The primary legislation governing arbitration in Bangladesh is the Arbitration Act, 2001. This Act provides the legal framework for both domestic and international arbitration. However, there are some laws that require specific disputes to be settled mandatorily by arbitration. For example, section 36 of the Real Estate Development and Management Act, 2010 requires disputes concerning failure to provide real estate utilities (Section 21), cancellation of real estate allotment (Section 22), mortgage of real estate (Section 23), unauthorized sale of real estate (Section 24), use of inferior quality of raw materials (Section 25) etc. to be resolved mandatorily via arbitration. Another example is Section 61 of the Road Transport Act 2018 under which any person aggrieved by a review or appeal decision concerning compensation for motor vehicle accident can apply to an arbitrator for an award and in a case concerning compensation for motor vehicle accident, the civil court’s jurisdiction is barred. If parties to an agreement have an arbitration clause in their agreement, then it is mandatory for the parties to settle the dispute through arbitration. All arbitration in Bangladesh is governed by the Arbitration Act, 2001. There are mandatory laws within the Arbitration Act, 2001 that govern the conduct of arbitration proceedings, including provisions on the validity of arbitration agreements, the composition of arbitral tribunals, and the enforcement of arbitral awards.

Yes, Bangladesh is a party by way of accession to the New York Convention.[1] Bangladesh has not filed any reservation under the Convention.[2] However, it should be noted that unlike some other jurisdiction, the Arbitration Act, 2001 does not officially capture Bangladesh’s accession to the Convention[3] but some of the statute’s features are inspired by it. For example, the definition of “foreign arbitral award” in Section 2(k) of the Arbitration Act, 2001 is inspired by the New York Convention and Section 46 (Chapter X) of the Arbitration Act, 2001 has borrowed provisions from the Convention.[4]

Footnotes:

[1] https://www.newyorkconvention.org/contracting-states

[2] https://www.newyorkconvention.org/contracting-states

[3] Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed

Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 3.4.

[4] Ibid.

Apart from New York Convention, Bangladesh is a party to International Centre for Settlement of Investment (ICSID) and SAARC Arbitration Council.

The Arbitration Act, 2001 does not adopt the UNCITRAL Model Law but the Arbitration Act, 2001 is generally based on it.[1] The absence of adoption of the UNCITRAL Model Law means that the UNCITRAL Model Law or its principles do not automatically apply to the Arbitration Act, 2001. However, despite this lack of official adoption, the courts tend to take guidance from the UNCITRAL Model Law or the explanatory note issued by the UNCITRAL secretariat (Explanatory Note by the UNCITRAL secretariat on the 1985 Model Law on International Commercial Arbitration as amended in 2006) in interpreting provisions of the Arbitration Act, 2001.[2] There are some differences between the Act and the UNCITRAL Model Law in terms of supporting jurisdiction of the court in foreign seated arbitration (Section 3), jurisdiction of the court in matters governed by the arbitration agreement (Section 7)[3], composition of arbitral tribunal with even number of arbitrators (Section 11[4], appointment of arbitrators (Section 12), substitution of terminated arbitrator (Section 16), judicial enforcement of arbitrator’s order for interim measures (Section 21(4)), commencement of arbitration (Section 27),[5] court assistance in taking evidence (Section 33),[6]  party default provisions (Section 35),[7] and the arbitrator’s power to choose the rules of law applicable to the substance of the dispute (Section 36(2)).[8]

The Arbitration Act, 2001 was enacted in 2001 and it was amended in 2004 to add Section 7A conferring powers on the High Court Division and the District Court to make interim orders in support of foreign and local arbitrations. There have not been any amendments to the Arbitration Act, 2001 since. Although the previous law minister in 2022 hinted towards the erstwhile Government’s intention about reforms[9] but there are no official steps from the Government to reform arbitration laws in Bangladesh.

Footnotes:

[1] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 3.2.

[2] Ibid.

[3] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 3.84.

[4] Ibid at para. 4.1.

[5] Ibid at para. 5.18.

[6]  Ibid at para. 5.33.

[7] Ibid at para. 5.39.

[8] Ibid at para. 6.3.

