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Mediation in Bangladesh

Mediation in Bangladesh

Mediation in Bangladesh: A Complete Overview

Barrister Remura Mahbub
Director, Tahmidur Remura TLS, Law Firm in Bangladesh

12 Nov 2022

The purpose of this article is to explain the entire process of mediation in Bangladesh: provisions that regulate mediation, step by step procedure, mediation agreement, costs, timeline etc.

What is ADR or Mediation in Bangladesh?

 Alternative Dispute Resolution (ADR) is an  alternative route to a quicker and cheaper method of settling disputes in which a neutral third party helps the disputing parties reach a resolution.  Mediation is one of the major forms of ADR, the other two being arbitration and conciliation.  Section 89A  of Code of Civil Procedure is the main provision of mediation in Bangladesh. 

Mediation in Bangladesh is a procedure in which the conflicting parties  attempt, with the assistance of a neutral third party (the Mediator), to reach a settlement of their disputed issues through negotiation.

 When a consensus is reached, the parties may call upon the services of the Mediator or one of their lawyers to draft a document that they will sign in order to record and finalize the consensus.  This official document will be known as their settlement agreement, which will binding on the parties.

 

Mediation In Bangladesh

Benefits of Mediation in Bangladesh

As mentioned above, medication is less expensive and more quicker than going to the court which allows the parties to move on from the issue more swiftly. Mediation enables you to retain control. In mediation, unlike in court where a judge makes the decisions, you select how to settle the disagreement and are not required to accept a conclusion with which you are unsatisfied.

Mediation offers  an encouraging and private environment.  The mediator will listen to all perspectives, speaking with the parties individually and when necessary, with all the opposing parties in the same room.

Mediation can aid in the preservation of relationships. A dispute that is resolved by an antagonistic court battle can strain the relationship between the parties.  However, mediation helps you focus on effective communication in order to create solutions that work for everyone. Hence, mediation in Bangladesh are especially encouraged for disputes in partnership, family law, property neighbours, businesses, etc.

Another instrumental benefit of mediation in Bangladesh is confidentiality. Since mediation is an attempt to resolve their disputes through facilitated negotiation, all discussions between the parties (whether with one another or privately with the mediator) will be “without prejudice.” “Without prejudice” means that any information resulting from mediation sessions must be viewed as both confidential and non-binding by all parties. Non-compellable indicates that neither party will raise such material in any legal procedure. Consequently, neither party may request or require the mediator to furnish information, give testimony, or produce documents in any legal case regarding the substance of any of the mediation sessions. The entire mediation process will be absolutely confidential. 

 

How To Do A Joint Venture In Bangladesh

   

                                    

Step by Step Procedure of Mediation

Appointment of a Mediator:

  The first step in commencing mediation in Bangladesh is to appoint a mediator, which will be determined by both parties. Mediator’s goal is to assist the parties in obtaining their own most constructive and equitable agreement. The Mediator has an obligation to work equally on behalf of each party, cannot provide individual legal advice to any party, and will not engage in therapy during the mediation. The respective clients and mediator will negotiate and define the fees and procedure to be followed in order to reach a settlement through mediation.  

Costs of Mediation:

Consequently, the cost of hiring the mediator will be covered by both parties.

Mediation Sessions:

It is understood that most mediation sessions will involve both parties in joint sessions with the Mediator, but separate meetings may be held between the Mediator and the parties individually before and during the mediation. If the Mediator requests a separate meeting with one party during a mediation session, he or she will also have a separate meeting with the other party.

Time Frame:

If the court itself refers mediation to the parties, then  under section 89A, sub-section (1), the parties shall inform the Court in writing of the mediator they have appointed within ten days from the date of reference. If the parties fail to appoint a mediator during this period, the Court shall, within seven days, appoint a mediator and the mediation under this section shall be concluded within sixty (60) days from the day the Court is so informed unless the Court of its own motion or upon a joint request of the parties, extends the time for a further period of 30  days.

In the case on non-court referred mediation in Bangladesh, if the parties have not already fixed the duration of mediation process in their mediation agreement, the parties themselves can determine the time frame within which they desire to conclude the mediation. The suggested timeline may range from 30 days to 90 days, depending on the complications of the issue at hand. 

Settlement Agreement or Court Decree

When a consensus is established, the parties may request the Mediator’s or one of their attorneys’ assistance in drafting a document that both the parties and mediator will sign to record and finalize the agreement. This official document will be known as the parties’ settlement agreement and will be legally binding.

In the case of court referred mediation in Bangladesh, the Legal Aid Officer or mediator will submit to the court a report of the result of the mediation proceedings, and if the result is a compromise of the  disputes in the suit, the terms of such compromise shall be reduced to writing in the form of an agreement, bearing signatures or left thumb impressions of the parties as executants, and signatures of the Legal Aid Officer or mediator. Court will pass an order or a decree in accordance with relevant provisions of Order XXIII of the Code of Civil Procedure within seven days from receiving the said report.

Here is a table that outlines the general step-by-step procedure for mediation in Bangladesh:

StepDescription
1The parties to the dispute agree to mediate or are ordered by a court to participate in mediation.
2A mediator is selected or appointed. The mediator should be neutral and have the necessary skills and experience to facilitate the mediation process.
3The mediator meets with the parties to explain the mediation process and discuss their needs and interests. The parties may also be asked to sign a mediation agreement, which sets out the terms and conditions of the mediation.
4The parties meet with the mediator to discuss the issues in the dispute and explore options for resolution. The mediator helps the parties to communicate effectively, identify common ground, and brainstorm potential solutions. The mediator may also meet with the parties separately (in “caucuses”) to facilitate the negotiation process.
5If the parties are able to reach an agreement, the mediator will help them to draft a written settlement agreement. The agreement should be clear, concise, and reflect the parties’ intentions. The parties may wish to have their lawyers review the agreement before signing it.
6If the parties are unable to reach an agreement, the mediation process is terminated. The parties may choose to pursue other dispute resolution options, such as arbitration or litigation.

I hope this table is helpful! Please note that this is a general outline and the specific steps and procedures may vary depending on the circumstances of the case and the preferences of the parties and the mediator. Let us know if you have any questions or need more information.

Here is a table with ten frequently asked questions about mediation in Bangladesh:

Q:What is mediation?
A:Mediation is a voluntary process in which a neutral third party (the mediator) helps the parties to a dispute communicate and negotiate a resolution. The mediator does not have the authority to make a decision on the dispute, but rather helps the parties come to an agreement on their own.
Q:When is mediation used in Bangladesh?
A:Mediation can be used at any stage of a dispute, whether it is before a lawsuit is filed, during the course of litigation, or after a judgment has been rendered. Parties can choose to mediate their dispute voluntarily, or they may be ordered by a court to participate in mediation as part of a pre-trial settlement conference or as a condition of appeal.
Q:Who can be a mediator in Bangladesh?
A:In Bangladesh, mediators are typically lawyers, judges, or other professionals with specialized training in conflict resolution. The mediator should be neutral and have the necessary skills and experience to facilitate the mediation process.
Q:Is mediation confidential in Bangladesh?
A:Yes, mediation is generally confidential in Bangladesh. The parties to the mediation and the mediator are required to keep the proceedings and any information disclosed during the mediation confidential, unless the parties agree otherwise.
Q:Is the mediator’s decision binding in Bangladesh?
A:No, the mediator does not have the authority to make a decision on the dispute. The mediator’s role is to facilitate communication and negotiation between the parties and help them reach a mutually-acceptable agreement. If the parties are able to reach an agreement through mediation, they may choose to reduce it to writing and have it signed by the mediator as a record of the agreement.
Q:Can the parties bring lawyers to the mediation in Bangladesh?
A:Yes, the parties are free to bring lawyers or other advisers to the mediation if they wish. The mediator may also choose to involve other professionals, such as financial advisers or experts in a particular field, if necessary to assist in the resolution of the dispute.
Q:How long does mediation take in Bangladesh?
A:The length of the mediation process can vary depending on the complexity of the dispute and the willingness of the parties to negotiate. Some mediations may be resolved in a single day, while others may take several days or even weeks.
Q:Is mediation expensive in Bangladesh?
A:Mediation can be less expensive than litigation or arbitration because it is typically quicker and less formal. The parties are responsible for paying the mediator’s fees, which can vary depending on the mediator’s experience and the nature of the dispute.
Q:Is mediation successful in Bangladesh?
A:Mediation is successful in resolving disputes in a majority of cases. According to the Bangladesh Mediation Centre, over 70% of cases referred to mediation result in a settlement.
Q:Can the parties appeal the mediator’s decision in Bangladesh?
A:No, the mediator does not have the authority

 

                 

Mediation In Bangladesh
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Partnership Business In Bangladesh
Proprietorship Business In Bangladesh_Top Law Firm In Dhaka_Tahmidur Rahman Remura

Are you planning to do arbitration or  looking for alternative dispute resolution remedies in Bangladesh?

 

Tahmidur Rahman Remura TLS is a full-service law firm that has been dealing with arbitration consisting of a wide range of topics at both international and local level. We have barristers that have specialised in  international commercial arbitration from the United Kingdom and accredited civil-commercial mediators. 

