Commercial Court Act needs re-examination: Law minister

FE Report | Published: May 21, 2026 22:33:48

Despite expectations that the laws governing commercial courts and arbitration should instil confidence, uphold justice and encourage innovation among local and foreign investors, many major issues faced by foreign investors in Bangladesh remain unaddressed.
Md. Asaduzzaman, minister of law, justice and parliamentary affairs, said this on Thursday at a seminar titled "Strengthening Bangladesh's Commercial Justice System: Commercial Court Act 2026 and Reform of the Arbitration Act 2001," held at a hotel in the capital.
The programme was organised by the Bangladesh International Arbitration Centre (BIAC) in partnership with the United Nations Development Programme (UNDP).
Though the Commercial Court Act was passed in parliament during the last session, the law minister said a re-examination of the law was necessary, as many issues had not been properly addressed.
"We want to re-examine it [Commercial Court Act] and introduce certain amendments to this law," so that justice can be served in the finest and swiftest manner, Asaduzzaman said.
"Otherwise, this law would be nothing but a futile exercise like other laws, because it stipulates that the provisions of the CPC (Code of Civil Procedure) will be applicable."
Speaking on the Arbitration Act, the minister said it had several loopholes that needed plugging, without which it would not help reduce the number of cases and the backlog before the courts.
"The act [Arbitration Act] would not shorten the proceedings or yield other results, as we fear."
The minister illustrated the harassment that foreign investors face in Bangladesh with a concrete example.
He said Toyota had done business in partnership with a local agent for 10 years and then decided not to renew the agreement, as it was instead willing to set up its own plant in the country.
After the deal expired, the local agent initiated criminal proceedings against the top executive of Toyota, who resides in Japan. As a result of the legal battle, he had to travel to Bangladesh and obtain bail.
The Arbitration Act would not provide remedy in a situation like this, the minister said. "We have to think about the real and practical problems that foreign investors are facing," he added.
He also said that before placing the act before parliament, he had not dared to modify it within such a short span of time.
In his speech, Mahbubur Rahman, chairman of the BIAC board, said the need for a modern, efficient and credible commercial justice system had become increasingly important as the country's economy grew and became further integrated with global markets.
"In this context, the Commercial Court Act 2026 and proposed reforms to the Arbitration Act 2001 represent important milestones," said Mr. Rahman.
He also said commercial courts could reduce delays, improve contract enforcement and create a more business-friendly environment.
"Likewise, a modern arbitration framework aligned with international standards can strengthen Bangladesh's reputation as a reliable destination for investment and dispute resolution," said Mr. Rahman.
Michael Miller, ambassador of the European Union to Bangladesh, said the expected standard of legal outcomes must be achieved on clear, transparent and trusted grounds.
He noted that if a dispute arose, investors would ask where they could seek redress, how long resolution would take, whether they would face discrimination, and whether the court would understand commercial reality.
"If a dispute arises, it will be resolved fairly, predictably, and in a minimum amount of time," said Mr. Miller, adding that Bangladesh was entering a new era by attracting higher-quality investment and diversifying its exports.
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