[9] See https://www.biac.org.bd/News-break/law-minister-appreciative-of-the-need-for-reform-of-the-arbitration-act-2001-and-acknowledges-the-necessity-to-bring-appropriate-amendments-at-biacs-11th-anniversary-seminar/

Bangladesh has several arbitral institutions, including The Bangladesh International Arbitration Centre (BIAC), The Dhaka Chamber of Commerce and Industry (DCCI), Bangladesh Institute of Arbitration (BIArb) etc. There is no official data about the number of times these institutions’ rules were amended (if at all). In 2019, Bangladesh International Arbitration Centre (BIAC) Rules, 2011 were replaced by BIAC Rules, 2019.

There is no specialist arbitration court in Bangladesh.

The validity requirements for an arbitration agreement in Bangladesh is that an arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement.[1] An arbitration agreement shall be in writing and an arbitration agreement shall be deemed to be in writing if it is contained in –

(a) a document signed by the parties;

(b) an exchange of letters, telex, telegrams, Fax, e-mail or other means of telecommunication which provide a record of the agreement; or

(c) an exchange of statement of claim and defence in which the existence of the agreement is alleged by one party and not denied by the other.[2]

Footnotes:

[1] Section 9(1) of the Arbitration Act, 2001.

[2] Section 9(2) of the Arbitration Act, 2001.

An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement.[1] Furthermore, an arbitration agreement or clause that forms part of another agreement is deemed to constitute a separate agreement for the purpose of determining the jurisdiction of the arbitral tribunal.[2]

Footnotes:

[1] Section 9(1) of the Arbitration Act, 2001.

[2] Section 18 of the Arbitration Act, 2001.

The courts in Bangladesh have not yet applied the validation principle in the context of an arbitration clause. However, the Arbitration Act, 2001 provides guidance on the validity and enforceability of arbitration agreements. The arbitral tribunal may rule on its own jurisdiction on the question whether there is existence of a valid arbitration agreement, unless otherwise agreed by the parties. In Anamika Corp. Ltd v. Humayun M. Chowdhury 17 SCOB [2023] HCD 119, on the issue of the arbitral tribunal’s power to rule on its own jurisdiction in the context of determining the existence of a valid arbitration agreement, the High Court Division observed that in view of Section 17(a) read with the other provisions of Chapter 5 of the  Arbitration Act, 2001, particularly Section 19(1) and Section 19(2), the power to decide on the issue of existence of a valid arbitration agreement has been conferred upon the arbitral tribunal and the court does not possess simultaneous or parallel jurisdiction to determine that issue.[1]

Footnotes:

[1] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 4.33.

The Arbitration Act, 2001 does not deal with third parties or non-signatories being bound by an arbitration agreement. However, in a reported case it has been held that an assignee of a contract containing an arbitration clause/agreement is a “party” to such clause/agreement.[1]

Footnotes:

[1] Khaled Rab v. Bangladesh Jute Mills 23 BLC 793.

There have not been any recent court decisions in Bangladesh concerning the choice of law applicable to an arbitration agreement where no such law has been specified by the Parties. However, in one reported judgment it has been held that where a contract (containing the arbitration clause) with a non-resident foreign national is governed by the laws of Bangladesh, and if the contract does not stipulate the rules of procedure or the seat or place of arbitration, then the provisions of the Arbitration Act, 2001 shall apply as if the arbitration is an international commercial arbitration seated in Bangladesh.[1]

Footnotes:

[1] Frigo Mekanik v. BD Milk Producers 2019 (2) 16 ALR 357. Also see Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 5.16.

The arbitral tribunal shall decide the dispute in accordance with the rules of law as are designated by the parties as applicable to the substance of the dispute.[1] Furthermore, any designation by the parties of the law or legal system of a given country shall be construed, unless otherwise expressed, as directly referring to the substantive law of that country.[2] Failing any designation of the law by the parties, under Section 36(1) of the Arbitration Act, 2001, the arbitral tribunal, in case of conflict of laws, shall apply the rules of law which it considers appropriate.[3] In effect, with respect to the arbitrator’s power to choose the rules of law applicable to the substance of the dispute, the Act applies a voie directe approach, which is not the case for article 28(2) of the UNCITRAL Model Law.[4] The arbitral tribunal shall decide the dispute in accordance with the terms of the contract taking into account the usages of the concerned matter, if any, for ends of justice.[5]

Footnotes:

[1] Section 36(1) of the Arbitration Act, 2001.

[2] Ibid.

[3] Section 36(2) of the Arbitration Act, 2001. The unofficial English translation does not correctly capture the original Bengali version of the Act. In this regard, see Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 6.3.