If you require any assistance or consultation, please visit our office or contact us at +8801779127165 or +8801847220062 (WhatsApp) or by email- [email protected] 

E-mail: [email protected]
Phone: +8801847220062 or +8801779127165 or +8801708080817

Address: House 410, Road 29, Mohakhali DOHS, Dhaka 1206

Partnership Business In Bangladesh_Best Law Firm In Bangladesh_Barrister Tahmidur Rahman

If you want to open a liaison office in Bangladesh or about branch formation click here!

  • Step by Step Process of forming a liaison office in Bangladesh

“Tahmidur Rahman Remura- The Law Firm in Bangladesh is considered as one of the leading corporate firms in Dhaka, Bangladesh”

BDLaw Firms Bangladesh

FAQ

How much money is required for company registration in Bangladesh?

The governmental fees for registering a company are determined by the amount of authorized capital. Government fees for the issuance of an Incorporation Certificate shall be BDT 1000.

How long does it take to register a company in Bangladesh?

Once the aforementioned formalities have been completed, RJSC will usually issue the certificate of incorporation (Company registration certificate) within 6-8 working days.

It usually takes 2-3 weeks from the date of submission of all documents to RJSC to register a company.

What is BIDA?

Bangladesh Investment Development Authority (BIDA) is in charge of facilitating foreign investments in the country.

BIDA's responsibilities include issuing work permits for foreign employees, visas for foreign investors, processing loans from foreign sources, approving remittance of royalties and technical fees, assisting in the acquisition of industrial plots, facilitating utility connections, approving foreign loans, suppliers credit, and providing assistance and advice on a variety of investment-related issues.

Foreign investors with industrial projects are strongly advised to register with BIDA after forming their limited company. However, there is no requirement for a commercial or trading company to register with BIDA. The average time frame for obtaining registration is 7-10 working days.

What documents are needed to set up a private limited company in Bangladesh?

1. Memorandum of Association
2. Article of Association
3. Certificate of Incorporation
4. Trade License
5. TIN
6. VAT Registration Certificate
7. Name Clearance
8. Environmental Clearance Certificate
9. Fire Certificate

What is the minimum capital required for a private limited company in Bangladesh?

In Bangladesh, there is no minimum or maximum authorised capital for a local company.

However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50,000/- must be invested in the Company.

Can a single person start a company in Bangladesh?

 Bangladesh does not allow a single person to open a private limited company or One Person Company (OPC).

A private limited company must have at least two shareholders. In the case of a public limited company, however, the total number of shareholders required is seven.

Can a private limited company have one director in Bangladesh?

A private limited company must have at least two directors. Local or foreign nationals may serve as directors.

Directors must be at least 18 years old and have never been bankrupt or convicted of a crime. A director is required by law to own the qualification shares specified in the Articles of Association.

What is the difference between authorised capital and paid-up capital?

- Authorised capital: The amount of authorised capital must be specified in the Memorandum of Association and Articles of Association. It is the maximum amount of share capital that a company may allocate to shareholders.  

In Bangladesh, there is no minimum or maximum authorised capital for a local company. However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50000/- must be invested in the Company.

-Paid-Up Capital : The minimum paid-up capital for registering a Bangladeshi company is Taka 1 (for local companies) and USD 50000 (for foreign companies).

Infographics
How To Form A Private Limited Company In Bangladesh_Best Corporate Law Firm In Bangladesh
Video Tutorial
Author’s Bio
About Meheruba Mahbub | One of the most innovative young lawyers in Bangladesh

Meheruba Mahbub is a finance partner and one of the Bangladesh's market leading international lawyers. She is head of the firm's Mergers and Acquisitions practice, which advises corporates and financial institutions on outbound and inbound investments, projects and financings.

Meheruba has a diverse finance practice , representing large banks, financial sponsors, and corporations. She specializes in acquisition and structured financings, loan portfolio purchase and financing, real estate financings, and inbound and outbound transactions. She has extensive expertise in the energy and infrastructure industries.
Work highlights

Meheruba has acted on many high-profile Finance and Commercial deals in Bangladesh and India. These include advising:

⦾ Standard Chartered Bank on the sale of a portfolio of loans in Bangladesh, the first in a series of similar deals in Bangladesh as part of the government’s directive to banks to focus on the robustness of their balance sheets.

⦾ the lending and underwriting banks on the refinancing of US$6.9bn worth of debt uninsured by the Summit Group

⦾ Brookfield Property Partners on the acquisition and financing of Unitech’s real estate portfolio

⦾ Enron on the US$3bn Dhabol power project (since renamed Ratnagiri Gas and Power), the first ever inward investment into the power sector

⦾ the sponsor and borrowers on the Sakhalin LNG project, the world’s largest integrated oil and gas project and the largest LNG financing in Russia

Email: [email protected]

Address: 2 Turner Street, Canning Town, E16 1FH, United Kingdom

Gender: Female

Job Title: Barrister and Senior Associate

Have a Different Question?

Email us anytime : [email protected]

Or call — +8801847220062 or +8801779127165

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Sales and Purchase Agreement in Bangladesh

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Bank Guarantee Process in Bangladesh

Bank Guarantee Process in Bangladesh: The Bank guarantee process in Bangladesh or performance guarantees are very popular and important in the era of mega development projects taking place in Bangladesh. As a result, this article will provide a comprehensive guideline...

Joint Ventures in Bangladesh

Joint Ventures in Bangladesh

Joint Ventures in Bangladesh: Types, Formation, and Agreements

Barrister Remura Mahbub
Director, Tahmidur Remura TLS, Law Firm in Bangladesh

10 Nov 2022

The purpose of this article is to provide an in-depth overview of joint ventures (JV) in Bangldesh: types of JV, formation of JV, what to look for in a joint venture partner, and JV agreements.

 

What are Joint Ventures?

A joint venture or JV comprises two or more businesses or corporations linking their resources and knowledge to accomplish a specific objective. The venture’s risks and rewards are also shared. A JV may be confined to a single project and so time-bound, or it may be an agreement to conduct a certain type of business as a continuing operation and thus not time-bound. In the case of a time-bound contract, the venture concludes upon completion of the underlying project.

Among the motives for forming a joint venture are corporate expansion, the creation of new products, and entry into new markets, — in particular internationally.

Your company may have a high growth potential and unique concepts, and products, but  a joint venture could expedite the process and provide:

  • enhanced competence,
  • additional resources,
  • better technical prowess
  • easier access to established marketplaces and distribution channels

Formation of Joint Ventures

A joint venture can be established using any of the following options:

A foreign corporation enters a new market by acquiring a stake in a local company; conversely, if a local company desires to expand its operations into new avenues, it can acquire a stake in an already-established foreign company.
 The co-venturers may, however, form a brand-new corporation for each new commercial venture.
Occasionally, the government may also enter into joint ventures with corporate companies for their expertise.

 

Joint Ventures In Bangladesh

                                       

Types of Joint Venture

There are various types of joint ventures. How you form a joint venture will depend on the objectives of your firm.

1. Project Partnership

The most common type of joint venture. It might be used to construct a toll road or an office building, among other things. The purpose is defined and confined to the completion of a particular project in accordance with the agreement of the venture. After the completion of the project, the Joint Venture comes to an end.

2. Limited Co-operation

This is when you agree to a limited and particular collaboration with another business. For instance, a small business with an innovative new product may choose to sell it through the distribution network of a larger corporation. The two partners agree to a contract outlining the rules and conditions of their arrangement.

3. Separate Joint Venture Business

Alternately, you may wish to establish a distinct joint venture, or even a new corporation, to handle a specific contract. This type of joint venture corporation might be a highly adaptable alternative. Each partner owns a share of the company and agrees on its management.

4. Business Partnerships

In some instances, a limited liability company may not be the best option. You could instead establish a company partnership or a limited liability partnership. You could even combine the two companies.
In certain situations, other options may be preferable to forming a corporation. You could, for instance, form a commercial partnership. You may even decide to merge your two enterprises totally.

5.  Functional Joint Venture
Each company has specialization in one or more business functions; consequently, they desire to establish a symbiotic environment for each other and reap the benefits of the synergies that result.

 

 

Best Corporate Law Firm In Bangladesh

                                   

6. Vertical Joint Venture

As like  a vertical merger and acquisition, the joint venture consists of two businesses inside the same supply chain. This is done when one of the entities produces a specialized good for which it requires a specialized raw material. To this end, it can invest with the supplier to create and maintain the capacity for such manufacturing, thereby mitigating the risk associated with the unavailability of this raw material. This occurs when the production business wishes to preserve a certain level of secrecy or when the demand for the input is low but the demand for the end product is great. A real-world example would be a certain type of computer chip used in the manufacture of certain patented technological objects.

7. Horizontal Joint Venture

Similarly, this type of joint venture involves two businesses that produce identical goods or services. This enables one of the enterprises to enter a new market, such as a new geographical region. The local partner possesses country-specific knowledge and information, such as an established distribution network, whilst the foreign partner can benefit from economies of scale.

 

 Which type of JV fits your objectives?

To determine which sort of joint venture is optimal for you, you should assess your involvement in its management. You should also consider what might occur if the venture fails and how much risk you are willing to take.

