BANGLADESH

Get in contact or get a price estimation from our partner in Bangladesh Get in contact
Content last updated: 02-09-2019

Choose the type of information you seek

  • Merger Control Regime
  • Merger Screening
  • Merger Filing

1. Overall description of merger control regime

1.1 Supranationality

1.1.1 Is the jurisdiction a member of/party to a supranational jurisdiction?

No.

1.1.2 Is the jurisdiction itself a supranational jurisdiction?

No.

1.1.3 If the answer to Section 1.1.1 and/or 1.1.2 above is in the affirmative, what are the implications hereof?

Not applicable.

2. Nature of merger control regime

2.1 Mandatory or voluntary

2.1.1 Is filing mandatory or voluntary?

The current law does not provide any filing process.

However, if in doubt as to whether a transaction could be ruled unlawful by the Competition Commission, the undertakings concerned may file an application before the Competition Commission to determine the lawfulness of the transaction. See Section 1.3.1 under the Merger Filing Schedule.

Competition rules defining the relevant terms are under preparation and are expected to be enacted soon.

2.2 Suspensory effect

2.2.1 Must completion of the transaction await clearance by the relevant authorities?

No. The Competition Commission has jurisdiction to review transactions post completion.

1. What type of transactions are caught by the merger control regime?

1.1 Concentrations

1.1.1 Type of transactions that are caught by the merger control rules?

Transactions triggering a change of control are caught by the merger control regime.

1.2 Joint ventures

1.2.1 What types of joint ventures are caught by the merger control rules?

See Section 1.1.1 above.

1.3 Definition of "control"

1.3.1 How are the concepts of "control" and "change of control" defined?

Such definition has not been finalized with respect to merger control. However, common corporate law, i.e. the Companies Act, 1994, defines such control to cover the ability to control the management or board, e.g. by appointing a majority of the directors or otherwise. This definition is currently applied by the Competition Commission.

1.4 Minority shareholdings

1.4.1 Are minority and other interests less than control caught by the merger control rules?

No.

2. Establishing jurisdiction for notification of mergers

2.1 Merging parties/undertakings concerned

2.1.1 Which undertakings are considered parties to the merger ("undertakings concerned") in the various types of transactions identified under Section 1.1.1 and 1.2.1.

Not applicable.

2.2 Date for establishing jurisdiction

2.2.1 Which date is relevant for concluding whether the transaction is notifiable?

Not applicable.

2.3 General thresholds

2.3.1 Threshold(s) for when a concentration must be notified under the general merger control regime?

Currently, no jurisdictional thresholds, mandatory filing requirements or clearance process are in place.

The law states that transactions envisaged to impose a “significantly adverse effect on competition” and an “abuse of dominant position” are caught by the merger control regime.

Based on the current interpretation while determining the risk of “significantly adverse effect on competition” the Competition Commission is to consider the aggregate market share proposed to be controlled by a combination (i.e. merger or acquisition). 

Competition rules defining the relevant terms are under preparation and are expected to be enacted soon.

2.3.2 For each threshold, can the threshold be triggered by only one party having local turnover?

Yes. The current law does not apply turnover thresholds.

2.3.3 For each threshold, can the threshold be triggered without any party having local turnover?

Yes. The current law does not apply turnover thresholds.

2.3.4 Are there any circumstances where transactions falling below these thresholds may be still investigated?

Not applicable.

2.4 Other national thresholds for ex ante merger control (e.g. sector-specific rules)

2.4.1 Relevant thresholds for sector-specific or other ex ante merger control rules?

Private sector investment is prohibited for certain sectors, including:

  • Arms and ammunition
  • Defence equipment
  • Forest plantation
  • Extraction of reserved forests
  • Nuclear energy
  • Security printing and minting.

In addition, there are seventeen controlled sectors which require prior clearance/permission from the respective line ministries/authorities. These are:

  • Fishing in the deep sea
  • Bank/financial institution in the private sector
  • Insurance companies in the private sector
  • Generation, supply and distribution of power in the private sector;
  • Exploration, extraction and supply of natural gas/oil
  • Exploration, extraction and supply of coal
  • Exploration, extraction and supply of other mineral resources
  • Large-scale infrastructure project (e.g. flyover, elevated expressway, monorail, economic zone, inland container depot/container freight station)
  • Crude oil refinery (recycling/refining of lube oil used as fuel);
  • Medium and large industry using natural gas/condescend and other minerals as raw material
  • Telecommunication service (mobile/cellular and land phone)
  • Satellite channel
  • Cargo/passenger aviation
  • Sea-bound ship transport
  • Sea-port/deep sea-port
  • VOIP/IP telephone and
  • Industries using heavy minerals accumulated from the sea beach. 