[4] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 6.3.

[5] Section 36(3) of the Arbitration Act, 2001.

The parties to arbitration proceedings are free to agree on a procedure for appointing the arbitrator or arbitrators.[1] However, there is a restriction with respect to even number of arbitrators. Although Section 11(1) of the Arbitration Act, 2001 gives the parties the autonomy to determine the number of arbitrators, that autonomy is “subject to” Section 11(3) when the parties appoint an even number of arbitrators. Thus, in case of selection of an even number of arbitrators, Section 11(3) of the Arbitration Act, 2001 requires that the appointed arbitrators jointly appoint a third arbitrator who shall act as a chairman of the arbitral tribunal. In other words, for all practical purposes, the Arbitration Act, 2001 does not allow the composition of an arbitral tribunal with even numbers.[2]

A person of any nationality may be an arbitrator, unless otherwise agreed by the parties.[3]

Footnotes:

[1] Section 12(1) of the Arbitration Act, 2001.

[2] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 4.1.

[3] Section 12(2) of the Arbitration Act, 2001.

Under Section 12(1), the parties have full autonomy to agree on a procedure for appointing the arbitrator.[1] The local court’s interventions in the selection of arbitrators are as follows:[2]

• • In case of a sole arbitrator tribunal, if the parties have not agreed on an appointment procedure at all under Section 12(1), then the provisions of Section 12(3) will apply under which, if the parties fail to agree on the arbitrator within thirty days from receipt of a request by one party from the other party to so agree, then the appointment shall be made upon request of a party- (i) by the District Judge in case of arbitration other than international commercial arbitration; and (ii) by the Chief Justice or by any other Judge of the Supreme Court designated by the Chief Justice in case of international commercial arbitration.
  • For a three-member arbitral tribunal, if the parties have not agreed on an appointment procedure at all under Section 12(1), then the provisions of Section 12(4) will apply under which if a party fails to appoint an arbitrator within thirty days of the receipt of a request to do so from the other party or if the appointed arbitrators fail to agree on the third arbitrator within thirty days of their appointment, the appointment shall be made, upon the application of a party – (i) by the District Judge except in case of international commercial arbitration, and (ii) by the Chief Justice or by any other Judge of the Supreme Court designated by the Chief Justice in case of international commercial arbitration.
  • If the parties agreed on a procedure under Section 12(1), but one party has failed to act, or both parties have failed to act as required, or the parties or the arbitrators have been unable to reach the agreement expected of them, or a person or any third party fails to perform any function assigned to him under the agreed procedure under Section 12(1), and unless the agreement on the appointment procedure under Section 12(1) provides other means to take the necessary measure for securing the appointment, then the provisions of Section 12(7) will apply under which a party may apply to – (i) the District Judge except in case of international commercial arbitration and the District Judge shall appoint the Chairman of the tribunal along with the other arbitrators; and (ii) the Chief Justice or any Judge of the Supreme Court designated by the Chief Justice in case of international commercial arbitration and the Chief Justice or the Judge of the Supreme Court as designated by the Chief Justice shall appoint the Chairman of the tribunal along with other arbitrators.
  • If more than one arbitrator are appointed under Section 12(4) of the Arbitration Act, 2001, then under Section 12(6), the District Judge, or the Chief Justice or any other Judge of the Supreme Court designated by the Chief Justice, as the case may be, shall appoint one person from among the said arbitrators to be the Chairman of the arbitral tribunal.

Footnotes:

[1] Agrocorp Ltd. v. Vietnam Northern Food 27 BLC 20.

[2] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 4.4 and 4.5.

When a person is requested to accept appointment as an arbitrator, he shall first disclose any circumstances likely to give rise to justifiable doubt as to his independence or impartiality.[1] An arbitrator, shall from the time of his appointment and throughout the arbitral proceedings, without delay, disclose to the parties any circumstances referred to in Section 13(1) of the Arbitration Act, 2001 unless they have already been so informed by him.[2] An arbitrator may be challenged only if circumstances exist that give rise to justifiable doubts as to his independence or impartiality, or he does not possess the qualifications agreed to by the parties.[3] A party may challenge an arbitrator appointed by him, or in whose appointment he has participated, only for reasons of which he becomes aware after the appointment has been made.[4]

Subject to Section 14(6) of the Arbitration Act, 2001, the parties shall be free to agree on a procedure for challenging an arbitrator.[5]

