Reduction of share capital in Bangladesh: the full journey, step by step

by Barrister Tahmidur Rahman | Oct 24, 2026

Case Journeys/Commercial

Reduction of share capital in Bangladesh: the full journey, step by step

A reduction of share capital in Bangladesh needs two things: a special resolution of the shareholders under section 59 of the Companies Act 1994, and an order of the High Court Division confirming it under sections 60 to 64. The court protects creditors by settling a list of those entitled to object and making sure each one has consented, been paid or been secured, and it can attach conditions.

The reduction takes effect only when the confirmation order and the court-approved minute are registered with the RJSC under section 65.

Step through it on the page
Confirm that a court-confirmed reduction is needed
▶Play full screen16 steps · 7 what-ifs · 7 courts & offices
Where it starts
The company's board and general meeting; then the High Court Division (statutory original jurisdiction, company bench)…
Main law
Companies Act 1994 (ss.3, 53, 57, 58, 59-70, 87, 88); Companies Rules 2009 (High Court Division); Code of Civil Procedure 1908…
Typical duration
about 6-12 months from board decision to RJSC registration where no creditor objects; 1-2 years or more if creditors…
Who can file
The company itself, acting through its board and shareholders. Creditors entitled to object, and in practice the RJSC…
Interactive journey · 16 steps

Reduction of share capital in Bangladesh: walk through every stage

Press next, use your arrow keys or tap a court on the map. The gold marker shows where your case is, and the green trail shows the route it has taken. For the immersive version, play it full screen.

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  1. Reduction of share capital in Bangladesh: step 1, Confirm that a court-confirmed reduction is needed
    Step 1 · Planning the reduction

    Confirm that a court-confirmed reduction is needed

    The lawyer first checks whether the plan is really a reduction. Cancelling authorised shares that nobody has taken is a simple alteration under section 53 and needs no court order. A true reduction under section 59 covers extinguishing liability on unpaid shares, cancelling paid-up capital that is lost or not represented by assets, and paying off capital in excess of the company's needs. The share premium account and capital redemption reserve are treated as paid-up capital for this purpose. A company cannot buy back its own shares except through this procedure (section 58).

    The articles must authorise reduction; if they do not, they are amended first by special resolution.

    Where: Company's lawyer · Time: 1-3 weeks · Law: s.53(1)(e) Companies Act 1994; s.57 Companies Act 1994; s.58(1) Companies Act 1994; s.59(1) Companies Act 1994 · Documents: Memorandum and articles of association, Latest audited accounts, Register of members and share capital history

    Tip: Check the RJSC records against the audited accounts at this stage. Mismatched capital figures are a common reason for supplementary affidavits later.

  2. Reduction of share capital in Bangladesh: step 2, Board approves the scheme and calls the meeting
    Step 2 · Planning the reduction

    Board approves the scheme and calls the meeting

    The board resolves on the type and amount of the reduction, the new capital structure and the reasons, and approves a list of creditors and an auditor's statement of the company's assets and liabilities, because the court will ask about them. Banks and other lenders often have loan covenants that forbid any change to capital without their consent, so the company approaches them early. The board then calls an extraordinary general meeting with at least twenty-one days' notice stating the intention to propose a special resolution.

    A shorter notice is possible only if every member entitled to attend and vote agrees.

    Where: Board and general meeting of the company · Time: 3-6 weeks including notice · Law: s.87(2) Companies Act 1994; s.59(1) Companies Act 1994 · Documents: Board resolution, Notice of extraordinary general meeting, Explanatory statement, Auditor's statement of assets and liabilities, Draft list of creditors

    Tip: Ask lenders for written consent before the meeting. A consent letter now is far cheaper than securing a disputed claim in court later.

