Delays in trade dispute resolution threaten investment climate

Around 4.0 million business-related cases remain pending in Bangladesh's courts, and prolonged judicial processes are hindering both local and foreign investment, experts say at a seminar.

The seminar, titled "Advancing Dispute Settlement and Contract Enforcement for Businesses," was organised by the Dhaka Chamber of Commerce and Industry (DCCI) at the trade body's auditorium in the capital on Tuesday.

DCCI President Taskeen Ahmed highlighted that as economic activities grow, disputes over business contracts, investments, and intellectual property are also increasing.

"Currently, around 4.0 million cases remain unresolved in lower and higher courts," he said, stressing that lengthy judicial processes are discouraging both domestic and foreign investment.

He noted that the 2001 Arbitration Act remains poorly implemented and urged establishing a Commercial Court with experienced judges and legal reforms to accelerate trade and investment.

Commerce Secretary Mahbubur Rahman said Bangladesh's dense population contributes to rising court cases, making delays intolerable. Resolving trade disputes outside traditional courts could ease pressure on the judiciary and improve the business climate.

Mr Rahman confirmed that plans to establish a Commercial Court are underway, with the draft expected to be finalised within a month.

At the event, European Union Ambassador Michael Miller said, "The EU is working with the government on legal reforms that could enhance the public's quality of life."

He emphasised that commercial courts are crucial for attracting foreign investment, especially as Bangladesh moves toward LDC graduation and export diversification. Strengthening arbitration mechanisms, he noted, would also reduce investment stagnation.

Md Abdur Rahim Khan, additional secretary (Export Wing) and vice chairman of the Export Promotion Bureau, highlighted that delays in trade dispute resolution hinder foreign direct investment (FDI) and export expansion, causing Bangladesh to lose its competitive position in global trade.

Barrister Md Sameer Sattar, former DCCI president, presented the keynote, citing Bangladesh's poor contract enforcement ranking -- 189th out of 190 countries in the World Bank's Doing Business Report -- and a 44.4/100 score in the B-READY 2024 report on dispute resolution.

He also noted that 25,000 financial loan court cases remain pending as of March 2025.

Md Ariful Hoque, director general (Joint Secretary) of Bangladesh Investment Development Authoroity (BIDA), said that laws alone are insufficient; institutional reforms are essential.

KAM Majedur Rahman, chief executive officer of the Bangladesh International Arbitration Centre (BIAC), described trade dispute delays as a serious concern. Vikna Rajah, co-head of South Asia Desk at Rajah & Tann, Singapore, cited Singapore's strong legal framework and specialised dispute resolution mechanisms as a model for attracting foreign investment.

Mr Rajah urged Bangladesh to establish commercial courts and revise the Arbitration Act.

Judge Tareque Muajjem Hussain, special officer (Additional District Judge) to the Chief Justice, stressed appointing experienced judges specialised in commercial disputes and providing them proper training for faster dispute resolution.

In the open discussion, Rizwan Rahman, former DCCI president, highlighted poor inter-ministerial coordination as a barrier to resolving trade disputes.

DCCI Vice President Md Salem Sulaiman, board members, and sector stakeholders also attended the seminar.

talhabinhabib@yahoo.com