Failing any agreement referred to in Section 14(1) of the Arbitration Act, 2001, a party who intends to challenge an arbitrator shall, within thirty days after becoming aware of the circumstances referred to in Section 13(3) of the Arbitration Act, 2001, send a written statement of the reasons for the challenge to the arbitral tribunal.[6]

Unless the arbitrator challenged under Section 14(2) of the Arbitration Act, 2001 withdraws from his office or the other party agrees to the challenge, the arbitral tribunal shall decide on the challenge within thirty days from the date of filing the written statement referred to in Section 14(2).[7]

Any party aggrieved by the decision of the arbitral tribunal under Section 14(3) of the Arbitration Act, 2001, may prefer an appeal to the High Court Division within thirty days from the date of the said decision.[8]

The High Court Division shall decide the matter within ninety days from the date on which it is filed.[9] There are no consequences provided for the event when the appeal is decided beyond the 90 day period. It is submitted that any appeal decided by the High Court Division under Section 14(5) beyond the 90 day period shall be bad in law and can be set aside.[10]

If a challenge under any procedure agreed upon by the parties or under the procedures under Section 14(3) of the Arbitration Act, 2001 or the appeal preferred against the decision is not successful, the arbitral tribunal shall continue the arbitral proceedings and make an award.[11]

Footnotes:

[1] Section 13(1) of the Arbitration Act, 2001.

[2] Section 13(2) of the Arbitration Act, 2001.

[3] Section 13(3) of the Arbitration Act, 2001.

[4] Section 13(4) of the Arbitration Act, 2001.

[5] Section 14(1) of the Arbitration Act, 2001.

[6]  Section 14(2) of the Arbitration Act, 2001.

[7] Section 14(3) of the Arbitration Act, 2001.

[8] Section 14(4) of the Arbitration Act, 2001.

[9] Section 14(5) of the Arbitration Act, 2001.

[10] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 4.20

[11]  Section 14(6) of the Arbitration Act, 2001.

As discussed above under Section 13(1) of the Arbitration Act, 2001, when a person is requested to accept appointment as an arbitrator, he shall first disclose any circumstances likely to give rise to justifiable doubt as to his independence or impartiality. There are no reported judgment in Bangladesh dealing with the issue of independence and impartiality of the arbitrators. However, under comparative common law jurisdictions, it has been held that non-disclosure by the arbitrator about matters related to independence and impartiality under Section 13(1) of the Arbitration Act, 2001 will invalidate any appointment, the arbitration and the resulting award (See Aoki India v. Mira International 2006 (3) Arb LR 503 (Madras); Imaging Solutions v. Hughes Communications 2013 (1) Arb LR 433 (P&H)).

There is no provision in the Arbitration Act, 2001 which deals with liability of arbitrators.  However, in one case it has been indicated by the court that if an arbitrator does not provide or record the reasoning of the award (or his dissent), then the appointing party may ask for refund of the fees paid to such arbitrator on the ground of being deprived of the benefit of such reasoning for the purpose of taking subsequent legal steps.[1]

Footnotes:

[1] Gas Transmission Company v. Drilltec-Maxwell [2021] 22 ALR 31.

Yes. Section 17 of the Arbitration Act, 2001 states that  unless otherwise agreed by the parties, the arbitral tribunal may rule on its own jurisdiction on any questions including the following issues, namely –

(a) whether there is existence of a valid arbitration agreement.

(b) whether the arbitral tribunal is properly constituted;

(c) whether the arbitration agreement is against public policy;

(d) whether the arbitration agreement is incapable of being performed; and,

(e) whether the matters have been submitted to arbitration in accordance with the arbitration agreement.

Furthermore, Section 18 of the Arbitration Act, 2001 states that an arbitration agreement which forms part of another agreement shall be deemed to constitute a separate agreement while giving decision for the purpose of determining the jurisdiction of the arbitral tribunal.

The provisions of Section 17 of the Arbitration Act, 2001 capture the principle of competence-competence which allows the arbitral tribunal to rule on its own jurisdiction. Loosely, Section 17 of the Arbitration Act, 2001 can be described as a jurisdictional point for the arbitral tribunal to decide but it also captures the related severability or separability point in Section 17(a), which is further clarified in Section 18 of the Arbitration Act, 2001.[1]

Footnotes:

[1] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 4.30.

