Cost of Arbitration in Bangladesh 2026: Fees, Expenses and Funding

Cost of arbitration in Bangladesh: fees and funding in 2026

The cost of arbitration in Bangladesh is the question most businesses ask last and should ask first. An arbitration clause commits the parties to a private tribunal that they pay for themselves: institutional fees, arbitrator fees, deposits, lawyers and experts and, after the award, the cost of stamping it, defending it and turning it into money. In 2026 those costs are under political scrutiny. In May the Law Minister said arbitrator fees are so high that ordinary businesspeople avoid the system.

This guide covers the official BIAC fee schedule, ad hoc arbitrator fees, deposits under section 49 of the Arbitration Act 2001, costs allocation under section 38(7), fee disputes, stamp duty, enforcement, third-party funding, legal aid and a verified comparison with SIAC and ICC. It ends with the steps that keep a budget under control.

Summary: Arbitration costs in Bangladesh fall into four layers: institutional charges (at BIAC, a Tk 20,000 registration fee and a scaled administrative fee capped at Tk 2,55,000), arbitrator fees (a BIAC scale where adopted, otherwise whatever is agreed), the parties' own legal and expert costs, and post-award costs of stamping, challenge and enforcement. The tribunal fixes and allocates costs in the award under section 38(7) unless the parties agree otherwise, and 15 per cent VAT applies to BIAC fees.

Key point: The tribunal's fees, not institutional charges, drive the bill. On a Tk 10 crore claim under BIAC Annex 1, the administrative fee is Tk 1,05,000, while the arbitrator scale runs from Tk 9,75,000 to Tk 22,50,000 before VAT and expenses. Agreeing the fee basis in writing at appointment is the most effective cost control, and it also decides whether the court can review the fee under section 50.

At a glance

Swipe or scroll →

Table of Contents

What the cost of arbitration in Bangladesh is made of

Section 38(7) of the Arbitration Act 2001 defines arbitration costs to include reasonable costs relating to the fees and expenses of the arbitrators and witnesses, legal fees and expenses, any administration fees of the supervising institution, and any other expenses connected with the proceedings and the award.[1] Rule 26 of the BIAC Arbitration Rules 2019 adopts the same four categories.[2]

In practice there are five budget lines: institutional fees, which are modest and predictable; arbitrator fees and expenses, the largest variable in a Bangladesh-seated case; the parties' own counsel, experts and witnesses; logistics such as hearing rooms, transcripts and interpreters; and post-award costs of stamping, challenge and execution. Our overview of arbitration law in Bangladesh explains the framework in which each arises.

Why the seat and the rules change the bill

BIAC publishes a Taka scale and holds deposits. An ad hoc case has no scale, so arbitrator fees are whatever the parties and tribunal agree. A foreign institution charges in its own currency and usually brings foreign counsel and travel. The clause you sign fixes much of the cost of arbitration in Bangladesh years before any dispute arises.

The BIAC fee schedule in 2026

BIAC publishes Annex 1 for ordinary arbitrations and Annex 2 for fast track cases. Both state that 15 per cent VAT applies, that amounts are in Taka, and that BIAC may modify them at any time without notice.[3] The figures below are those published on the BIAC website when we checked them on 20 October 2026. Confirm them with the Secretariat before relying on them.

Assessment and registration fees

A party submitting documents for assessment pays Tk 5,000. Under Annex 1 the claimant pays a non-refundable registration fee of Tk 20,000 with the notice of arbitration, and BIAC will not proceed without it. A respondent filing a counterclaim pays a further Tk 20,000, and the same fee is payable on any extension sought under Rule 13(4).[3] Rule 13(4) requires oral hearings to start within 30 days of the written pleadings and end within 180 days of the first hearing, so the extension fee is a deliberate price on delay.[2]

The BIAC administrative fee

The Annex 1 administrative fee is Tk 30,000 for claims up to Tk 50 lakh. It then rises by a falling percentage of the excess in each band: 0.2 per cent up to Tk 1 crore, 0.1 per cent up to Tk 5 crore, 0.05 per cent up to Tk 10 crore, 0.025 per cent up to Tk 50 crore and 0.01 per cent up to Tk 100 crore. Above Tk 100 crore it is a flat Tk 2,55,000.[3] However large the claim, the administrative fee is a small share of the total.