  3. Reduction of share capital in Bangladesh: step 3, Listed company: disclosure and regulatory dealings
    Step 3 · Planning the reduction

    Listed company: disclosure and regulatory dealings

    For a listed company, the board decision to propose a reduction of share capital in Bangladesh is price-sensitive information. It must be disclosed promptly to the Bangladesh Securities and Exchange Commission and the stock exchanges under the listing regulations and the insider trading rules, and insiders must not trade on it. The Companies Act itself requires only the special resolution and the court's confirmation, and no BSEC rule expressly requiring prior approval could be confirmed. Press reports, such as on RN Spinning Mills' 2020 proposal, still describe listed reductions as subject to regulatory approval.

    Regulation 9(i) of the 2015 listing regulations sets a minimum paid-up capital, reported in 2021 as Tk 30 crore, so a reduction below it raises problems.

    Where: Bangladesh Securities and Exchange Commission and stock exchanges (listed companies) · Time: Disclosure within the listing deadline; regulatory correspondence 1-3 months · Law: Securities and Exchange Ordinance 1969; Dhaka and Chittagong Stock Exchange (Listing) Regulations 2015; BSEC (Prohibition of Insider Trading) Rules 2022 · Documents: Price-sensitive information disclosure, Board resolution, Application or intimation to BSEC

    Tip: Check the current BSEC directives before announcing. The requirements for listed companies change more often than the Companies Act.

  4. Reduction of share capital in Bangladesh: step 4, Shareholders pass the special resolution
    Step 4 · Shareholder approval

    Shareholders pass the special resolution

    At the general meeting, the special resolution for reducing share capital must be passed by at least three-fourths of the votes of members entitled to vote who are present in person or by proxy. Section 59(2) calls it a resolution for reducing share capital. The resolution should state the exact amounts: the capital before and after, the number and nominal value of shares, and how much, if anything, is paid back to members. If a poll is demanded, each member has the votes the articles give them.

    The minutes are signed by the chair, and the resolution itself is the document the High Court Division will later be asked to confirm.

    Where: Board and general meeting of the company · Time: Meeting day · Law: s.59(2) Companies Act 1994; s.87(1)-(6) Companies Act 1994 · Documents: Special resolution, Signed minutes, Attendance and proxy register, Poll results, if any

  5. Step 5: File the special resolution with the RJSC
    Step 5 · Shareholder approval

    File the special resolution with the RJSC

    A certified copy of the special resolution must be filed with the Registrar of Joint Stock Companies and Firms within fifteen days of the meeting, under section 88. A late filing attracts a daily fine. If the reduction involves paying capital back to members or reducing liability on unpaid shares, the company must also add the words 'and reduced' to its name from the date of the resolution until a date the court fixes, under section 61.

    The RJSC is usually made a respondent to the later court petition so that it is bound by the final order.

    Where: Registrar of Joint Stock Companies and Firms · Time: Within 15 days of the meeting · Law: s.88(1) and (4) Companies Act 1994; s.61 Companies Act 1994 · Documents: Certified copy of the special resolution, RJSC filing receipt

  6. Step 6: Prepare the company petition
    Step 6 · Court petition and creditors

    Prepare the company petition

    The company's lawyer drafts a petition under section 60, supported by an affidavit sworn by a director. It sets out the company's history, the capital before and after, the reasons, the resolution and the creditor position, and it attaches the audited accounts and a list of creditors. Common respondents are the RJSC and, where relevant, Bangladesh Bank and the company's banks. In The IBN SINA Polymer Industries Ltd (2026), the petitioner joined Bangladesh Bank and its account banks so that no one could later claim lack of notice.

    The prayer should include every consequential direction needed, such as correcting the RJSC records.

    Where: Company's lawyer · Time: 2-4 weeks · Law: s.60 Companies Act 1994; Companies Rules 2009; Company Matter No. 1936 of 2025 (HCD, 05.07.2026) · Documents: Petition under s.60, Supporting affidavit, Special resolution and minutes, Audited accounts, List of creditors, Board resolution authorising the filing, Vakalatnama

  7. Step 7: File in the High Court Division company bench
    Step 7 · Court petition and creditors

    File in the High Court Division company bench

    The petition is filed in the High Court Division, which section 3 makes the Court under the Companies Act. It is registered as a company matter and listed before the single judge whom the Chief Justice has assigned to company matters. There is no value threshold: every reduction, large or small, goes to this court. The Government can notify a District Court to exercise company jurisdiction, but in practice petitions are filed in Dhaka. Court fees and process fees are paid on filing, and the petition is placed for admission and directions.

