Economy Profile
Bangladesh
Bangladesh
Doing Business
2020
Page 1
Economy Profile of
Bangladesh
Doing Business 2020 Indicators
(in order of appearance in the document)
Starting a business
Procedures, time, cost and paid-in minimum capital to start a limited liability company
Dealing with construction permits
Procedures, time and cost to complete all formalities to build a warehouse and the quality control and safety
mechanisms in the construction permitting system
Getting electricity
Procedures, time and cost to get connected to the electrical grid, and the reliability of the electricity supply and
the transparency of tariffs
Registering property
Procedures, time and cost to transfer a property and the quality of the land administration system
Getting credit
Movable collateral laws and credit information systems
Protecting minority investors
Minority shareholders’ rights in related-party transactions and in corporate governance
Paying taxes
Payments, time, total tax and contribution rate for a firm to comply with all tax regulations as well as postfiling
processes
Trading across borders
Time and cost to export the product of comparative advantage and import auto parts
Enforcing contracts
Time and cost to resolve a commercial dispute and the quality of judicial processes
Resolving insolvency
Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for
insolvency
Employing workers
Flexibility in employment regulation and redundancy cost
Bangladesh
Doing Business
2020
Page 2
About Doing Business
The
project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and
regional level.
Doing Business
The
project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life
cycle.
Doing Business
captures several important dimensions of the regulatory environment as it applies to local firms. It provides quantitative indicators on regulation for
starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across
borders, enforcing contracts and resolving insolvency.
also measures features of employing workers. Although
does not present rankings
of economies on the employing workers indicators or include the topic in the aggregate ease of doing business score or ranking on the ease of doing business, it does
present the data for these indicators.
Doing Business
Doing Business Doing Business
By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time,
encourages
economies to compete towards more efficient regulation; offers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector
researchers and others interested in the business climate of each economy.
Doing Business
In addition,
offers detailed
, which exhaustively cover business regulation and reform in different cities and regions within a nation.
These studies provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected
cities can compare their business regulations with other cities in the economy or region and with the 190 economies that
has ranked.
Doing Business
subnational studies
Doing Business
The first
study, published in 2003, covered 5 indicator sets and 133 economies. This year’s study covers 11 indicator sets and 190 economies. Most
indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013
(Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where
also collected data
for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has benefited from
feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the
regulatory environment for business around the world.
Doing Business
Doing Business
To learn more about
please visit
Doing Business
doingbusiness.org
Bangladesh
Doing Business
2020
Page 3
Ease of Doing Business in
Bangladesh
Region
South Asia
Income Category
Lower middle income
Population
161,356,039
City Covered
Dhaka, Chittagong
168
DB RANK DB SCORE
45.0
Rankings on Doing Business topics -
Bangladesh
131
135
176
184
119
72
151
176
189
154
Starting
a
Business
Dealing
with
Construction
Permits
Getting
Electricity
Registering
Property
Getting
Credit
Protecting
Minority
Investors
Paying
Taxes
Trading
across
Borders
Enforcing
Contracts
Resolving
Insolvency
Topic Scores
82.4 61.1 34.9 29.0 45.0 60.0 56.1 31.8 22.2 28.1
(rank)
Starting a Business
131
Score of starting a business (0-100)
82.4
Procedures (number)
9
Time (days)
19.5
Cost (number)
8.7
Paid-in min. capital (% of income per capita)
0.0
(rank)
Dealing with Construction Permits
135
Score of dealing with construction permits (0-100)
61.1
Procedures (number)
16
Time (days)
274
Cost (% of warehouse value)
1.6
Building quality control index (0-15)
10.0
(rank)
Getting Electricity
176
Score of getting electricity (0-100)
34.9
Procedures (number)
9
Time (days)
125
Cost (% of income per capita)
1,745.8
Reliability of supply and transparency of tariff index (0-8)
0
(rank)
Registering Property
184
Score of registering property (0-100)
29.0
Procedures (number)
8
Time (days)
271
Cost (% of property value)
7.1
Quality of the land administration index (0-30)
6.5
(rank)
Getting Credit
119
Score of getting credit (0-100)
45.0
Strength of legal rights index (0-12)
5
Depth of credit information index (0-8)
4
Credit registry coverage (% of adults)
5.2
Credit bureau coverage (% of adults)
0.0
(rank)
Protecting Minority Investors
72
Score of protecting minority investors (0-100)
60.0
Extent of disclosure index (0-10)
6.0
Extent of director liability index (0-10)
7.0
Ease of shareholder suits index (0-10)
7.0
Extent of shareholder rights index (0-6)
4.0
Extent of ownership and control index (0-7)
3.0
Extent of corporate transparency index (0-7)
3.0
(rank)
Paying Taxes
151
Score of paying taxes (0-100)
56.1
Payments (number per year)
33
Time (hours per year)
435
Total tax and contribution rate (% of profit)
33.4
Postfiling index (0-100)
44.4
(rank)
Trading across Borders
176
Score of trading across borders (0-100)
31.8
Time to export
Documentary compliance (hours)
147
Border compliance (hours)
168
Cost to export
Documentary compliance (USD)
225
Border compliance (USD)
408
Time to export
Documentary compliance (hours)
144
Border compliance (hours)
216
Cost to export
Documentary compliance (USD)
370
Border compliance (USD)
900
(rank)
Enforcing Contracts
189
Score of enforcing contracts (0-100)
22.2
Time (days)
1,442
Cost (% of claim value)
66.8
Quality of judicial processes index (0-18)
7.5
(rank)
Resolving Insolvency
154
Score of resolving insolvency (0-100)
28.1
Recovery rate (cents on the dollar)
29.1
Time (years)
4.0
Cost (% of estate)
8.0
Outcome (0 as piecemeal sale and 1 as going
concern)
0
Strength of insolvency framework index (0-16)
4.0
Bangladesh
Doing Business
2020
Page 4
Starting a Business
This topic measures the number of procedures, time, cost and paid-in minimum capital requirement for a small- to medium-sized limited liability company to start up and
formally operate in each economy’s largest business city.
To make the data comparable across 190 economies,
uses a standardized business that is 100% domestically owned, has start-up capital equivalent to
10 times the income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of
operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one
company is owned by 5 married women and the other by 5 married men. The ranking of economies on the ease of starting a business is determined by sorting their
scores for starting a business. These scores are the simple average of the scores for each of the component indicators.
Doing Business
The most recent round of data collection for the project was completed in May 2019.
.
See the methodology for more information
What the indicators measure
Procedures to legally start and formally operate a company
(number)
Preregistration (for example, name verification or reservation,
notarization)
•
Registration in the economy’s largest business city
•
Postregistration (for example, social security registration,
company seal)
•
Obtaining approval from spouse to start a business or to leave
the home to register the company
•
Obtaining any gender specific document for company
registration and operation or national identification card
•
Time required to complete each procedure (calendar days)
Does not include time spent gathering information
•
Each procedure starts on a separate day (2 procedures cannot
start on the same day)
•
Procedures fully completed online are recorded as ½ day
•
Procedure is considered completed once final document is
received
•
No prior contact with officials
•
Cost required to complete each procedure (% of income per
capita)
Official costs only, no bribes
•
No professional fees unless services required by law or
commonly used in practice
•
Paid-in minimum capital (% of income per capita)
•
Funds deposited in a bank or with third party before registration
or up to 3 months after incorporation
Case study assumptions
To make the data comparable across economies, several assumptions about the business and the
procedures are used. It is assumed that any required information is readily available and that the
entrepreneur will pay no bribes.
The business:
-Is a limited liability company (or its legal equivalent). If there is more than one type of limited
liability company in the economy, the limited liability form most common among domestic firms is
chosen. Information on the most common form is obtained from incorporation lawyers or the
statistical office.
-Operates in the economy’s largest business city. For 11 economies the data are also collected for
the second largest business city.
-Performs general industrial or commercial activities such as the production or sale to the public of
goods or services. The business does not perform foreign trade activities and does not handle
products subject to a special tax regime, for example, liquor or tobacco. It is not using heavily
polluting production processes.
-Does not qualify for investment incentives or any special benefits.
-Is 100% domestically owned.
-Has five business owners, none of whom is a legal entity. One business owner holds 30% of the
company shares, two owners have 20% of shares each, and two owners have 15% of shares
each.
-Is managed by one local director.
-Has between 10 and 50 employees one month after the commencement of operations, all of them
domestic nationals.
-Has start-up capital of 10 times income per capita.
-Has an estimated turnover of at least 100 times income per capita.
-Leases the commercial plant or offices and is not a proprietor of real estate.
-Has an annual lease for the office space equivalent to one income per capita.
-Is in an office space of approximately 929 square meters (10,000 square feet).
-Has a company deed that is 10 pages long.
The owners:
-Have reached the legal age of majority and are capable of making decisions as an adult. If there
is no legal age of majority, they are assumed to be 30 years old.
-Are in good health and have no criminal record.
-Are married, the marriage is monogamous and registered with the authorities.
-Where the answer differs according to the legal system applicable to the woman or man in
question (as may be the case in economies where there is legal plurality), the answer used will be
the one that applies to the majority of the population.
Bangladesh
Doing Business
2020
Page 5
Starting a Business - Dhaka
Figure – Starting a Business in Dhaka – Score
Procedures
52.9
Time
80.9
Cost
95.6
Paid-in min. capital
100.0
Figure – Starting a Business in Dhaka and comparator economies – Ranking and Score
DB 2020 Starting a Business Score
0 100
89.3: Pakistan (Rank: 72)
88.2: Sri Lanka (Rank: 85)
82.4: Chittagong
82.4: Dhaka
81.7: Nepal (Rank: 135)
81.6: India (Rank: 136)
Note: The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of
the scores for each of the component indicators.
Standardized Company
Legal form
Private Limited Liability Company
Paid-in minimum capital requirement
No minimum
City Covered
Dhaka
Indicator
Best Regulatory
Performance
Procedure – Men (number)
9
7.1
4.9
1 (2 Economies)
Time – Men (days)
19.5
14.5
9.2
0.5 (New Zealand)
Cost – Men (% of income per capita)
8.7
8.3
3.0
0.0 (2 Economies)
Procedure – Women (number)
9
7.3
4.9
1 (2 Economies)
Time – Women (days)
19.5
14.6
9.2
0.5 (New Zealand)
Cost – Women (% of income per capita)
8.7
8.3
3.0
0.0 (2 Economies)
Paid-in min. capital (% of income per capita)
0.0
0.2
7.6
0.0 (120 Economies)
Bangladesh
Doing Business
2020
Page 6
Figure – Starting a Business in Dhaka – Procedure, Time and Cost
This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.
*
Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the
time for women. For more information on methodology, see the
website (
). For details on the procedures
reflected here, see the summary below.
Doing Business
http://doingbusiness.org/en/methodology
Procedures (number)
1 2 3 4 5 * 6 7 8 9
0
5
10
15
Time (days)
0
1
2
3
4
5
6
Cost (% of income per capita)
Time (days) Cost (% of income per capita)
Bangladesh
Doing Business
2020
Page 7
Details – Starting a Business in Dhaka – Procedure, Time and Cost
No.
Procedures
Time to Complete
Associated Costs
1
Verify the uniqueness of the proposed company name on the website of the Registrar of
Joint Stock Companies and Firms
: Registrar of Joint Stock Companies and Firms
Agency
The search for the availability of a company name was computerized in 2003. After checking that
the proposed company name is available for registration, the entrepreneur then applies for name
clearance through the Registrar of Joint Stock Companies and Firms (RJSC) website. The status
of the application can be checked online and is usually accepted or rejected within 1 working day.
If accepted, the company name is reserved for 6 months. A print out of the name clearance
certificate must be submitted to the RJSC, along with the other required documents for
incorporation. In addition to the BRAC Bank, the name reservation fee may be paid at the
following designated banks: One Bank and Mutual Bank.
Less than one day
(online procedure)
BDT 200 without VAT (paid
at a designated Bank)
2
Register at the Registrar of Joint Stock Companies and Firms
: Registrar of Joint Stock Companies and Firms
Agency
To register a company, the following documents must be submitted to the registrar:
(1) Name clearance certificate
(2) Memorandum and Articles of association
(3) Forms I (Declaration on the registration of the company); Form VI (Notice of the registered
office); Form IX (Consent to act as directors); Form X (The list of persons consenting to act as
directors); and Form XII (Particulars of the Directors, Managers, and Managing Agents)
Once the registration application is filed, the system generates a payment slip that should be
printed and paid at a designated bank. This payment slip includes the registration fees,
registration filing fees, stamp duties, and certified copies fees.
Registration fees can be calculated online at http://app.roc.gov.bd:7781/psp/fee_calculator
Less than one day
(online procedure)
paid in procedure 3
3
Pay all applicable registration fees and duties at a designated bank
: Designated bank
Agency
The fees are as follows:
i. Registration fees.
For the authorized share capital of up to BDT 1,000,000, the fee is BDT 0.
For the authorized capital from BDT 1,000,001 to BDT 5,000,000, the fee is BDT 50 for every BDT
10,000 or part thereof;
For the authorized capital exceeding BDT 5,000,001, the fee is BDT 80 for every BDT 10,000 or
part thereof.
ii. Registration filing fees.
For filing 6 documents (5 filled in forms and the memorandum & articles of association, the fee is
BDT 400.00 per document): BDT 2,400
iii. Certified copies.
Certified Copy MoA+Form XII+Digital Certificate: BDT 1,220
iv. Stamp duties.
BDT 4,150
1 day
BDT 150 (without VAT)
registration fees + BDT
2,400 (without VAT)
registration filing fees +
BDT 1,220 (without VAT)
for the certified copies of
Memorandum and Articles
of Association, Form 12
and Digital Certificate +
BDT 4,150 for stamp
duties
4
Make a company seal
: Sealmaker
Agency
Business founders can make a company seal at the Seal maker for BDT 30-50. A better quality
seal can be more expensive at BDT 250-300.
1 day
BDT 30-50
5
Obtain a Tax Identification Number
: National Board of Revenue
Agency
In order to start business operations, every company must register for taxes at the appropriate
taxation authority (Deputy Commission of Taxes of Company Circle, Zonal Taxation Department)
under the National Board of Revenue (NBR) and obtain a tax identification number. Obtaining TIN
number can now be done online at http://incometax.gov.bd/TINHome in less than one day.
Less than one day
(online procedure)
no charge
6
Open a Bank Account
: Bank
Agency
In order to register for VAT, the company must first open a bank account.
1 day (simultaneous with
previous procedure)
no charge
7
Obtain a trade license
: City Corporation
Agency
Companies obtain a trade license from the City Corporation. Recently, the City Corporation
(Dhaka) was divided into 2 zones: the North Zone and the South Zone. The company has to file its
application at the nearest City Corporation.
The trade license filled-in application form must be accompanied by the following documents:
(1) A certified copy of the memorandum and articles of association
(2) A copy of the certificate of incorporation
(3) Tax Identification Number certificate
(4) The address and nature of business
(5) A copy of the lease agreement of the registered office
(6) 2 copies of Authorized Company Representative's NID or Passport
1 week
BDT 4,500 without VAT
Bangladesh
Doing Business
2020
Page 8
Takes place simultaneously with previous procedure.
8
Register for VAT
: National Board of Revenue
Agency
For VAT purposes, companies register with the Customs, Excise, and VAT Commission under the
National Board of Revenue. The company's VAT is regulated by the Customs, VAT and Excise
Department of the region in which it operates.
