Bangladesh are reforming their law on secured transactions and collateral registries. The Bangladesh Bank and Ministry of Finance have signed a cooperation agreement with the International Financial Corporation (IFC) to start the implementation of a comprehensive secured transactions reform.
The IFC have announced an advisory project continuing until June 2020 with aims to increase level of finance to businesses in Bangladesh by strengthening secured lending and collateral framework in the country and the establishment of a register.
Bangladesh has also announced a master plan with a view to developing its capital markets to increase financing. This arose out of the market crisis of 2011 in Bangladesh. Some progress has been made by de-mutualising two key stock markets, but the current programme has indicated a need to strengthen rules and regulations of the market, upgrading the financial infrastructure and addressing the slow court systems.
These efforts resulted in The Bangladesh Bank publishing The Secured Transaction (Movable Property) Draft Act in December 2018, setting out their intended secured transactions law reform. This Draft Act is comprehensive and recognises movables both tangible and intangible as subject matter of security interests. This is a notable change, since the current legal system only recognises immovables like land is accepted as a security interest ensuring performance.
Click here to view The Bangladesh Bank website, where you can download the Draft Act
- IMF Country Report No. 17/147, 2017 Article IV Consultation on Bangladesh (2017)
Last Checked August 2020
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