    Where: High Court Division · Time: 1-4 weeks to first listing · Law: s.3(1) Companies Act 1994; s.60 Companies Act 1994; Article 107(3) Constitution of Bangladesh · Documents: Filed petition with annexures, Court fee and process fee receipts

  8. Step 8: Directions on creditors and advertisement
    Step 8 · Court petition and creditors

    Directions on creditors and advertisement

    At the first hearing, the court gives directions. Where the reduction involves paying members or reducing liability on unpaid shares, every creditor with a provable claim on a date the court fixes is entitled to object without further permission. In other cases, creditors may object only if the court permits. The court fixes that date, orders notice to the respondents and may direct advertisement in national newspapers. Under section 69 it can also order the company to publish the reasons for the reduction.

    For a reduction that only writes off lost capital, the court may decide that creditors' rights are not affected.

    Where: High Court Division · Time: 1-2 months · Law: s.62(1) Companies Act 1994; s.69 Companies Act 1994; Companies Rules 2009 · Documents: Order with directions, Draft advertisement, Notices to respondents

  9. Step 9: Notices and advertisement to creditors
    Step 9 · Court petition and creditors

    Notices and advertisement to creditors

    The company serves the court's notices on the RJSC, regulators and known creditors, and publishes any advertisement the court has ordered, usually in one Bangla and one English daily. The notice tells creditors the date fixed for entitlement, where to inspect the petition and the deadline to claim a place on the list of objecting creditors. The company files an affidavit of service and publication with copies of the newspaper pages. Creditors who miss the deadline lose the right to object, although section 67 protects a creditor who never knew of the proceedings.

    Where: Creditors and lending banks · Time: 3-6 weeks · Law: s.62(2) Companies Act 1994; s.67(1) proviso Companies Act 1994 · Documents: Newspaper advertisements, Postal and courier receipts, Affidavit of service and publication

  10. Step 10: The court settles the list of creditors
    Step 10 · Court petition and creditors

    The court settles the list of creditors

    Under section 62(2), the court settles a list of creditors entitled to object. It works out, as far as possible without waiting for applications, the names of the creditors and the nature and amount of their claims, and it decides claims from creditors not originally listed. The company supports this with a certified list of creditors and an affidavit from an officer verifying it. Concealing a creditor or misstating a claim is a criminal offence under section 68, punishable with up to two years' imprisonment, so the list must be complete and honest.

    Where: High Court Division · Time: 1-3 months · Law: s.62(2) Companies Act 1994; s.68 Companies Act 1994 · Documents: Certified list of creditors, Officer's verifying affidavit, Claims lodged by creditors

  11. Step 11: Obtain consent, pay or secure each listed creditor
    Step 11 · Court petition and creditors

    Obtain consent, pay or secure each listed creditor

    Every creditor on the list must either consent in writing, be paid, have the claim determined, or be secured. Where a listed creditor refuses consent, section 63 lets the court dispense with that consent if the company sets aside the full amount of an admitted claim. For a disputed, contingent or unascertained claim, the company sets aside an amount the court fixes after an inquiry, as if the company were being wound up. Security usually takes the form of a bank guarantee, a fixed deposit under lien or money paid into court.

    Most companies resolve objections commercially before the final hearing.

    Where: Creditors and lending banks · Time: 1-4 months · Law: s.63 Companies Act 1994; s.64 Companies Act 1994 · Documents: Creditor consent letters, Proof of payment, Bank guarantee or deposit receipts, Application under s.63

  12. Step 12: Final hearing on confirmation
    Step 12 · Confirmation order

    Final hearing on confirmation

    At the final hearing, the court must be satisfied about every creditor entitled to object. It also looks at whether the resolution was validly passed, whether shareholders of the same class are treated fairly, and whether the public and future investors are being given accurate information. Objecting members or creditors may be heard. In the 2026 IBN SINA Polymer judgment, the court confirmed an unopposed reduction made to correct an inflated subscription figure.

