Arbitration Process in Bangladesh 2026: How to File and Run an Arbitration Step by Step

The arbitration process in Bangladesh: from notice to award

The arbitration process in Bangladesh is set by two layers of rules: the Arbitration Act 2001, which supplies the mandatory framework and the default procedure, and whatever procedural rules the parties have chosen, most often the BIAC Arbitration Rules 2019 or the UNCITRAL Rules. Between them they decide when a claim is treated as started, who appoints the tribunal if a party stalls, how long each side has to plead, and what the award must contain to survive scrutiny in court. Getting the sequence right from the first notice is what separates an arbitration that runs to an enforceable award from one that stalls in satellite litigation.

This guide follows a claim from start to finish. It covers the notice of arbitration and how to file, constitution of the arbitral tribunal, challenges, jurisdiction objections, the preliminary meeting and procedural orders, the statement of claim and defence, evidence and hearings, the award, corrections, and the costs that fall due at each stage. It also gives realistic timelines under the Act and under the BIAC Rules, and the practical documents you need at every step.

Summary: An arbitration seated in Bangladesh starts when the respondent receives a notice of arbitration (or, under the BIAC Rules, when BIAC receives the Request). The tribunal is then constituted, usually within 30 days of a request, with the District Judge or the Chief Justice stepping in on default. The tribunal sets the procedure, the parties exchange a statement of claim and defence, evidence is heard, and a reasoned award follows. Under the BIAC Rules the award is due within 60 days of the hearings closing.

Key point: The Arbitration Act 2001 sets no overall time limit for an award, so the timetable depends on the rules the parties chose and the procedural orders the tribunal makes. Choosing institutional rules with fixed periods, such as the BIAC Rules, is the single most effective way to keep an arbitration on schedule.

At a glance

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Table of Contents

How the arbitration process in Bangladesh is structured

The Arbitration Act 2001 governs every arbitration seated in Bangladesh. It follows the 1985 UNCITRAL Model Law but has not adopted the 2006 amendments, and its only substantive amendment, in 2004, added section 7A on court-ordered interim measures.[7] Readers who want the full statutory architecture should read our companion analysis of the Arbitration Act 2001 framework; this guide is about the moving parts of a live case.

Three principles shape every step: the arbitral tribunal follows the procedure the parties agreed and decides it only where they have not; it is not bound by the Code of Civil Procedure or the Evidence Act; and it must act fairly, give each party a reasonable opportunity to present its case, and proceed as quickly as possible.[2]

Ad hoc or institutional arbitration

An ad hoc arbitration runs on the Act's default rules, often with the UNCITRAL Rules. An institution, by contrast, administers the file and holds deposits. The Bangladesh International Arbitration Centre (BIAC), which began operating in April 2011, administers cases under the BIAC Arbitration Rules 2019, and parties are equally free to choose ICC, SIAC or another institution.[6] [7] The BIAC Rules attach fixed periods to almost every stage the Act leaves open.

Domestic or international: which court supports the arbitration

The Act defines an international commercial arbitration by reference to the parties, not the subject matter: at least one party must be a foreign national or habitual resident, a foreign-incorporated body corporate, an entity whose central management and control is abroad, or a foreign government.[2] That decides which court supports the arbitration process in Bangladesh: the District Judge or District Court for domestic cases; the Chief Justice (appointments) and the High Court Division (interim measures, setting aside) for international ones.[2] Under section 53 the first court seised keeps every later application under the same agreement, so choose it deliberately.[2]

Before you file: preparation that protects the claim

Most procedural mistakes in the arbitration process in Bangladesh happen before the notice of arbitration is sent.

Read the clause closely

Confirm the seat, the rules, the number of arbitrators, the language, any appointment mechanism and any pre-arbitration steps such as negotiation between senior executives or mediation. An arbitration agreement must be in writing, which includes an exchange of email or other communications that records the agreement.[2] If the clause is unclear or contested, our analysis of arbitration agreement enforceability in Bangladesh explains how courts approach validity; a parallel TRW guide covers drafting the clause itself.

Check limitation

The Limitation Act 1908 applies to arbitrations as it applies to court proceedings, and for limitation purposes the arbitration is treated as commenced on the date fixed by section 27.[2] Where a contract shortens the time for starting arbitration, the court has power to extend it on terms if justice requires.[2]

Honour pre-arbitration steps

Comply with, and document, any negotiation or mediation tier in the clause without letting limitation run. A well-drafted legal notice can start the contractual clock.