Where any party to an arbitration agreement or any person claiming under him commences any legal proceedings against any other party to the agreement or any person claiming under him in respect of any matter agreed to be referred to arbitration, any party to such legal proceedings may, at any time before filing a written statement, apply to the relevant court before which the proceedings are pending to refer the matter to arbitration.[1] The expression “any person claiming under him” conveys the notion of derivative action or defence, that is to say, cause of action or ground of defence derived from the party, and under this principle, an arbitration clause in a contract between A and B was allowed to be relied upon by C, who was a party to another contract between A, B and C and which incorporated by reference the arbitration clause of the first-mentioned contract on the ground that although C was not a party to that first-mentioned contract, it could rely on the arbitration clause because in view of Section 10 of the Act, C could claim its rights under the second-mentioned contract as a party claiming under A and B, who were the parties to the first-mentioned contract.[2] However, criminal proceedings cannot be stayed under Section 10 of the Act on the ground that there is an arbitration clause or agreement[3]

The relevant court shall, if it is satisfied that an arbitration agreement exists, refer the parties to arbitration and stay the proceedings, unless the relevant court finds that the arbitration agreement is void, inoperative or is incapable of determination by arbitration.[4] It has been held that if the contract itself is a void, illegal or fraudulent act, then the entire contract along with the arbitration clause would become non est.[5]

Notwithstanding that an application has been made under Section 10(1) of the Arbitration Act, 2001 and that the issue is pending before the court, an arbitration may be commenced or continued and an arbitral award made.[6]

Footnotes:

[1] Section 10(1) of the Arbitration Act, 2001.

[2] Md. Mostafizur Rahman v. Ms. Amin Maria [2022] 26 ALR 34. Also see Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 3.102.

[3] Shahnawaz Akhand v. The State 16 BLC 438.

[4] Section 10(2) of the Arbitration Act, 2001.

[5] BJMC v. MAICO Jute & Bag 56 DLR 224.

[6] Section 10(3) of the Arbitration Act, 2001.

The Arbitration Act, 2001 does not contain any provision under which a respondent can be compelled to participate in the arbitration. If without showing sufficient cause a party — (a) fails to attend or be represented at an oral hearing of which due notice was given, or (b) where matters are to be dealt with in writing fails, after due notice, to  submit written evidence or make written submissions, the arbitral tribunal may continue the proceedings in the absence of that party or, as the case may be, without any written evidence or submissions on his behalf and may make an award on the basis of the evidence before it.[1]

If the arbitral tribunal makes an award based on the basis of Section 35(4) of the Arbitration Act, 2001, the courts will enforce such awards.

Footnotes:

[1] Section 35(4) the Arbitration Act, 2001.

Third parties cannot voluntarily join arbitration proceedings. The Arbitration Act, 2001 is silent on allowing third parties joining arbitration upon agreement of the contesting parties. There is no judicial precedent on this point in Bangladesh. However, comparative common law jurisprudence shows that if a third party (who did not execute the arbitration agreement) acts for a party to the arbitration agreement with the consent of counterparty and is given the power to consent to the appointment of an arbitrator under the arbitration agreement, then the third party may be regarded as a “party” to the arbitration agreement despite the fact that it did not sign the arbitration agreement.[1] If all parties do not agree to the intervention, then the tribunal cannot allow for it.

Footnotes:

[1] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 3.26.

Unless the parties agree otherwise, upon prayer of either parties, before or during continuance of the proceedings or until enforcement of the award under in the case of international commercial arbitration the High Court Division and in the case of other arbitrations the District Judge Court may pass order in the following matters: (a) To appoint guardian for a minor or insane person to conduct the arbitral proceedings on his/her behalf. (b) To take into interim custody or sale of or other protective measures in respect of goods or property included in the arbitration agreement. (c) To restrain any party to transfer certain property or pass injunction on transfer of such property which is intended to create impediment on the way of enforcement of award. (d) To empower any person to seize, preserve, inspect, to take photograph, collect specimen, examine, to take evidence of any goods or property included in arbitration agreement and for that purpose to enter into the land or building in possession of any party. (e) To issue ad interim injunction. (f) To appoint receiver; and (g) To take any other interim protective measures which may appear reasonable or appropriate to the District Judge Court or the High Court Division.[1]

