Legal Intelligence
According to the High Court Division of Bangladesh, The Companies Act should undergo significant changes.
In short
The High Court Division has observed that the Companies Act 1994 requires significant reform. The Act remains the governing company law statute in Bangladesh, and observations of this kind indicate direction rather than change the current position — companies should continue to comply with the Act as it stands.
The High Court has recommended making significant amendments to the current company law to lift Bangladesh to the status of a developed nation after observing that the Companies Act of 1994 needs to be more enforceable in many situations.
Moreover, it has recommended taking the necessary measures to set up one Company Appellate Tribunal in each division and one or more Company Law Tribunals in each district according to the number of companies.
The 14-point recommendations were included in the complete text of the judgment that the HC issued after resolving two business disputes brought up by Md. Uzzal about the ownership of "Top Ten Fabrics and Tailors Ltd."
On August 25, 2022, Justice Md Ashraful Kamal delivered the quick decision; the 232-page full judgment was released recently.
The court also made the following observation:
The High Court advised the commerce ministry to prepare a new company legislation modelled after India's Companies Act. The Ministry was also instructed to revise the Act annually.
The HC urged the Minister to create Special Criminal Courts for Companies Act violations and modernize and reinforce the RJSC's legal structure and services.
Court also ordered the Ministry to publish the Corporate Law Code in Bangla and advise companies to keep it at their offices.
It further requested that the Ministry require every company to hire a permanent legal officer, and a company law professional as a consultant.
It proposed establishing a training center in each district under the Ministry of Commerce for company formation and administration and requiring company officials to attend at least one training session each year.
It further requested that the Ministry compel the nomination of one independent director, company secretary, and internal auditor in every company and that any company with a paid-up capital exceeding Tk 50 million have a full-time company secretary (who will be a member of the ICSB).
#bangladesh #companylaw #companysecretary #legalofficer #amendments #companiesact1994 #judgement #companybench #HCD #supremecourt
Please note. This is general information about the law as it stood on 22 February 2023, not legal advice, and no solicitor–client relationship arises from reading it. Law and practice change; take advice on your own facts before acting.