In addition, certain maximum ownership thresholds, in general, apply to certain industries such as Banking, Insurance etc. Foreign investors also have certain maximum ownership thresholds such as freight forwarding, logistics and other sectors.

2.4.2 Are any such schemes mandatory or voluntary?

Not applicable.

2.5 Foreign-to-foreign mergers

2.5.1 Do any exemptions, special thresholds etc. apply to foreign-to-foreign mergers, i.e. where none of the undertakings concerned is domiciled in the jurisdiction?

Currently, no rules apply in this regard.

3. Calculation and allocation of turnover, asset value, transaction value etc.

3.1 Relevant turnover

3.1.1 How is turnover defined (e.g. is income from other sources than "ordinary activities to be included, and how are rebates, taxes, internal turnover etc. treated)?

Not applicable.

3.1.2 Identification and link to any official rules, guidance etc. on how to calculate turnover?

Not applicable.

3.2 Relevant period for calculation of turnover

3.2.1 Which financial year(s) is relevant for the calculation of turnover?

Not applicable.

3.2.2 Should adjustments be made for e.g. divestitures, acquisitions, closings and other changes of the economic reality of the undertaking concerned made after or during the relevant financial year?

Not applicable.

3.3 Relevant undertakings for the calculation of turnover

3.3.1 The "undertakings concerned", i.e. which parties?

Not applicable.

3.3.2 The undertakings whose turnover is taken into account?

Not applicable.

3.3.3 Shall the turnover of the existing seller be included in the target's group turnover?

Not applicable.

3.4 Geographical allocation of turnover

3.4.1 The principles for the geographical allocation of turnover?

Not applicable.

3.5 Valuation and allocation of assets

3.5.1 The principles for valuation and allocation of assets?

Not applicable.

3.6 Calculation of other thresholds

3.6.1 The principles for calculation of metrics for other thresholds (e.g. transaction value, market share, share of supply etc.)?

Not applicable.

3.7 Special rules

3.7.1 Do any special rules or principles apply to the calculation, allocation etc. of turnover, assets etc. for specific undertakings (e.g. State-owned undertakings, investment funds, credit and financial institutions, insurance companies, financial holding companies, others)?

Not applicable.

3.7.2 Does any exemptions apply?

Not applicable.

1. Practical information

1.1 Responsibility for filing

1.1.1 The parties responsible for filing?

Not applicable.

1.2 Deadlines for filing

1.2.1 Are there any mandatory deadlines for filing, and, if so, how these are calculated?

Not applicable.

1.2.2 Are there any sanctions for not filing within the deadlines?

Not applicable.

1.3 Early filing

1.3.1 Is it possible to file before the signing of merger agreement?

Generally not. However, any concerned party (which could be a third party) including the parties involved in the transaction may voluntarily file an application before the Competition Commission for the determination as to whether the concentration would have a “significantly adverse effect on competition” and an “abuse of dominant position”. The Competition Commission is to finalize its assessment of such application within sixty days providing due justification.

1.4 Filing fees

1.4.1 Are there any fees for filing, and, if so, please describe how such fees are calculated?

No.

1.4.2 When must the filing fee must be paid?

Not applicable.

1.5 Publicity

1.5.1 When and in which format will the authority publish receiving a notification?

Not applicable.

1.5.2 How will the authority in general handle the case publicly, e.g. will it usually comment in the media, send out press releases etc.?

There is no provision in the local regulation as to public notification about such cases. In general, the Competition Commission does not disclose details publicly unless approached by an application under the Right for Information Act or by journalists. Even under such scenarios it only discloses information which is not of confidential or sensitive nature.

1.5.3 Will third parties be able to review the notification?

Third parties are not able to review the notification.

However, a third party who considers a concentration a “significantly adverse effect on competition” and an “abuse of dominant position” may bring action before the Competition Commission to decide on the matter. The Competition Commission may also initiate a case on its own accord.

2. Procedure and timing

2.1 Normal and simplified procedures

2.1.1. Does the regime allow for a simplified (fast track) procedure, and, if so, what are the criteria for using the simplified procedure?

Not applicable.

2.2 Procedural stages (cf. timetable below)

2.2.1 The various stages of (i) a simplified procedure and (ii) a normal procedure?

There are no such procedures implemented yet but detailed procedural rules are due from the Competition Commission in the form of Competition Rules. So far, the following procedure is followed in all cases:

First Stage: The Competition Commission considers the components of the application, forms a committee to analyze the case and submits its report and then decides on its decision within sixty days from the lodgment of the application. 