When an enterprise submits a VAT Registration application to the VAT authority an application
must accomplish or enclosed the following papers & Documents:
- Fill-up an application form.
- Enterprise Trade License.
- Bank Solvency Certificate.
- Owners 02 photograph.
- National ID/Passport copy of owners.
- IRC/ERC if enterprise is importing and exporting.
- Article & Memorandum (if enterprise is Limited Company.)
- TIN Certificate.
- Location MAP of Enterprise premises.
Application for VAT registration is submitted online at
https://vat.gov.bd/sap/bc/ui5_ui5/sap/zmcf_pri/index.html#/Welcome. However, in-person follow up
is commonly required after submitting the documents online.
1 week
no charge
9
Receive physical inspection of the business premises by a government agent and after VAT
registration
: National Board of Revenue
Agency
As of 2010, businesses receive physical inspection by a government agent in order to verify that
the company is real - this inspection is related to VAT registration. Starting from April 15, 2019, the
inspections are done after the registration.
1 day
no charge
Bangladesh
Doing Business
2020
Page 9
Starting a Business - Chittagong
Figure – Starting a Business in Chittagong – Score
Procedures
52.9
Time
80.9
Cost
95.6
Paid-in min. capital
100.0
Figure – Starting a Business in Chittagong and comparator economies – Ranking and Score
DB 2020 Starting a Business Score
0 100
89.3: Pakistan (Rank: 72)
88.2: Sri Lanka (Rank: 85)
82.4: Chittagong
82.4: Dhaka
81.7: Nepal (Rank: 135)
81.6: India (Rank: 136)
Note: The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of
the scores for each of the component indicators.
Standardized Company
Legal form
Private Limited Liability Company
Paid-in minimum capital requirement
No minimum
City Covered
Chittagong
Indicator
Best Regulatory
Performance
Procedure – Men (number)
9
7.1
4.9
1 (2 Economies)
Time – Men (days)
19.5
14.5
9.2
0.5 (New Zealand)
Cost – Men (% of income per capita)
8.7
8.3
3.0
0.0 (2 Economies)
Procedure – Women (number)
9
7.3
4.9
1 (2 Economies)
Time – Women (days)
19.5
14.6
9.2
0.5 (New Zealand)
Cost – Women (% of income per capita)
8.7
8.3
3.0
0.0 (2 Economies)
Paid-in min. capital (% of income per capita)
0.0
0.2
7.6
0.0 (120 Economies)
Bangladesh
Doing Business
2020
Page 10
Figure – Starting a Business in Chittagong – Procedure, Time and Cost
This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.
*
Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the
time for women. For more information on methodology, see the
website (
). For details on the procedures
reflected here, see the summary below.
Doing Business
http://doingbusiness.org/en/methodology
Procedures (number)
1 2 3 * 4 5 * 6 7 8 9
0
5
10
15
Time (days)
0
1
2
3
4
5
6
Cost (% of income per capita)
Time (days) Cost (% of income per capita)
Bangladesh
Doing Business
2020
Page 11
Details – Starting a Business in Chittagong – Procedure, Time and Cost
No.
Procedures
Time to Complete
Associated Costs
1
Verify the uniqueness of the proposed company name on the website of the Registrar of
Joint Stock Companies and Firms
: Registrar of Joint Stock Companies and Firms
Agency
The search for the availability of a company name was computerized in 2003. After checking that
the proposed company name is available for registration, the entrepreneur then applies for name
clearance through the Registrar of Joint Stock Companies and Firms (RJSC) website. The status
of the application can be checked online and is usually accepted or rejected within 1 working day.
If accepted, the company name is reserved for 6 months. A print out of the name clearance
certificate must be submitted to the RJSC, along with the other required documents for
incorporation.
Less than one day
(online procedure)
BDT 200 (paid at a
designated Bank)
2
Register at the Registrar of Joint Stock Companies and Firms
: Registrar of Joint Stock Companies and Firms
Agency
To register a company, the following documents must be submitted to the registrar:
(1) Name clearance certificate
(2) Memorandum and Articles of association
(3) Forms I (Declaration on the registration of the company); Form VI (Notice of the registered
office); Form IX (Consent to act as directors); Form X (The list of persons consenting to act as
directors); and Form XII (Particulars of the Directors, Managers, and Managing Agents)
Once the registration application is filed, the system generates a payment slip that should be
printed and paid at a designated bank. This payment slip includes the registration fees,
registration filing fees, stamp duties, and certified copies fees.
Registration fees can be calculated online at http://123.49.32.37:7781/psp/fee_calculator
Less than one day
(online procedure)
paid in procedure 3
3
Pay all applicable registration fees and duties at a designated bank
: Designated bank
Agency
The fees are as follows:
i. Registration fees.
For the authorized share capital of up to BDT 1,000,000, the fee is BDT 0.
For the authorized capital from BDT 1,000,001 to BDT 5,000,000, the fee is BDT 50 for every BDT
10,000 or part thereof;
For the authorized capital exceeding BDT 5,000,001, the fee is BDT 80 for every BDT 10,000 or
part thereof.
ii. Registration filing fees.
For filing 6 documents (5 filled in forms and the memorandum & articles of association, the fee is
BDT 400.00 per document): BDT 2,400
iii. Certified copies.
Certified Copy MoA+Form XII+Digital Certificate: BDT 1,220
iv. Stamp duties.
BDT 4,150
1 day
BDT 150 (without VAT)
registration fees + BDT
2,400 (without VAT)
registration filing fees +
BDT 1,220 (without VAT)
for the certified copies of
Memorandum and Articles
of Association, Form 12
and Digital Certificate +
BDT 4,150 for stamp
duties
4
Make a company seal
: Sealmaker
Agency
Business founders can make a company seal at the Seal maker for BDT 30-50. A better quality
seal can be more expensive at BDT 250-300.
1 day
BDT 30-50
5
Obtain a Tax identification number
: National Board of Revenue
Agency
In order to start business operations, every company must register for taxes at the appropriate
taxation authority (Deputy Commission of Taxes of Company Circle, Zonal Taxation Department)
under the National Board of Revenue (NBR) and obtain a tax identification number. Obtaining TIN
number can now be done online in less than one day.
Less than one day
(online procedure)
no charge
6
Open a Bank Account
: Bank
Agency
In order to register for VAT, the company must first open a bank account.
1 day (simultaneous with
previous procedure)
no charge
7
Obtain a trade license
: City Corporation
Agency
Companies obtain a trade license from the City Corporation (Chittagong). The trade license filled-
in application form must be accompanied by the following documents:
(1) A certified copy of the memorandum and articles of association
(2) A copy of the certificate of incorporation
(3) Tax Identification Number certificate
(4) Photograph of the Managing Director
(5) A copy of the lease agreement of the registered office
1 week
BDT 4,500
Bangladesh
Doing Business
2020
Page 12
Takes place simultaneously with previous procedure.
8
Register for VAT
: National Board of Revenue
Agency
For VAT purposes, companies register with the Customs, Excise, and VAT Commission under the
National Board of Revenue. The company's VAT is regulated by the Customs, VAT and Excise
Department of the region in which it operates.
When an enterprise submits a VAT Registration application to the VAT authority an application
must accomplish or enclosed the following papers & Documents:
- Fill-up an application form.
- Enterprise Trade License.
- Bank Solvency Certificate.
- Owners 02 photograph.
- National ID/Passport copy of owners.
- IRC/ERC if enterprise is importing and exporting.
- Article & Memorandum (if enterprise is Limited Company.)
- TIN Certificate.
- Location MAP of Enterprise premises.
Application for VAT registration is submitted online at
https://vat.gov.bd/sap/bc/ui5_ui5/sap/zmcf_pri/index.html#/Welcome. However, in-person follow up
is commonly required after submitting the documents online.
1 week
no charge
9
Receive physical inspection of the business premises by a government agent after VAT
registration
: National Board of Revenue
Agency
As of 2010, businesses receive physical inspection by a government agent in order to verify that
the company is real - this inspection is related to VAT registration. Starting from April 15, 2019, the
inspections are done after the registration.
1 day
no charge
Bangladesh
Doing Business
2020
Page 13
Dealing with Construction Permits
This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required notifications,
requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building
quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional
certification requirements. The most recent round of data collection was completed in May 2019.
See the methodology for more information
What the indicators measure
Procedures to legally build a warehouse (number)
Submitting all relevant documents and obtaining all necessary
clearances, licenses, permits and certificates
•
Submitting all required notifications and receiving all necessary
inspections
•
Obtaining utility connections for water and sewerage
•
Registering and selling the warehouse after its completion
•
Time required to complete each procedure (calendar days)
Does not include time spent gathering information
•
Each procedure starts on a separate day—though procedures
that can be fully completed online are an exception to this rule
•
Procedure is considered completed once final document is
received
•
No prior contact with officials
•
Cost required to complete each procedure (% of income per
capita)
Official costs only, no bribes
•
Building quality control index (0-15)
Quality of building regulations (0-2)
•
Quality control before construction (0-1)
•
Quality control during construction (0-3)
•
Quality control after construction (0-3)
•
Liability and insurance regimes (0-2)
•
Professional certifications (0-4)
•
Case study assumptions
To make the data comparable across economies, several assumptions about the construction
company, the warehouse project and the utility connections are used.
The construction company (BuildCo):
- Is a limited liability company (or its legal equivalent) and operates in the economy’s largest
business city. For 11 economies the data are also collected for the second largest business city.
- Is 100% domestically and privately owned; has five owners, none of whom is a legal entity. Has a
licensed architect and a licensed engineer, both registered with the local association of architects
or engineers. BuildCo is not assumed to have any other employees who are technical or licensed
experts, such as geological or topographical experts.
- Owns the land on which the warehouse will be built and will sell the warehouse upon its
completion.
The warehouse:
- Will be used for general storage activities, such as storage of books or stationery.
- Will have two stories, both above ground, with a total constructed area of approximately 1,300.6
square meters (14,000 square feet). Each floor will be 3 meters (9 feet, 10 inches) high and will be
located on a land plot of approximately 929 square meters (10,000 square feet) that is 100%
owned by BuildCo, and the warehouse is valued at 50 times income per capita.
- Will have complete architectural and technical plans prepared by a licensed architect. If
preparation of the plans requires such steps as obtaining further documentation or getting prior
approvals from external agencies, these are counted as procedures.
- Will take 30 weeks to construct (excluding all delays due to administrative and regulatory
requirements).
The water and sewerage connections:
- Will be 150 meters (492 feet) from the existing water source and sewer tap. If there is no water
delivery infrastructure in the economy, a borehole will be dug. If there is no sewerage
infrastructure, a septic tank in the smallest size available will be installed or built.
- Will have an average water use of 662 liters (175 gallons) a day and an average wastewater flow
of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and
a peak wastewater flow of 1,136 liters (300 gallons) a day.
- Will have a constant level of water demand and wastewater flow throughout the year; will be 1
inch in diameter for the water connection and 4 inches in diameter for the sewerage connection.
Bangladesh
Doing Business
2020
Page 14
Dealing with Construction Permits - Dhaka
Figure – Dealing with Construction Permits in Dhaka – Score
Procedures
56.0
Time
26.5
Cost
91.9
Building quality control index
66.7
Figure – Dealing with Construction Permits in Dhaka and comparator economies – Ranking and Score
DB 2020 Dealing with Construction Permits Score
0 100
78.7: India (Rank: 27)
72.3: Sri Lanka (Rank: 66)
67.3: Nepal (Rank: 107)
66.5: Pakistan (Rank: 112)
63.8: Chittagong
60.3: Dhaka
Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their scores for dealing with construction permits. These scores
are the simple average of the scores for each of the component indicators.
Standardized Warehouse
Estimated value of warehouse
BDT 7,300,370.40
City Covered
Dhaka
Indicator
Best Regulatory
Performance
Procedures (number)
16
14.6
12.7
None in 2018/19
Time (days)
281
149.7
152.3
None in 2018/19
Cost (% of warehouse value)
1.6
12.5
1.5
None in 2018/19
Building quality control index (0-15)
10.0
9.4
11.6
15.0 (6 Economies)
Bangladesh
Doing Business
2020
Page 15
Figure – Dealing with Construction Permits in Dhaka – Procedure, Time and Cost
This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.
*
Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the
time for women. For more information on methodology, see the
website (
). For details on the procedures
reflected here, see the summary below.
Doing Business
http://doingbusiness.org/en/methodology
Procedures (number)
1 2 * 3 4 5 * 6 * 7 * 8 9 10 11 12 13 14 15 * 16
0
50
100
150
200
250
Time (days)
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Cost (% of warehouse value)
Time (days) Cost (% of warehouse value)
Bangladesh
Doing Business
2020
Page 16
Figure – Dealing with Construction Permits in Dhaka and comparator economies – Measure of Quality
Dhaka India Nepal Pakistan Sri
Lanka
Chittagong South
Asia
0
2
4
6
8
10
12
14
16
Index score
10.0
14.5
10.0
13.0
6.0
10.0
9.4
Details – Dealing with Construction Permits in Dhaka – Procedure, Time and Cost
No.
Procedures
Time to Complete
Associated Costs
1
Obtain cadastral survey map from Land Settlement Office
: Land Settlement Office
Agency
BuildCo needs to obtain a cadastral map from the Land Settlement office. The fee to obtain the
smallest area map, equivalent to a neighborhood, is 350 Takas.
3 days
BDT 350
2
Obtain Land Use Clearance
: RAJUK (Capital Development Authority) and City Corporation
Agency
To obtain clearance, BuildCo must present proof of land ownership and the cadastral maps
showing the exact site location. An anticorruption drive of the interim government of Bangladesh
stemmed from massive violations of building regulations on one hand and collapse of buildings
with casualties on the other hand impacted the work of some areas of construction regulation.
45 days
BDT 1,000
3
Obtain soil test report
: Private Company
Agency
An external firm is generally hired for conducting a soil test.
24 days
BDT 59,500
4
Obtain project clearance from the local authority (Ward Commissioner, Dhaka City
Corporation)
: Dhaka City Corporation
Agency
To obtain the local authority’s approval, BuildCo must submit an application with the proposed
design plans. The approval may take anywhere from 3 to 7 days.
3 days
no charge
5
Obtain project clearance from the Environmental Directorate
: Environmental Directorate
Agency
The Environmental Directorate of Rajuk issues three types of clearances based on the type of
establishment: green (nonpolluting), orange (low polluting), and red (high polluting). To obtain a
project clearance, the following documents are required, depending on the environmental
category:
• Approval from the Ward Commissioner, Dhaka City Corporation
• Project profile, feasibility report, and drawings
• Land ownership documents
• Cadastral survey map and location map
• Trade license (copy)
• Registration of the Board of Investment (copy)
• EIA/ IEE/ EMP Report
• Fees payable to DOE
30 days
BDT 10,000
6
Obtain fire safety clearance
: Fire Department
Agency
15 days
BDT 8,000
7
Obtain clearance from Dhaka Electricity Supply Co (DESCO)
: Dhaka Electricity Supply Co (DESCO)
Agency
BuildCo must obtain the clearance from Dhaka Electricity Supply Co (DESCO) for the electrical
plans.
15 days
no charge
8
Obtain water and sanitation clearance
: Dhaka Water and Sewerage Authority (WASA)
Agency
The plumbing plans must be cleared by the relevant agencies.