Build the evidence file

Collect the contract and all amendments, correspondence, invoices, payment records, minutes, technical reports and witness details. Under the BIAC Rules every written statement must be filed with copies of the supporting documents and verified by the party and its counsel, so the file needs to be complete at the outset.[3]

Step 1: How to file for arbitration in Bangladesh

The notice of arbitration in an ad hoc case

Unless the parties agree otherwise, section 27 treats the proceedings as commenced when a dispute has arisen under the arbitration agreement and a party has received from the other a notice requiring it to refer, or concur in referring, the dispute to arbitration, or to appoint, join in or approve the appointment of a tribunal.[1] [2] A well-drafted notice of arbitration identifies the parties, quotes the arbitration clause, summarises the dispute and relief sought, proposes the number of arbitrators and names the claimant's arbitrator (or proposes a sole arbitrator), and calls on the respondent to appoint or agree within 30 days.

The Request for Arbitration at BIAC

Under the BIAC Rules the notice of arbitration takes the form of a Request for Arbitration, which the claimant files with BIAC and the respondent, and the proceedings commence on the date BIAC receives it; the Secretary General then notifies the respondent.[3] Rule 3 requires the Request to include:

• the parties' and representatives' contact details;
• the contract and arbitration agreement relied on;
• a brief statement of the claim, relief and amount;
• views on the number of arbitrators, place, law and language;
• a nomination or proposal for the tribunal; and
• payment of the registration fee.[3]

The claimant's registration fee is BDT 20,000 under the standard schedule and BDT 15,000 for fast-track cases; it is non-refundable and BIAC will not proceed without it.[4]

Serving the notice of arbitration correctly

The Act deems a notice received if delivered personally or at the addressee's business, residence or mailing address, or, failing those after reasonable inquiry, sent by registered letter to the last known address.[2] The BIAC Rules accept registered post, courier, fax and email with a record of transmission.[3] Keep the proof: an award can be set aside where a party was not given proper notice of the appointment of an arbitrator or of the proceedings.[2]

The response and any counterclaim

The Act does not prescribe a response to the notice, but the BIAC Rules give the respondent 30 days from receipt of the Request to file a Response with a brief answer, any counterclaim, its arbitrator nomination and the counterclaim registration fee. The claimant then has 30 days to reply to any counterclaim. If the respondent does not respond, BIAC proceeds regardless.[3]

Step 2: Constituting the arbitral tribunal

Constitution of the arbitral tribunal is where delay most often enters the arbitration process in Bangladesh.

How many arbitrators

The parties are free to fix the number. If they do not, the Act provides for three. Where the parties choose an even number, the appointees jointly appoint an additional arbitrator to chair the arbitral tribunal.[1] [2] The BIAC Rules reverse the default: where the clause is silent and the parties cannot agree, a sole arbitrator is appointed by the BIAC Arbitration Committee unless it considers three more appropriate.[3]

Appointment and the court's default powers

Parties may agree any appointment procedure. Failing agreement, if the parties cannot agree on a sole arbitrator within 30 days of a request, or a party fails to appoint its arbitrator within 30 days of a request, or the two party-appointed arbitrators fail to agree on the chair within 30 days of their appointment, either party may apply to the District Judge (domestic) or to the Chief Justice or a Supreme Court judge he designates (international commercial arbitration).[1] [2] The appointment must be made within 60 days of receipt of the application and the decision is final.[2]

Appointment under the BIAC Rules

Under the BIAC Rules, each side nominates one arbitrator and the two appoint the presiding arbitrator. If a party fails to nominate within 30 days of a request, or the co-arbitrators fail to agree on the chair within 30 days, the Arbitration Committee appoints. It circulates at least three names, and each party has 10 days to strike any it objects to.[3]

Disclosure and challenges

An arbitrator must disclose any circumstances likely to give rise to justifiable doubts about independence or impartiality, both before accepting and throughout the case. A challenge lies only on those grounds or for lack of agreed qualifications, and a party can challenge its own appointee only for reasons learned after the appointment.[2]

Absent an agreed procedure, the challenging party must send a written statement of reasons to the arbitral tribunal within 30 days of learning of the circumstances; the tribunal decides within 30 days; an aggrieved party may appeal to the High Court Division within 30 days; and the High Court Division must decide within 90 days.[1] [2] The BIAC Rules are tighter: notice of challenge within 14 days, and if the other party does not agree and the arbitrator does not withdraw within 7 days, the Arbitration Committee decides and its decision is final.[3]