    It noted the absence of any objection after notice, and held that it can make the consequential directions needed to give full effect to a confirmation order.

    Where: High Court Division · Time: 1-3 hearing days; often 3-9 months after filing · Law: s.64 Companies Act 1994; Company Matter No. 1936 of 2025 (HCD, 05.07.2026) · Documents: Compliance affidavit on notices and creditors, Written submissions, Draft minute of reduction

  13. Step 13: Order confirming the reduction
    Step 13 · Confirmation order

    Order confirming the reduction

    The court confirms the reduction on such terms and conditions as it thinks fit and approves a minute showing the reduced share capital, the number of shares, the nominal value of each share and the amount deemed paid up on each. It decides whether the words 'and reduced' must be added to the name, and for how long. It can dispense with them entirely where no capital is paid back and no liability is reduced.

    Typical conditions include deadlines for filing with the RJSC, newspaper publication of the reduction and an affidavit of compliance back to the court.

    Where: High Court Division · Time: Judgment day; certified copy 1-4 weeks · Law: s.64 Companies Act 1994; s.61 proviso Companies Act 1994; Companies Rules 2009, rules 23-24; s.65(1)(b) Companies Act 1994 · Documents: Judgment and order, Court-approved minute, Certified copy of the order

    Tip: Apply for the certified copy on the day of judgment. Any deadline the court sets for filing usually runs from when the order is drawn up.

  14. Step 14: Register the order and minute with the RJSC
    Step 14 · Registration and implementation

    Register the order and minute with the RJSC

    The company produces the certified copy of the order and the approved minute to the RJSC, which must register them under section 65(1). This step is what makes the reduction legally effective: under section 65(2) the resolution takes effect on registration and not before. The Registrar then certifies the registration, and that certificate is conclusive evidence that the Act's requirements were met and that the capital is as stated in the minute. Courts often set a short deadline: in the IBN SINA Polymer case it was three weeks from the order being drawn up.

    Where: Registrar of Joint Stock Companies and Firms · Time: 2-6 weeks · Law: s.65(1), (2) and (4) Companies Act 1994 · Documents: Certified copy of the order, Court-approved minute, RJSC forms and fee receipt, Registrar's certificate of registration

  15. Step 15: Publish the registration and report compliance
    Step 15 · Registration and implementation

    Publish the registration and report compliance

    Notice of the registration is published as the court directs, under section 65(3), usually in two national dailies. The company then files an affidavit of compliance in the High Court Division with the newspaper pages and the RJSC certificate. The registered minute replaces the capital clause of the memorandum under section 66, and every copy of the memorandum issued afterwards must include it. A listed company also discloses the completed reduction of share capital in Bangladesh to the BSEC and the exchanges, and arranges for its shareholding records to be updated.

    Where: Board and general meeting of the company · Time: 2-6 weeks · Law: s.65(3) Companies Act 1994; s.66 Companies Act 1994 · Documents: Newspaper notices, Affidavit of compliance, Updated memorandum of association

  16. Step 16: Pay out, update registers and deal with tax
    Step 16 · Registration and implementation

    Pay out, update registers and deal with tax

    If capital is being paid back, payments are made to members on the register in line with the minute, and share certificates and the register of members are updated. The next annual return to the RJSC shows the new capital. Payments to shareholders may be treated as a dividend for income tax to the extent of the company's accumulated profits, so take tax advice before paying. Payments to non-resident shareholders are remitted through an authorised dealer bank under Bangladesh Bank's foreign exchange rules.

    After section 65 registration, members are not liable beyond the reduced amount on their shares, except to a creditor left off the list without knowing of the proceedings.