15 days
no charge
9
Request and receive inspection from the City Development Authority (RAJUK)
: City Development Authority (RAJUK)
Agency
Before the building permit is issued, the authorized officers must visit the site to ascertain its
location according to the drawings and maps. However, with only a handful of officers and a
massive number of applications, it is extremely difficult to comply with the original 30-day time limit
established by the government. The procedure still takes 2 -- 5 months on average.
60 days
no charge
Bangladesh
Doing Business
2020
Page 17
Takes place simultaneously with previous procedure.
10
Request and obtain project clearance and building permit from the City Development
Authority (RAJUK)
: City Development Authority (RAJUK)
Agency
The approving panel of the City Development Authority (RAJUK) meets weekly to discuss cases.
In early 2007, officials in the Ministry of Works imposed a 30-day time limit on the process.
Applicants must obtain all relevants clearances, water, sanitation, electricity and a fire safety
clearance certificate before applying for the building permit.
Each agency that provides approval is given a 7-day time limit, but it is generally not complied
with.
The required documents are: (1) proof of ownership, (2) land use clearance from RAJUK, (3)
clearances from Fire Department and Environment for non residential construction
105 days
BDT 8,300
11
Receive random inspection from the City Development Authority (RAJUK)
: City Development Authority (RAJUK)
Agency
According to the 2006 National Building Code, Section II, chapter 3, all inspections during
construction are carried out by a structural engineer who must sign the certificate of supervision.
There are one or two random inspections for an average project. However, a building officer from
the City Development Authority may carry out one random inspection during construction to verify
that the work is being done according to the approved plans
1 day
no charge
12
Submit notice of completion and obtain Occupancy Permit
: City Development Authority (RAJUK)
Agency
According to the 2006 National Building Code, chapter 3, section 3.3.4, the completion notice
must be signed by the structural engineer who has supervised the entire construction phase. The
notice of completion certifies that the building has been built in compliance with the existing
regulations. The authorities may or may not inspect the building. It is only after receipt of this
completion notice that the certificate of conformity can be issued.
21 days
BDT 1,000
13
Request water and sewerage connection
: Dhaka Water and Sewerage Authority (WASA)
Agency
BuildCo must first submit an application to get a new water connection from the Dhaka Water and
Sewerage Authority.
10 days
BDT 30,000
14
Receive Site Inspection for Water Connection
: Dhaka Water and Sewerage Authority
Agency
A utilities inspection is required before water and sewerage connections can be approved in order
to verify feasibility of connection to water grid.
1 day
no charge
15
Obtain Water Connection
: Dhaka Water and Sewerage Authority
Agency
The Dhaka Water and Sewerage Authority will install the water meter and connect the construction
to the water and sewerage grid once all conditions have been met.
1 day
no charge
16
Receive inspection by tax inspector from Dhaka City Corporation upon completion of
construction
: Dhaka City Corporation
Agency
A tax inspector from the Dhaka City Corporation visits the site to assess the completed building.
No appointment is necessary and there are no fees paid. The tax authority then sends the annual
tax bill which will arrive 30 days later.
1 day
no charge
Bangladesh
Doing Business
2020
Page 18
Details – Dealing with Construction Permits in Dhaka – Measure of Quality
Answer
Score
Building quality control index (0-15)
10.0
Quality of building regulations index (0-2)
2.0
How accessible are building laws and regulations in your economy? (0-1)
Available online; Free
of charge.
1.0
Which requirements for obtaining a building permit are clearly specified in the building regulations or on any
accessible website, brochure or pamphlet? (0-1)
List of required
documents; Fees to
be paid; Required
preapprovals.
1.0
Quality control before construction index (0-1)
1.0
Which third-party entities are required by law to verify that the building plans are in compliance with existing
building regulations? (0-1)
Licensed architect;
Licensed engineer.
1.0
Quality control during construction index (0-3)
2.0
What types of inspections (if any) are required by law to be carried out during construction? (0-2)
Inspections by in-
house engineer;
Unscheduled
inspections.
1.0
Do legally mandated inspections occur in practice during construction? (0-1)
Mandatory
inspections are
always done in
practice.
1.0
Quality control after construction index (0-3)
3.0
Is there a final inspection required by law to verify that the building was built in accordance with the approved
plans and regulations? (0-2)
Yes, in-house
engineer submits
report for final
inspection.
2.0
Do legally mandated final inspections occur in practice? (0-1)
Final inspection
always occurs in
practice.
1.0
Liability and insurance regimes index (0-2)
0.0
Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use
(Latent Defect Liability or Decennial Liability)? (0-1)
No party is held liable
under the law.
0.0
Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or
problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1)
No party is required
by law to obtain
insurance .
0.0
Professional certifications index (0-4)
2.0
What are the qualification requirements for the professional responsible for verifying that the architectural plans
or drawings are in compliance with existing building regulations? (0-2)
University degree in
architecture or
engineering; Being a
registered architect or
engineer; Passing a
certification exam.
1.0
What are the qualification requirements for the professional who supervises the construction on the ground? (0-
2)
University degree in
engineering,
construction or
construction
management; Being
a registered architect
or engineer.
1.0
Bangladesh
Doing Business
2020
Page 19
Dealing with Construction Permits - Chittagong
Figure – Dealing with Construction Permits in Chittagong – Score
Procedures
60.0
Time
36.3
Cost
92.3
Building quality control index
66.7
Figure – Dealing with Construction Permits in Chittagong and comparator economies – Ranking and Score
DB 2020 Dealing with Construction Permits Score
0 100
78.7: India (Rank: 27)
72.3: Sri Lanka (Rank: 66)
67.3: Nepal (Rank: 107)
66.5: Pakistan (Rank: 112)
63.8: Chittagong
60.3: Dhaka
Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their scores for dealing with construction permits. These scores
are the simple average of the scores for each of the component indicators.
Standardized Warehouse
Estimated value of warehouse
BDT 7,300,370.40
City Covered
Chittagong
Indicator
Best Regulatory
Performance
Procedures (number)
15
14.6
12.7
None in 2018/19
Time (days)
247
149.7
152.3
None in 2018/19
Cost (% of warehouse value)
1.5
12.5
1.5
None in 2018/19
Building quality control index (0-15)
10.0
9.4
11.6
15.0 (6 Economies)
Bangladesh
Doing Business
2020
Page 20
Figure – Dealing with Construction Permits in Chittagong – Procedure, Time and Cost
This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.
*
Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the
time for women. For more information on methodology, see the
website (
). For details on the procedures
reflected here, see the summary below.
Doing Business
http://doingbusiness.org/en/methodology
Procedures (number)
1 2 3 * 4 * 5 * 6 * 7 8 9 10 11 12 13 14 * 15
0
50
100
150
200
Time (days)
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Cost (% of warehouse value)
Time (days) Cost (% of warehouse value)
Bangladesh
Doing Business
2020
Page 21
Figure – Dealing with Construction Permits in Chittagong and comparator economies – Measure of Quality
Chittagong India Nepal Pakistan Sri
Lanka
Dhaka South
Asia
0
2
4
6
8
10
12
14
16
Index score
10.0
14.5
10.0
13.0
6.0
10.0
9.4
Details – Dealing with Construction Permits in Chittagong – Procedure, Time and Cost
No.
Procedures
Time to Complete
Associated Costs
1
Obtain cadastral survey map and proof of ownership from Land Records Department
: Land Records Department
Agency
BuildCo needs to obtain a cadastral map from the Land Settlement office. The fee to obtain the
smallest area map, equivalent to a neighborhood, is 350 Takas.
3 days
BDT 350
2
Obtain project approval from Ward Commissioner
: Chittagong City Corporation
Agency
Due to the location of the Doing Business case study warehouse (which would be near the port),
BuildCo is required to obtain the approval of the land commissioner for the project, in addition to
the building permit from the Development Authority. An application must therefore be submitted,
along with the design plan.
4 days
no charge
3
Obtain land use clearance (LUC) from the Chittagong Development Authority
: Chittagong Development Authority (CDA)
Agency
The land use clearance is obtained to ensure that the plot of land can be used for construction
purposes. The applicants needs to submit documents to the Chittagong Development Authority so
that officials analyze and check the request against their GIS system. If required they will visit to
the premises. CDA will publish in a local newspaper approved, conditionally approved and denied
requests for land use
50 days
BDT 5,000
4
Obtain soil test report
: Private Company
Agency
A soil test study must be obtained prior to applying for the permit. A certified company provided by
the government conducts the soil test.
24 days
BDT 59,500
5
Obtain fire safety license
: Fire Authority
Agency
A fire safety license must be obtained from the fire authority to be compliant with the agency. This
can be done while the land use clearance is being processed.
15 days
BDT 8,000
6
Obtain clearance from Bangladesh Power Development Board
: Bangladesh Power Development Board
Agency
BuildCo must first obtain the clearance from Bangladesh Power Development Board for the
electrical plans before applying for the building permit.
15 days
no charge
7
Obtain water and sanitation clearance
: Chittagong WASA
Agency
The plumbing plans must be cleared by the relevant agencies.
15 days
no charge
8
Request and receive inspection from the Chittagong Development Authority (CDA)
: Chittagong Development Authority (CDA)
Agency
The Chittagong Development Authority (CDA) will then have to inspect the land physically and
make its own independent assessment. The waiting time is about 3-6 months for inspectors to
visit the site because of a backlog in requests. If the inspection is satisfactory, the inspector then
submits a report to the CDA for the approval of the building permit.
60 days
no charge
9
Obtain building permit from the Chittagong Development Authority (CDA)
: Chittagong Development Authority (CDA)
Agency
BuildCo submits an application for a building permit to the Authorization Committee of CDA along
with design plans, legal documents proving ownership of land, land use clearance, identification
documents and fee payment receipt. It can take as long as 3-6 months from the moment a
satisfactory report on the inspection is issued to the time it takes CDA to issue the building
permit.There are 14 internal steps at CDa during the approval of the permit.
105 days
BDT 8,300
10
Receive random inspection during construction
: Chittagong Development Authority (CDA)
Agency
A building officer will randomly inspect the construction site.
1 day
no charge
Bangladesh
Doing Business
2020
Page 22
Takes place simultaneously with previous procedure.
11
Submit completion certificate and receive certificate of conformity
: Chittagong Development Authority (CDA)
Agency
According to the National Building Code, Chapter 3, Section 3.3.4, the completion notice must be
signed by the structural engineer who has supervised the entire construction phase, certifying that
the building has been built in compliance with the existing regulations. The authority may or may
not conduct a final inspection of the building. It is only after receipt of this completion notice that
the certificate of conformity is issued.
1 day
BDT 1,000
12
Request water connection at WASA
: Chittagong WASA
Agency
BuildCo must first submit an application to get a new water connection.
1 day
no charge
13
Receive inspection for water assessment works
: Chittagong WASA
Agency
The sales division will then visit the site and assess the feasibility of the work. If feasible, they will
issue a demand note containing the cost estimate for the excavation and the pipes. If there is road
crossing involved, an extra permit from the city would be required.
1 day
no charge
14
Obtain water connection
: Chittagong WASA
Agency
21 days
BDT 30,000
15
Receive inspection by tax inspector from Chittagong City Corporation upon completion of
construction
: Chittagong City Corporation
Agency
A tax inspector from the Chittagong City Corporation visits the site to assess the completed
building. No appointment is necessary and there are no fees paid. The tax authority then sends
the annual tax bill, which will arrive 30 days later.
1 day
no charge
Bangladesh
Doing Business
2020
Page 23
Details – Dealing with Construction Permits in Chittagong – Measure of Quality
Answer
Score
Building quality control index (0-15)
10.0
Quality of building regulations index (0-2)
2.0
How accessible are building laws and regulations in your economy? (0-1)
Available online; Free
of charge.
1.0
Which requirements for obtaining a building permit are clearly specified in the building regulations or on any
accessible website, brochure or pamphlet? (0-1)
List of required
documents; Fees to
be paid; Required
preapprovals.
1.0
Quality control before construction index (0-1)
1.0
Which third-party entities are required by law to verify that the building plans are in compliance with existing
building regulations? (0-1)
Licensed architect;
Licensed engineer.
1.0
Quality control during construction index (0-3)
2.0
What types of inspections (if any) are required by law to be carried out during construction? (0-2)
Inspections by in-
house engineer;
Unscheduled
inspections.
1.0
Do legally mandated inspections occur in practice during construction? (0-1)
Mandatory
inspections are
always done in
practice.
1.0
Quality control after construction index (0-3)
3.0
Is there a final inspection required by law to verify that the building was built in accordance with the approved
plans and regulations? (0-2)
Yes, in-house
engineer submits
report for final
inspection.
2.0
Do legally mandated final inspections occur in practice? (0-1)
Final inspection
always occurs in
practice.
1.0
Liability and insurance regimes index (0-2)
0.0
Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use
(Latent Defect Liability or Decennial Liability)? (0-1)
No party is held liable
under the law.
0.0
Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or
problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1)
No party is required
by law to obtain
insurance .
0.0
Professional certifications index (0-4)
2.0
What are the qualification requirements for the professional responsible for verifying that the architectural plans
or drawings are in compliance with existing building regulations? (0-2)
University degree in
architecture or
engineering; Being a
registered architect or
engineer.
1.0
What are the qualification requirements for the professional who supervises the construction on the ground? (0-
2)
University degree in
engineering,
construction or
construction
management; Being
a registered architect
or engineer.
1.0
Bangladesh
Doing Business
2020
Page 24
Getting Electricity
This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally,
the reliability of supply and transparency of tariffs index measures reliability of supply, transparency of tariffs and the price of electricity. The most recent round of data
collection for the project was completed in May 2019.
.
See the methodology for more information
What the indicators measure
Procedures to obtain an electricity connection (number)
Submitting all relevant documents and obtaining all necessary
clearances and permits
•
Completing all required notifications and receiving all necessary
inspections
•
Obtaining external installation works and possibly purchasing
material for these works
•
Concluding any necessary supply contract and obtaining final
supply
•
Time required to complete each procedure (calendar days)
Is at least 1 calendar day
•
Each procedure starts on a separate day
•
Does not include time spent gathering information
•
Reflects the time spent in practice, with little follow-up and no
prior contact with officials
•
Cost required to complete each procedure (% of income per
capita)
Official costs only, no bribes
•
Value added tax excluded
•
The reliability of supply and transparency of tariffs index (0-8)
Duration and frequency of power outages (0–3)
•
Tools to monitor power outages (0–1)
•
Tools to restore power supply (0–1)
•
Regulatory monitoring of utilities’ performance (0–1)
•
Financial deterrents limiting outages (0–1)
•
Transparency and accessibility of tariffs (0–1)
•
Price of electricity (cents per kilowatt-hour)*
Price based on monthly bill for commercial warehouse in case
study
•
*Note:
measures the price of electricity, but it is
not included in the ease of doing business score nor in the ranking
on the ease of getting electricity.
Doing Business
Case study assumptions
To make the data comparable across economies, several assumptions about the warehouse, the
electricity connection and the monthly consumption are used.
The warehouse:
- Is owned by a local entrepreneur and is used for storage of goods.
- Is located in the economy’s largest business city. For 11 economies the data are also collected for
the second largest business city.
- Is located in an area where similar warehouses are typically located and is in an area with no
physical constraints. For example, the property is not near a railway.
- Is a new construction and is being connected to electricity for the first time.
- Has two stories with a total surface area of approximately 1,300.6 square meters (14,000 square
feet). The plot of land on which it is built is 929 square meters (10,000 square feet).
The electricity connection:
- Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-
kilo-volt-ampere (kVA) with a power factor of 1, when 1 kVA = 1 kilowatt (kW).