It is essential to seek legal counsel to determine your best course of action. The manner in which a joint venture is established impacts its management, profit distribution, and taxation. It also impacts your obligation should the venture fail. You need a legally binding contract that specifies how the joint venture will operate and how any profits will be divided. Refer to the section of this article detailing how to create a joint venture agreement.

 

 

Joint Venture In Dhaka_Best Civil Law Firm In Dhaka

             

          Joint Venture Agreement (JVA) 

When forming a joint venture, the terms and conditions should be outlined in a joint venture agreement. This will aid in avoiding ambiguities once the joint venture is operational.

A JVA should address:

  • the objectives of the joint venture
  • the financial contributions you will each make
  • whether you will transfer any assets or employees to the joint venture ownership of intellectual property created by the joint venture
  • management and control, e.g. respective responsibilities and
  • processes to be followed how liabilities, profits and losses are shared how any disputes between the parties will be resolve.
  • You may also require additional agreements, such as a confidentiality agreement, to safeguard any trade secrets you divulge.

Before making any final decisions, it is crucial to obtain professional advice from barristers or lawyers who may draw up your joint venture agreement. 

Partnership Business In Bangladesh

 

              Choosing a Suitable Co-Venturer

The ideal partner in a joint venture is one with complementary resources, skills, and assets. The joint venture must be viable contractually, and the values of the two organizations must be compatible.

Assessing the compatibility of existing clients and suppliers with whom you have an established, long-term connection is a solid beginning point. You may also consider your competition and other professional colleagues. In general, you must consider the following:

  • What is their performance?
  • How do they view collaboration, and do they share your level of dedication?
  • Are your business objectives the same?
  • Can you rely on them?
  • Do their brand principles align with your own?
  • What is the nature of their reputation?

If you decide to evaluate a new potential partner, you must conduct the following checks:

  • Are they secure financially?
  • Do they experience credit issues?
  • Do they have existing joint venture ties with other companies?
  • What type of management team do they possess?
  • How are their production, marketing, and people operations?
  • What do their clients and suppliers have to say about their reliability and reputation?

Before entering into a joint venture, it is essential to safeguard your personal interests. This should entail drafting legal documentation to protect your own trade secrets and determining if your possible business partner has intellectual property rights agreements.

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Are you planning to do a writ or looking for criminal and civil remedies in Bangladesh?

Tahmidur Rahman Remura TLS is a full-service law firm that has been dealing with Writ-related problems on a regular basis since its inception through its qualified and experienced lawyers.

If you require any assistance or consultation, please visit our office or contact us at +8801779127165 or +8801847220062 (WhatsApp) or by email- [email protected]

E-mail: [email protected]
Phone: +8801847220062 or +8801779127165 or +8801708080817

Address: House 410, Road 29, Mohakhali DOHS, Dhaka 1206

Partnership Business In Bangladesh_Best Law Firm In Bangladesh_Barrister Tahmidur Rahman

If you want to open a liaison office in Bangladesh or about branch formation click here!

“Tahmidur Rahman Remura- The Law Firm in Bangladesh is considered as one of the leading corporate firms in Dhaka, Bangladesh”

BDLaw Firms Bangladesh

FAQ

How much money is required for company registration in Bangladesh?

The governmental fees for registering a company are determined by the amount of authorized capital. Government fees for the issuance of an Incorporation Certificate shall be BDT 1000.

How long does it take to register a company in Bangladesh?

Once the aforementioned formalities have been completed, RJSC will usually issue the certificate of incorporation (Company registration certificate) within 6-8 working days.

It usually takes 2-3 weeks from the date of submission of all documents to RJSC to register a company.

What is BIDA?

Bangladesh Investment Development Authority (BIDA) is in charge of facilitating foreign investments in the country.

BIDA's responsibilities include issuing work permits for foreign employees, visas for foreign investors, processing loans from foreign sources, approving remittance of royalties and technical fees, assisting in the acquisition of industrial plots, facilitating utility connections, approving foreign loans, suppliers credit, and providing assistance and advice on a variety of investment-related issues.

Foreign investors with industrial projects are strongly advised to register with BIDA after forming their limited company. However, there is no requirement for a commercial or trading company to register with BIDA. The average time frame for obtaining registration is 7-10 working days.

What documents are needed to set up a private limited company in Bangladesh?

1. Memorandum of Association
2. Article of Association
3. Certificate of Incorporation
4. Trade License
5. TIN
6. VAT Registration Certificate
7. Name Clearance
8. Environmental Clearance Certificate
9. Fire Certificate

What is the minimum capital required for a private limited company in Bangladesh?

In Bangladesh, there is no minimum or maximum authorised capital for a local company.

However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50,000/- must be invested in the Company.

Can a single person start a company in Bangladesh?

 Bangladesh does not allow a single person to open a private limited company or One Person Company (OPC).

A private limited company must have at least two shareholders. In the case of a public limited company, however, the total number of shareholders required is seven.

Can a private limited company have one director in Bangladesh?

A private limited company must have at least two directors. Local or foreign nationals may serve as directors.

Directors must be at least 18 years old and have never been bankrupt or convicted of a crime. A director is required by law to own the qualification shares specified in the Articles of Association.

What is the difference between authorised capital and paid-up capital?

- Authorised capital: The amount of authorised capital must be specified in the Memorandum of Association and Articles of Association. It is the maximum amount of share capital that a company may allocate to shareholders.  

In Bangladesh, there is no minimum or maximum authorised capital for a local company. However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50000/- must be invested in the Company.

-Paid-Up Capital : The minimum paid-up capital for registering a Bangladeshi company is Taka 1 (for local companies) and USD 50000 (for foreign companies).

Infographics
How To Form A Private Limited Company In Bangladesh_Best Corporate Law Firm In Bangladesh
Video Tutorial
Author’s Bio
About Meheruba Mahbub | One of the most innovative young lawyers in Bangladesh

Meheruba Mahbub is a finance partner and one of the Bangladesh's market leading international lawyers. She is head of the firm's Mergers and Acquisitions practice, which advises corporates and financial institutions on outbound and inbound investments, projects and financings.

Meheruba has a diverse finance practice , representing large banks, financial sponsors, and corporations. She specializes in acquisition and structured financings, loan portfolio purchase and financing, real estate financings, and inbound and outbound transactions. She has extensive expertise in the energy and infrastructure industries.
Work highlights

Meheruba has acted on many high-profile Finance and Commercial deals in Bangladesh and India. These include advising:

⦾ Standard Chartered Bank on the sale of a portfolio of loans in Bangladesh, the first in a series of similar deals in Bangladesh as part of the government’s directive to banks to focus on the robustness of their balance sheets.

⦾ the lending and underwriting banks on the refinancing of US$6.9bn worth of debt uninsured by the Summit Group

⦾ Brookfield Property Partners on the acquisition and financing of Unitech’s real estate portfolio

⦾ Enron on the US$3bn Dhabol power project (since renamed Ratnagiri Gas and Power), the first ever inward investment into the power sector

⦾ the sponsor and borrowers on the Sakhalin LNG project, the world’s largest integrated oil and gas project and the largest LNG financing in Russia

Email: [email protected]

Address: 2 Turner Street, Canning Town, E16 1FH, United Kingdom

Gender: Female

Job Title: Barrister and Senior Associate

Have a Different Question?

Email us anytime : [email protected]

Or call — +8801847220062 or +8801779127165

Engineering and Project Management Consultancy in Bangladesh

Project Management Consultancy law firm and EPMC company in Bangladesh Tahmidur Rahman Remura (TLS) is a well-established law firm and one of the leading Engineering and Project Management Consultancy (EPMC) companies in Bangladesh. The company has been providing...

Affidavit in Bangladesh and the execution

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Sales and Purchase Agreement in Bangladesh

SPA agreement in Bangladesh What is the meaning of a Sales and Purchase Agreement (SPA)? A Sales and Purchase Agreement (SPA agreement in Bangladesh) is a legal contract between a property buyer and seller. This agreement is legally binding and clearly explains the...

Start up law in Bangladesh and Funding stages

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How to get justice against physical torture in Bangladesh

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Arbitration in Bangladesh

Arbitration in Bangladesh

Arbitration In Bangladesh

Barrister Remura Mahbub
Director, Tahmidur Remura TLS, Law Firm in Bangladesh

15 Oct 2022

This article will aim to encapsulate all the information you need to know about arbitration in Bangladesh.  It will cover  international commercial arbitration, composition, recognition and enforcement of foreign arbitral awards, costs of arbitration, and appeals in arbitration.

 

What is ADR or Arbitration in Bangladesh?

In order to explain ADR or Arbitration in Bangladesh, it is essential to define alternative dispute resolution also known as ADR. Alternative Dispute Resolution (ADR) is a spectrum of less expensive and quicker alternative to litigation in which a neutral third party aids the disputing parties in finding a resolution. ADR allows for more collaborative and diverse solutions than traditional litigation.

They are increasingly used in issues that might otherwise result in litigation, such as high-profile labor disputes, contractual and commercial disputes, divorce proceedings, and personal injury claims.

ADR can be divided into four categories: arbitration; mediation; conciliation; court resolution, including Lok Adalat settlement.

Arbitration In Bangladesh_Dispute Resolution

                                       

What is Arbitration?

Section 89B of the Code of Civil Procedure, 1908 and the Arbitration Act 2001 are the central provisions of arbitration in Bangladesh.

