There is no dedicated statutory procedure for recognising foreign insolvency proceedings in Bangladesh, because the UNCITRAL Model Law on Cross-Border Insolvency has not been adopted. That does not mean a foreign proceeding has no effect, but it must be given effect through other routes, such as exercising shareholder rights over a local subsidiary, enforcing a foreign judgment where the conditions are met, or commencing local proceedings. Outcomes depend on the facts and the relief sought. For any cross-border insolvency with Bangladeshi assets, we assess these routes at the outset and advise on the most practical sequence.

The subsidiary is a separate company under Bangladeshi law and is not automatically in insolvency because its parent is. The foreign administrator usually controls the parent's shareholding and may exercise shareholder rights to change directors or approve a sale of the subsidiary, subject to the subsidiary's articles, local approvals and any lender security. Local directors remain responsible under Bangladeshi law. Local creditors may still sue the subsidiary. We advise office-holders and local boards on governance, continuity of operations, sale processes and protection of value during the parent's cross-border insolvency. Continuity of banking and supply relationships is often the first priority.

A creditor, foreign or local, may petition the High Court Division to wind up a company that is unable to pay its debts, under the Companies Act 1994. Winding up is a serious remedy, and courts examine whether the debt is genuinely due and undisputed. Petitions are sometimes used to pressure debtors, and an abusive petition may be resisted. For foreign creditors, the petition should be considered alongside other options, such as enforcing security, a money suit, arbitration or participation in a restructuring. We advise on the merits, evidence and strategy before a petition is filed or defended.

Yes, the Companies Act 1994 provides for compromises and arrangements between a company and its creditors or members, sanctioned by the court after meetings and the required majorities. Schemes can bind dissenting creditors within a class, which makes them useful for restructuring. They require careful class formation, disclosure and court applications, and foreign creditors may need parallel arrangements abroad for the restructuring to be effective against them. In a cross-border insolvency, we consider whether a Bangladeshi scheme, a foreign scheme or restructuring plan, or both, will best achieve the desired result. Class formation needs particular care.

Foreign judgments may be enforced in Bangladesh under the Code of Civil Procedure 1908, either by execution where the judgment comes from a superior court of a reciprocating territory, or by bringing a suit on the judgment. In both cases, the debtor may raise limited defences, such as lack of jurisdiction, fraud, breach of natural justice or conflict with Bangladeshi law. Foreign arbitral awards are enforced under the Arbitration Act 2001. Insolvency-related orders raise additional questions. We assess the judgment, the debtor's assets and the likely timetable, and coordinate enforcement with any related insolvency proceedings abroad.

Foreign borrowing by Bangladeshi companies is subject to approvals and conditions, including scrutiny of terms by the authorities and Bangladesh Bank rules on repayment and remittance. Changing repayment schedules, interest, currency or the identity of the lender, or converting debt into equity, may require fresh approvals or notifications, now involving Invest Bangladesh and Bangladesh Bank. Withholding tax on interest paid to non-residents also applies, at 10 per cent following the Finance Act 2026. We map required approvals early, because foreign exchange issues frequently determine the timetable of cross-border insolvency and restructuring transactions involving Bangladeshi borrowers.

Yes. Bangladeshi insolvency law includes provisions allowing certain transactions entered into before winding up or bankruptcy, such as fraudulent preferences and transfers intended to defeat creditors, to be challenged in appropriate circumstances. General law on fraud and fraudulent transfers may also apply. Foreign office-holders may seek to challenge transactions involving Bangladeshi assets, and local liquidators may pursue transactions abroad. Evidence and timing are important. We advise office-holders, creditors and counterparties on the risk of challenge, and on defending or pursuing such claims in a cross-border insolvency context. Records should be preserved promptly. Both sides benefit from early analysis.

Directors should obtain a clear view of the company's financial position, cash flow and obligations, take advice early, keep proper records of decisions and reasons, and avoid transactions that favour particular creditors or move assets without proper value. Engagement with banks and key creditors is usually better than silence. Where foreign creditors or a foreign parent are involved, directors should understand how decisions here affect proceedings abroad. We help boards evaluate options, communicate with stakeholders and plan a restructuring or orderly process that protects the company and reduces personal risk for directors. Early action keeps more options open.