- Has a length of 150 meters. The connection is to either the low- or medium-voltage distribution
network and is either overhead or underground, whichever is more common in the area where the
warehouse is located and requires works that involve the crossing of a 10-meter road (such as by
excavation or overhead lines) but are all carried out on public land. There is no crossing of other
owners’ private property because the warehouse has access to a road.
- Does not require work to install the internal wiring of the warehouse. This has already been
completed up to and including the customer’s service panel or switchboard and the meter base.
The monthly consumption:
- It is assumed that the warehouse operates 30 days a month from 9:00 a.m. to 5:00 p.m. (8 hours
a day), with equipment utilized at 80% of capacity on average and that there are no electricity cuts
(assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours
(kWh); hourly consumption is 112 kWh.
- If multiple electricity suppliers exist, the warehouse is served by the cheapest supplier.
- Tariffs effective in January of the current year are used for calculation of the price of electricity for
the warehouse. Although January has 31 days, for calculation purposes only 30 days are used.
Bangladesh
Doing Business
2020
Page 25
Getting Electricity - Dhaka
Figure – Getting Electricity in Dhaka – Score
Procedures
0.0
Time
57.8
Cost
78.0
Reliability of supply and transparency of
tariff index
0.0
Figure – Getting Electricity in Dhaka and comparator economies – Ranking and Score
DB 2020 Getting Electricity Score
0 100
89.4: India (Rank: 22)
74.5: Sri Lanka (Rank: 89)
64.0: Pakistan (Rank: 123)
60.9: Nepal (Rank: 135)
38.1: Chittagong
34.0: Dhaka
Note: The ranking of economies on the ease of getting electricity is determined by sorting their scores for getting electricity. These scores are the simple average of the
scores for all the component indicators except the price of electricity.
Figure – Getting Electricity in Dhaka – Procedure, Time and Cost
This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.
*
Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the
time for women. For more information on methodology, see the
website (
). For details on the procedures
Doing Business
http://doingbusiness.org/en/methodology
Procedures (number)
1 * 2 3 * 4 5 6 * 7 8 9
0
20
40
60
80
100
Time (days)
0
200
400
600
800
1000
1200
1400
Cost (% of income per capita)
Time (days) Cost (% of income per capita)
Standardized Connection
Name of utility
Dhaka Electric Supply Company Ltd. (DESCO)
Price of electricity (US cents per kWh)
9.4
City Covered
Dhaka
Indicator
Best Regulatory
Performance
Procedures (number)
9
5.5
4.4
3 (28 Economies)
Time (days)
115
86.1
74.8
18 (3 Economies)
Cost (% of income per capita)
1781.1
952.6
61.0
0.0 (3 Economies)
Reliability of supply and transparency of tariff index (0-8)
0
2.7
7.4
8 (26 Economies)
Bangladesh
Doing Business
2020
Page 26
reflected here, see the summary below.
Figure – Getting Electricity in Dhaka and comparator economies – Measure of Quality
Dhaka India Nepal Pakistan Sri
Lanka
Chittagong South
Asia
0
1
2
3
4
5
6
7
Index score
0
6
0
5
6
0
2.7
Bangladesh
Doing Business
2020
Page 27
Details – Getting Electricity in Dhaka – Procedure, Time and Cost
Takes place simultaneously with previous procedure.
No.
Procedures
Time to Complete
Associated Costs
1
Obtain permission for installation of underground cable
: City Corporation
Agency
Once the clearance has been obtained from the City Corporation office for the excavation works,
the customer must also inform the local police station for the road works
21 calendar days
BDT 0
2
Hire electrical contracting firm to purchase substation equipment, get it tested and carry
out installation and earthing
: Outside firm
Agency
All electrical equipment, the distribution transformer, etc, must be purchased and tested by the
Bangladesh University of Engineering and Technology (BUET), before submitting the application
for a new electricity connection to the utility. Usually, all these equipment are readily available in
Dhaka.
15 calendar days
BDT 1,800,000
3
Apply for license from Electrical Licensing Board (ELB)
: Ministry of Power
Agency
This is the official clearance required in order to set up the warehouse and obtain the electrical
connection (not just for internal wiring).
Documents required
• Application form
• Technical specifications of equipment and test report
• Land registration deed (on which warehouse is located)
• RAJUK approval/mutation certificate
• Fire service permission (for underground cabling)
• Architectural approval
10 calendar days
BDT 11,820
4
Receive an inspection from the Electrical Licensing Board (ELB)
: Electrical Licensing Board (ELB)
Agency
In order to obtain the license from the Electrical Licensing Board for the new connection, an
inspection carried out by the board is completed.
1 calendar day
BDT 0
5
Submit application to Dhaka Electric Supply Company (DESCO) and await estimate
: DESCO
Agency
To submit an application, the customer must prepare the following documents:
- One complete application form duly filled online, printed and signed
- 2 passport-size photos
- Copy of National ID/Passport
- Land deed/copy of mutation certificate/succession certificate in case if the land owner is
deceased
- Copy of the latest paid bill if there is an existing connection in the premise (no new documents
are required in such cases)
- For high rise building (more than 10 stories), fire certificate
- Approved plan from Rajuk/City corporation/Municipal Corporation where required
The applicant needs to bear all the cost of 11.4kV S/S and to be connected with the nearby 11kV
supply of DPDC through underground cable.
30 calendar days
BDT 158,678.11
6
Have electrical contracting firm carry out external works
: Outside firm
Agency
The customer must hire an electrical contracting firm to carry out the external works, which
involves the setting up of the substation on the warehouse premises. All equipment already
purchased, electrical contractor firm and builder does the site construction and installation of
equipment
20 calendar days
BDT 270,000
7
Receive installation of solar panels by private firm
: Private solar panel installation company
Agency
As per the Ministry’s directive to all the utilities, all new connections with demand above 2KW will
now require installation of solar panels. For domestic purposes, solar energy should meet at least
2 percent of the demand, for commercial 7 percent and for industrial 10 percent.
14 calendar days
BDT 310,000
8
Have electrical contracting firm purchase meter
: Outside firm
Agency
The meter can be collected once the estimate has been paid, and the utility sends communication
to the stores department, and stores department then issues an account number, and the meter is
then available for pickup.
14 calendar days
BDT 50,000
9
Receive meter testing and installation, final inspection and electricity flow
: DESCO
Agency
The utility conducts final internal as well as external inspection, tests the meter and electricity
starts flowing.
20 calendar days
BDT 0
Bangladesh
Doing Business
2020
Page 28
Details – Getting Electricity in Dhaka – Measure of Quality
Note:
If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tariff index.
If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index.
If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index.
Answer
Reliability of supply and transparency of tariff index (0-8)
0
Total duration and frequency of outages per customer a year (0-3)
0
System average interruption duration index (SAIDI)
..
System average interruption frequency index (SAIFI)
..
What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI
N/A
Mechanisms for monitoring outages (0-1)
0
Does the distribution utility use automated tools to monitor outages?
No
Mechanisms for restoring service (0-1)
0
Does the distribution utility use automated tools to restore service?
No
Regulatory monitoring (0-1)
1
Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on reliability of supply?
Yes
Financial deterrents aimed at limiting outages (0-1)
0
Does the utility either pay compensation to customers or face fines by the regulator (or both) if outages exceed a certain cap?
No
Communication of tariffs and tariff changes (0-1)
0
Are effective tariffs available online?
Yes
Link to the website, if available online
www.berc.org.bd
Are customers notified of a change in tariff ahead of the billing cycle?
No
Bangladesh
Doing Business
2020
Page 29
Getting Electricity - Chittagong
Figure – Getting Electricity in Chittagong – Score
Procedures
33.3
Time
39.1
Cost
80.0
Reliability of supply and transparency of
tariff index
0.0
Figure – Getting Electricity in Chittagong and comparator economies – Ranking and Score
DB 2020 Getting Electricity Score
0 100
89.4: India (Rank: 22)
74.5: Sri Lanka (Rank: 89)
64.0: Pakistan (Rank: 123)
60.9: Nepal (Rank: 135)
38.1: Chittagong
34.0: Dhaka
Note: The ranking of economies on the ease of getting electricity is determined by sorting their scores for getting electricity. These scores are the simple average of the
scores for all the component indicators except the price of electricity.
Figure – Getting Electricity in Chittagong – Procedure, Time and Cost
This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.
*
Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the
time for women. For more information on methodology, see the
website (
). For details on the procedures
Doing Business
http://doingbusiness.org/en/methodology
Procedures (number)
1 2 * 3 4 5 * 6 7
0
20
40
60
80
100
120
140
Time (days)
0
200
400
600
800
1000
1200
Cost (% of income per capita)
Time (days) Cost (% of income per capita)
Standardized Connection
Name of utility
BPDB, Chittagong
Price of electricity (US cents per kWh)
10.9
City Covered
Chittagong
Indicator
Best Regulatory
Performance
Procedures (number)
7
5.5
4.4
3 (28 Economies)
Time (days)
158
86.1
74.8
18 (3 Economies)
Cost (% of income per capita)
1620.9
952.6
61.0
0.0 (3 Economies)
Reliability of supply and transparency of tariff index (0-8)
0
2.7
7.4
8 (26 Economies)
Bangladesh
Doing Business
2020
Page 30
reflected here, see the summary below.
Figure – Getting Electricity in Chittagong and comparator economies – Measure of Quality
Chittagong India Nepal Pakistan Sri
Lanka
Dhaka South
Asia
0
1
2
3
4
5
6
7
Index score
0
6
0
5
6
0
2.7
Bangladesh
Doing Business
2020
Page 31
Details – Getting Electricity in Chittagong – Procedure, Time and Cost
Takes place simultaneously with previous procedure.
No.
Procedures
Time to Complete
Associated Costs
1
Hire electrical contracting firm to purchase substation equipment and carry out installation
and earthing
: Outside firm
Agency
All electrical equipment, the distribution transformer, etc, must be purchased and tested by a
testing lab before submitting the application for a new electricity connection to the utility. Usually,
all these equipment are readily available in Chittagong.
30 calendar days
BDT 1,400,000
2
Apply for license from Electrical Licensing Board (ELB)
: Ministry of Power, Energy and Mineral Resources
Agency
The client must apply for the certificate of connection from the Electricity License Board. This is
the official clearance required in order to set up the warehouse and obtain the electrical
connection (not just for internal wiring).
Documents required:
• Application form
• Technical specifications of equipment and test report
• Land registration deed (on which warehouse is located)
• CCC approval/mutation certificate
• Fire service permission (for underground cabling)
• Architectural approval
28 calendar days
BDT 5,000
3
Receive an inspection from the Electrical Licensing Board (ELB)
: Electrical Licensing Board (ELB)
Agency
A customer must receive an inspection from the Electrical Licensing Board (ELB)
1 calendar day
BDT 0
4
Submit application to BPDB Chittagong and await estimate
: BPDB
Agency
List of documents to be provided with application:
• Two duly certified passport size photos
• Copy of land deed paper and copy of mutation certificate where necessary.
• Copy of land tax payment to the municipal/union parishad.
• Copy of the agreement paper between the landowner and developer, if building is constructed by
real estate developer.
• Design of the building, duly approved by CDA.
• Clear location of the meter room, including the S/S in the plan, duly approved by CDA
• Certified copy of test result on electrical equipment.
• Copy of approved/duly certified single line diagram and earthwork diagram of the S/S
• Copy of the layout diagram of S/S from the Office of Chief Electrical Inspector.
• Copy of the license received from Office of Chief Electrical Inspector.
• Detailed description of present connection status.
• Trade license
• Land documents
• Copy of the last paid bills.
2. The applicant needs to bear all the cost of 11.4kV S/S and to be connected with the nearby
11kV supply of DPDC through underground cable.
The long duration noted for this procedure is due to the delay in the customer receiving the
demand notice from the utility.
50 calendar days
BDT 381,678.11
5
Have electrical contracting firm carry out external works
: Customer's electrical contracting firm
Agency
The customer must hire an electrical contracting firm to carry out the external works, which
involves the setting up of the substation on the warehouse premises. All equipment already
purchased, electrical contractor firm and builder carries out the site construction and installation of
equipment.
30 calendar days
BDT 270,000
6
Receive installation of solar panels by private firm
: Private solar panel installation firm
Agency
As per the Ministry’s directive to all the utilities, all new connections with demand above 2KW will
now require the installation of solar panels. For domestic purposes, solar energy should meet at
least 2 percent of the demand, for commercial 7 percent and for industrial 10 percent.
14 calendar days
BDT 310,000
7
Receive meter testing and installation, final inspection and electricity flow
: BPDB, Chittagong
Agency
After the installation of all electrical equipment, an authorized inspector from the ELB license
board will inspect all installations and equipment. If the inspection is successful, a certificate of
conformity will be issued, with an official seal. Company will then submit the ELB certificate to
PDB and electricity will start flowing.
20 calendar days
BDT 0
Bangladesh
Doing Business
2020
Page 32
Details – Getting Electricity in Chittagong – Measure of Quality
Note:
If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tariff index.
If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index.
If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index.
Answer
Reliability of supply and transparency of tariff index (0-8)
0
Total duration and frequency of outages per customer a year (0-3)
0
System average interruption duration index (SAIDI)
..
System average interruption frequency index (SAIFI)
..
What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI
N/A
Mechanisms for monitoring outages (0-1)
0
Does the distribution utility use automated tools to monitor outages?
No
Mechanisms for restoring service (0-1)
0
Does the distribution utility use automated tools to restore service?
No
Regulatory monitoring (0-1)
1
Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on reliability of supply?
Yes
Financial deterrents aimed at limiting outages (0-1)
0
Does the utility either pay compensation to customers or face fines by the regulator (or both) if outages exceed a certain cap?
No
Communication of tariffs and tariff changes (0-1)
0
Are effective tariffs available online?
Yes
Link to the website, if available online
http://www.berc.org.bd/ind
ex.php?id=101
Are customers notified of a change in tariff ahead of the billing cycle?
No
Bangladesh
Doing Business
2020
Page 33
Registering Property
This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a
building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality
of land administration index has five dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access
to property rights. The most recent round of data collection for the project was completed in May 2019.
.
See the methodology for more information
What the indicators measure
Procedures to legally transfer title on immovable property
(number)
Preregistration procedures (for example, checking for liens,
notarizing sales agreement, paying property transfer taxes)
•
Registration procedures in the economy's largest business city.
•
Postregistration procedures (for example, filling title with
municipality)
•
Time required to complete each procedure (calendar days)
Does not include time spent gathering information
•
Each procedure starts on a separate day - though procedures
that can be fully completed online are an exception to this rule
•
Procedure is considered completed once final document is
received
•
No prior contact with officials
•
Cost required to complete each procedure (% of property
value)
Official costs only (such as administrative fees, duties and
taxes).
•
Value Added Tax, Capital Gains Tax and illicit payments are
excluded
•
Quality of land administration index (0-30)
Reliability of infrastructure index (0-8)
•
Transparency of information index (0–6)
•
Geographic coverage index (0–8)
•
Land dispute resolution index (0–8)
•
Equal access to property rights index (-2–0)
•
Case study assumptions
To make the data comparable across economies, several assumptions about the parties to the
transaction, the property and the procedures are used.
The parties (buyer and seller):
- Are limited liability companies (or the legal equivalent).
- Are located in the periurban (that is, on the outskirts of the city but still within its official limits)
area of the economy’s largest business city. For 11 economies the data are also collected for the
second largest business city.
- Are 100% domestically and privately owned.
- Perform general commercial activities.