However, there has been substantial litigation about the power of the court to pass preservative or interim orders under Section 7A in support of arbitration seated outside Bangladesh in view of Section 3(2) along with Section 3(1) of the Arbitration Act, 2001. There were two sets of cases that went in opposite directions in dealing with this issue. In the first set of cases,[2] it was held that except Sections 45, 46 and 47, the other provisions (including Section 7A) of the Arbitration Act, 2001 will not apply to foreign seated arbitrations. In the second set of cases,[3] there were only two cases that held that the provisions of the Arbitration Act, 2001 will apply to foreign seated arbitrations. This conflict was later settled by a larger bench of the High Court Division in the case of Accom Travels and Tours Limited v. Oman Air[4] where it was held that except Sections 45, 46 and 47, the other provisions (including Section 7A) of the Arbitration Act, 2001 will not apply to foreign seated arbitrations. The case of Accom Travels was questioned as being per incuriam[5] in the recent case of Italian Thai Development Public Company Ltd. v. The Export-Import Bank of China and others,[6] where the High Court Division reiterated the position that except Sections 45, 46 and 47, the other provisions (including Section 7A) of the Arbitration Act, 2001 will not apply to foreign seated arbitrations. This decision was challenged before the Appellate Division[7] where by an interim order, the Appellate Division ordered the parties to maintain status quo until the first sitting of the foreign seated arbitral tribunal (Singapore) and subsequently, by invoking Section 7A(6) of the Arbitration Act, 2001, the order of status quo was vacated by the Appellate Division[8] when the foreign seated arbitral tribunal passed an interim order. Although not a full or complete judgment, but the latest case of Italian Thai Development Public Company Ltd. indicates that in an appropriate case, courts in Bangladesh will exercise the authority to grant interim measures for foreign-seated arbitrations.

Generally, anti-suit and/or anti-arbitration injunctions from a foreign court is enforceable within the provisions of the Code of Civil Procedure 1908. However, there are some legal uncertainties about the extent of anti-arbitration injunctions from Bangladeshi courts on foreign seated arbitrations. Two recent cases have taken the position that Bangladeshi courts have the jurisdiction to issue anti-arbitration injunctions on foreign seated arbitrations. However, there is academic commentary that has questioned the soundness of these judgments.[9]

Footnotes:

[1]  Section 7A of the Arbitration Act, 2001.

[2] In line with Canda Shipping v. TT Katikaayu 54 DLR 93; Unicol Bangladesh v. Maxwell Engineering 56 DLR (AD) 166 etc. Also see Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 3.46.

[3] HRC Shipping Limited v. M.V. Xpress Manaslu 12 MLR 265 and Southern Solar Power Limited v. BPDB 25 BLC 501, 2019 (2) 16 ALR 91.

[4] 27 BLC 596.

[5] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 3.72.

[6] Arbitration Application No. 2 of 2024.

[7] Civil Petition for Leave to Appeal No. 1828 of 2024 (arising out of Arbitration Application No. 2 of 2024).

[8] Ibid by order dated 01.09.2024.

[9] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at Chapter 10.

The arbitral tribunal has wide latitude in deciding the matters of procedure and evidence in conducting the arbitration in the absence of the parties’ agreement under Section 25(1).[1] Unless otherwise agreed by the parties, the arbitral tribunal shall decide whether to hold oral hearings for the presentation of evidence or for oral argument, or whether the proceedings shall be conducted on the basis of documents and other material.[2]

Unless otherwise agreed by the parties- (a) evidence may be given before the arbitral tribunal orally or in writing or by affidavit, (b) the arbitral tribunal may administer an oath or affirmation to a witness subject to his consent.[3] The arbitral tribunal, or a party to the proceedings with the approval of the tribunal, may apply to the  court for issuing summons upon any person necessary for examining, or submitting materials or appearing, or producing before the tribunal for both the purposes, as the case maybe, and the  court shall issue such summons.[4] A person shall not be compelled under any summons issued under Section 33(1) of the Arbitration Act, 2001 to answer any question or produce any documents or materials which that person could not be compelled to answer or produce at the trial in an action before the court.[5] Persons failing to attend before the tribunal in accordance with such summons as issued under Section 33(1) of the Arbitration Act, 2001 or making any other default, or refusing to perform, or guilty of any contempt to the arbitral tribunal during the conduct of arbitral proceedings, shall be subject to the like punishments by order of the court on the representations of the arbitral tribunal as they would incur for the like offences in suits tried before the court.[6] An interesting question that arises is whether the power to issue summons under Section 33 can be exercised against persons in Bangladesh in case of a foreign seated arbitration. There is no reported case on this point. However, in view of the latest interim order of the Appellate Division in Italian Thai Development Public Company Ltd. v. The Export-Import Bank of China and others, and due to the problems of the larger bench judgment of the High Court Division in the case of Accom Travels and Tours Limited v. Oman Air,[7] it seems that a Bangladeshi court may possess the jurisdiction to issue summons to persons in Bangladesh to give evidence or produce documents as witnesses for a foreign seated arbitration.[8]

Footnotes:

[1] Section 25(3) of the Arbitration Act, 2001.

