There is no single green bond statute. Green and other labelled bonds are issued under the general framework for debt securities administered by the Bangladesh Securities and Exchange Commission, with green features defined in the issuer's framework and offer documents by reference to recognised market standards. Bangladesh Bank's sustainable finance policy and taxonomy are relevant where banks and financial institutions are involved. We check the current rules at the time of the transaction and structure the issue to meet both regulatory requirements and investor expectations. Issuers should confirm which regulator's approval applies to the intended use of proceeds.

A green loan finances specific eligible projects, such as solar installations or effluent treatment plants, and the borrower must report on the use of proceeds. A sustainability-linked loan can be used for general corporate purposes, but its margin rises or falls depending on whether the borrower meets agreed sustainability performance targets, such as reduced emissions or water use. We help clients choose the right instrument and draft the documents so that obligations, reporting and pricing mechanics are clear and workable. Both have a place in Bangladesh. Investor appetite and the borrower's ability to measure targets usually decide which structure fits.

Bangladeshi law does not impose a general requirement for every labelled transaction, but market standards strongly encourage external review, such as a second-party opinion on the framework or verification of reported data and performance targets. International investors and development lenders often require it. A reputable review supports credibility and reduces greenwashing risk. We advise on the type of review needed, the scope of engagement and the interaction between the reviewer's findings and the legal documents, including disclaimers, reliance and the consequences of a negative or qualified finding. Reviews also help with pricing. We also negotiate engagement letters.

The Invest Bangladesh Act 2026 merged BIDA, BEZA and the PPP Authority into Invest Bangladesh, which has operated since 23 August 2026. Foreign borrowing approvals that were previously handled by BIDA now involve Invest Bangladesh, alongside Bangladesh Bank's foreign exchange role. Transitional arrangements and procedural details are still bedding in. For a green or sustainability-linked facility from an international lender, we confirm the current approval route, prepare the application and supporting documents, and build realistic approval timing into the transaction timetable and conditions precedent. We monitor every change closely. Lenders expect accurate timing, so we plan carefully.

Interest paid to non-resident lenders is generally subject to withholding tax, and the Finance Act 2026 reduced the rate to 10 percent from 20 percent. Treaties may provide further relief in some cases. Facility agreements usually contain gross-up clauses that shift the cost of withholding to the borrower, so the tax position directly affects pricing. Stamp duty, VAT on fees and the treatment of margin adjustments may also need attention. We coordinate with tax advisers so that the economics are clear before signing. Borrowers should model the gross-up cost before agreeing margin or fees.

Yes. Exporters investing in energy efficiency, rooftop solar, water recycling, effluent treatment and certified green factory buildings are natural candidates for green loans and refinancing schemes promoted by Bangladesh Bank. International buyers increasingly expect suppliers to show progress on environmental performance, and financing linked to those improvements can support both compliance and competitiveness. We advise exporters on eligibility, documentation and evidence requirements, and on how sustainability commitments in loan documents interact with commitments made to buyers, auditors and certification bodies. Exporters should plan financing alongside compliance programmes. Buyers increasingly ask about financing.

In a sustainability-linked facility, missing a target usually leads to a margin increase or, in a bond, a coupon step-up, rather than an event of default. However, failure to report, inaccurate reporting or misleading statements can have more serious consequences, including default or misrepresentation claims. The documents should define the targets, measurement methods, verification process and consequences precisely. We draft these provisions carefully and advise borrowers on internal processes for collecting reliable data, so that the risk of performance disputes is reduced. Reporting should come from systems with named owners, and recalibration terms should be stated.

Greenwashing risk arises when environmental or social claims about a product, project or company are inaccurate, exaggerated or poorly supported. It can lead to investor complaints, regulatory scrutiny, reputational harm and contractual claims. Managing it starts with a robust framework, careful marketing language, reliable data and external review. It continues with honest reporting over the life of the instrument. We review documents and communications for consistency and help clients put governance in place that supports their claims to the market. Honesty is the best defence. Board approval of the framework helps show that public claims were made carefully.