Arbitration is a non-court alternative for settling disputes in which a single arbitrator or a panel of arbitrators is appointed by the parties to render a binding decision that is very difficult to reverse as it has few grounds of challenge.  

Arbitration in Bangladesh can be either ad hoc in which the parties determine whatever rules they deem appropriate or administered where its arbitration is conducted under the auspices of one of several arbitral organisations, such as the International Chamber of Commerce (ICC), International Centre for Dispute Resolution (ICDR), or the London Court of International Arbitration (LCIA)

Other legitimate arbitral support from local level can be taken from Federation of Bangladesh Chambers of Commerce and Industries (FBCCI), The Chittagong Chamber of Commerce & Industry (CCCI), or Sylhet Chamber of Commerce and Industry (SCCI).

As arbitrations are typically confidential, this encourages parties to settle their issue through arbitration, which is also a faster process than litigation. Arbitration is appropriate for international conflicts because the outcomes are internationally binding.

Typically, the arbitration clause is governed by the same law as the rest of the contract, and its validity is evaluated under the law of that country. As an arbitration clause is distinct and independent from the contract, various laws may be applied throughout the arbitration procedure.

Therefore, where a party wants the law applicable to the arbitration provision to differ from the law applicable to the contract, the arbitration clause must specifically indicate this demand.

 

                 

Arbitration In Bangladesh_Best Corporate Law Firm

 Arbitration in Bangladesh clauses are essential in commercial contracts  because it binds the parties and precludes court interference in the resolution of a dispute, at least prior to the issuance of the award. Thus, the agreement must be in written and signed by both parties, and the institution must have the authority to settle disputes or oversee the process of settlement.

In addition the Arbitration in Bangladesh offers arbitrators the authority to resolve conflicts between the parties and facilitates efficient proceedings and a legally enforceable award.

It should be noted that a dispute can also be settled without an arbitration provision by a separate agreement of arbitration between the parties, containing the entire arbitration procedure outlined in chapter III of the Arbitration Act, 2001.

                

  Composition and Proceedings of Arbitration

The disputing parties will be entitled to determine the location of the arbitration, people who  will comprise the arbitration panel, what procedure will govern the arbitration and how the arbitral panel will be assembled.  Also, the party may seek resolution from any of the arbitral institution mentioned above .  According to  section 3 of the First Schedule of the Arbitration Act, arbitration proceedings should normally be concluded in four months 

  A body of a three-member arbitral tribunal and a single arbitrator of any nationality can often serve as arbitrators.  One or three arbitrators are used in commercial arbitrations subject to  discretion of the parties.

In the instance of a single arbitrator, the parties have the option of appointing the arbitrator either in advance or when a disagreement occurs. Typically, when a dispute arises, one arbitrator is assigned. The parties should agree on how the arbitrator will be selected and how he will carry out his duties. Additionally, an arbitration institution is able to make the appointment.

In case of multiple arbitrators,  there are usually three arbitrators. Each party picks an arbitrator, and the two arbitrators nominated by the parties appoint the third arbitrator who serves as the tribunal’s chair. In the event that none of the arbitrators are appointed, an appointing authority shall be designated to appoint the arbitrators.

Regarding the selection of each arbitrator, the requesting party must notify the responding party of its request for arbitration in writing and by registered mail or courier, and immediately nominate an arbitrator. The responding party must respond in writing and by registered mail or courier service within fourteen days of receiving the request for arbitration, naming an arbitrator  in the response.

As arbitration is an informal process, the arbitrator proceeds in this manner as he or she sees proper.

The Arbitration in Bangladesh begins with the submission of a request by the applicant; the sessions may be oral, but is typically written. Evidence and witnesses may be presented orally or in writing, as the arbitrator sees suitable. Under the Arbitration Act of 2001, evidence must be presented in accordance with the Evidence Act of 1870.

 

Arbitration In Bangladesh_Dispute Resolution

          Arbitral Awards and Enforcement 

If the parties obtain a settlement agreement during the arbitration, they may seek that the arbitral tribunal record the terms in the arbitral award. 

In general, an Arbitration in Bangladesh tribunal renders a ruling based on the arbitrators’ majority vote, or if that fails, as per the president of the panel and  c oncerning a single arbitrator, the president can also render the award.

In order to execute the award, the prevailing party may petition the national court of the losing party. It should be noted that the award is enforceable by the parties.

In rare circumstances, the award may be appealed, and the party may also seek that the award be set aside under the Arbitration Act of 2001.

In accordance with the Arbitration Act of 2001, a party may petition the High Court Division to set aside an arbitral award rendered in an international commercial arbitration proceeding in Bangladesh within sixty days of receiving the award.

In the case of Nurul Abser vs. Golam Rabbani, for instance, 68 DLR (AD) (2016) stipulates that an application to set aside an arbitral judgement must be filed within 60 days, after which the award becomes enforceable.

In this instance, the petitioning party failed to contest the award within the allotted time period; hence, the award has become final and enforceable.

Chapter IX of the Arbitration Act of 2001 addresses the enforcement of arbitration awards. The request for enforcement of an arbitral award shall be made in accordance with the Code of Civil Procedure, as if it were a court decision, if the time limit for filing an application to vacate the award has elapsed or if such an application has been denied.

The enforcement of the international arbitral award shall follow the same procedure and be executed by the court as if it were a court order.

 

 

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                           Arbitration Costs

      The number of arbitrators has an impact on the arbitration’s costs.  If the number of arbitrators increase, costs will increase inevitably.   Additionally, the parties may negotiate the cost prior to the arbitration process. Regarding arbitration by the institution, the institution fixes the cost. Another factor that might determine the cost is the difficulty of the issue at hand. More complications equals to higher quotation.  

 

             

                       Appeals in Arbitration

An appeal under the Arbitration Act of 2001 must be filed with the High Court Division concerning the following issues:

a) Setting aside or refusing to se aside  an arbitral award,

(a) Refusing to comply with the arbitral award,

(c) Refusing to acknowledge or enforce foreign arbitral proceedings or award

As mentioned above, a party must apply to set aside the arbitral award within sixty days after receiving the award. If the party successfully makes the application within the stipulated time. the Court has the power to set aside the arbitral award. 

                        

 Are you planning to do arbitration or  looking for alternative dispute resolution remedies in Bangladesh?

Tahmidur Rahman Remura TLS is a full-service law firm that has been dealing with arbitration consisting of a wide range of topics at both international and local level. We have barristers that have specialised in  international commercial arbitration from the United Kingdom and accredited civil-commercial mediators. 

If you require any assistance or consultation, please visit our office or contact us at +8801779127165 or +8801847220062 (WhatsApp) or by email- [email protected]

E-mail: [email protected]
Phone: +8801847220062 or +8801779127165 or +8801708080817

Address: House 410, Road 29, Mohakhali DOHS, Dhaka 1206

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“Tahmidur Rahman Remura- The Law Firm in Bangladesh is considered as one of the leading corporate firms in Dhaka, Bangladesh”

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FAQ

How much money is required for company registration in Bangladesh?

The governmental fees for registering a company are determined by the amount of authorized capital. Government fees for the issuance of an Incorporation Certificate shall be BDT 1000.

How long does it take to register a company in Bangladesh?

Once the aforementioned formalities have been completed, RJSC will usually issue the certificate of incorporation (Company registration certificate) within 6-8 working days.

It usually takes 2-3 weeks from the date of submission of all documents to RJSC to register a company.

What is BIDA?

Bangladesh Investment Development Authority (BIDA) is in charge of facilitating foreign investments in the country.

BIDA's responsibilities include issuing work permits for foreign employees, visas for foreign investors, processing loans from foreign sources, approving remittance of royalties and technical fees, assisting in the acquisition of industrial plots, facilitating utility connections, approving foreign loans, suppliers credit, and providing assistance and advice on a variety of investment-related issues.

Foreign investors with industrial projects are strongly advised to register with BIDA after forming their limited company. However, there is no requirement for a commercial or trading company to register with BIDA. The average time frame for obtaining registration is 7-10 working days.

What documents are needed to set up a private limited company in Bangladesh?

1. Memorandum of Association
2. Article of Association
3. Certificate of Incorporation
4. Trade License
5. TIN
6. VAT Registration Certificate
7. Name Clearance
8. Environmental Clearance Certificate
9. Fire Certificate

What is the minimum capital required for a private limited company in Bangladesh?

In Bangladesh, there is no minimum or maximum authorised capital for a local company.

However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50,000/- must be invested in the Company.

Can a single person start a company in Bangladesh?

 Bangladesh does not allow a single person to open a private limited company or One Person Company (OPC).

A private limited company must have at least two shareholders. In the case of a public limited company, however, the total number of shareholders required is seven.

Can a private limited company have one director in Bangladesh?

A private limited company must have at least two directors. Local or foreign nationals may serve as directors.

Directors must be at least 18 years old and have never been bankrupt or convicted of a crime. A director is required by law to own the qualification shares specified in the Articles of Association.

What is the difference between authorised capital and paid-up capital?

- Authorised capital: The amount of authorised capital must be specified in the Memorandum of Association and Articles of Association. It is the maximum amount of share capital that a company may allocate to shareholders.  