The property (fully owned by the seller):
- Has a value of 50 times income per capita, which equals the sale price.
- Is fully owned by the seller.
- Has no mortgages attached and has been under the same ownership for the past 10 years.
- Is registered in the land registry or cadastre, or both, and is free of title disputes.
- Is located in a periurban commercial zone (that is, on the outskirts of the city but still within its
official limits), and no rezoning is required.
- Consists of land and a building. The land area is 557.4 square meters (6,000 square feet). A two-
story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse
is 10 years old, is in good condition, has no heating system and complies with all safety standards,
building codes and legal requirements. The property, consisting of land and building, will be
transferred in its entirety.
- Will not be subject to renovations or additional construction following the purchase.
- Has no trees, natural water sources, natural reserves or historical monuments of any kind.
- Will not be used for special purposes, and no special permits, such as for residential use,
industrial plants, waste storage or certain types of agricultural activities, are required.
- Has no occupants, and no other party holds a legal interest in it.
Bangladesh
Doing Business
2020
Page 34
Registering Property - Dhaka
Figure – Registering Property in Dhaka – Score
Procedures
41.7
Time
0.0
Cost
52.5
Quality of the land administration index
21.7
Figure – Registering Property in Dhaka and comparator economies – Ranking and Score
DB 2020 Registering Property Score
0 100
63.6: Nepal (Rank: 97)
51.9: Sri Lanka (Rank: 138)
48.6: Pakistan (Rank: 151)
47.6: India (Rank: 154)
29.0: Dhaka
28.9: Chittagong
Note: The ranking of economies on the ease of registering property is determined by sorting their scores for registering property. These scores are the simple average of
the scores for each of the component indicators.
Indicator
Best Regulatory
Performance
Procedures (number)
8
6.9
4.7
1 (5 Economies)
Time (days)
264
107.8
23.6
1 (2 Economies)
Cost (% of property value)
7.1
7.0
4.2
0.0 (Saudi Arabia)
Quality of the land administration index (0-30)
6.5
9.1
23.2
None in 2018/19
Bangladesh
Doing Business
2020
Page 35
Figure – Registering Property in Dhaka – Procedure, Time and Cost
This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.
*
Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the
time for women. For more information on methodology, see the
website (
). For details on the procedures
reflected here, see the summary below.
Doing Business
http://doingbusiness.org/en/methodology
Procedures (number)
1 2 * 3 4 5 6 7 * 8
0
50
100
150
200
250
Time (days)
0
1
2
3
4
5
6
7
8
Cost (% of property value)
Time (days) Cost (% of property value)
Bangladesh
Doing Business
2020
Page 36
Figure – Registering Property in Dhaka and comparator economies – Measure of Quality
Dhaka India Nepal Pakistan Sri
Lanka
Chittagong South
Asia
0
2
4
6
8
10
12
Index score
6.5
10.8
6.0
9.8
5.5
6.5
9.1
Details – Registering Property in Dhaka – Procedure, Time and Cost
No.
Procedures
Time to Complete
Associated Costs
1
Verifying the current Khatian (record of rights) at the Directorate of Land Records and
Surveys (DLRS)
: Directorate of Land Records and Surveys (DLRS)
Agency
Various departments of two Ministries manage the core functions of land administration:
1. The Ministry of Land (MoL): land-related activities including survey, the collection of land
development tax, arbitration process. The following agencies are under the Ministry of Land:
1.1 Directorate of Land Records and Surveys (DLRS): Conducts cadastral surveys, from which it
produces mouza (revenue village) maps showing individual plots of land and khatian (individual
land record certificates)
1.2 AC (Land) Office: Manages the mutated Khatian.
1.2.1Tehsil office: the local administrative division that has the function of record keeping.
2. The Ministry of Law, Justice and Parliamentary Affairs (MLJP): Records land mutation and
transfers.
2.1 The Department of Land Registration (DLR): Records land mutations arising through sale,
inheritance or other forms of transfer, reports changes to the Ministry of Land, and collects the
immovable property transfer tax (IPTT).
2.2.1 Sub-registrar’s office: the local administrative division that has the function of registration.
For a property transfer, first, the company will obtain a proof of land ownership titles (called
Porcha or Khatian) at the Directorate of Land Records and Surveys (DLRS). It contains the names
of owners, percentages of ownership of each person, the plot number, the type of property
(residential, commercial), and its size.
However, the Khatian requested at the DLRS is not conclusive evidence of ownership, and merely
provide a basis of possession at the recording time.
20 days
no charge
2
Conduct the first mutation and obtain an updated record of rights (Khatian) at the Assistant
Commissioner of Lands (AC Land) - Tahsil
: Assistant Commissioner of Lands (AC Land) - Tahsil
Agency
The current land system in Bangladesh produces multiple khatians.The khatian is administered
separately by the Directorate of Land Records and Surveys (DLRS), the DC Record Room, the
Assistant Commissioner of Lands and the Tahsil Office. The khatian managed by DLRS may differ
from the mutated khatian managed by the AC (Land) Office. In that case, If the name of the
transferor is not found in the latest Khatian or his/her name is not mutated, the Sub Registrar will
refuse to register the transfer deed. Therefore, it is mandatory to mutate the name of the
transferor in the latest Khatian.
The mutation is the process for updating the ownership and obtain a certificate of the land record.
This certificate is one of the documents needed to register the property transfer. Typically,
properties have missing information in the records, or the seller legal owner may not be correct.
The interest parties will always verify with AC Land the history of ownership to see if the Khatian
information is correctly corresponding to the actual land. This situation is common because, in at
least 50% of cases, the records are not correct. Sometimes, due to problems caused at the AC
Land Office, such as incorrectly recording names and other details of the land.
53 days
BDT 1,170; (Application
fee (Court fee) 20 Taka;
Notice issue fee 50 Taka;
Record correction fee
1000 Taka; Khatian fee
100 Taka)
3
Inspection of the property for updating the record of rights (Khatian) by the Assistant
Commissioner of Lands (AC Land) - Tahsil
: Assistant Commissioner of Lands (AC Land) - Tahsil
Agency
The Assistant Commissioner of Lands (Tahsil) will carry a physical inspection to provide the
updated record of rights (Khatian). Officials visit the plot to check if there are no irregularities, such
as informal buildings, and if the size of the land plot is correct, etc.
53 days
Included in Procedure 2
4
Obtain the non-encumbrance certificate from the relevant Sub-registry office
: Land Registration Directorate - Sub-registry office
Agency
The buyer checks the legal status of the land (mortgaged or leased or ownership) at the relevant
Sub-registry. From January 2012 both Sub-registry and Land Revenue Office provide non-
encumbrance certificates. Sometimes a land report is required. A land report gives an idea about
the current situation and ownership of the land that may include the chain of ownership, land tax,
land record, registry status etc. A non-encumbrance certificate is used in property transactions as
evidence of free title/ownership.
8 days
BDT 150
Bangladesh
Doing Business
2020
Page 37
Takes place simultaneously with previous procedure.
5
A lawyer or a deed writer draft the deed transfer
: Lawyer
Agency
In most of the cases, a lawyer or a deed writer draft the transfer deed that should be signed by the
interested partied.
1 day
BDT 6,000; (Lawyer fees)
6
Pay stamp duty, capital gains tax, registration fee and other taxes at designated bank
: Designated Bank
Agency
The parties should pay all registration fees at the designated commercial bank.
1 day
BDT 511,365.93; (3% of
the property value (stamp
duties) + 2% of property
value (registration fees) +
2% of property value (local
government fee) + BDT
100 (endorsement fee of
100) + BDT 240
(mandatory copy)
Per methodology, VAT and
source tax (capital gains)
are not recorded.)
7
Apply for registration at the relevant Sub-registry
: Land Registration Directorate - Sub-registry office
Agency
The buyer applies for registration at the Sub-registry office, presenting the following documents:
- Records to prove land ownership - Porcha or Khatian – (obtained in procedure 1)
- The mutation proof - mutated Khatian (obtained in procedure 2)
- Certificate of non-encumbrance (obtained in procedure 4)
- Transfer deed (obtained in procedure 5)
- Proof of payment of fees at a bank (Obtained in procedure 6)
A certified registration document is obtained within a week for the buyer’s record. The original sale
deed/certificate requires about 6 months to be obtained.
180 days
Already paid in Procedure
6
8
Conduct second mutation to change the ownership at the Assistant Commissioner of
Lands (AC Land) - Tahsil
: Assistant Commissioner of Lands (AC Land) - Tahsil
Agency
The change of ownership must be registered at the Assistant Commissioner of Lands (AC Land).
The property is recorded under the name of the new owner, who is responsible for paying the land
taxes from the day it is transferred.
The purpose of the 1st mutation (procedure 1) is to update the records under the seller’s name.
The purpose of the 2nd mutation (procedure 8) is to update the records under the buyer’s name.
53 days
BDT 1,170; (Application
fee (Court fee) 20 Taka;
Notice issue fee 50 Taka;
Record correction fee
1000 Taka; Khatian fee
100 Taka)
Bangladesh
Doing Business
2020
Page 38
Details – Registering Property in Dhaka – Measure of Quality
Answer
Score
Quality of the land administration index (0-30)
6.5
Reliability of infrastructure index (0-8)
0.0
Type of land registration system in the economy:
Dual system (Title &
Deed)
What is the institution in charge of immovable property registration?
Sub-Registry office
In what format are past and newly issued land records kept at the immovable property registry of the largest
business city of the economy —in a paper format or in a computerized format (scanned or fully digital)?
Paper
0.0
Is there a comprehensive and functional electronic database for checking for encumbrances (liens, mortgages,
restrictions and the like)?
No
0.0
Institution in charge of the plans showing legal boundaries in the largest business city:
Directorate of Land
Records and Survey
(DLRS)
In what format are past and newly issued cadastral plans kept at the mapping agency of the largest business
city of the economy—in a paper format or in a computerized format (scanned or fully digital)?
Paper
0.0
Is there an electronic database for recording boundaries, checking plans and providing cadastral information
(geographic information system)?
No
0.0
Is the information recorded by the immovable property registration agency and the cadastral or mapping agency
kept in a single database, in different but linked databases or in separate databases?
Separate databases
0.0
Do the immovable property registration agency and cadastral or mapping agency use the same identification
number for properties?
No
0.0
Transparency of information index (0–6)
3.5
Who is able to obtain information on land ownership at the agency in charge of immovable property registration
in the largest business city?
Anyone who pays the
official fee
1.0
Is the list of documents that are required to complete any type of property transaction made publicly available–
and if so, how?
Yes, online
0.5
Link for online access:
https://land.gov.bd/pa
ges/mutation
Is the applicable fee schedule for any type of property transaction at the agency in charge of immovable
property registration in the largest business city made publicly available–and if so, how?
Yes, online
0.5
Link for online access:
https://land.gov.bd/pa
ges/mutation
Does the agency in charge of immovable property registration agency formally commit to deliver a legally
binding document that proves property ownership within a specific timeframe –and if so, how does it
communicate the service standard?
Yes, online
0.5
Link for online access:
http://lawjusticediv.po
rtal.gov.bd/site/page/
5b23e6f0-4a9c-4e41-
a97c-
093e87272e59/Citize
n-Charter
Is there a specific and independent mechanism for filing complaints about a problem that occurred at the agency
in charge of immovable property registration?
No
0.0
Contact information:
Are there publicly available official statistics tracking the number of transactions at the immovable property
registration agency?
No
0.0
Number of property transfers in the largest business city in 2018:
Who is able to consult maps of land plots in the largest business city?
Anyone who pays the
official fee
0.5
Is the applicable fee schedule for accessing maps of land plots made publicly available—and if so, how?
Yes, online
0.5
Bangladesh
Doing Business
2020
Page 39
Link for online access:
http://dlrs.gov.bd/site/
page/767754cd-
5340-4356-851f-
210c944f5ba8/Find-
Mouza-Map
Does the cadastral/mapping agency formally specifies the timeframe to deliver an updated cadastral plan—and
if so, how does it communicate the service standard?
No
0.0
Link for online access:
Is there a specific and independent mechanism for filing complaints about a problem that occurred at the
cadastral or mapping agency?
No
0.0
Contact information:
Geographic coverage index (0–8)
0.0
Are all privately held land plots in the largest business city formally registered at the immovable property
registry?
No
0.0
Are all privately held land plots in the economy formally registered at the immovable property registry?
No
0.0
Are all privately held land plots in the largest business city mapped?
No
0.0
Are all privately held land plots in the economy mapped?
No
0.0
Land dispute resolution index (0–8)
3.0
Does the law require that all property sale transactions be registered at the immovable property registry to make
them opposable to third parties?
Yes
1.5
Legal basis:
Part III of the
Registration Act 1908
Is the system of immovable property registration subject to a state or private guarantee?
Yes
0.5
Type of guarantee:
State guarantee
Legal basis:
Part III of the
Registration Act 1908
Is there a is a specific, out-of-court compensation mechanism to cover for losses incurred by parties who
engaged in good faith in a property transaction based on erroneous information certified by the immovable
property registry?
No
0.0
Legal basis:
Does the legal system require a control of legality of the documents necessary for a property transaction (e.g.,
checking the compliance of contracts with requirements of the law)?
Yes
0.5
If yes, who is responsible for checking the legality of the documents?
Registrar;
Does the legal system require verification of the identity of the parties to a property transaction?
Yes
0.5
If yes, who is responsible for verifying the identity of the parties?
Registrar;
Is there a national database to verify the accuracy of government issued identity documents?
No
0.0
What is the Court of first instance in charge of a case involving a standard land dispute between two local
businesses over tenure rights for a property worth 50 times gross national income (GNI) per capita and located
in the largest business city?
Dhaka Joint District
Judge Court
How long does it take on average to obtain a decision from the first-instance court for such a case (without
appeal)?
More than 3 years
0.0
Are there publicly available statistics on the number of land disputes at the economy level in the first instance
court?
No
0.0
Number of land disputes in the economy in 2018:
Equal access to property rights index (-2–0)
0.0
Do unmarried men and unmarried women have equal ownership rights to property?
Yes
Do married men and married women have equal ownership rights to property?
Yes
0.0
Bangladesh
Doing Business
2020
Page 40
Registering Property - Chittagong
Figure – Registering Property in Chittagong – Score
Procedures
41.7
Time
0.0
Cost
52.3
Quality of the land administration index
21.7
Figure – Registering Property in Chittagong and comparator economies – Ranking and Score
DB 2020 Registering Property Score
0 100
63.6: Nepal (Rank: 97)
51.9: Sri Lanka (Rank: 138)
48.6: Pakistan (Rank: 151)
47.6: India (Rank: 154)
29.0: Dhaka
28.9: Chittagong
Note: The ranking of economies on the ease of registering property is determined by sorting their scores for registering property. These scores are the simple average of
the scores for each of the component indicators.
Indicator
Best Regulatory
Performance
Procedures (number)
8
6.9
4.7
1 (5 Economies)
Time (days)
295
107.8
23.6
1 (2 Economies)
Cost (% of property value)
7.2
7.0
4.2
0.0 (Saudi Arabia)
Quality of the land administration index (0-30)
6.5
9.1
23.2
None in 2018/19
Bangladesh
Doing Business
2020
Page 41
Figure – Registering Property in Chittagong – Procedure, Time and Cost
This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.
*
Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the
time for women. For more information on methodology, see the
website (
). For details on the procedures
reflected here, see the summary below.
