Arbitration issues for foreign investors in Bangladesh

1 · 09 · 24

Foreign investors may face special hurdles linked to arbitration when they invest in Bangladesh, despite the fact that Bangladesh offers attractive prospects for outside investment.

With the purpose of providing insights into the legal environment, obstacles, and possible solutions, this essay investigates the most important concerns that are associated with arbitration for foreign investors in Bangladesh.

Legal Framework for Bangladesh Arbitration

Bangladesh Arbitration Act

The Arbitration Act of Bangladesh serves as the legal basis for arbitration procedures in Bangladesh. Additionally, it provides an account of the methods, enforcement mechanisms, and recognition of arbitral rulings. When foreign investors engage in commercial activity in Bangladesh, it is vital for them to have a solid understanding of this administrative structure.

Arbitration internationally

Under the jurisdiction of the Arbitration Act, international arbitrations that include foreign investors are considered to be applicable. This act respects the values of neutrality and justice, and it guarantees that an organized approach is taken to the resolution of disputes that occur across international borders.

Major Arbitration Issues for Foreign Investors

Enforcement of Arbitrations

An important obstacle to overcome is the process of putting arbitral rulings into effect. When it comes to ensuring that the verdicts that are given via arbitration are efficiently implemented within the legal framework of Bangladesh, foreign investors may encounter obstacles from time to time.

Intervention by Judge

A potential cause for worry is the involvement of the judiciary in the arbitration procedure. The participation of local courts in arbitration issues may have an influence on the efficiency and autonomy of the process, which raises doubts about the impartiality and efficacy of arbitration for investors from other countries.

Solution and Strategy Options

Arbitration Institutions

It is possible to contribute to impartiality and decrease the possibility of unnecessary court interference by selecting institutional arbitration, which is a method in which a recognized arbitration institution controls the process. It is possible that dependable alternatives might be found via international organizations that have a presence in Bangladesh.

Drafting Arbitration Clauses Carefully

It is of the utmost importance that contracts have arbitration terms that have been carefully designed. It is possible to reduce the likelihood of future problems by giving careful thought to the wording and specifications included within these provisions, which may also offer a clear path for problem resolution via arbitration.

Treating Cultural and Procedural Differences

Sense of Culture

In the course of arbitration processes, it is very necessary to acknowledge and talk about cultural differences. Taking a culturally sensitive approach helps to guarantee that parties are able to communicate and understand one another effectively, which in turn contributes to a more streamlined arbitration process.

Local Law Expertise

A smart strategy would be to include legal specialists who are knowledgeable about the local rules and regulations that are in place in Bangladesh. The foreign investor may benefit from the guidance of local legal counsel since it can give useful insights, help them negotiate the procedural complexities, and improve their awareness of the arbitration scene.

Collaboration, Advocacy

Industry Cooperation

There are potential advantages to working together inside the sector. It is possible that the establishment of industry-specific arbitration structures or forums might provide individualized solutions for the resolution of conflicts, therefore encouraging a collaborative attitude among the many stakeholders.

Industry Cooperation

An example of a proactive move would be to advocate for legal changes within the scope of arbitration. Foreign investors have the opportunity to participate in conversations with local officials, industry groups, and legal professionals in order to make contributions to the development of the atmosphere for arbitration.

Considerations for the Future

Technological Integration

As technology plays an increasingly crucial role in the settlement of disputes, the use of digital platforms and online arbitration may become a trend in the future. This would provide overseas investors with a way of participating in arbitration procedures that is both more efficient and more easily accessible.

Multilateral and bilateral treaties

An important factor to take into account is the investigation of both bilateral and international treaties. For the purpose of enhancing the credibility and efficiency of arbitration for foreign investors, it is possible to either take part in or advocate for accords that enable the acceptance and execution of arbitral rulings.


Arbitration in Bangladesh is a dynamic landscape that is formed by legislative frameworks, cultural subtleties, and developing trends. This terrain allows international investors to participate in arbitration.

In spite of the fact that there are obstacles to overcome, international investors may be empowered to successfully traverse the arbitration environment by taking strategic considerations, seeking proactive solutions, and engaging with local knowledge.

By resolving arbitration concerns, Bangladesh is contributing to a more resilient and investor-friendly business climate, which is important as the country continues to present itself as an attractive investment destination.

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