Second Stage: During the course of a proceeding before the Competition Commission, if any objection is raised by a third party that any decision taken or proposed to be taken by the Competition Commission is contrary or is likely to be in contravention to the Competition Act and another statutory body is authorized to ensure competition in that sector then, the Competition Commission may refer the issue to the statutory body for taking proper action on it.

On receipt of a reference from the Competition Commission the statutory body is required to give its opinion within 60 days of receipt of such reference sought. Upon taking into consideration of the opinion, the Competition Commission shall take necessary actions and issue final decision.

2.2.2 Is pre-notification contact with the relevant authorities customary/obligatory/encouraged/etc.?

Pre-notification contact is not obligatory or customary in Bangladesh, but any concerned party (which could be an affected third party), including the parties involved in the transaction, may voluntarily file an application. See Section 1.3.1 above.

2.2.3 Are there any sanctions for not filing within the deadlines?

Not applicable.

2.3 Timetable (cf. timetable below)

2.3.1 The statutory timetable/deadlines for review of a notification?

Please see Section 2.2.1 above.

2.3.2 Can the statutory timetable/deadlines be suspended ("stop-the-clock"), and if so under which conditions?

No.

2.3.3 If pre-notification with the relevant authorities contact is possible/customary, how long will the duration of such contact usually be?

Pre-notification contact is not statutorily provisioned or customary in Bangladesh.

3. Format and content of notification

3.1 Notification forms

3.1.1 Must the notifying parties use any mandatory notification forms, e.g. for simplified and normal procedures, and, if relevant, add a link to the relevant forms?

No.

3.2 Supporting documentation

3.2.1 List of the supporting documentation which must as a minimum be submitted along with the notification?

Not applicable.

3.3 Originals, legalization and apostillation

3.3.1 List of all documents which must be submitted in original/legalized versions and whether any documents must be apostilled?

Not applicable.

3.3.2 If the merger regime has a mandatory filing deadline, must all the documents identified under Section 3.3.1 be submitted within this deadline?

Not applicable.

3.4 Language

3.4.1 Which languages may be used for drafting and filing a notification?

The application must be made in either English or Bengali.

3.4.2 Does translations have to be certified/legalized and apostilled?

Not applicable.

Statutory timetable

Step Description Time
1

Pre-notification

Pre-notification contact is not statutorily provisioned or customary in Bangladesh. 

Not applicable.

2

There are no procedures implemented yet but detailed procedural rules are due from the Competition Commission in the form of Competition Rules. So far, the following procedure is followed in all cases:

Stage I

The Competition Commission considers the components of the application, forms a committee to analyze the case and submits its report and then decides on its decision.

60 days from the lodgment of the application.

3

Stage II

During the course of a proceeding before the Competition Commission, if any objection is raised by a third party that any decision taken or proposed to be taken by the Competition Commission is contrary or is likely to be in contravention to the Competition Act and another statutory body is authorized to ensure competition in that sector then, the Competition Commission may refer the issue to the statutory body for taking proper action on it.

On receipt of a reference from the Competition Commission the statutory body is required to give its opinion within 60 days of receipt of such reference sought. Upon taking into consideration of the opinion, the Competition Commission shall take necessary actions and issue final decision.

  • Step 1 1
  • Step 2 2
  • Step 3 3
  • Not applicable
  • 60 days
  • 60 days + extension
This content was delivered
and last updated on 02-09-2019 by
Contact Person
A.B.M. Nasirud Doulah, Partner
CONTACT DETAILS:

Doulah & Doulah has provided all input about merger control in Bangladesh.

Established in 1965 the firm stands as one of the biggest law firms in Bangladesh. With top-ranked transactional capabilities complemented by a strong litigation practice it has been representing the world’s largest business houses and working with the biggest international law firms. The firm holds a market leading commercial, competition and tax practice in Bangladesh with special emphasis in corporate, finance, power/energy, infrastructure, and M&A matters. So far it has acted in most of the major global M&A matters and largest cross border financing matters in Bangladesh.  Major clients include IFC, Blackstone Group, Aercape, OPIC, GE, Golar Power, ADB, IDB, British Petroleum, Ophir Energy, AES, Covanta, Shenzhen Stock Exchange, Cementos Mollins, Microsoft, Gates Foundation, etc.

For more information about Doulah & Doulah and merger control in Bangladesh, please contact our Partner directly.

Banner Logo     Banner Logo    Banner Logo    Banner Logo