Doing Business
http://doingbusiness.org/en/methodology
Procedures (number)
1 2 * 3 4 5 6 7 * 8
0
50
100
150
200
250
Time (days)
0
1
2
3
4
5
6
7
8
Cost (% of property value)
Time (days) Cost (% of property value)
Bangladesh
Doing Business
2020
Page 42
Figure – Registering Property in Chittagong and comparator economies – Measure of Quality
Chittagong India Nepal Pakistan Sri
Lanka
Dhaka South
Asia
0
2
4
6
8
10
12
Index score
6.5
10.8
6.0
9.8
5.5
6.5
9.1
Details – Registering Property in Chittagong – Procedure, Time and Cost
No.
Procedures
Time to Complete
Associated Costs
1
Verifying the current Khatian (record of rights) at the Directorate of Land Records and
Surveys (DLRS)
: Directorate of Land Records and Surveys (DLRS)
Agency
Various departments of two Ministries manage the core functions of land administration:
1. The Ministry of Land (MoL): land-related activities including survey, the collection of land
development tax, arbitration process. The following agencies are under the Ministry of Land:
1.1 Directorate of Land Records and Surveys (DLRS): Conducts cadastral surveys, from which it
produces mouza (revenue village) maps showing individual plots of land and khatian (individual
land record certificates)
1.2 AC (Land) Office: Manages the mutated Khatian.
1.2.1Tehsil office: the local administrative division that has the function of record keeping.
2. The Ministry of Law, Justice and Parliamentary Affairs (MLJP): Records land mutation and
transfers.
2.1 The Department of Land Registration (DLR): Records land mutations arising through sale,
inheritance or other forms of transfer, reports changes to the Ministry of Land, and collects the
immovable property transfer tax (IPTT).
2.2.1 Sub-registrar’s office: the local administrative division that has the function of registration.
For a property transfer, first, the company will obtain a proof of land ownership titles (called
Porcha or Khatian) at the Directorate of Land Records and Surveys (DLRS). It contains the names
of owners, percentages of ownership of each person, the plot number, the type of property
(residential, commercial), and its size.
However, the Khatian requested at the DLRS is not conclusive evidence of ownership, and merely
provide a basis of possession at the recording time.
30 days
no charge
2
Conduct first mutation and obtain an updated record of rights (Khatian) at the Assistant
Commissioner of Lands (AC Land) - Tahsil
: Assistant Commissioner of Lands (AC Land) - Tahsil
Agency
The current land system in Bangladesh produces multiple khatians.The khatian is administered
separately by the Directorate of Land Records and Surveys (DLRS), the DC Record Room, the
Assistant Commissioner of Lands and the Tahsil Office. The khatian managed by DLRS may differ
from the mutated khatian managed by the AC (Land) Office. In that case, If the name of the
transferor is not found in the latest Khatian or his/her name is not mutated, the Sub Registrar will
refuse to register the transfer deed. Therefore, it is mandatory to mutate the name of the
transferor in the latest Khatian.
The mutation is the process for updating the ownership and obtain a certificate of the land record.
This certificate is one of the documents needed to register the property transfer. Typically,
properties have missing information in the records, or the seller legal owner may not be correct.
The interest parties will always verify with AC Land the history of ownership to see if the Khatian
information is correctly corresponding to the actual land. This situation is common because, in at
least 50% of cases, the records are not correct. Sometimes, due to problems caused at the AC
Land Office, such as incorrectly recording names and other details of the land.
53 days
BDT 1,170; (Application
fee (Court fee) 20 Taka;
Notice issue fee 50 Taka;
Record correction fee
1000 Taka; Khatian fee
100 Taka)
3
The Assistant Commissioner of Lands conducts an inspection for updating the record of
rights (Khatian)
: Assistant Commissioner of Lands (AC Land) - Tahsil
Agency
The Assistant Commissioner of Lands (Tahsil) will carry a physical inspection to provide the
updated record of rights (Khatian). Officials visit the plot to check if there are no irregularities, such
as informal buildings, and if the size of the land plot is correct, etc.
30 days
Included in procedure 2
4
Obtain the non-encumbrance certificate from the relevant Sub-registry office
: Land Registration Directorate - Sub-registry office
Agency
The buyer checks the legal status of the land (mortgaged or leased or ownership) at the relevant
Sub-registry. From January 2012 both Sub-registry and Land Revenue Office provide non-
encumbrance certificates. Sometimes a land report is required. A land report gives an idea about
the current situation and ownership of the land that may include the chain of ownership, land tax,
land record, registry status etc. A non-encumbrance certificate is used in property transactions as
an evidence of free title/ownership.
30 days
BDT 200; (80 takas for the
copy + 10 takas multiplied
by 12 years of search)
Bangladesh
Doing Business
2020
Page 43
Takes place simultaneously with previous procedure.
5
A lawyer or a deed writer draft the deed transfer
: Lawyer or deed writer
Agency
In most of the cases, a lawyer or a deed writer draft the transfer deed that should be signed by the
interested partied.
1 day
BDT 6,000
6
Pay stamp duty, capital gains tax, registration fee and other taxes at designated bank
: Designated Bank
Agency
The parties should pay all registration fees at the designated commercial bank.
1 day
BDT 514,025.93; (3% of
the property value (stamp
duties) + 2% of property
value (registration fees) +
2% of property value
(municipality tax) + 3,000
takas (certified copy fee)
Per methodology, VAT and
source tax (capital gains)
are not recorded.)
7
Apply for registration at the relevant Sub-registry
: Land Registration Directorate - Sub-registry office
Agency
The buyer applies for registration at the Sub-registry office, presenting the following documents:
- Records to prove land ownership - Porcha or Khatian – (obtained in procedure 1)
- The mutation proof - mutated Khatian (obtained in procedure 2)
- Certificate of non-encumbrance (obtained in procedure 4)
- Transfer deed (obtained in procedure 5)
- Proof of payment of fees at a bank (Obtained in procedure 6)
A certified registration document is obtained within a week for the buyer’s record. The original sale
deed/certificate requires about 6 months to be obtained.
180 days
Already paid in Procedure
6
8
Conduct second mutation to change the ownership at the Assistant Commissioner of
Lands (AC Land) - Tahsil
: Assistant Commissioner of Lands (AC Land) - Tahsil
Agency
The change of ownership must be registered at the Assistant Commissioner of Lands (AC Land).
The property is recorded under the name of the new owner, who is responsible for paying the land
taxes from the day it is transferred.
The purpose of the 1st mutation (procedure 1) is to update the records under the seller’s name.
The purpose of the 2nd mutation (current procedure) is to update the records under the buyer’s
name.
75 days
BDT 1,170; (Application
fee (Court fee) 20 Taka;
Notice issue fee 50 Taka;
Record correction fee
1000 Taka; Khatian fee
100 Taka)
Bangladesh
Doing Business
2020
Page 44
Details – Registering Property in Chittagong – Measure of Quality
Answer
Score
Quality of the land administration index (0-30)
6.5
Reliability of infrastructure index (0-8)
0.0
Type of land registration system in the economy:
Dual system (Title &
Deed)
What is the institution in charge of immovable property registration?
Office of the Sub-
Registrar of
Chittagong
In what format are past and newly issued land records kept at the immovable property registry of the largest
business city of the economy —in a paper format or in a computerized format (scanned or fully digital)?
Paper
0.0
Is there a comprehensive and functional electronic database for checking for encumbrances (liens, mortgages,
restrictions and the like)?
No
0.0
Institution in charge of the plans showing legal boundaries in the largest business city:
Directorate of Land
Records and Survey
(DLRS) of Chittagong
In what format are past and newly issued cadastral plans kept at the mapping agency of the largest business
city of the economy—in a paper format or in a computerized format (scanned or fully digital)?
Paper
0.0
Is there an electronic database for recording boundaries, checking plans and providing cadastral information
(geographic information system)?
No
0.0
Is the information recorded by the immovable property registration agency and the cadastral or mapping agency
kept in a single database, in different but linked databases or in separate databases?
Separate databases
0.0
Do the immovable property registration agency and cadastral or mapping agency use the same identification
number for properties?
No
0.0
Transparency of information index (0–6)
3.5
Who is able to obtain information on land ownership at the agency in charge of immovable property registration
in the largest business city?
Anyone who pays the
official fee
1.0
Is the list of documents that are required to complete any type of property transaction made publicly available–
and if so, how?
Yes, online
0.5
Link for online access:
https://land.gov.bd/pa
ges/mutation
Is the applicable fee schedule for any type of property transaction at the agency in charge of immovable
property registration in the largest business city made publicly available–and if so, how?
Yes, online
0.5
Link for online access:
https://land.gov.bd/pa
ges/mutation
Does the agency in charge of immovable property registration agency formally commit to deliver a legally
binding document that proves property ownership within a specific timeframe –and if so, how does it
communicate the service standard?
Yes, online
0.5
Link for online access:
http://lawjusticediv.po
rtal.gov.bd/site/page/
5b23e6f0-4a9c-4e41-
a97c-
093e87272e59/Citize
n-Charter
Is there a specific and independent mechanism for filing complaints about a problem that occurred at the agency
in charge of immovable property registration?
No
0.0
Contact information:
Are there publicly available official statistics tracking the number of transactions at the immovable property
registration agency?
No
0.0
Number of property transfers in the largest business city in 2018:
Who is able to consult maps of land plots in the largest business city?
Anyone who pays the
official fee
0.5
Is the applicable fee schedule for accessing maps of land plots made publicly available—and if so, how?
Yes, online
0.5
Bangladesh
Doing Business
2020
Page 45
Link for online access:
http://dlrs.gov.bd/site/
page/767754cd-
5340-4356-851f-
210c944f5ba8/Find-
Mouza-Map
Does the cadastral/mapping agency formally specifies the timeframe to deliver an updated cadastral plan—and
if so, how does it communicate the service standard?
Yes, in person
0.0
Link for online access:
Is there a specific and independent mechanism for filing complaints about a problem that occurred at the
cadastral or mapping agency?
No
0.0
Contact information:
Geographic coverage index (0–8)
0.0
Are all privately held land plots in the largest business city formally registered at the immovable property
registry?
No
0.0
Are all privately held land plots in the economy formally registered at the immovable property registry?
No
0.0
Are all privately held land plots in the largest business city mapped?
No
0.0
Are all privately held land plots in the economy mapped?
No
0.0
Land dispute resolution index (0–8)
3.0
Does the law require that all property sale transactions be registered at the immovable property registry to make
them opposable to third parties?
Yes
1.5
Legal basis:
Part III of the
Registration Act
Is the system of immovable property registration subject to a state or private guarantee?
Yes
0.5
Type of guarantee:
State guarantee
Legal basis:
Part II of the
Registration Act
Is there a is a specific, out-of-court compensation mechanism to cover for losses incurred by parties who
engaged in good faith in a property transaction based on erroneous information certified by the immovable
property registry?
No
0.0
Legal basis:
Does the legal system require a control of legality of the documents necessary for a property transaction (e.g.,
checking the compliance of contracts with requirements of the law)?
Yes
0.5
If yes, who is responsible for checking the legality of the documents?
Registrar;
Does the legal system require verification of the identity of the parties to a property transaction?
Yes
0.5
If yes, who is responsible for verifying the identity of the parties?
Registrar;
Is there a national database to verify the accuracy of government issued identity documents?
No
0.0
What is the Court of first instance in charge of a case involving a standard land dispute between two local
businesses over tenure rights for a property worth 50 times gross national income (GNI) per capita and located
in the largest business city?
Chittagong Joint
District Judge Court
How long does it take on average to obtain a decision from the first-instance court for such a case (without
appeal)?
More than 3 years
0.0
Are there publicly available statistics on the number of land disputes at the economy level in the first instance
court?
No
0.0
Number of land disputes in the economy in 2018:
Equal access to property rights index (-2–0)
0.0
Do unmarried men and unmarried women have equal ownership rights to property?
Yes
Do married men and married women have equal ownership rights to property?
Yes
0.0
Bangladesh
Doing Business
2020
Page 46
Getting Credit
This topic explores two sets of issues—the strength of credit reporting systems and the effectiveness of collateral and bankruptcy laws in facilitating lending. The most
recent round of data collection for the project was completed in May 2019.
.
See the methodology for more information
What the indicators measure
Strength of legal rights index (0–12)
Rights of borrowers and lenders through collateral laws (0-10)
•
Protection of secured creditors’ rights through bankruptcy laws
(0-2)
•
Depth of credit information index (0–8)
Scope and accessibility of credit information distributed by
credit bureaus and credit registries (0-8)
•
Credit bureau coverage (% of adults)
Number of individuals and firms listed in largest credit bureau
as a percentage of adult population
•
Credit registry coverage (% of adults)
Number of individuals and firms listed in credit registry as a
percentage of adult population
•
Case study assumptions
assesses the sharing of credit information and the legal rights of borrowers and
lenders with respect to secured transactions through 2 sets of indicators. The depth of credit
information index measures rules and practices affecting the coverage, scope and accessibility of
credit information available through a credit registry or a credit bureau. The strength of legal rights
index measures the degree to which collateral and bankruptcy laws protect the rights of borrowers
and lenders and thus facilitate lending. For each economy it is first determined whether a unitary
secured transactions system exists. Then two case scenarios, case A and case B, are used to
determine how a nonpossessory security interest is created, publicized and enforced according to
the law. Special emphasis is given to how the collateral registry operates (if registration of security
interests is possible). The case scenarios involve a secured borrower, company ABC, and a
secured lender, BizBank.
Doing Business
In some economies the legal framework for secured transactions will allow only case A or case B
(not both) to apply. Both cases examine the same set of legal provisions relating to the use of
movable collateral.
Several assumptions about the secured borrower (ABC) and lender (BizBank) are used:
- ABC is a domestic limited liability company (or its legal equivalent).
- ABC has up to 50 employees.
- ABC has its headquarters and only base of operations in the economy’s largest business city. For
11 economies the data are also collected for the second largest business city.
- Both ABC and BizBank are 100% domestically owned.
The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants
BizBank a nonpossessory security interest in one category of movable assets, for example, its
machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In
economies where the law does not allow nonpossessory security interests in movable property,
ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for
nonpossessory security interests).
In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any
charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of
ABC’s movable assets as possible). ABC keeps ownership and possession of the assets.
Bangladesh
Doing Business
2020
Page 47
Getting Credit - Dhaka
Figure – Getting Credit in Dhaka – Score
Score - Getting Credit
45.0
Figure – Getting Credit in Dhaka and comparator economies – Ranking and Score
DB 2020 Getting Credit Score
0 100
80.0: India (Rank: 25)
75.0: Nepal (Rank: 37)
45.0: Chittagong
45.0: Dhaka
45.0: Pakistan (Rank: 119)
40.0: Sri Lanka (Rank: 132)
Note: The ranking of economies on the ease of getting credit is determined by sorting their scores for getting credit. These scores are the sum of the scores for the
strength of legal rights index and the depth of credit information index.
Indicator
Best Regulatory
Performance
Strength of legal rights index (0-12)
5
5.5
6.1
12 (5 Economies)
Depth of credit information index (0-8)
4
5.1
6.8
8 (53 Economies)
Credit registry coverage (% of adults)
5.2
5.1
24.4
100.0 (2 Economies)
Credit bureau coverage (% of adults)
0.0
21.0
66.7
100.0 (14 Economies)
Bangladesh
Doing Business
2020
Page 48
Figure – Legal Rights in Dhaka and comparator economies
Dhaka India Nepal Pakistan Sri
Lanka
Chittagong South
Asia
0
2
4
6
8
10
12
Index Score
5
9
10
2 2
5
5.5
Bangladesh
Doing Business
2020
Page 49
Details – Legal Rights in Dhaka
Strength of legal rights index (0-12)
5
Does an integrated or unified legal framework for secured transactions that extends to the creation, publicity and enforcement of functional equivalents
to security interests in movable assets exist in the economy?