    Where: Board and general meeting of the company · Time: 1-3 months · Law: s.67 Companies Act 1994; Income Tax Act 2023 (definition of dividend); Foreign Exchange Regulation Act 1947 · Documents: Payment records, Updated register of members, New or endorsed share certificates, Tax deduction records, Bank remittance documents

Branches · appeal, revision, review, reference, remand

What if…? How the reduction of share capital in Bangladesh can change course

Choose a scenario. The map animates the route up the hierarchy and, where a case is sent back, down to the lower court and up again.

Route of this scenario
UpRemand
Appeal · Company Bench → Appellate Division

What if the company bench refuses confirmation, or an objector loses?

  1. 1
    Appellate Division of the Supreme Court

    Civil petition for leave to appeal

    There is no appeal from the company bench to another bench of the High Court Division. A company refused confirmation, or a creditor or member whose objection failed, files a civil petition for leave to appeal in the Appellate Division under Article 103 within sixty days of the order. An urgent application for stay can be heard by the Chamber Judge. Leave is granted only where a substantial question of law or a serious error is shown.

    60 days to file; 6-18 months to decide leaveArticle 103(3) Constitution of BangladeshOrder XIII rule 1 Supreme Court of Bangladesh (Appellate Division) Rules 1988
  2. 2
    Appellate Division of the Supreme Court

    Civil appeal and final decision

    If leave is granted, the petition becomes a civil appeal. The Appellate Division may affirm, set aside or vary the confirmation order, or impose new conditions for creditor protection. Its decision binds all courts under Article 111. Until a stay is granted, the company can register a confirmation order with the RJSC, but doing so while a leave petition is pending carries risk.

    1-3 yearsArticle 103 Constitution of BangladeshArticle 111 Constitution of Bangladesh

Where it ends up: The Appellate Division's decision is final, and the order it upholds or makes is registered with the RJSC.

Alternative route · Company Bench → Appellate Division

Is there a civil revision against the company bench's order?

  1. 1
    High Court Division

    Revision barred; leave or review instead

    Civil revision under section 115 of the Code lies to the High Court Division against subordinate courts. It cannot be used against the High Court Division's own orders, so interim orders of the company bench, such as directions on advertisement or a refusal to add a creditor to the list, cannot be revised. A party must ask the same bench to vary or review the order, or seek leave from the Appellate Division. Revision would matter only if a District Court had been notified to exercise company jurisdiction under section 3.

    Not applicables.115 Code of Civil Procedure 1908s.3(1) proviso Companies Act 1994Article 103 Constitution of Bangladesh

Where it ends up: Interim and final orders of the company bench are challenged by review or by leave to the Appellate Division, not by revision.

Review · Company Bench → Company Bench

Can the company bench reconsider its own order?

  1. 1
    High Court Division

    Review or correction by the same bench

    A party can ask the company bench to review its order under section 114 and Order XLVII of the Code, on discovery of new and important evidence, an error apparent on the face of the record or another sufficient reason. Clerical or arithmetical slips in the order or minute can be corrected under section 152. In practice the company also applies to the same bench for extensions of time or modified directions, for example where the RJSC deadline cannot be met.

    File promptly after the order; 1-6 monthss.114 Code of Civil Procedure 1908Order XLVII rule 1 Code of Civil Procedure 1908s.152 Code of Civil Procedure 1908

Where it ends up: The bench confirms, corrects or varies its own order, and the corrected order is filed with the RJSC.

Reference · Company Bench → Company Bench → Appellate Division

Can a doubtful point be referred to another court?

  1. 1
    High Court Division

    No section 113 reference; the bench decides

    A reference under section 113 and Order XLVI of the Code is made by a subordinate court to the High Court Division, so it does not apply where the High Court Division itself is the court of first instance. Disputed creditor claims are decided by the company bench under section 63 after an inquiry, as in a winding up. Where a judge doubts an earlier High Court Division decision, the judge may place the matter before the Chief Justice to form a larger bench.

    A question of general importance then goes to the Appellate Division on leave.