Step 3: Jurisdiction objections and interim measures

Objections to jurisdiction

The arbitral tribunal may rule on its own jurisdiction, including the existence and validity of the arbitration agreement, and the arbitration clause is treated as separable from the main contract.[1] [7] A jurisdictional objection must be raised before the statement of defence is filed; the tribunal may admit a late plea if the delay is justified.[1] The High Court Division may decide jurisdiction on application only where that is likely to save substantial costs, the application was prompt and there is good reason, and the arbitration may continue meanwhile.[7]

A party that knowingly proceeds without promptly objecting to non-compliance is deemed to have waived the objection.[2]

Interim measures from the tribunal and the court

Unless the parties agree otherwise, the arbitral tribunal may order interim measures at a party's request and may require security. No appeal lies against the order, notice to the other side can be dispensed with if delay would defeat the measure, and the court can enforce the order on application.[1] [2] Under section 7A the court, or the High Court Division in international cases, may grant injunctions, receivers, and custody, preservation and inspection orders, before or during the proceedings or until enforcement.[2] Section 7A relief is not available before or during a foreign-seated arbitration.[7]

Step 4: Tribunal rules, the preliminary meeting and procedural orders

Once constituted, the arbitral tribunal fixes the procedure, usually in a first procedural order. Section 25 lists the matters it may decide absent agreement, including time and place of hearings, language and translation, the form and timing of the statement of claim and defence, disclosure, and the admissibility and weight of evidence. The tribunal may fix and extend time limits for compliance with its orders.[2]

The preliminary conference under the BIAC Rules

The BIAC Rules require a preliminary conference, in person or by teleconference, no later than 21 days after the tribunal is constituted, to settle the provisional timetable, information exchange, hearing length and venue, deadlines for witness statements and expert reports, and hearing dates.[3] In a fast-track arbitration it must be held within 10 days.[3]

What Procedural Order No 1 should cover

The first meeting produces a procedural order. Use it to settle:

• the timetable to the hearing and document production;
• witness statements, cross-examination and experts;
• language, bundles, venue and virtual participation; and
• confidentiality and deposits.

The Act itself is silent on confidentiality and on discovery, privilege and cross-examination, so these points depend on agreement, the chosen rules or the procedural order.[7] The BIAC Rules supply defaults: hearings are private and confidential, English is the language if the clause is silent, Dhaka is the seat absent agreement, and ex parte communications with the tribunal are prohibited.[3]

Representation

Unless otherwise agreed, a party may be represented by a lawyer or any other person it chooses.[2] Local Bar admission is not required, which allows foreign counsel to appear alongside Bangladeshi lawyers.[7] At BIAC, have board resolutions and powers of attorney ready as proof of authority.[3]

Step 5: Statement of claim, defence and further submissions

Within the time fixed by the arbitral tribunal, the claimant must set out the facts supporting the claim, the points at issue and the relief sought, and the respondent must answer them. Parties may attach all documents they consider relevant or refer to evidence they will produce later, and either side may amend or supplement its case unless the tribunal considers it inappropriate because of unfairness or delay.[2]

Pleading timetable under the BIAC Rules

The BIAC Rules fix the sequence: statement of claim within 30 days of constitution of the tribunal; statement of defence and any counterclaim within 30 days of receiving the claim; the claimant's rejoinder and defence to counterclaim within 14 days; and the respondent's rejoinder within a further 14 days. Amendments need the tribunal's permission.[3]

Drafting a statement of claim that works

A statement of claim should do more than repeat the notice of arbitration: plead the terms, chronology, breaches, causation and each head of loss with calculations, interest and costs, with an indexed document bundle. Our guide to breach of contract in Bangladesh sets out the substantive remedies most commercial claims rely on.

What happens if a party defaults

Under section 35, if the claimant fails to file its statement of claim, the arbitral tribunal must terminate the proceedings. If the respondent fails to file a defence, the tribunal continues without treating the failure as an admission. The tribunal may dismiss a claim for inordinate and inexcusable delay that creates a substantial risk of unfairness or serious prejudice, may proceed in a party's absence after due notice, may dismiss a claim where the claimant fails to provide ordered security for costs, and for other defaults may exclude material, draw adverse inferences, proceed on the existing record or order costs.[2]

Step 6: Evidence and the hearing

Unless the parties agree otherwise, evidence may be given orally, in writing or by affidavit, and the arbitral tribunal may administer an oath or affirmation with the witness's consent.[2] Because the Evidence Act does not bind the tribunal, admissibility and weight are matters for the tribunal's judgement rather than technical rules.[2]

Documents and witness statements

Every statement, document or application one party gives the tribunal must be communicated to the other, as must any expert report or document the tribunal may rely on.[2] Under the BIAC Rules the tribunal may order the exchange of witness statements and expert reports and may direct that written statements stand as evidence-in-chief; each party must identify its witnesses, their subject and language at least 15 days before the hearing.[3]