In Bangladesh, there is no minimum or maximum authorised capital for a local company. However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50000/- must be invested in the Company.

-Paid-Up Capital : The minimum paid-up capital for registering a Bangladeshi company is Taka 1 (for local companies) and USD 50000 (for foreign companies).

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Author’s Bio
About Meheruba Mahbub | One of the most innovative young lawyers in Bangladesh

Meheruba Mahbub is a finance partner and one of the Bangladesh's market leading international lawyers. She is head of the firm's Mergers and Acquisitions practice, which advises corporates and financial institutions on outbound and inbound investments, projects and financings.

Meheruba has a diverse finance practice , representing large banks, financial sponsors, and corporations. She specializes in acquisition and structured financings, loan portfolio purchase and financing, real estate financings, and inbound and outbound transactions. She has extensive expertise in the energy and infrastructure industries.
Work highlights

Meheruba has acted on many high-profile Finance and Commercial deals in Bangladesh and India. These include advising:

⦾ Standard Chartered Bank on the sale of a portfolio of loans in Bangladesh, the first in a series of similar deals in Bangladesh as part of the government’s directive to banks to focus on the robustness of their balance sheets.

⦾ the lending and underwriting banks on the refinancing of US$6.9bn worth of debt uninsured by the Summit Group

⦾ Brookfield Property Partners on the acquisition and financing of Unitech’s real estate portfolio

⦾ Enron on the US$3bn Dhabol power project (since renamed Ratnagiri Gas and Power), the first ever inward investment into the power sector

⦾ the sponsor and borrowers on the Sakhalin LNG project, the world’s largest integrated oil and gas project and the largest LNG financing in Russia

Email: [email protected]

Address: 2 Turner Street, Canning Town, E16 1FH, United Kingdom

Gender: Female

Job Title: Barrister and Senior Associate

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Writs in Bangladesh: Types, Jurisdiction, and Execution

Writs in Bangladesh: Types, Jurisdiction, and Execution

Writs in Bangladesh: Types, Jurisdiction, and Execution

Barrister Remura Mahbub
Director, Tahmidur Remura TLS, Law Firm in Bangladesh

15 Oct 2022

The purpose of this article is to clarify writs in Bangladesh:  the five types of writs, the court process and jurisdiction, who can apply for a writ, the grounds on which a writ can be applied, and how writs are executed. 

 

What are Writs?

A writ is a formal, legal document drafted by courts that commands an individual or entity to conduct  or stop doing  a certain action or deed. The right to a writ is a crucial legal remedy that citizens  have when their fundamental rights have been violated, such as by an illegal act of government, a legal error, etc., in order to enforce and apply substantive law. According to Article 102 of the People’s Republic of Bangladesh Constitution, this right is exercised in Bangladesh by submitting a written petition, or writ petition, to the High Court Division of the Supreme Court, asking for the court’s recommendations or rulings on the topic.  The opposing parties, or respondents, are then summoned by the court and ordered to do or  to refrain from doing something.

There are five types of writs in Bangladesh:

  • Habeas Corpus
  • Certiorari
  • Prohibition
  • Mandamus 
  • Quo-Warranto

1. Writ of Habeas Corpus

The first type of writ in Bangladesh is referred to as Habeas Corpus. Habeas Corpus is Latin for “have his body.” Since 1640, this law has protected the liberty of British subjects against their unlawful imprisonment in public or private custody. The King’s Bench issues a writ of habeas corpus to determine if an individual was unlawfully detained. In accordance with sub-clause I of clause (b) of sub-clause (2) of article 102 of the Bangladesh Constitution, the High Court Division, upon the application of any person, directs that a person in custody be brought before it so that it may determine whether he is being detained with or without legal authority. Illegally detained individuals may file a petition for the writ of habeas corpus. However, if the prisoner is unable to make such an application, any other interested party may do so on his behalf. Thus, a wife, a father, or even a friend may apply for the writ of habeas corpus in such situations.

Every request for a writ of habeas corpus must be accompanied by an affidavit detailing the facts and circumstances that led to the request. If the court determines that there is a prima facie case for granting the petition, it will issue a rule directing the detaining authority to show cause on a certain date why the ruling  should not be made absolute. The court will assess the merits of the case and issue an appropriate order on the specified date.

If the court determines that he is being unlawfully detained by the authority, it can declare that authority to be without legal jurisdiction. Section 491 of the Code of Criminal Procedure also permits the High Court Division to issue an order in the manner of a writ of habeas corpus to summon a person imprisoned in public or private custody before it in order to determine whether he is being detained illegally or inappropriately. If the High Court Division determines that the detainee is being detained illegally or improperly, it orders the detaining authority or person to release him.

Case Law References:

  • AKM Azizul Hoque Vs. Bangladesh, 42 DLR 189
    When a specific criminal accusation has been lodged and a specific criminal case is ongoing, the executive authority should not commit resources to preventative detention. The administrative authority has a solemn constitutional commitment to assist the Supreme Court.
  • Habiba Mahmud Vs. Bangladesh, 45 DLR (AD) 89
    The Court must maintain a balance between the State’s duty to prevent harmful actions and the citizen’s right to personal freedom.
    Government of Bangladesh v. Sajeda Parvin, 40 DLR (AD) 178
    Important is the reality of detention, not the date of the order for detention.
  • Bangladesh and Others v. Jamil Huq, 1 BLD (AD) 488
    The only thing that can be asserted is that the grounds on which a Court Martial established under the Army Act can be challenged by habeas corpus will be analogous to those available under Article 102, subsection 5, of the Constitution.

 

Writs In Bangladesh: Types, Jurisdiction, And Execution

                                       

2. Writ of Certiorari

Certiorari is Latin meaning “to be certified” or “to be more completely aware of.” Initially, certiorari was a court order. With the passage of time, the scope of this writ was expanded to include judicial, quasi-judicial, and even administrative powers. This writ power enables the High Court Division of the Supreme Court to control the actions of the inferior or subordinate courts, i.e. to determine whether the subordinate courts in Bangladesh are operating within their jurisdiction or beyond it.

A writ of certiorari may be submitted by the aggrieved party or, in some circumstances, by anyone against a lower court, tribunal, or authority that abused its power or breached the principle of natural justice.

The court should give ex.debito justitiae relief if the application is made by the party directly impacted by the lawsuit. However, if the application is made by a person not directly affected by the litigation, the court has complete discretion to grant the writ.

A writ of certiorari may be issued on the basis of the following:

1. Error evident on the face of the record

By issuing a writ of certiorari, a decision of a lower court or a tribunal can be overturned if there is an obvious mistake of law on the face of the record.

2. infringement of natural justice

A writ of certiorari may be issued when the standards of natural justice have been violated.

3. Error of jurisdiction

A writ of certiorari may be granted against a lower court or tribunal that acts without jurisdiction, exceeds its jurisdiction, or fails to exercise the jurisdiction conferred in it by law.

4. Jurisdictional fact

Insufficient jurisdiction may also result from the absence of certain preliminary facts that must exist before a court exercises its authority. These facts are referred to be “jurisdictional” or “collateral.”

Case Law References:

  • Secretary, Ministry of Home Affairs v. Sk Ali Ahmed, 40 DLR (AD) 170; 48 DLR (AD) 20.
    Even though the statute is silent, notice must be given if a person’s right, interest, property, or character is to be affected. When the law mandates service of notice, the authority cannot evade this obligation.
  • Regional Transport Authority of Dhaka versus Momin Motor Company (1958) 10 DLR 284
    A writ of certiorari was granted when a quasi-judicial entity, such as the regional Transport Authority, issued an order negatively impacting a person’s interests without his knowledge.
  • Ashraf Ali & Others v. Bangladesh, 5 BLT (AD) 261
    The learned Judges of the High Court Division exceeded their jurisdiction when they exercised their certiorari authority to overturn the decision of a lower court.

 

                 

Writs In Bangladesh: Types, Jurisdiction, And Execution

                                       

 

                  3. Writ of Mandamus

Mandamus is Latin for “we command.” By writ of mandamus, the superior court orders any individual, corporation, lower court, or government to perform a defined public duty related to their office. This writ is issued when a lower court has refused to exercise the jurisdiction vested in it, or when a public official has refused to comply with the law. In accordance with sub-clause I of clause (a) of subparagraph (2) of article 102 of the Constitution the High Court Division may direct a person performing tasks related to the affairs of the Republic or a local authority to comply with the law. This remedy is accessible when a person’s legal rights, as opposed to contractual rights, are breached. The applicant must demonstrate that he has a legal right to the fulfilment of a legal obligation by the individual or entity against whom the writ is sought.

The following requirements must be met by the petitioner before a writ of mandamus can be issued:

(i) Legal duty:

A legal obligation must have been imposed on the authority, and the fulfilment of that obligation must be mandatory, not voluntary or discretionary. There must be a right for the applicant to compel the opponent to undertake some obligation. Therefore, if the government grants dearness allowance to its employees at its own discretion, there is no legal obligation and a writ of mandamus cannot be filed against the government for fulfilment of such duty. Such a duty must be statutory, i.e. imposed by the constitution, another statute, or some rule of common law, but should not be contractual in certain circumstances. However, the writ of mandamus may be issued for the enforcement of such a duty if discretionary power is conferred on the authority and statutory provisions are made for the exercise of such power. This obligation must be of a public character. The writ of mandamus may be issued if the public authority vested with discretionary power abuses the power, exceeds it, acts maliciously, fails to apply its mind, or takes irrelevant circumstances into account.

