer registered with IEB).
- Labour compliance — lawyer specialising in Bangladesh Labour Act.
- Safety management — ISO 45001 consultant for systematic safety management.