No
Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without requiring a specific description
of collateral?
Yes
Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring a specific description of
collateral?
Yes
May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds and replacements of the
original assets?
Yes
Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and obligations be secured between parties;
and can the collateral agreement include a maximum amount for which the assets are encumbered?
Yes
Is a collateral registry in operation for both incorporated and non-incorporated entities, that is unified geographically and by asset type, with an
electronic database indexed by debtor's name?
No
Does a notice-based collateral registry exist in which all functional equivalents can be registered?
No
Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be performed online by any interested third
party?
No
Are secured creditors paid first (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency procedure?
No
Are secured creditors paid first (i.e. before tax claims and employee claims) when a business is liquidated?
No
Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised reorganization procedure? Does the law
protect secured creditors’ rights by providing clear grounds for relief from the stay and sets a time limit for it?
No
Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law allow the secured creditor to sell
the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt?
Yes
Figure – Credit Information in Dhaka and comparator economies
Dhaka India Nepal Pakistan Sri
Lanka
Chittagong South
Asia
0
1
2
3
4
5
6
7
8
Index Score
4
7
5
7
6
4
5.1
Bangladesh
Doing Business
2020
Page 50
Details – Credit Information in Dhaka
Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult
population, the total score on the depth of credit information index is 0.
Depth of credit information index (0-8)
Credit bureau
Credit registry
Score
Are data on both firms and individuals distributed?
No
Yes
1
Are both positive and negative credit data distributed?
No
Yes
1
Are data from retailers or utility companies - in addition to data from banks and
financial institutions - distributed?
No
No
0
Are at least 2 years of historical data distributed? (Credit bureaus and registries
that distribute more than 10 years of negative data or erase data on defaults as
soon as they are repaid obtain a score of 0 for this component.)
No
No
0
Are data on loan amounts below 1% of income per capita distributed?
No
Yes
1
By law, do borrowers have the right to access their data in the credit bureau or
credit registry?
No
No
0
Can banks and financial institutions access borrowers’ credit information online
(for example, through an online platform, a system-to-system connection or
both)?
No
Yes
1
Are bureau or registry credit scores offered as a value-added service to help
banks and financial institutions assess the creditworthiness of borrowers?
No
No
0
Coverage
Credit bureau
Credit registry
Number of individuals
0
4,461,674
Number of firms
0
1,164,838
Total
0
5,626,512
Percentage of adult population
0.0
5.2
Bangladesh
Doing Business
2020
Page 51
Getting Credit - Chittagong
Figure – Getting Credit in Chittagong – Score
Score - Getting Credit
45.0
Figure – Getting Credit in Chittagong and comparator economies – Ranking and Score
DB 2020 Getting Credit Score
0 100
80.0: India (Rank: 25)
75.0: Nepal (Rank: 37)
45.0: Chittagong
45.0: Dhaka
45.0: Pakistan (Rank: 119)
40.0: Sri Lanka (Rank: 132)
Note: The ranking of economies on the ease of getting credit is determined by sorting their scores for getting credit. These scores are the sum of the scores for the
strength of legal rights index and the depth of credit information index.
Indicator
Best Regulatory
Performance
Strength of legal rights index (0-12)
5
5.5
6.1
12 (5 Economies)
Depth of credit information index (0-8)
4
5.1
6.8
8 (53 Economies)
Credit registry coverage (% of adults)
5.2
5.1
24.4
100.0 (2 Economies)
Credit bureau coverage (% of adults)
0.0
21.0
66.7
100.0 (14 Economies)
Bangladesh
Doing Business
2020
Page 52
Figure – Legal Rights in Chittagong and comparator economies
Chittagong India Nepal Pakistan Sri
Lanka
Dhaka South
Asia
0
2
4
6
8
10
12
Index Score
5
9
10
2 2
5
5.5
Bangladesh
Doing Business
2020
Page 53
Details – Legal Rights in Chittagong
Strength of legal rights index (0-12)
5
Does an integrated or unified legal framework for secured transactions that extends to the creation, publicity and enforcement of functional equivalents
to security interests in movable assets exist in the economy?
No
Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without requiring a specific description
of collateral?
Yes
Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring a specific description of
collateral?
Yes
May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds and replacements of the
original assets?
Yes
Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and obligations be secured between parties;
and can the collateral agreement include a maximum amount for which the assets are encumbered?
Yes
Is a collateral registry in operation for both incorporated and non-incorporated entities, that is unified geographically and by asset type, with an
electronic database indexed by debtor's name?
No
Does a notice-based collateral registry exist in which all functional equivalents can be registered?
No
Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be performed online by any interested third
party?
No
Are secured creditors paid first (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency procedure?
No
Are secured creditors paid first (i.e. before tax claims and employee claims) when a business is liquidated?
No
Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised reorganization procedure? Does the law
protect secured creditors’ rights by providing clear grounds for relief from the stay and sets a time limit for it?
No
Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law allow the secured creditor to sell
the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt?
Yes
Figure – Credit Information in Chittagong and comparator economies
Chittagong India Nepal Pakistan Sri
Lanka
Dhaka South
Asia
0
1
2
3
4
5
6
7
8
Index Score
4
7
5
7
6
4
5.1
Bangladesh
Doing Business
2020
Page 54
Details – Credit Information in Chittagong
Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult
population, the total score on the depth of credit information index is 0.
Depth of credit information index (0-8)
Credit bureau
Credit registry
Score
Are data on both firms and individuals distributed?
No
Yes
1
Are both positive and negative credit data distributed?
No
Yes
1
Are data from retailers or utility companies - in addition to data from banks and
financial institutions - distributed?
No
No
0
Are at least 2 years of historical data distributed? (Credit bureaus and registries
that distribute more than 10 years of negative data or erase data on defaults as
soon as they are repaid obtain a score of 0 for this component.)
No
No
0
Are data on loan amounts below 1% of income per capita distributed?
No
Yes
1
By law, do borrowers have the right to access their data in the credit bureau or
credit registry?
No
No
0
Can banks and financial institutions access borrowers’ credit information online
(for example, through an online platform, a system-to-system connection or
both)?
No
Yes
1
Are bureau or registry credit scores offered as a value-added service to help
banks and financial institutions assess the creditworthiness of borrowers?
No
No
0
Coverage
Credit bureau
Credit registry
Number of individuals
0
4,461,674
Number of firms
0
1,164,838
Total
0
5,626,512
Percentage of adult population
0.0
5.2
Bangladesh
Doing Business
2020
Page 55
Protecting Minority Investors
This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights,
governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed
in May 2019.
.
See the methodology for more information
What the indicators measure
: Disclosure, review, and
approval requirements for related-party transactions
•
Extent of disclosure index (0–10)
: Ability of minority
shareholders to sue and hold interested directors liable for
prejudicial related-party transactions; Available legal
remedies (damages, disgorgement of profits, disqualification
from managerial position(s) for one year or more, rescission of
the transaction)
•
Extent of director liability index (0–10)
: Access to internal
corporate documents; Evidence obtainable during trial and
allocation of legal expenses
•
Ease of shareholder suits index (0–10)
Sum of
the extent of disclosure, extent of director liability and ease of
shareholder suits indices
•
Extent of conflict of interest regulation index (0-30):
: Shareholders’ rights
and role in major corporate decisions
•
Extent of shareholder rights index (0-6)
: Governance
safeguards protecting shareholders from undue board control
and entrenchment
•
Extent of ownership and control index (0-7)
: Corporate
transparency on ownership stakes, compensation, audits and
financial prospects
•
Extent of corporate transparency index (0-7)
: Sum
of the
extent of shareholders rights, extent of ownership and control
and extent of corporate transparency indices
•
Extent of shareholder governance index (0–20)
: Sum
of the extent of conflict of interest regulation and extent of
shareholder governance indices
•
Strength of minority investor protection index (0–50)
Case study assumptions
To make the data comparable across economies, a case study uses several assumptions about
the business and the transaction.
- Is a publicly traded corporation listed on the economy’s most important stock exchange.
- Has a board of directors and a chief executive officer (CEO) who may legally act on behalf of
Buyer where permitted, even if this is not specifically required by law.
- Has a supervisory board in economies with a two-tier board system on which Mr. James
appointed 60% of the shareholder-elected members.
- Has not adopted bylaws or articles of association that go beyond the minimum requirements.
Does not follow codes, principles, recommendations or guidelines that are not mandatory.
- Is a manufacturing company with its own distribution network.
The business (Buyer):
- Mr. James owns 60% of Buyer, sits on Buyer’s board of directors and elected two directors to
Buyer’s five-member board.
- Mr. James also owns 90% of Seller, a company that operates a chain of retail hardware stores.
Seller recently closed a large number of its stores.
- Mr. James proposes that Buyer purchase Seller’s unused fleet of trucks to expand Buyer’s
distribution of its food products, a proposal to which Buyer agrees. The price is equal to 10% of
Buyer’s assets and is higher than the market value.
- The proposed transaction is part of the company’s principal activity and is not outside the
authority of the company.
- Buyer enters into the transaction. All required approvals are obtained, and all required disclosures
made—that is, the transaction was not entered into fraudulently.
- The transaction causes damages to Buyer. Shareholders sue Mr. James and the executives and
directors that approved the transaction.
The transaction involves the following details:
Bangladesh
Doing Business
2020
Page 56
Protecting Minority Investors - Dhaka
Figure – Protecting Minority in Dhaka – Score
Score - Protecting Minority Investors
60.0
Figure – Protecting Minority Investors in Dhaka and comparator economies – Ranking and Score
DB 2020 Protecting Minority Investors Score
0 100
80.0: India (Rank: 13)
72.0: Sri Lanka (Rank: 28)
72.0: Pakistan (Rank: 28)
60.0: Chittagong
60.0: Dhaka
58.0: Nepal (Rank: 79)
Note: The ranking of economies on the strength of minority investor protections is determined by sorting their scores for protecting minority investors. These scores are
the simple average of the scores for the extent of conflict of interest regulation index and the extent of shareholder governance index.
Stock exchange information
Stock exchange
Dhaka Stock Exchange
Stock exchange URL
http://www.dsebd.org
Listed firms with equity securities
461
City Covered
Dhaka
Indicator
Best Regulatory
Performance
Extent of disclosure index (0-10)
6.0
5.8
6.5
10 (13 Economies)
Extent of director liability index (0-10)
7.0
5.0
5.3
10 (3 Economies)
Ease of shareholder suits index (0-10)
7.0
7.4
7.3
10 (Djibouti)
Extent of shareholder rights index (0-6)
4.0
3.5
4.7
6 (19 Economies)
Extent of ownership and control index (0-7)
3.0
3.6
4.5
7 (9 Economies)
Extent of corporate transparency index (0-7)
3.0
3.3
5.7
7 (13 Economies)
Bangladesh
Doing Business
2020
Page 57
Figure – Protecting Minority Investors in Dhaka and comparator economies – Measure of Quality
Dhaka
Chittagong
India
Nepal
Pakistan
Sri Lanka
OECD high income
South Asia
0 5 10 15 20 25 30 35 40 45
Sub-Indicator Score
3 7 6 3 4 7
3 7 6 3 4 7
6 7 8 6 6 7
4 1 6 4 5 9
5 7 6 7 5 6
5 5 8 6 5 7
5.6 5.6 6.6 4.3 4.5 7.4
3.9 5.9 6.1 4.4 4.1 7.1
Extent of corporate transparency index (0-7) Extent of director liability index (0-10) Extent of disclosure index (0-10) Extent of ownership and control index (0-7)
Extent of shareholder rights index (0-6) Ease of shareholder suits index (0-10)
Bangladesh
Doing Business
2020
Page 58
Details – Protecting Minority Investors in Dhaka – Measure of Quality
Answer
Score
Extent of conflict of interest regulation index (0-30)
Extent of disclosure index (0-10)
6.0
Whose decision is sufficient to approve the Buyer-Seller transaction? (0-3)
Board of directors
excluding interested
members
2.0
Must an external body review the terms of the transaction before it takes place? (0-1)
No
0.0
Must Mr. James disclose his conflict of interest to the board of directors? (0-2)
Full disclosure of all
material facts
2.0
Must Buyer disclose the transaction in periodic filings (e.g. annual reports)? (0-2)
Disclosure on the
transaction and on
the conflict of interest
2.0
Must Buyer immediately disclose the transaction to the public? (0-2)
No disclosure
obligation
0.0
Extent of director liability index (0-10)
7.0
Can shareholders representing 10% of Buyer's share capital sue for the damage the transaction caused to
Buyer? (0-1)
Yes
1.0
Can shareholders hold Mr. James liable for the damage the transaction caused to Buyer? (0-2)
Liable if negligent
1.0
Can shareholders hold the other directors liable for the damage the transaction caused to Buyer? (0-2)
Liable if unfair or
prejudicial
2.0
Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by shareholders? (0-1)
Yes
1.0
Must Mr. James repay profits made from the transaction upon a successful claim by shareholders? (0-1)
Yes
1.0
Is Mr. James disqualified upon a successful claim by shareholders? (0-1)
No
0.0
Can a court void the transaction upon a successful claim by shareholders? (0-2)
Voidable if negligently
concluded
1.0
Ease of shareholder suits index (0-10)
7.0
Before suing, can shareholders representing 10% of Buyer's share capital inspect the transaction documents?
(0-1)
Yes
1.0
Can the plaintiff obtain any documents from the defendant and witnesses at trial? (0-3)
Any relevant
document
3.0
Can the plaintiff request categories of documents from the defendant without identifying specific ones? (0-1)
Yes
1.0
Can the plaintiff directly question the defendant and witnesses at trial? (0-2)
Preapproved
questions only
1.0
Is the level of proof required for civil suits lower than that of criminal cases? (0-1)
Yes
1.0
Can shareholder plaintiffs recover their legal expenses from the company? (0-2)
At the discretion of
the court
0.0
Extent of shareholder governance index (0-20)
Extent of shareholder rights index (0-6)
4.0
Does the sale of 51% of Buyer's assets require shareholder approval?
No
0.0
Can shareholders representing 10% of Buyer's share capital call for a meeting of shareholders?
Yes
1.0
Must Buyer obtain its shareholders’ approval every time it issues new shares?
No
0.0
Do shareholders automatically receive preemption rights every time Buyer issues new shares?
Yes
1.0
Do shareholders elect and dismiss the external auditor?
Yes
1.0
Are changes to the rights of a class of shares only possible if the holders of the affected shares approve?
Yes
1.0
Extent of ownership and control index (0-7)
3.0
Bangladesh
Doing Business
2020
Page 59
Is it forbidden to appoint the same individual as CEO and chairperson of the board of directors?
No
0.0
Must the board of directors include independent and nonexecutive board members?
No
0.0
Can shareholders remove members of the board of directors without cause before the end of their term?
Yes
1.0
Must the board of directors include a separate audit committee exclusively comprising board members?
No
0.0
Must a potential acquirer make a tender offer to all shareholders upon acquiring 50% of Buyer?
Yes
1.0
Must Buyer pay declared dividends within a maximum period set by law?
Yes
1.0
Is a subsidiary prohibited from acquiring shares issued by its parent company?