Experts and reluctant witnesses

The tribunal may appoint its own expert or assessor, and the parties may comment on the report and question the expert. The tribunal, or a party with its approval, may also apply to the court for a summons compelling a witness to attend or produce material, with default punishable as in a civil suit.[2]

The oral hearing

The arbitral tribunal decides whether to hold oral hearings or proceed on documents, but it must hold a hearing at an appropriate stage if a party asks, unless the parties agreed there would be none. The parties must receive sufficient advance notice of every hearing and inspection.[2] The BIAC Rules require at least five working days' notice, oral hearings to start within 30 days after written pleadings close, and the hearing to conclude within 180 days of the first hearing day; a party seeking an extension pays a further registration fee.[3]

Settlement during the arbitration

The tribunal may, with all parties' agreement, use mediation or conciliation at any point to encourage settlement. If the parties settle, the tribunal will on request record the terms as an award on agreed terms, which has the same status as any other award.[2]

Step 7: The award

In a tribunal of more than one arbitrator, decisions are made by majority unless the parties agree otherwise, and procedural questions may be left to the chair if authorised.[2] Under the BIAC Rules, if there is no majority the presiding arbitrator decides alone.[3]

Form and content

Section 38 requires the award to be in writing and signed by the arbitrators; in a panel the majority's signatures suffice if the reason for the missing signature is stated. Reasons must be given unless the parties agreed otherwise or the award records a settlement. The award must state its date and the place of arbitration, and a signed copy must be delivered to each party.[2]

Interest and costs in the award

Unless otherwise agreed, the tribunal may award interest at a reasonable rate for all or part of the period from the cause of action to the award, and the sum awarded carries post-award interest at two per cent per annum above the Bangladesh Bank rate unless the award directs otherwise.[2] The tribunal fixes the costs and must state who is entitled to them, who pays, the amount or method of calculation and how payment is made. Costs include reasonable fees and expenses of the arbitrators and witnesses, legal fees, institutional fees and other expenses of the proceedings.[2]

When the award is due

The Act imposes no deadline for the award.[7] The BIAC Rules require the award within 60 days of the close of oral hearings, save in exceptional circumstances, and the tribunal deposits the original with BIAC, which releases certified copies once the costs are fully paid.[3] In an ad hoc case, agree a target date for the award in the first procedural order.

Correction, interpretation and additional awards

Within 14 days of receiving the award a party may, on notice to the other side, ask the tribunal to correct computational, clerical or typographical errors. The tribunal acts within 14 days if it considers the request justified, and may correct such errors on its own initiative within 14 days of the award. A party may also ask within 14 days for an additional award on claims presented but omitted, which the tribunal makes within 60 days if justified.[2] The BIAC Rules adopt the same 14-day request window and allow requests for interpretation.[3]

Timelines in the arbitration process in Bangladesh

The table below sets the statutory periods beside those under the BIAC Rules. Where the Act is silent, the timetable is whatever the tribunal orders. On a phone, scroll it sideways.

BIAC's own guidance anticipates an arbitration concluding in roughly 180 days with the award following within 60 days, and the Rules set an outer limit of 388 days for standard cases, which the tribunal must keep in view when extending deadlines.[3] [5] Where the amount in dispute, including counterclaims, does not exceed Tk 50 million, any party may ask BIAC before the preliminary conference to treat the case as a fast-track arbitration, with the award due within three months of constitution of the tribunal unless exceptionally extended.[3]

Costs at each stage of the arbitration

Costs in the arbitration process in Bangladesh fall into institutional fees, arbitrators' fees, the parties' own legal and expert costs, and court costs. Budget for each at the outset.

Filing and administration

At BIAC, the registration fee is BDT 20,000 for the claimant (and the same for a respondent bringing a counterclaim), and the administrative fee is scaled to the amount in dispute, starting at BDT 30,000 for claims up to Tk 5 million and capped at BDT 255,000 for claims above Tk 1,000 million. VAT at 15 per cent is added.[4]

Arbitrators' fees and deposits

Where both parties accept BIAC's arbitrator fee scale, a claim up to Tk 5 million attracts BDT 100,000 to BDT 500,000, rising by bands.[4] Under the Act the arbitral tribunal may fix a deposit as an advance on costs, payable in equal shares; if one party fails to pay, the other may pay its share, and if neither pays the tribunal may terminate the proceedings on that claim or counterclaim.[2] Under the BIAC Rules, deposits are called on constitution of the tribunal; if unpaid after 14 days and a 7-day reminder, the case continues ex parte against the defaulting party, with the paying party reimbursed in the award.[3]

Holding back the award

The tribunal has a lien on the award for unpaid costs. If it refuses to release the award until fees are paid, a party whose fees were not fixed in writing may pay the sum demanded into court and ask the court to determine what is reasonable.[2] Agree fees in writing at the start, keep time records from day one and file a costs schedule with closing submissions.