The BIAC arbitrator fee scale

The arbitrator scale in Annex 1 applies only where both parties agree to it, and sets a minimum and maximum for each band:[3]

• Up to Tk 50 lakh: Tk 1,00,000 to Tk 5,00,000.
• Tk 50 lakh to Tk 1 crore: Tk 1,00,000 plus 2.5 per cent, to Tk 5,00,000 plus 5 per cent, of the excess over Tk 50 lakh.
• Tk 1 crore to Tk 5 crore: Tk 2,25,000 plus 1.25 per cent, to Tk 7,50,000 plus 2.5 per cent, of the excess over Tk 1 crore.
• Tk 5 crore to Tk 10 crore: Tk 7,25,000 plus 0.5 per cent, to Tk 17,50,000 plus 1 per cent, of the excess over Tk 5 crore.
• Tk 10 crore to Tk 50 crore: Tk 9,75,000 plus 0.1 per cent, to Tk 22,50,000 plus 0.2 per cent, of the excess over Tk 10 crore.
• Above Tk 50 crore: from Tk 13,75,000 (minimum) and Tk 24,50,000 (maximum), with small percentage increments thereafter.

Two points need care. The published maximum for the Tk 10 crore to Tk 50 crore band reaches Tk 30,50,000 at the top of the band, above the Tk 24,50,000 starting maximum of the next band, so confirm the applicable ceiling with BIAC in writing on claims in that range. The Annex also does not say expressly whether the scale is per arbitrator or per tribunal; settle that at the preliminary conference, not on the final invoice.

Fast track arbitration under Annex 2

Where the claim, counterclaim and defence together do not exceed Tk 50 million (Tk 5 crore), any party may ask BIAC, before the preliminary conference, to treat the case as fast track, with the award due within three months of the tribunal's constitution.[2] Annex 2 is cheaper: a Tk 15,000 registration fee, an administrative fee from Tk 10,000, and arbitrator fees from Tk 50,000 to Tk 1,00,000 for claims up to Tk 10 lakh.[3]

How BIAC computes the sum in dispute

Claims and counterclaims are added together, and set-off defences are added too unless the tribunal decides they need no significant extra work. Interest is ignored unless it exceeds the principal. Foreign-currency claims are converted at the Bangladesh Bank mean rate. For unquantified claims the Secretary General fixes the fees, and BIAC may exceed the scale in exceptional circumstances, including where the parties run the case in an unexpected way.[3]

Worked examples

Under Annex 1, a Tk 1 crore claim attracts an administrative fee of Tk 40,000 and an arbitrator range of Tk 2,25,000 to Tk 7,50,000. A Tk 10 crore claim attracts Tk 1,05,000 and Tk 9,75,000 to Tk 22,50,000. A Tk 50 lakh claim on the fast track scale attracts Tk 18,000 and Tk 1,10,000 to Tk 2,20,000, against Tk 30,000 and Tk 1,00,000 to Tk 5,00,000 under Annex 1.[3] All figures are before VAT and expenses.

Arbitration expenses on top of fees

BIAC invoices expenses separately: tribunal-appointed experts, travel (business class unless otherwise agreed), accommodation, hearing rooms, video conferencing, court reporters and interpreters.[3] A tribunal expert's fees are paid from the deposits and form part of the costs.[2]

Ad hoc arbitration: arbitrator fees without a schedule

Many Bangladeshi contracts still provide for ad hoc arbitration. The Arbitration Act 2001 contains no fee scale; remuneration is left to agreement, subject to the court's power under section 50 where fees have not been fixed by written agreement.[1] In ad hoc cases, the cost of arbitration in Bangladesh is therefore whatever the parties negotiate with their tribunal, often after the dispute has arisen and when bargaining power is weakest.

Fee models used in practice

Ad hoc tribunals charge per sitting, a lump sum, an hourly or daily rate, or a percentage of the claim. Per-sitting fees reward adjournments; lump sums need staging so that an early settlement does not trigger the full fee. Whichever model applies, record it in signed terms of appointment covering each member's fee, cancellation charges, expenses and VAT. For claims in the lower bands, a sole arbitrator is usually better value than a three-member tribunal, and all members should be on the same fee terms.