(ii) Legal privilege:

The petitioner must possess legal standing. Thus, when a petitioner claimed that he was passed over for promotion by the government and it was determined that he was not qualified for the position, his petition was denied.

(iii) Demand and refusal:

A demand for justice and its denial must precede the petition for a writ of mandamus. In Halsbury’s Laws of England, it is stated: “as a general rule, the order will not be granted unless the party complained of knew what he was required to do, so that he could weigh whether or not to comply, and it must be shown by evidence that there was a distinct demand of that which the party seeking the mandamus wishes to enforce, and that demand was refused.”

(iv) Good faith:

A request for mandamus must have been submitted in good faith and without any ulterior motive or covert objective. Even though a petition for mandamus is filed in good faith, it will not be granted if it is intended to annoy the respondent or exact personal revenge.

 Case Law References:

  • Government of Bangladesh vs. Zamiruddin Ahmed, 1 BLD (HCD) 304
    Mandamus may be issued even though no demand for justice has been made previous to the filing of the writ petition if specific circumstances suggest that a demand for justice would be useless.
  • M. Walid Ahmed Chowdhury versus Mahfuzul Huq Chowdhury, 8 DLR 429 (1956).
    A mandamus will not be issued unless the party seeking it has not only stated on affidavit that he demanded of the party against whom the mandamus is sought to be enforced by the writ and that such demand was refused, but has also satisfied the court that this is a principle that has been universally accepted and insisted upon as an essential and invariable condition for the issuance of the writ.

 

 

 

 

 

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                    4. Writ of Prohibition 

 

Another type of common writ in Bangladesh is called prohibition. The term prohibition refers to a preventive writ. It empowers the High Court Division to prevent a court, tribunal, authority, or person from engaging in conduct that is prohibited by law. A writ of prohibition is appropriate where there is a lack or excess of jurisdiction, an abuse of power, or a violation of the principle of natural justice.

If judicial or quasi-judicial authorities issue an order that is illegal or exceeds the court’s jurisdiction, the aggrieved party may file a writ petition with the superior court, i.e. the High Court Division of the Supreme Court, and if the court finds the complaint to be valid, it may issue a writ of prohibition against the lower court, i.e. the District Judge Court etc.
Prohibition is the opposite of mandamus in that, although mandamus requires the authority to act, prohibition stops a court or tribunal from acting where it lacks the authority to do so. 

In essence,  writs of  prohibition may be issued on the following grounds: 

i. Absence or excess of jurisdiction

ii. Violation of natural justice

iii. Statute’s Unconstitutionality

iv. Violation of fundamental human rights

When the lack of jurisdiction is clear on the face of the proceedings, not only the injured party but also a third party may file a motion for prohibition. The rationale underpinning this rule is that usurpation of authority constitutes a breach of the royal prerogative and an insult to the crown. Therefore, it is irrelevant who informs the court about the usurpation.

However, administrative authority cannot  be prohibited from performing administrative, executive, or ministerial duties. Similarly, it would not lie against the legislature to prevent it from passing or enforcing a law.

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                     5. Writ of Quo-Warranto 

     The final type of writ in Bangladesh that will be discussed in this article is called writ of quo-warranto.  The term quo-wattanto means  “what is your authority” in Latin. It is judicial  remedy against an occupant or usurper of an independent public office, franchise, or liberty. It imposes jurisdiction and authority on the judiciary to control executive conduct in terms of making appointments to public positions contrary to relevant statutory provisions, so protecting citizens from being denied a public post to which they may be entitled. In a writ of quo warranto, the petitioner challenges the legitimacy of the claim of the incumbent of a public office. Therefore, this writ can be requested by anyone, regardless of whether they have a personal stake in the outcome.
The purpose of the writ of quo warranto is to prevent a person who has illegitimately seized a public office from remaining in that position. Therefore, an application for a writ of quo warranto challenging the legitimacy and validity of an appointment to a public position may be filed by any private individual, even if he has no personal stake in the matter.
Before the quo warranto can be issued, the following specifications must be met:

i. . Before issuing the writ, the court must be convinced that the post in question is public in nature and that the occupant lacks the legal authority to retain said office. This writ will not lie in relation to a private office, such as a private school’s governing board.

ii. The position must be substantive in nature. The phrase “substantive character” indicates that the office in question must be independent. 

iii. The office must be created by statute or the constitution

iv. The holder must have made a legitimate claim to the office. 

 Quo warranto is a discretionary remedy, and the petitioner has no inherent right to obtain this writ. Taking into account the facts and circumstances of the case, the court may decline to grant this writ. This may include situations when the issues of a writ would be vexatious, where the petitioner has consented, or where it would be pointless since the incumbent of the office in question has resigned. It may also be denied if there is a simple electoral irregularity.

A writ of quo warranto may also be denied on the grounds that the petitioner has access to alternative statutory remedies. Thus, when it was sought to issue a writ of quo warranto against a member of the State legislature, it was denied on the grounds that an election petition provided an alternative remedy.

Case Law References: 

  • The District Registrar and Others v. Mohammad Abdur Rab Mia, 19 BLD (AD) 24.
    The petitioner did not appear before the writ court to establish a public right; rather, he did so to further his own interests. A quo warranto cannot be used in such a manner or for such a purpose.
  • Sajda Parvin v. Bangladesh, 40 DLR (AD) 178; Ahmed Nazir v. Bangladesh, 27 DLR 199; Alam Ara Huq v. Bangladesh, 42 DLR 98.
    No public office can be held without a legitimate claim to that office.

 

Are you planning to do a writ or looking for criminal and civil remedies in Bangladesh?

Tahmidur Rahman Remura TLS is a full-service law firm that has been dealing with Writ-related problems on a regular basis since its inception through its qualified and experienced lawyers.

If you require any assistance or consultation, please visit our office or contact us at +8801779127165 or +8801847220062 (WhatsApp) or by email- [email protected]

E-mail: [email protected]
Phone: +8801847220062 or +8801779127165 or +8801708080817

Address: House 410, Road 29, Mohakhali DOHS, Dhaka 1206

Partnership Business In Bangladesh_Best Law Firm In Bangladesh_Barrister Tahmidur Rahman

If you want to open a liaison office in Bangladesh or about branch formation click here!

“Tahmidur Rahman Remura- The Law Firm in Bangladesh is considered as one of the leading corporate firms in Dhaka, Bangladesh”

BDLaw Firms Bangladesh

FAQ

How much money is required for company registration in Bangladesh?

The governmental fees for registering a company are determined by the amount of authorized capital. Government fees for the issuance of an Incorporation Certificate shall be BDT 1000.

How long does it take to register a company in Bangladesh?

Once the aforementioned formalities have been completed, RJSC will usually issue the certificate of incorporation (Company registration certificate) within 6-8 working days.

It usually takes 2-3 weeks from the date of submission of all documents to RJSC to register a company.

What is BIDA?

Bangladesh Investment Development Authority (BIDA) is in charge of facilitating foreign investments in the country.

BIDA's responsibilities include issuing work permits for foreign employees, visas for foreign investors, processing loans from foreign sources, approving remittance of royalties and technical fees, assisting in the acquisition of industrial plots, facilitating utility connections, approving foreign loans, suppliers credit, and providing assistance and advice on a variety of investment-related issues.

Foreign investors with industrial projects are strongly advised to register with BIDA after forming their limited company. However, there is no requirement for a commercial or trading company to register with BIDA. The average time frame for obtaining registration is 7-10 working days.

What documents are needed to set up a private limited company in Bangladesh?

1. Memorandum of Association
2. Article of Association
3. Certificate of Incorporation
4. Trade License
5. TIN
6. VAT Registration Certificate
7. Name Clearance
8. Environmental Clearance Certificate
9. Fire Certificate

What is the minimum capital required for a private limited company in Bangladesh?

In Bangladesh, there is no minimum or maximum authorised capital for a local company.

However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50,000/- must be invested in the Company.

Can a single person start a company in Bangladesh?

 Bangladesh does not allow a single person to open a private limited company or One Person Company (OPC).

A private limited company must have at least two shareholders. In the case of a public limited company, however, the total number of shareholders required is seven.

Can a private limited company have one director in Bangladesh?

A private limited company must have at least two directors. Local or foreign nationals may serve as directors.

Directors must be at least 18 years old and have never been bankrupt or convicted of a crime. A director is required by law to own the qualification shares specified in the Articles of Association.

What is the difference between authorised capital and paid-up capital?

- Authorised capital: The amount of authorised capital must be specified in the Memorandum of Association and Articles of Association. It is the maximum amount of share capital that a company may allocate to shareholders.  

In Bangladesh, there is no minimum or maximum authorised capital for a local company. However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50000/- must be invested in the Company.

-Paid-Up Capital : The minimum paid-up capital for registering a Bangladeshi company is Taka 1 (for local companies) and USD 50000 (for foreign companies).