After the award: the next 60 days

An award is final and binding on the parties and those claiming through them, but the statutory challenge right survives.[2] An application to set aside must be made within 60 days of receiving the award, to the District Court for domestic awards or to the High Court Division for awards in international commercial arbitrations held in Bangladesh, on the limited grounds in section 43. The court may order any sum payable under the award to be deposited or secured while the application is pending.[2] Once the period expires or a challenge is refused, the award is enforced under the Code of Civil Procedure as a decree of the court where it was made and signed.[2]

Execution is covered in TRW's separate guides to enforcing domestic awards and to international commercial arbitration.

Step-by-step checklist for the arbitration process in Bangladesh

The sequence below is how we run a claim from instructions to award.

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Construction and project disputes show these risks most clearly; see our analysis of unpaid infrastructure project claims in Bangladesh.

What to watch in 2026

Two developments affect the arbitration process in Bangladesh this year. First, in April 2026 Parliament passed the Commercial Courts Bill 2026, converting the Commercial Court Ordinance issued at the start of January 2026 into law and creating district-level commercial courts with a 90-day trial target from final hearing.[10] [11] [12]

Second, reform of the Arbitration Act 2001 is on the agenda. At a BIAC seminar in May 2026, the Law Minister, Md Asaduzzaman, identified high arbitrator fees and long pendency as limitations of the Act that could be fixed, and the BIAC chairman referred to proposed reforms.[8] A 2023 Dhaka Chamber paper sought deadlines for court appointments and for arbitrations overall.[9]

If a dispute is emerging, the earliest procedural decisions carry the most weight. Our international arbitration practice and alternative dispute resolution practice act for claimants and respondents in BIAC, ad hoc and foreign-seated arbitrations. For an overview of every settlement route, see our guide to alternative dispute resolution in Bangladesh, or contact TRW to discuss your matter.

Frequently asked questions

How do I start an arbitration in Bangladesh?

In an ad hoc case, serve the respondent with a written notice requiring the dispute to be referred to arbitration or requiring it to appoint or agree a tribunal; the proceedings start when the respondent receives it. Under the BIAC Rules, file a Request for Arbitration with BIAC and the respondent and pay the registration fee; the case starts when BIAC receives it.[2] [3]

What happens if the other side refuses to appoint an arbitrator?

After 30 days from your request, apply to the District Judge in a domestic case or to the Chief Justice or a designated Supreme Court judge in an international commercial arbitration. The appointment must be made within 60 days and is final. Under the BIAC Rules, the Arbitration Committee appoints.[2] [3]

How many arbitrators will hear the case?

Whatever number the parties agreed. If they agreed nothing, the Act provides for three, while the BIAC Rules default to a sole arbitrator unless the Arbitration Committee considers three more appropriate.[2] [3]

Does the Code of Civil Procedure apply in arbitration?

No. The arbitral tribunal is not bound by the Code of Civil Procedure or the Evidence Act, and follows the procedure agreed by the parties or, failing agreement, set by the tribunal.[2]

How long does the arbitration process in Bangladesh take?

The Act sets no overall limit. Under the BIAC Rules, hearings must conclude within 180 days of the first hearing and the award follows within 60 days, with a fast track of three months from constitution for claims up to Tk 50 million.[3]

How much does it cost to file an arbitration at BIAC?

The claimant pays a non-refundable registration fee of BDT 20,000 (BDT 15,000 on the fast track). Administrative and arbitrator fees are then scaled to the amount in dispute, with 15 per cent VAT.[4]

Can the respondent stop the arbitration by not taking part?

No. The tribunal continues and may make an award on the evidence, though the failure is not treated as an admission.[2]

Can I get urgent interim relief during the arbitration?

Yes, from the tribunal, or from the court under section 7A in a Bangladesh-seated arbitration.[2]

What interest is payable on an arbitral award?

The tribunal may award pre-award interest at a reasonable rate. Unless the award directs otherwise, the sum awarded carries interest at two per cent per annum above the Bangladesh Bank rate from the award to payment.[2]

What can I do if the award contains a mistake?

Within 14 days of receiving it, ask the tribunal to correct computational, clerical or typographical errors, or to make an additional award on a claim it omitted. A challenge to set the award aside must be filed within 60 days of receipt.[2]