    Within the petitions.113 Code of Civil Procedure 1908s.63(b) Companies Act 1994Article 107(3) Constitution of Bangladesh

Where it ends up: The company bench decides the point itself, and any question of law is finally settled by the Appellate Division.

Remand · Company Bench → Appellate Division → Company Bench → Appellate Division

What if the Appellate Division sends the petition back?

  1. 1
    Appellate Division of the Supreme Court

    Order set aside and petition remitted

    If the Appellate Division finds that the company bench confirmed the reduction without a properly settled list of creditors, or refused it on a wrong view of the law, it can set the order aside and send the petition back for fresh hearing. It usually gives directions, for example to issue fresh notices, settle the list again or secure a disputed claim.

    On judgmentArticle 103 Constitution of BangladeshArticle 104 Constitution of Bangladeshs.62(2) Companies Act 1994
  2. 2
    High Court Division

    Rehearing in the company bench

    The company matter is restored to the High Court Division. The company complies with the directions, files fresh affidavits of service and creditor compliance, and the bench hears the petition again on the corrected record. It then makes a new order confirming or refusing the reduction, with any conditions, and approves a fresh minute if the figures have changed.

    3-9 monthsss.62-64 Companies Act 1994Companies Rules 2009
  3. 3
    Appellate Division of the Supreme Court

    Back to the Appellate Division if needed

    The new order can again be challenged by a civil petition for leave to appeal within sixty days. A second trip is unusual, because the remand directions normally resolve the point. Once no challenge is pending, the order and minute are registered with the RJSC and the reduction of share capital in Bangladesh takes effect.

    60 days to fileArticle 103 Constitution of BangladeshOrder XIII rule 1 Appellate Division Rules 1988

Where it ends up: The reduction is confirmed or refused on rehearing, and a confirmed reduction is then registered with the RJSC.

Review · Appellate Division → Appellate Division

Can the Appellate Division review its own judgment?

  1. 1
    Appellate Division of the Supreme Court

    Review under Article 105

    After a final Appellate Division judgment, the only further remedy is a review petition under Article 105, filed within thirty days. In a civil matter the grounds are similar to Order XLVII of the Code, such as an error apparent on the face of the record. A review is not a rehearing of the appeal, and it is rarely granted.

    30 days to file; 3-12 monthsArticle 105 Constitution of BangladeshOrder XXVI rules 1-2 Appellate Division Rules 1988

Where it ends up: The Appellate Division's judgment stands or is corrected, and the matter closes.

Alternative route · Creditors → Company Bench

What if a creditor was left off the list?

  1. 1
    High Court Division

    Members' liability to an unlisted creditor

    After registration, members are not liable beyond the reduced amount on their shares. But if a creditor entitled to object was left off the list because it did not know of the proceedings, and the company later cannot pay that creditor, the members at the date of registration can be made to contribute what they would have owed in a winding up begun the day before registration. In a winding up, the court can settle a list of those members on the creditor's application.

    Arises only if the company later failss.67(1) proviso Companies Act 1994s.68 Companies Act 1994

Where it ends up: A creditor the company overlooked keeps a remedy against members, which is why a complete creditors' list matters.

Lower court to higher court

How the reduction of share capital in Bangladesh moves up the court hierarchy

A reduction of share capital in Bangladesh begins at tier one. Section 3 of the Companies Act 1994 makes the High Court Division the Court, and petitions are heard in its statutory original jurisdiction by a single-judge company bench. There is no value threshold and no lower civil court: the same bench hears a Tk 10 lakh correction and a listed company's write-off of hundreds of crores. The Government may notify a District Court to exercise company jurisdiction, but that is not the usual route.

The Commercial Courts Act 2026 (Act 23 of 2026) does not take over matters within the High Court Division's original jurisdiction (s.2(gha)). Before the court stage, the company acts through its board and shareholders, and a listed company deals with the BSEC and the exchanges. After the order, the RJSC registers it. From the company bench there is no intra-court appeal and no revision. A party goes to the Appellate Division by civil petition for leave under Article 103, and that court decides mainly questions of law.