Adopting the BIAC or UNCITRAL fee rules

Parties can agree that the BIAC arbitrator scale applies without BIAC administering the case, though they then lose its deposit-holding role. Under the UNCITRAL Arbitration Rules, Article 41 requires arbitrators' fees to be reasonable, having regard to the amount in dispute, complexity and time spent, and requires the tribunal to tell the parties promptly after constitution how it proposes to set its fees.[6]

Deposits and advances on costs under section 49

Section 49 lets the tribunal fix a deposit as an advance for the section 38(7) costs it expects, with separate deposits for a claim and a counterclaim if it chooses. The deposit is payable in equal shares. If one party fails to pay, the other may pay that share; if neither pays, the tribunal may terminate the proceedings on that claim or counterclaim or refuse to make an award. At the end, the tribunal accounts for the deposits and returns any unspent balance.[1]

Deposits at BIAC

Rule 27 of the BIAC Rules is stricter. On constitution, the tribunal directs equal deposits with BIAC and may later direct supplementary deposits. If a deposit is unpaid after 14 days and a further seven days following a reminder, the case continues ex parte against the defaulting party, the other party pays its share, and the award orders reimbursement.[2] Each party pays its share in cash, but a share above Tk 5 lakh may be covered by bank guarantee for the excess, and BIAC may allow instalments.[3]

Joint and several liability

Under the BIAC fee annex, the parties are jointly and severally liable to the tribunal and BIAC for the costs of the arbitration.[3] A claimant facing a respondent that refuses to engage should budget for the full advance on costs and treat recovery of the other share as part of the final award.

Security for costs

Deposits fund the tribunal; security for costs protects the opponent. Under section 35(6), if a claimant fails to comply with an order to provide security for costs, the tribunal may dismiss the claim.[1] When a court grants interim relief under section 7A, it may require the applicant to give security for the opposite party's costs, applying Order 25 of the Code of Civil Procedure.[7] Respondents facing a thinly capitalised claimant should apply early.

Fee disputes and the tribunal's lien

If a tribunal refuses to deliver its award except on payment of the costs it demands, section 50 lets the court order delivery once the applicant pays the amount demanded into court. After any inquiry it thinks fit, the court pays the tribunal a reasonable sum and refunds the balance.[1]

The remedy has a limit many parties overlook. It is available only where the fees demanded have not been fixed by written agreement between the applicant and the tribunal.[1] A party that signed an open-ended or generous fee letter has, in effect, given up court review of that fee. The court may also make costs orders where the award makes no sufficient provision for costs, and, subject to any contrary agreement, the tribunal has a lien on the award for unpaid costs.[1]

At BIAC, the tribunal deposits the original award with BIAC, which releases certified copies only once the costs are fully settled, and BIAC and the tribunal hold a lien over the award.[2] [3] A winning party may have to pay the loser's unpaid share simply to obtain its award, then recover it under the costs order. That hidden step belongs in any estimate of the cost of arbitration in Bangladesh.

Who pays: costs allocation under section 38(7)

Unless the parties agree otherwise, section 38(7) requires the tribunal to fix the costs and specify the party entitled to them, the party who must pay, the amount or method of determining it, and the manner of payment.[1] The Act sets no default rule that costs follow the event. Rule 26 of the BIAC Rules lets the tribunal decide who bears the costs in the circumstances and apportion them as it thinks fit.[2]

Under the UNCITRAL Rules, Article 42 provides that costs are in principle borne by the unsuccessful party, subject to apportionment where reasonable, and legal costs are recoverable only to the extent the tribunal finds them reasonable.[6] Practitioner guides confirm that legal costs are recoverable in Bangladesh-seated arbitrations.[7] To recover them, keep time records and invoices from day one, make written settlement offers, and check that the award actually contains a costs decision.

Interest as part of the recovery

Unless otherwise agreed, the tribunal may award reasonable interest from the date the cause of action arose to the award, and the award carries post-award interest at two per cent above the Bangladesh Bank rate unless it directs otherwise.[1] The BIAC Rules allow simple or compound interest.[2] In a long enforcement fight, post-award interest offsets part of the cost of delay.

Lawyer fees, experts and other expenses

For most parties, counsel fees are the largest single line in the cost of arbitration in Bangladesh, and no statutory scale regulates them. Where counsel are qualified Bangladeshi lawyers, the Bangladesh Bar Council Canons of Professional Conduct and Etiquette apply.[7] The drivers are predictable: the number of written submissions, document production, witness statements, technical experts, translation of Bangla documents and hearing days.

BIAC requires hearings to finish within 180 days of the first hearing and the award to issue within 60 days of their close, save in exceptional circumstances.[2] Those deadlines give a party something concrete to hold the timetable, and the fees, to. Ask counsel for a phased budget covering tribunal constitution, pleadings, evidence, hearing, award and enforcement, with fixed or capped fees per phase where possible, and agree expert fees before instructions are given.

Post-award costs: stamp duty, challenges and enforcement

Stamp duty on the award

An award is chargeable to stamp duty under the Stamp Act 1899. Practitioner guides report a duty of Tk 1,000 on lower-value awards and 0.5 per cent of the award's value above that, subject to a maximum of Tk 40,000.[8] Finance Acts change stamp rates from time to time, so check the current Schedule I entry before filing.