Infographics
How To Form A Private Limited Company In Bangladesh_Best Corporate Law Firm In Bangladesh
Video Tutorial
Author’s Bio
About Meheruba Mahbub | One of the most innovative young lawyers in Bangladesh

Meheruba Mahbub is a finance partner and one of the Bangladesh's market leading international lawyers. She is head of the firm's Mergers and Acquisitions practice, which advises corporates and financial institutions on outbound and inbound investments, projects and financings.

Meheruba has a diverse finance practice , representing large banks, financial sponsors, and corporations. She specializes in acquisition and structured financings, loan portfolio purchase and financing, real estate financings, and inbound and outbound transactions. She has extensive expertise in the energy and infrastructure industries.
Work highlights

Meheruba has acted on many high-profile Finance and Commercial deals in Bangladesh and India. These include advising:

⦾ Standard Chartered Bank on the sale of a portfolio of loans in Bangladesh, the first in a series of similar deals in Bangladesh as part of the government’s directive to banks to focus on the robustness of their balance sheets.

⦾ the lending and underwriting banks on the refinancing of US$6.9bn worth of debt uninsured by the Summit Group

⦾ Brookfield Property Partners on the acquisition and financing of Unitech’s real estate portfolio

⦾ Enron on the US$3bn Dhabol power project (since renamed Ratnagiri Gas and Power), the first ever inward investment into the power sector

⦾ the sponsor and borrowers on the Sakhalin LNG project, the world’s largest integrated oil and gas project and the largest LNG financing in Russia

Email: [email protected]

Address: 2 Turner Street, Canning Town, E16 1FH, United Kingdom

Gender: Female

Job Title: Barrister and Senior Associate

Have a Different Question?

Email us anytime : [email protected]

Or call — +8801847220062 or +8801779127165

Engineering and Project Management Consultancy in Bangladesh

Project Management Consultancy law firm and EPMC company in Bangladesh Tahmidur Rahman Remura (TLS) is a well-established law firm and one of the leading Engineering and Project Management Consultancy (EPMC) companies in Bangladesh. The company has been providing...

Affidavit in Bangladesh and the execution

Affidavit in Bangladesh in its execution in 2023 An affidavit is a written statement that is sworn or affirmed to be true. In Bangladesh, an affidavit is a legal document that can be used in a variety of situations, including court cases, property disputes, and...

Sales and Purchase Agreement in Bangladesh

SPA agreement in Bangladesh What is the meaning of a Sales and Purchase Agreement (SPA)? A Sales and Purchase Agreement (SPA agreement in Bangladesh) is a legal contract between a property buyer and seller. This agreement is legally binding and clearly explains the...

Start up law in Bangladesh and Funding stages

Start up law in Bangladesh and what exactly is a start up? A startup is a company in its early stages of development. It is founded by one or more entrepreneurs in order to meet a specific need for a product or service. Startups are high-cost, low-revenue businesses...

How to get justice against physical torture in Bangladesh

Physical torture in Bangladesh ( Assault and threats) In Bangladesh, assault and threats charges are governed by the Penal Code, which defines various offenses related to violence and threats of violence. Under the Penal Code, assault is defined as the act of causing...

How to oppose a suit lodged by a bank in Bangladesh

How to oppose a suit lodged by a bank in Bangladesh If you have been served with a lawsuit from a bank in Bangladesh, you will need to respond to the lawsuit in order to present your side of the case. One way to respond is to file an "answer" to the lawsuit....

Alternative Dispute Resolution in Bangladesh

Alternative Dispute Resolution in Bangladesh and what exactly is ADR? The term "alternative dispute resolution" or "ADR" is frequently used to refer to a wide range of dispute resolution mechanisms that are abridged versions of or substitutes for full-scale court...

How to send a legal notice in Bangladesh

Sending a legal notice in Bangladesh is a formal way to initiate a legal process and can be an important step in resolving a dispute. At common law, notice is the fundamental principle in service of process. In this case, the service of process puts the defendant...

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Best Lawyers in Bangladesh in 2023 Bangladesh is home to a thriving legal profession, with many talented and dedicated lawyers working to serve the needs of clients across the country. In this article, we will take a closer look at some of the top lawyers in...

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Bank Guarantee Process in Bangladesh: The Bank guarantee process in Bangladesh or performance guarantees are very popular and important in the era of mega development projects taking place in Bangladesh. As a result, this article will provide a comprehensive guideline...
Registration of a Private Limited Company in Bangladesh in 2022 | 5 Simple Steps

Registration of a Private Limited Company in Bangladesh in 2022 | 5 Simple Steps

Registration of a Private Limited Company in Bangladesh in 2022

Meheruba Mahbub

Meheruba Mahbub
 Senior Associate, The Law Firm in Bangladesh

24 Jan 2022

This article will explain in details about formation and registration of a Private Limited Company in Bangladesh.

It will focus on five easy steps: business name clearance, drafting required documents, opening a bank account, company registration with the RJSC, and post registration formalities.

Moreover, it will outline essential points for foreign investors and alternative ways to set up a company in Bangladesh.

 Private Limited Company in Bangladesh

There are five ways of doing business in Bangladesh:

  • It restricts the ability to transfer shares [section 2(q)]
  • The minimum number of members is 2 (two) [s. 5]; the maximum number of members is 50 (fifty), excluding employees of the Company [s. 2(q)].
  • It must have at least two directors [s. 90 (2)]
  • It prohibits any public invitation to subscribe for the Company’s shares or debentures [s. 2(q)].

After completion of Registration of a Private Limited Company in Bangladesh, it can begin operations as soon as it is registered with  The Registrar of Joint Stock Companies (RJSC), subject to obtaining the other licenses listed below in the post-registration section of this Report.

We will explain the whole thing in this article, but here is a table outlining the steps involved in forming a company in Bangladesh:

StepDescription
1Choose a business name and register it with the Registrar of Joint Stock Companies and Firms (RJSC).
2Obtain any necessary licenses or permits for your business.
3Draft the memorandum and articles of association for your company.
4Hold a meeting with the directors to adopt the memorandum and articles of association.
5Submit the memorandum and articles of association, along with other required documents, to the RJSC for registration.
6Pay the registration fees and obtain a certificate of incorporation from the RJSC.
7Obtain a tax identification number (TIN) from the National Board of Revenue (NBR).
8Register for any necessary taxes with the NBR.
9Obtain any necessary approvals or permits from relevant government agencies.
10Start operating your business.

Please note that this is a general overview of the process and may vary depending on the specific type of company you are forming and the nature of your business. It is advisable to seek legal and professional guidance to ensure that all necessary steps are taken and all necessary documents are properly completed and filed. Now let’s get into details!

    Procedure for Registration of a Private Limited Company in Bangladesh

    The 5 steps listed below correctly outlines the procedure for the registration of a Private Limited Company in Bangladesh.

    Step 1: Business Name Clearance 

    The first step in forming a private limited company in Bangladesh is to fix a desired name for the company.  Following the selection of a name, the applicant must apply for name clearance in order to obtain the name approval certificate RJSC.

    The certificate is usually delivered within 1 to 2 days. Investors are required to pay RJSC the necessary fees for name clearance and verification.The government fee for name clearance is currently 230 BDT or  around 3 USD.

    Step 2: Drafting Required Documents

    In order to form a Private Limited company in Bangladesh, a Memorandum of Association (MoA) and Articles of association (AoA) must be prepared by the company.

    Drafting Memorandum of Association (MoA):

    A limited company’s Memorandum of Association (MOA) states the company’s objectives, company’s authorized capital, and list of the shareholders along with their respective shareholdings.

    However, it should be noted that in order to begin a banking, finance, school, or hospital business, prior approval from the relevant authority is required.

    Drafting Articles of Association (AoA):

    The AoA outlines all of the regulations that govern how a limited company operates. The AoA should include the number and list of directors, the board’s power, the Managing Director’s power, the meeting process, quorum, notice procedure, and the appointment of auditors.

    It also specifies how the company’s bank account will be managed.

     

     

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    Step 3: Opening a Bank Account

    To start a private limited company in Bangladesh, you will need to open a temporary bank account in the proposed company name with any scheduled bank in Bangladesh.  

    This stage is solely applicable if the proposed company has foreign shareholding. The following documents need to be filed to the respective banks in order to open the bank account:

    • Name Clearance
    • Draft copy of your MoA and AoA
    • Board Resolutions of the foreign company
    • Passports copies of the representative shareholders
    • bank account opening forms.

    Foreign investors wanting to form a private limited company in Bangladesh must deposit the requisite paid-up capital into the company’s bank account.

    The remitted funds will be held by the bank. The bank will produce an Encashment Certificate, which will be required by RJSC in order for the company to be incorporated.

    This certificate states that the appropriate capital contribution has been duly deposited in the proposed company’s temporary bank account.

     

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    Step 4: Company Registration with the RJSC

    In order to register the private limited company in Bangladesh, all the required information and documents must be submitted to the RJSC. They are as follows:

    • Details of Directors (name, parents name, passport number, email ID, mobile number)
    • National Identification Number (if Bangladeshi national)
    • Tax Identification Number (if Bangladeshi national)
    • Limit of paid up capital and authorized capital
    • Photo of all shareholders (1 copy)
    • Address of the company
    • Signatories of the bank account

    The registration fee and stamp duty must be paid in the RJSC’s designated bank.
    The government fee will be calculated depending on the proposed company’s approved share capital.
    A certificate of incorporation must be obtained from the RJSC after all processes have been completed successfully in order to register a private limited company in Bangladesh.