  1. Appellate DivisionAppellate Division of the Supreme Court
  2. High Court DivisionHigh Court Division
  3. Start · outside courtCompany's lawyer · Board and general meeting of the company · Bangladesh Securities and Exchange Commission and stock exchanges (listed companies) · Creditors and lending banks · Registrar of Joint Stock Companies and Firms
Courts & addresses

Where your case is heard

Addresses are for Dhaka. Every district has equivalent courts at its own district judgeship.

Appellate Division

Supreme Court of Bangladesh (Appellate Division and High Court Division)

Supreme Court of Bangladesh, Shahbag, Ramna, Dhaka-1000

Hears appeals, revisions, references, writ petitions under Article 102, company matters and death references (High Court Division), and appeals by leave from the High Court Division (Appellate Division).

Both Divisions sit in the Supreme Court complex; many High Court Division benches sit in the Annex Building. Check the daily cause list for the bench and court room. Postal contact is the Registrar General, Supreme Court of Bangladesh, Ramna, Dhaka-1000.

Start · outside court

Company's lawyer

Where this happens depends on your district or the office concerned. Ask us for the exact courtroom and address.

Start · outside court

Board and general meeting of the company

Where this happens depends on your district or the office concerned. Ask us for the exact courtroom and address.

Start · outside court

Bangladesh Securities and Exchange Commission (BSEC)

Securities Commission Bhaban, E-6/C Agargaon, Sher-e-Bangla Nagar Administrative Area, Dhaka-1207

Regulates the capital market, listed companies, stock exchanges and market intermediaries under the Securities and Exchange Commission Act 1993; a listed company may need its consent for capital changes.

Address as published on the Commission's official website.

Start · outside court

Creditors and lending banks

Where this happens depends on your district or the office concerned. Ask us for the exact courtroom and address.

Start · outside court

Office of the Registrar of Joint Stock Companies and Firms (RJSC)

TCB Bhaban (7th floor), 1 Kawran Bazar, Dhaka-1215

Registers companies, partnership firms and societies, and receives annual returns and statutory filings under the Companies Act 1994.

Head office (Dhaka). Filing is mostly online. RJSC also has offices in Chattogram, Khulna and Rajshahi. PABX +88 02 55013776.

Indicative timeline

How long each stage takes

These are indicative ranges based on typical Dhaka practice. Adjournments, case backlogs and appeals can stretch them.

Planning the reduction
0.5–2 months
Shareholder approval
0.5–1 months
Court petition and creditors
2–8 months
Confirmation order
1–4 months
Registration and implementation
1–3 months
Dark bar = faster cases · light bar = slower casesFirst-instance journey: 5–18 months · Overall: Indicative range based on typical Dhaka practice: about 6-12 months from board decision to RJSC registration where no creditor objects; 1-2 years or more if creditors object or the order is taken to the Appellate Division
Prepare

Documents checklist and key terms

Tick off what you have. Your ticks stay saved in this browser. Bring the list to your first meeting with your lawyer.

Special resolution
A resolution passed by at least three-fourths of the members voting at a general meeting called with at least twenty-one days' notice (s.87(2) Companies Act 1994).
Paid-up capital
The part of the nominal value of issued shares that members have actually paid to the company.
Confirmation order
The High Court Division's order under s.64 approving the reduction, on any terms it sets.
Minute of reduction
The court-approved statement of the new capital, number and nominal value of shares and amount paid up, registered with the RJSC and substituted into the memorandum.
List of creditors
The list the court settles under s.62(2) of creditors entitled to object to the reduction.
'And reduced'
Words the company may have to add to its name for a period fixed by the court (s.61), which the court can dispense with.
Company bench
The High Court Division judge assigned by the Chief Justice to hear matters under the Companies Act.
Civil petition for leave to appeal
The application to the Appellate Division for permission to appeal a High Court Division order, filed within sixty days.
Questions