Timing matters. In Rupayan Housing Estate Ltd v Hazi Mohammad Mustafa Zaman, the High Court Division noted that section 38(1) requires an award to be in writing and signed, with no requirement that it be stamped or registered, and accepted that stamping becomes relevant when the award is filed for enforcement under section 44.[9] Non-stamping is therefore not a ground to set the award aside, but the stamp must be in place before execution.

Setting-aside proceedings

A party may apply to set aside an award within sixty days of receiving it, before the District Judge or, for an international commercial arbitration seated in Bangladesh, the High Court Division. Under section 43(2), the court may order any money payable under the award to be deposited or secured while the application is pending.[1] Award creditors should ask for that order at the first hearing; it turns a cheap delaying tactic into one that ties up the challenger's cash. An appeal then lies under section 48, adding another round of fees.[1]

Execution as a decree

Once the challenge period has expired, or a challenge has failed, section 44 provides that the award is enforced under the Code of Civil Procedure as a decree. A foreign award is enforced by the District Judge's Court in Dhaka under section 45, on production of the award, the arbitration agreement and evidence that it is a foreign award, with a certified English translation where required. Where enforcement is adjourned pending a challenge at the seat, the court may order the award debtor to give suitable security.[1]

Execution is where budgets most often fail. At the May 2026 BIAC seminar, a former DCCI president cited a World Bank figure of 1,442 days on average to enforce a contract in Bangladesh.[5] Plan asset tracing, translation and certification before the award is issued, not after. Our guide to unpaid infrastructure project claims in Bangladesh covers recovery against project counterparties.

Third-party funding and alternative fee arrangements

The Arbitration Act 2001 is silent on third-party funding,[8] and practitioner guides report no rules or restrictions on funders.[7] A claimant may therefore use litigation funding, claim assignment or insurance-backed arrangements to meet the cost of arbitration in Bangladesh, but there is no statutory protection on disclosure, privilege or the funder's control of settlement. The funding agreement must deal with each.

Disclosure duties at foreign institutions

Under the SIAC Rules 2025, parties must disclose any third-party funding agreement and the funder's identity, and the tribunal may take funding into account when apportioning costs.[12] The ICC Arbitration Rules 2026 require each party to disclose promptly the existence and identity of any non-party funding its claims or defences.[14]

Contingent fees for arbitrators are barred at BIAC

The BIAC Arbitrators' Code of Conduct requires arbitrators to adopt the BIAC fee annex and prohibits any fee agreement with a party that is contingent on the result or the amount of a settlement.[2] Counsel fee arrangements are governed separately by the lawyers' professional rules, so take advice before agreeing a success-based structure.

Legal aid for arbitration

State legal aid is not limited to court litigation. The Legal Aid Services Act 2000 defines legal aid, for litigants who are financially insolvent, without resources or unable to obtain justice for socio-economic reasons, to include an honorarium for a mediator or arbitrator appointed to settle a case through mediation or arbitration under the Code of Civil Procedure 1908 and other laws, as well as case costs and lawyers' fees at regulated rates.[10]

In practice, legal aid reaches court-connected arbitration and the statutory ADR schemes rather than commercial arbitration between companies. For eligible individuals in family, land and tenancy disputes, the district legal aid office is the starting point, as our guide to alternative dispute resolution in Bangladesh explains.

Mediation as a low-cost alternative

For commercial parties, mediation is the main way to cut costs. BIAC charges a Tk 20,000 mediation registration fee, and mediator fees run from Tk 5,000 to Tk 50,000 per hour as agreed, plus VAT.[4] A one-day mediation that settles a Tk 10 crore dispute costs a fraction of the arbitrator fees on the same claim.

BIAC, SIAC and ICC: comparing costs for foreign seats

Foreign parties often push for Singapore or ICC arbitration, and Bangladeshi parties often resist on cost. The fee bases differ: BIAC charges in Taka, SIAC publishes maximum fees in Singapore dollars, and ICC uses an ad valorem scale in US dollars. The table summarises verified headline figures. On a phone, scroll it sideways.