[2] Section 30(1) of the Arbitration Act, 2001.

[3] Section 34 of the Arbitration Act, 2001.

[4] Section 33(1) of the Arbitration Act, 2001.

[5] Section 33(2) of the Arbitration Act, 2001.

[6] Section 33(3) of the Arbitration Act, 2001.

[7] 27 BLC 596. In this regard, also see Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 3.72.

[8] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 5.36.

When a person is requested to accept appointment as an arbitrator, he shall first disclose any circumstances likely to give rise to justifiable doubt his to his independence or impartiality.[1] An arbitrator, shall from the time of his appointment and throughout the arbitral proceedings, without delay, disclose to the parties any circumstances referred to in Section 13(1) of the Arbitration Act, 2001 unless they have already been so informed by him.[2] An arbitrator’s appointment may be challenged if circumstances exist that give rise to justifiable doubts as to his independence or impartiality, or he does not possess the qualifications agreed to by the parties.[3]

Moreover, the arbitral tribunal shall deal with any of the dispute submitted to it fairly and impartially and for this purpose – each party shall be given reasonable opportunity to present his case orally or in writing or both, and each party shall be given reasonable opportunity to examine all the documents and other relevant materials filed by other party or any other person concerned before the tribunal.[4] The arbitral tribunal shall deal with a dispute submitted to it as quickly as possible.[5] The arbitral tribunal in conducting proceedings shall act fairly and impartially in deciding procedure and evidence and in exercising other powers conferred on it.[6] The Arbitration Act, 2001 does not specify anything with respect to conduct of the counsel.

The Arbitration Act is applicable to all arbitration proceedings conducted in Bangladesh.[7] Therefore, the codes and professional standards will be applicable to everyone irrespective of their nationality.

Footnotes:

[1] Section 13(1) of the Arbitration Act, 2001.

[2] Section 13(2) of the Arbitration Act, 2001.

[3] Section 13(3) of the Arbitration Act, 2001.

[4] Section 23(1) (a) and (b) of the Arbitration Act, 2001.

[5] Section 23(2) of the Arbitration Act, 2001.

[6] Section 23(3) of the Arbitration Act, 2001.

[7] Section 3(1) of the Arbitration Act, 2001.

In Bangladesh, there are no rules with respect to the confidentiality of arbitration proceedings.

In Bangladesh the time frame for enforcement of an award is around 12 to 24 months.

A party may bring a motion for the recognition and enforcement of an award on an ex parte basis.

The grounds for setting aside a Bangladesh seated arbitral award in an international commercial arbitration[1] are almost the same as the grounds for refusing recognition or execution of foreign arbitral awards.[2] One of the differences is that, a Bangladesh seated arbitral award may be set aside if the court is satisfied that the arbitral award is induced or affected by fraud or corruption.[3] Although fraud and corruption is not an express ground of refusing recognition or enforcement of foreign arbitral award, it should be treated as part of the ground that the foreign arbitral award should not be in conflict with the public policy of Bangladesh.[4]

Footnotes:

[1] Section 43(1) of the Arbitration Act, 2001.

[2] Section 46(1) of the Arbitration Act, 2001.

[3] Section 43(1)(b)(iv) of the Arbitration Act, 2001.

[4] Professor M. Samsul Alam v. Bangladesh 10 SCOB [2018] HCD 205. In this regard, also see Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 7.51.

