BANGLADESH Trends and Developments Contributed by: Mohammed Forrukh Rahman, Kamrunnaher Shimu and Salauddin Kader, Rahman’s Chambers
Conclusion: the necessity of sophisticated risk management The investment landscape in Bangladesh offers sig- nificant opportunities but demands a sophisticated approach to risk management. Success hinges not merely on the legal framework, but on a granular understanding of the operational and regulatory reali- ties. Rigorous, independent due diligence – particu- larly concerning land, permits, and technical feasibil- ity – is imperative, especially as tender documents increasingly place the burden of verification on the investor. Furthermore, the shift to competitive bidding neces- sitates expert legal guidance from the outset of the procurement process. By strategically structuring their presence and meticulously managing contrac- tual risks, investors and international contractors can navigate the complexities of this dynamic market.
ments (such as “availability payments” for express- ways) often leads to disputes regarding whether the contract allows for the pass-through of these new costs to the government authority. Payment defaults and foreign exchange risks The current macroeconomic climate, characterised by pressure on foreign exchange reserves, heightens the risk of payment defaults by SOEs – particularly in the energy sector with regard to capacity payments. Addi- tionally, investors face risks related to the repatriation of profits. Although investment agreements guaran- tee the free transfer of funds, restrictions or delays imposed by the central bank due to foreign exchange shortages can impede repatriation, potentially forming the basis of a dispute.
20 CHAMBERS.COM
Powered by FlippingBook