The Ministry of Industry, Commerce and Employment defines cottage-scale industries as those industries, whose initial fixed capital investment is less than Nu. 1 million and employ up to 4 people; and small-scale as those industries with fixe capital investment of Nu. 1 to 10 million. and employing up to 19 people.
The scale of industries, be it medium or large, depends on the level of fixed capital investment. Industries with a fixed capital investment between Nu. 10 and Nu. 100 million are categorized as medium industries whereas industries with a fixed capital investment of more than Nu. 100 million are categorized as large industries.

There are three different sectors of industries in Bhutan namely; 
1. Production and Manufacturing sector, 
2. Service sector,
3. Contract business. 

A Bhutanese citizen who is 18 years of age and above can legally own and operate an industry. An industry can be a unit that produces and manufactures goods or an entity that provides essential services. Retail and wholesale of goods is not considered as an industry and would fall under the Trading Sector. 

You must have a good business idea. Ideally, your business should be in an industry you have knowledge about and it should involve something you do better than anyone else. Your business should reflect your strengths and goals. 
Above all, it should be something you are passionate about and is something that fills an opportunity gap you have identified. You should then prepare a proper business plan.

As they say, “when you fail to plan, you plan to fail”.  When you need to convey your business ideas and models to others – lenders, investors and potential partners, you may need a business plan. 

If you are unsure, you can seek help from friends, consultants or approach a relevant government agency such as the Department of Industry or the Regional Office of Industry, Commerce and Employment. 

Yes, you are required to obtain an industrial license/registration certificate from the Department of Industry or Regional Office of Industry, Commerce and Employment for any kind of industrial activities.  
The exception to this is entertainment-related business, for which, you will have to approach the Bhutan InfoCom and Media Authority (BICMA).

At the time of application, please make sure to have valid security clearance certificate and depending on the type of business activity, you may also need to have soft copy of sector clearances as some industries may require clearances from other agencies such as the Department of Environment and Climate Change, Bhutan Food and Drug Authority or Thromde/Dzongkhags etc. and a business plan where required.   

Please visit your nearest Regional Office of Industry, Commerce and Employment or the Department of Industry.  Any officer there will be able to advice you on what are documents and/ or clearances are required. 

If all the required information, documents and clearances are submitted, the license/registration certificate will be issued within one or two working days.

The cost of the license will depend on the scale of your business. 

If it is a cottage-scale business, there is no cost for registration certificate for both registration and renewal but late renewal penalty of Nu. 20 will be applicable, if not renewed on time. 

If your scale of business is small, you will pay a sum of Nu. 3,000. However, for resturant, contract  tour operator and entertainment licenses, the fees will depend as per activity.

If your scale of business is medium, you will have to pay a sum of Nu. 6,000 and if your scale of business is large, you will have to pay a sum of Nu. 12,000 to obtain licenses. 

All types of business activities are allowed in the country with the exception of the following:
- Activities that violate any relevant laws of the country,
- Activities that threaten national security and public order,
- Activities that have harmful effects on public health, environment and Bhutanese morals and culture,
- Arms, ammunitions and explosives,
- Production of hazardous chemicals,
- Activities based on imported waste,
- Production, display and sale of pornographic materials,
- Gambling and betting,
- Tobacco and tobacco-based products

The government provides many fiscal and non-fiscal incentives to industries such as tax holidays for certain number of years, import duty exemption on machines, equipment, primary raw materials and primary packaging material, preferential buying by the government and focused capacity development programs and supports.

Depending on the priority of an industry, its viability and location, you may be able to lease State Forest Reserve Land or government land for a fixed period. 
Depending on the availability, you could also apply for industrial plots in one of the existing industrial estates and service centers.

The first and foremost requirement while starting a medium or large industry is to prepare a comprehensive business plan. The business plan will act as a foundation for your upcoming industry and serve as a reference point for the approval and licensing of your business.

There are Guidelines for the formulation of a business plan depending on the nature of the activity of your industry. Currently, the Department has published two guidelines for business plans; one for production and manufacturing industries and another one for service industries. 

You may download the Guidelines from the Legislations section from the Homepage of the Department website. 

Apart from a business plan, you are required to obtain and submit sectoral clearances and documents from relevant agencies depending on the activity of your industry. 

Some examples of sectoral clearances are environmental clearance, location clearance, technical clearances, currency clearances, and conditional food safety clearances. You may contact the Large Industry Promotion Division of the Department of Industry for advice on the relevant clearances and documents required for your business.