    Step 5: Post-registration Formalities

    After successful company formation, the last step in order to form a private limited company in Bangladesh is to acquire the following certificates/licenses:

    (a) Trade License 

    The companies must obtain a trade license from the local authorities. The proposed Company must submit an application to the local City Corporation, together with all essential paperwork and payments.

    The cost of getting a trade license is around USD 200, and it can be renewed annually. Three to four working days are typically required to receive it.

    b) TIN (Tax Identification Number)

    A private limited company in Bangladesh must obtain an E-TIN from the National Board of Revenue‘s (NBR) website, which can be done free of cost.

    c) VAT Registration Certificate

    The newly formed company must also obtain a VAT registration Certificate from the National Board of Revenue. This should take about 5-7 working days.

    d) Fire Certificate

    Bangladesh Fire Service and Civil Defense Authority will need to issue a fire certificate to the private limited company.

    e) Environmental Clearance Certificate

    A private limited company in Bangladesh must collect an environment clearance certificate from the Department of Environment if it intends to be involved in industrial activity.

    Furthermore, each year, the company must submit to the RJSC the following documents:

    • Schedule X which is a list of shareholders and an annual summary of share capital.
    • Balance Sheet within 30 days of Annual General Meeting (AGM).
    • Profit and Loss Account within 30 days of AGM.
      Form 23B which is a letter of approval from the auditor that must be provided within 30 days of the appointment date.
    How To Form A Private Limited Company In Bangladesh_Best Corporate Law Firm In Dhaka

    If you want to open a liaison office in Bangladesh or about branch formation click here!

    Essential Information for Foreign Investors

    Foreign investors need to keep the following things in mind when they plan to form a private limited company in Bangladesh:

    • The costs of registering a company are primarily determined by the company’s authorized capital. The average cost is between USD 1800.
    • Shelf companies are not permitted and must have a physical place of business in Bangladesh.
    • Bangladesh Forex Regulations allow for the full repatriation of profits and investments.
    • Foreign nationals may be employed at a 20:1 (local: expat) ratio, subject to obtaining the necessary work permit.
    • Except in a few restricted areas, 100 percent FDI investment is permitted.
    • Directors can be either foreign or domestic nationals.
    • The typical corporate income tax rate ranges from 25% to 45 percent, depending on the sector and nature of the company.

      However, tax exemptions are available for selected sectors and areas for 5-7 years.

    • There are also additional tax exemptions  for investing in Special Economic Zones.

     

    “Tahmidur Rahman – The Law Firm in Bangladesh is considered as one of the leading corporate firms in Dhaka, Bangladesh”

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    What are some alternative ways to set up a company in Bangladesh?

    Branch Office:

    A branch  is not a separate incorporated entity, but rather an extension of its parent company. In other words, the parent company is liable for the liabilities of its branches. 

    With Bangladesh Investment Development Authority’s (BIDA) approval, a branch can engage in commercial activities. The Exchange Control Guidelines, on the other hand, strictly monitor its operation.
    In Bangladesh, the average time to open a branch officis 45- 60 days.

    Liason Office:

    A liaison, also known as a representative office, is subject to BIDA approval  similarly as a branch.

    It must have an overseas parent company, and its activities are limited because it only serves as a communication or coordination instrument for Bangladesh’s business resources.

    Also, keep in mind that a liaison office in Bangladesh cannot earn any local income. Through remittance, the parent company bears all of its expenses and operational cost. It also adheres to the general business registration procedure in Bangladesh.

     

    How To Register A Private Limited Company In Bangladesh Infographics Remura Mahbub

    “To start a private limited company in Bangladesh, you will need to open a temporary bank account in the proposed company name with any scheduled bank in Bangladesh.

     This stage is solely applicable if the proposed company has foreign shareholding.”

     -Meheruba Mahbub

    Are you planning to register a private limited company in Bangladesh?

    Company formation and registration at Tahmidur Rahman Remura: The Law Firm in Bangladesh:

    The legal team of Tahmidur Rahman, The Law Firm in Bangladesh Remura: The Law Firm in Bangladesh are highly experienced in providing all kinds of services related to forming and registering a Private Limited Company in Bangladesh . For queries or legal assistance, please reach us at:

    E-mail: [email protected]
    Phone: +8801847220062 or +8801779127165

    Address: House 410, Road 29, Mohakhali DOHS

     

    FAQ

    How much money is required for company registration in Bangladesh?

    The governmental fees for registering a company are determined by the amount of authorized capital. Government fees for the issuance of an Incorporation Certificate shall be BDT 1000.

    How long does it take to register a company in Bangladesh?

    Once the aforementioned formalities have been completed, RJSC will usually issue the certificate of incorporation (Company registration certificate) within 6-8 working days.

    It usually takes 2-3 weeks from the date of submission of all documents to RJSC to register a company.

    What is BIDA?

    Bangladesh Investment Development Authority (BIDA) is in charge of facilitating foreign investments in the country.

    BIDA's responsibilities include issuing work permits for foreign employees, visas for foreign investors, processing loans from foreign sources, approving remittance of royalties and technical fees, assisting in the acquisition of industrial plots, facilitating utility connections, approving foreign loans, suppliers credit, and providing assistance and advice on a variety of investment-related issues.

    Foreign investors with industrial projects are strongly advised to register with BIDA after forming their limited company. However, there is no requirement for a commercial or trading company to register with BIDA. The average time frame for obtaining registration is 7-10 working days.

    What documents are needed to set up a private limited company in Bangladesh?

    1. Memorandum of Association
    2. Article of Association
    3. Certificate of Incorporation
    4. Trade License
    5. TIN
    6. VAT Registration Certificate
    7. Name Clearance
    8. Environmental Clearance Certificate
    9. Fire Certificate

    What is the minimum capital required for a private limited company in Bangladesh?

    In Bangladesh, there is no minimum or maximum authorised capital for a local company.

    However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50,000/- must be invested in the Company.

    Can a single person start a company in Bangladesh?

     Bangladesh does not allow a single person to open a private limited company or One Person Company (OPC).

    A private limited company must have at least two shareholders. In the case of a public limited company, however, the total number of shareholders required is seven.

    Can a private limited company have one director in Bangladesh?

    A private limited company must have at least two directors. Local or foreign nationals may serve as directors.

    Directors must be at least 18 years old and have never been bankrupt or convicted of a crime. A director is required by law to own the qualification shares specified in the Articles of Association.

    What is the difference between authorised capital and paid-up capital?

    - Authorised capital: The amount of authorised capital must be specified in the Memorandum of Association and Articles of Association. It is the maximum amount of share capital that a company may allocate to shareholders.  

    In Bangladesh, there is no minimum or maximum authorised capital for a local company. However, for practical reasons and to obtain complete flexibility in terms of expatriation and bringing in foreign expatriates, a minimum of USD 50000/- must be invested in the Company.

    -Paid-Up Capital : The minimum paid-up capital for registering a Bangladeshi company is Taka 1 (for local companies) and USD 50000 (for foreign companies).

    Infographics
    How To Form A Private Limited Company In Bangladesh_Best Corporate Law Firm In Bangladesh
    Video Tutorial
    Author’s Bio
    About Meheruba Mahbub | One of the most innovative young lawyers in Bangladesh

    Meheruba Mahbub is a finance partner and one of the Bangladesh's market leading international lawyers. She is head of the firm's Mergers and Acquisitions practice, which advises corporates and financial institutions on outbound and inbound investments, projects and financings.

    Meheruba has a diverse finance practice , representing large banks, financial sponsors, and corporations. She specializes in acquisition and structured financings, loan portfolio purchase and financing, real estate financings, and inbound and outbound transactions. She has extensive expertise in the energy and infrastructure industries.
    Work highlights

    Meheruba has acted on many high-profile Finance and Commercial deals in Bangladesh and India. These include advising:

    ⦾ Standard Chartered Bank on the sale of a portfolio of loans in Bangladesh, the first in a series of similar deals in Bangladesh as part of the government’s directive to banks to focus on the robustness of their balance sheets.

    ⦾ the lending and underwriting banks on the refinancing of US$6.9bn worth of debt uninsured by the Summit Group

    ⦾ Brookfield Property Partners on the acquisition and financing of Unitech’s real estate portfolio

    ⦾ Enron on the US$3bn Dhabol power project (since renamed Ratnagiri Gas and Power), the first ever inward investment into the power sector

    ⦾ the sponsor and borrowers on the Sakhalin LNG project, the world’s largest integrated oil and gas project and the largest LNG financing in Russia

    Email: [email protected]

    Address: 2 Turner Street, Canning Town, E16 1FH, United Kingdom

    Gender: Female

    Job Title: Barrister and Senior Associate

    Have a Different Question?

    Email us anytime : [email protected]

    Or call — +8801847220062 or +8801779127165

    Engineering and Project Management Consultancy in Bangladesh

    Project Management Consultancy law firm and EPMC company in Bangladesh Tahmidur Rahman Remura (TLS) is a well-established law firm and one of the leading Engineering and Project Management Consultancy (EPMC) companies in Bangladesh. The company has been providing...

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