SIAC figures in 2026

The SIAC Schedule of Fees applies to arbitrations commenced on or after 1 January 2025. The non-refundable filing fee is S$3,000 for overseas parties. Administration fees start at S$5,000 and are capped at S$150,000. The maximum arbitrator fee is S$5,000 per arbitrator for claims up to S$50,000, rising to a ceiling of S$2 million. An emergency arbitrator application costs S$5,000 for overseas parties plus a S$30,000 deposit.[11] For claims of S$1 million or less, the streamlined procedure applies by default and caps tribunal and SIAC fees at 50 per cent of the scale maximums.[12]

ICC figures in 2026

The ICC Arbitration Rules 2026 apply to arbitrations commenced on or after 1 June 2026, with fees calculated under the Schedule of Fees in force at commencement.[14] The claimant pays a non-refundable first advance of US$5,000 on filing. The advance on costs is then payable in equal shares, with the filing payment credited to the claimant's share.[13]

Hidden costs of a foreign seat

A foreign seat usually means foreign counsel, witness travel and venue costs. Bangladeshi courts are reported not to grant interim relief in support of foreign arbitration proceedings until the enforcement stage,[7] so urgent asset protection may need an emergency arbitrator at extra cost, and the award must still be enforced in Dhaka. Our analysis of arbitration agreement enforceability in Bangladesh covers the clause choices that drive these outcomes.

The Law Minister's May 2026 remarks and the reform outlook

At a seminar on strengthening the commercial justice system, organised by BIAC with UNDP support and reported on 22 May 2026, the Law Minister, Md Asaduzzaman, flagged limitations in the Arbitration Act 2001 that he said can be fixed easily. He said arbitrator fees are so high that ordinary businesspeople avoid the system, and that files are kept pending so long that the Act's purpose of quick dispute resolution is defeated. The BIAC chairman described the proposed reforms to the Arbitration Act as an important milestone.[5]

The remarks are a policy signal, not a change in the law. As at 20 October 2026, we are not aware of an enacted amendment regulating arbitrator fees. Until one arrives, the cost of arbitration in Bangladesh remains a matter of contract, institutional rules and disciplined case management, and parties signing contracts now should build fee and timetable protections into the clause itself.

How to control the cost of arbitration in Bangladesh

Applied together, the levers below can substantially reduce the cost of a mid-sized domestic arbitration.

Swipe or scroll →

Common cost mistakes to avoid

• An open-ended fee letter: it removes court review of the fee under section 50(2).
• An inflated claim: BIAC fees scale with the sum in dispute, counterclaims included.
• Ignoring the other side's share: joint and several liability may leave the claimant funding the whole advance.
• No post-award budget: stamp duty, a setting-aside defence and execution can take years.

TRW's commercial arbitration practice prepares cost budgets, negotiates tribunal fee terms and runs BIAC, ad hoc and foreign-seated cases.

Frequently asked questions

How much does arbitration cost in Bangladesh?

At BIAC, a Tk 1 crore claim attracts a Tk 20,000 registration fee, a Tk 40,000 administrative fee and, if the parties adopt the scale, arbitrator fees of Tk 2,25,000 to Tk 7,50,000, plus VAT, expenses and legal costs.[3]

Is the BIAC arbitrator fee scale mandatory?

It applies where both parties agree. BIAC's Code of Conduct requires arbitrators to adopt the fee annex, and BIAC may exceed the scale in exceptional circumstances.[2] [3]

Who pays the deposit in a Bangladesh arbitration?

Under section 49, the parties pay in equal shares. If one does not, the other may pay its share; if neither pays, the tribunal may terminate that claim.[1]

Does the losing party pay the costs of arbitration?

Not automatically. Under section 38(7), the tribunal fixes the costs, including legal fees, and decides who pays, unless the parties agree otherwise.[1]

Can a tribunal withhold its award until it is paid?

Yes, it has a lien for unpaid costs. Where fees were not fixed by written agreement, a party can pay the sum into court and ask the court to fix a reasonable fee under section 50.[1]

Is stamp duty payable on an arbitral award?

Yes. Practitioner guides report 0.5 per cent of value, capped at Tk 40,000, and the High Court Division has accepted that stamping becomes relevant on enforcement.[8] [9]

Is third-party funding allowed?

The Act is silent and no rules restrict funders, but SIAC and ICC rules require disclosure of funding.[7] [12] [14]

Can legal aid cover arbitration costs?

For eligible litigants, yes. The Legal Aid Services Act 2000 covers an honorarium for a mediator or arbitrator appointed to settle a case.[10]

Is BIAC cheaper than SIAC or ICC?

On institutional fees, generally yes: BIAC's administrative fee is capped at Tk 2,55,000, while SIAC's starts at S$5,000 and ICC requires US$5,000 on filing. Arbitrator and counsel fees decide the total.[3] [11] [13]

What did the Law Minister say about arbitrator fees?

In May 2026, Md Asaduzzaman said arbitrator fees are so high that ordinary businesspeople avoid arbitration, and that this and long pendency are limitations of the Act that can be fixed easily.[5]