The courts may set aside a domestic award or a Bangladesh seated arbitral award in an international commercial arbitration on the application of a party within 60 (sixty) days from the receipt of the award.[1] In case of the former, the application for setting aside the award should be made to the District Judge’s Court within the local limits of whose jurisdiction the arbitral award has been finally made and signed, and in case of the latter, the application should be made to the High Court Division.[2] The grounds for setting aside such award are:[3]

(a) the party making the application furnishes proof that –

(i) a party to the arbitration agreement was under some incapacity, or

(ii) the arbitration agreement is not valid under the law to which the parties have subjected it, or

(iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable due to some reasonable causes to present his case, or

(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration or it contains decision on matters beyond the scope of the submission to arbitration, or

(b) the court is satisfied that –

(i) the subject-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force in Bangladesh, or

(ii) the arbitral award is prima facie opposed to the law for the time being in force in Bangladesh, or

(iii) the arbitral award is in conflict with the public policy of Bangladesh, or

(iv) the arbitral award is induced or affected by fraud or corruption.

Under the Arbitration Act, 2001, in case of a foreign arbitral award, the only option for the unsuccessful party is to wait for the successful party to come to Bangladesh to file the award for enforcement under Section 45 and object to any such application under Section 46.[4]

The only provision regarding waiver in the Arbitration Act, 2001 is that if a party knows that (a) the parties may derogate from any provision of the Arbitration Act, 2001, or (b) any requirement under the arbitration agreement has not been complied with and despite such knowledge, proceeds with the arbitration without stating his objection to such non-compliance without undue delay or, without stating his objection to such non-compliance within a time limit as provided in the Arbitration Act, 2001 for such objection, then that party shall be deemed to have waived his right to raise such objection.[5] However, the parties cannot waive rights of appeal or challenge to an award by way of agreement.[6]

Footnotes:

[1] Section 42 of the Arbitration Act, 2001.

[2] Section 42 read with the Explanation of Section 43 of the Arbitration Act, 2001.

[3] Section 43(1) of the Arbitration Act, 2001

[4] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 7.63. Also see Smith Co-Generation v. PDB 15 BLC 704.

[5] Section 6 of the Arbitration Act, 2001.

[6] See Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 4.19.

An arbitral award made by an arbitral tribunal pursuant to an arbitration agreement is binding on both the parties and on any persons claiming through or under them.[1] Thus, an arbitral award is not binding on any third party who is not a party to the arbitration agreement. Any challenge to the recognition of a foreign arbitral award must be made by the party against whom the award is being invoked (that is, the unsuccessful party in the arbitration).[2] Therefore, such challenge cannot be initiated by a third party.

Footnotes:

[1] Section 39(1) of the Arbitration Act, 2001.

[2] Section 46 of the Arbitration Act, 2001.

Section 21 empowers an arbitral tribunal to grant interim measures unless otherwise agreed by the parties. An order of an arbitral tribunal for taking interim measures may be enforced by the court upon an application by the party that requested such interim measures.[1]

Footnotes:

[1] Section 21(4) of the Arbitration Act, 2001.

The Arbitration Act, 2001 does not provide for simplified or expedited procedures for claims under a certain value. However, BIAC holds fast track arbitration upon request by a party before the preliminary conference when the amount in dispute, including the claim, counterclaim and defense, does not exceed Taka 50 million (or equivalent). In fast track arbitration, BIAC passes the award within 3 (three) months, unless exceptional circumstances require an extension.[1]

Footnotes:

[1] Rule 28(1) and (3) of the BIAC Arbitration Rules, 2019

No.

In Professor M. Samsul Alam v. Bangladesh 10 SCOB [2018] HCD, the High Court Division of the Supreme of Bangladesh rejected the claim of payment for services provided under a contract procured by bribery and corruption. Although there are no guidelines about corrupt behaviour among private parties, with regard to public servants, the Penal Code 1860 contains a number of offences such as accepting any gratification other than legal remuneration as a motive or reward for doing or forbearing to do any official act.[1] The party applying to set aside an arbitral award[2] or to refuse recognition or enforcement of a foreign arbitral award[3] bears the initial burden of proof. However, in case of corruption, even if a party does not raise the issue of corruption, the court may inquire about and consider it in its own motion.[4]

Footnotes:

[1] Section 161 of the Penal Code, 1860.

[2] Section 43 of the Arbitration Act, 2001.

[3] Section 46 of the Arbitration Act, 2001.

[4] Sections 43(1)(b) and 46(1)(b) of the Arbitration Act, 2001. Also see Commentaries on the Law of Arbitration in Bangladesh (with bilingual annotations), Junayed Ahmed Chowdhury, University Press Limited (catalogued at the British Library), 2024, at para. 7.7 and 7.62.