Reduction of share capital in Bangladesh: common questions

Can a company reduce its capital without going to court?
Not if it is a true reduction. Section 59 makes every reduction subject to confirmation by the High Court Division. The only exception is cancelling authorised shares that nobody has taken or agreed to take, which is an alteration under section 53(1)(e) and is expressly not a reduction. A company also cannot buy back its own shares except through the reduction procedure.
What majority of shareholders is needed?
A special resolution: at least three-fourths of the members entitled to vote who are present in person or by proxy, at a meeting called with at least twenty-one days' notice stating the intention to propose it as a special resolution. Shorter notice is allowed only if every member entitled to attend and vote agrees. The articles must also authorise reduction.
Do creditors have to agree?
If the reduction involves paying capital back or reducing liability on unpaid shares, every creditor on the court's list must consent, be paid or be secured before the court confirms. For other reductions, such as writing off lost capital, creditors can object only if the court allows. The court can dispense with a refusing creditor's consent if the company secures the claim under section 63.
How long does a reduction of share capital in Bangladesh take?
As an indicative range based on typical Dhaka practice, an unopposed petition takes about six to twelve months from the board decision to RJSC registration. In the 2026 IBN SINA Polymer case, the special resolution was passed in October 2025 and confirmed in July 2026. Objections from creditors or an appeal to the Appellate Division can add a year or more.
When does the reduction actually take effect?
Only when the RJSC registers the certified copy of the court's order and the court-approved minute under section 65. The resolution has no effect before then. The Registrar's certificate of registration is conclusive evidence that the Act was complied with and that the capital is as stated in the minute, so it is the document to keep.
Does a listed company need BSEC approval?
The Companies Act requires only a special resolution and the High Court Division's confirmation, and no BSEC rule expressly requiring prior approval could be confirmed. But a listed company must disclose the proposal as price-sensitive information, deal with the BSEC and the exchanges, and respect the minimum paid-up capital in the listing regulations. Check the current BSEC directives before announcing.
Can the court refuse to confirm?
Yes. Confirmation is discretionary. The court must be satisfied about every creditor entitled to object, and it also considers whether the resolution was valid, whether shareholders of the same class are treated fairly and whether the public is properly informed. It can confirm on conditions, such as publishing reasons under section 69, or refuse.
Can a reduction of share capital in Bangladesh be used to correct wrong capital records?
Yes, in the right case. In The IBN SINA Polymer Industries Ltd (2026), a typing error at incorporation had inflated the subscribed capital tenfold. The High Court Division confirmed a reduction to the true figure, dispensed with the words 'and reduced', and directed the RJSC to correct the company's past annual returns and electronic records.

Law and sources

  1. Companies Act 1994, Laws of Bangladesh
  2. Companies Act 1994, Bangla text with amendments (mirror)
  3. The IBN SINA Polymer Industries Ltd v Registrar, RJSC, Company Matter No. 1936 of 2025 (HCD, 05.07.2026)
  4. Commercial Courts Act 2026 (Act 23 of 2026), Bangla text (mirror)
  5. Code of Civil Procedure 1908, Laws of Bangladesh
  6. Constitution of the People's Republic of Bangladesh, Laws of Bangladesh
  7. The Financial Express: RN Spinning Mills decides to reduce paid-up capital (June 2020)
  8. The Financial Express: 64 cos get Dec 31, '22 deadline (minimum paid-up capital, December 2021)

This Case Journey is a general guide to procedure in Bangladesh as of October 2026. It is not legal advice. Procedure, fees and time limits change, and every case turns on its own facts. Timelines are indicative. Speak to a lawyer about your own matter.

Living abroad?

Run this case from outside Bangladesh

You can usually start and run this case without travelling. You sign a power of attorney abroad, the Bangladesh High Commission or Embassy attests it, and your attorney and lawyer act for you in Dhaka. Some steps, such as giving evidence in person, may still need you or a commission. See how a case runs through a power of attorney →

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