No
0.0
Extent of corporate transparency index (0-7)
3.0
Must Buyer disclose direct and indirect beneficial ownership stakes representing 5%?
No
0.0
Must Buyer disclose information about board members’ primary employment and directorships in other
companies?
No
0.0
Must Buyer disclose the compensation of individual managers?
Yes
1.0
Must a detailed notice of general meeting be sent 21 days before the meeting?
No
0.0
Can shareholders representing 5% of Buyer’s share capital put items on the general meeting agenda?
No
0.0
Must Buyer's annual financial statements be audited by an external auditor?
Yes
1.0
Must Buyer disclose its audit reports to the public?
Yes
1.0
Bangladesh
Doing Business
2020
Page 60
Protecting Minority Investors - Chittagong
Figure – Protecting Minority in Chittagong – Score
Score - Protecting Minority Investors
60.0
Figure – Protecting Minority Investors in Chittagong and comparator economies – Ranking and Score
DB 2020 Protecting Minority Investors Score
0 100
80.0: India (Rank: 13)
72.0: Sri Lanka (Rank: 28)
72.0: Pakistan (Rank: 28)
60.0: Chittagong
60.0: Dhaka
58.0: Nepal (Rank: 79)
Note: The ranking of economies on the strength of minority investor protections is determined by sorting their scores for protecting minority investors. These scores are
the simple average of the scores for the extent of conflict of interest regulation index and the extent of shareholder governance index.
Stock exchange information
Stock exchange
Dhaka Stock Exchange
Stock exchange URL
http://www.dsebd.org
Listed firms with equity securities
461
City Covered
Chittagong
Indicator
Best Regulatory
Performance
Extent of disclosure index (0-10)
6.0
5.8
6.5
10 (13 Economies)
Extent of director liability index (0-10)
7.0
5.0
5.3
10 (3 Economies)
Ease of shareholder suits index (0-10)
7.0
7.4
7.3
10 (Djibouti)
Extent of shareholder rights index (0-6)
4.0
3.5
4.7
6 (19 Economies)
Extent of ownership and control index (0-7)
3.0
3.6
4.5
7 (9 Economies)
Extent of corporate transparency index (0-7)
3.0
3.3
5.7
7 (13 Economies)
Bangladesh
Doing Business
2020
Page 61
Figure – Protecting Minority Investors in Chittagong and comparator economies – Measure of Quality
Chittagong
Dhaka
India
Nepal
Pakistan
Sri Lanka
OECD high income
South Asia
0 5 10 15 20 25 30 35 40 45
Sub-Indicator Score
3 7 6 3 4 7
3 7 6 3 4 7
6 7 8 6 6 7
4 1 6 4 5 9
5 7 6 7 5 6
5 5 8 6 5 7
5.6 5.6 6.6 4.3 4.5 7.4
3.9 5.9 6.1 4.4 4.1 7.1
Extent of corporate transparency index (0-7) Extent of director liability index (0-10) Extent of disclosure index (0-10) Extent of ownership and control index (0-7)
Extent of shareholder rights index (0-6) Ease of shareholder suits index (0-10)
Bangladesh
Doing Business
2020
Page 62
Details – Protecting Minority Investors in Chittagong – Measure of Quality
Answer
Score
Extent of conflict of interest regulation index (0-30)
Extent of disclosure index (0-10)
6.0
Whose decision is sufficient to approve the Buyer-Seller transaction? (0-3)
Board of directors
excluding interested
members
2.0
Must an external body review the terms of the transaction before it takes place? (0-1)
No
0.0
Must Mr. James disclose his conflict of interest to the board of directors? (0-2)
Full disclosure of all
material facts
2.0
Must Buyer disclose the transaction in periodic filings (e.g. annual reports)? (0-2)
Disclosure on the
transaction and on
the conflict of interest
2.0
Must Buyer immediately disclose the transaction to the public? (0-2)
No disclosure
obligation
0.0
Extent of director liability index (0-10)
7.0
Can shareholders representing 10% of Buyer's share capital sue for the damage the transaction caused to
Buyer? (0-1)
Yes
1.0
Can shareholders hold Mr. James liable for the damage the transaction caused to Buyer? (0-2)
Liable if negligent
1.0
Can shareholders hold the other directors liable for the damage the transaction caused to Buyer? (0-2)
Liable if unfair or
prejudicial
2.0
Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by shareholders? (0-1)
Yes
1.0
Must Mr. James repay profits made from the transaction upon a successful claim by shareholders? (0-1)
Yes
1.0
Is Mr. James disqualified upon a successful claim by shareholders? (0-1)
No
0.0
Can a court void the transaction upon a successful claim by shareholders? (0-2)
Voidable if negligently
concluded
1.0
Ease of shareholder suits index (0-10)
7.0
Before suing, can shareholders representing 10% of Buyer's share capital inspect the transaction documents?
(0-1)
Yes
1.0
Can the plaintiff obtain any documents from the defendant and witnesses at trial? (0-3)
Any relevant
document
3.0
Can the plaintiff request categories of documents from the defendant without identifying specific ones? (0-1)
Yes
1.0
Can the plaintiff directly question the defendant and witnesses at trial? (0-2)
Preapproved
questions only
1.0
Is the level of proof required for civil suits lower than that of criminal cases? (0-1)
Yes
1.0
Can shareholder plaintiffs recover their legal expenses from the company? (0-2)
At the discretion of
the court
0.0
Extent of shareholder governance index (0-20)
Extent of shareholder rights index (0-6)
4.0
Does the sale of 51% of Buyer's assets require shareholder approval?
No
0.0
Can shareholders representing 10% of Buyer's share capital call for a meeting of shareholders?
Yes
1.0
Must Buyer obtain its shareholders’ approval every time it issues new shares?
No
0.0
Do shareholders automatically receive preemption rights every time Buyer issues new shares?
Yes
1.0
Do shareholders elect and dismiss the external auditor?
Yes
1.0
Are changes to the rights of a class of shares only possible if the holders of the affected shares approve?
Yes
1.0
Extent of ownership and control index (0-7)
3.0
Bangladesh
Doing Business
2020
Page 63
Is it forbidden to appoint the same individual as CEO and chairperson of the board of directors?
No
0.0
Must the board of directors include independent and nonexecutive board members?
No
0.0
Can shareholders remove members of the board of directors without cause before the end of their term?
Yes
1.0
Must the board of directors include a separate audit committee exclusively comprising board members?
No
0.0
Must a potential acquirer make a tender offer to all shareholders upon acquiring 50% of Buyer?
Yes
1.0
Must Buyer pay declared dividends within a maximum period set by law?
Yes
1.0
Is a subsidiary prohibited from acquiring shares issued by its parent company?
No
0.0
Extent of corporate transparency index (0-7)
3.0
Must Buyer disclose direct and indirect beneficial ownership stakes representing 5%?
No
0.0
Must Buyer disclose information about board members’ primary employment and directorships in other
companies?
No
0.0
Must Buyer disclose the compensation of individual managers?
Yes
1.0
Must a detailed notice of general meeting be sent 21 days before the meeting?
No
0.0
Can shareholders representing 5% of Buyer’s share capital put items on the general meeting agenda?
No
0.0
Must Buyer's annual financial statements be audited by an external auditor?
Yes
1.0
Must Buyer disclose its audit reports to the public?
Yes
1.0
Bangladesh
Doing Business
2020
Page 64
Paying Taxes
This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as the administrative burden of
paying taxes and contributions and complying with postfiling procedures (VAT refund and tax audit). The most recent round of data collection for the project was
completed in May 2019 covering for the Paying Taxes indicator calendar year 2018 (January 1, 2018 – December 31, 2018).
See
the
methodology
for
more
information
.
What the indicators measure
Tax payments for a manufacturing company in 2018 (number
per year adjusted for electronic and joint filing and payment)
Total number of taxes and contributions paid or withheld,
including consumption taxes (value added tax, sales tax or
goods and service tax)
•
Method and frequency of filing and payment
•
Time required to comply with 3 major taxes (hours per year)
Collecting information, computing tax payable
•
Preparing separate tax accounting books, if required
•
Completing tax return, filing with agencies
•
Arranging payment or withholding
•
Total tax and contribution rate (% of commercial profits)
Profit or corporate income tax
•
Social contributions, labor taxes paid by employer
•
Property and property transfer taxes
•
Dividend, capital gains, financial transactions taxes
•
Waste collection, vehicle, road and other taxes
•
Postfiling Index
Time to comply with VAT refund (hours)
•
Time to obtain VAT refund (weeks)
•
Time to comply with a corporate income tax correction (hours)
•
Time to complete a corporate income tax correction (weeks)
•
Case study assumptions
Using a case scenario,
records taxes and mandatory contributions a medium size
company must pay in a year, and measures the administrative burden of paying taxes,
contributions and dealing with postfiling processes. Information is also compiled on frequency of
filing and payments, time taken to comply with tax laws, time taken to comply with the
requirements of postfiling processes and time waiting.
Doing Business
To make data comparable across economies, several assumptions are used:
- TaxpayerCo is a medium-size business that started operations on January 1, 2017. It produces
ceramic flowerpots and sells them at retail.
Taxes and mandatory contributions are measured
at all levels of government.
- In June 2018, TaxpayerCo. makes a large capital purchase: the value of the machine is 65 times
income per capita of the economy. Sales are equally spread per month (1,050 times income per
capita divided by 12) and cost of goods sold are equally expensed per month (875 times income
per capita divided by 12). The machinery seller is registered for VAT and excess input VAT incurred
in June will be fully recovered after four consecutive months if the VAT rate is the same for inputs,
sales and the machine and the tax reporting period is every month. Input VAT will exceed Output
VAT in June 2018.
All taxes and contributions recorded are paid in the
second year of operation (calendar year 2018).
The VAT refund process:
- An error in calculation of income tax liability (for example, use of incorrect tax depreciation rates,
or incorrectly treating an expense as tax deductible) leads to an incorrect income tax return and a
corporate income tax underpayment. TaxpayerCo. discovered the error and voluntarily notified the
tax authority. The value of the underpaid income tax liability is 5% of the corporate income tax
liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual
tax return, but within the tax assessment period.
The corporate income tax audit process:
Bangladesh
Doing Business
2020
Page 65
Paying Taxes - Dhaka
Figure – Paying Taxes in Dhaka – Score
Payments
50.0
Time
40.3
Total tax and contribution rate
89.8
Postfiling index
44.4
Figure – Paying Taxes in Dhaka and comparator economies – Ranking and Score
DB 2020 Paying Taxes Score
0 100
67.6: India (Rank: 115)
59.8: Sri Lanka (Rank: 142)
56.1: Chittagong
56.1: Dhaka
52.9: Pakistan (Rank: 161)
47.1: Nepal (Rank: 175)
Note: The ranking of economies on the ease of paying taxes is determined by sorting their scores for paying taxes. These scores are the simple average of the scores for
each of the component indicators, with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax and contribution rate. The
threshold is defined as the total tax and contribution rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing
Business 2015, which is 26.1%. All economies with a total tax and contribution rate below this threshold receive the same score as the economy at the threshold.
Indicator
Best Regulatory
Performance
Payments (number per year)
33
26.7
10.3
3 (2 Economies)
Time (hours per year)
435
273.5
158.8
49 (3 Economies)
Total tax and contribution rate (% of profit)
33.4
43.9
39.9
26.1 (33 Economies)
Postfiling index (0-100)
44.4
41.2
86.7
None in 2018/19
Bangladesh
Doing Business
2020
Page 66
Figure – Paying Taxes in Dhaka and comparator economies – Measure of Quality
Dhaka India Nepal Pakistan Sri
Lanka
Chittagong South
Asia
0
10
20
30
40
50
60
Index score
44.4
49.3
33.3
10.5
49.3
44.3
41.2
Bangladesh
Doing Business
2020
Page 67
Details – Paying Taxes in Dhaka
Tax or
mandatory
contribution
Payments
(number)
Notes on
Payments
Time (hours)
Statutory tax
rate
Tax base
Total tax and
contribution
rate (% of
profit)
Notes on TTCR
Corporate
income tax
5.0
144.0
35%
taxable profit
30.37
Municipal tax
(property tax)
1.0
7%
rental value
2.25
Capital gains tax
0.0
jointly
15%
capital gains
0.76
Tax on interest
0.0
withheld
10%
interest income
0.26
included in other
taxes
Value added tax
(VAT)
12.0
171.0
Variable rate (up
to 15%)
value added
0.00
not included
Vehicle tax
1.0
fixed fee
depending on
type of vehicle
0.00
small amount
Personal income
tax
12.0
120.0
varies
gross salaries
0.00
withheld
Stamp duty on
contracts
1.0
varies
type of contract
0.00
small amount
Land
development tax
(khajna)
1.0
Fixed fee
depending on
area of land and
locality where
situated
area of land
0.00
small amount
Totals
33
435
33.4
Bangladesh
Doing Business
2020
Page 68
Details – Paying Taxes in Dhaka – Tax by Type
Taxes by type
Answer
Profit tax (% of profit)
31.1
Labor tax and contributions (% of profit)
0.0
Other taxes (% of profit)
2.3
Bangladesh
Doing Business
2020
Page 69
Details – Paying Taxes in Dhaka – Measure of Quality
Names of taxes have been standardized. For instance income tax, profit tax, tax on company's income are all named corporate income tax in this table.
The hours for VAT include all the VAT and sales taxes applicable.
The hours for Social Security include all the hours for labor taxes and mandatory contributions in general.
The postfiling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax correction
and time to complete a corporate income tax correction.
N/A = Not applicable.
Notes:
Answer
Score
Postfiling index (0-100)
44.4
VAT refunds
Does VAT exist?
Yes
Does a VAT refund process exist per the case study?
Yes
Restrictions on VAT refund process
none
Percentage of cases exposed to a VAT audit (%)
50% - 74%
Is there a mandatory carry forward period?
No
Time to comply with VAT refund (hours)
58.0
0.0
Time to obtain VAT refund (weeks)
18.0
71.7
Corporate income tax audits
Does corporate income tax exist?
Yes
Percentage of cases exposed to a corporate income tax audit (%)
50% - 74%
Time to comply with a corporate income tax correction (hours)
37.0
34.9
Time to complete a corporate income tax correction (weeks)
9.3
71.0
Bangladesh
Doing Business
2020
Page 70
Paying Taxes - Chittagong
Figure – Paying Taxes in Chittagong – Score
Payments
50.0
Time
40.3
Total tax and contribution rate
89.8
Postfiling index
44.3
Figure – Paying Taxes in Chittagong and comparator economies – Ranking and Score
DB 2020 Paying Taxes Score
0 100
67.6: India (Rank: 115)
59.8: Sri Lanka (Rank: 142)
56.1: Chittagong
56.1: Dhaka
52.9: Pakistan (Rank: 161)
47.1: Nepal (Rank: 175)
Note: The ranking of economies on the ease of paying taxes is determined by sorting their scores for paying taxes. These scores are the simple average of the scores for
each of the component indicators, with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax and contribution rate. The
threshold is defined as the total tax and contribution rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing
Business 2015, which is 26.1%. All economies with a total tax and contribution rate below this threshold receive the same score as the economy at the threshold.
Indicator
Best Regulatory
Performance
Payments (number per year)
33
26.7
10.3
3 (2 Economies)
Time (hours per year)
435
273.5
158.8
49 (3 Economies)
Total tax and contribution rate (% of profit)
33.4
43.9
39.9
26.1 (33 Economies)
Postfiling index (0-100)
44.3
41.2
86.7
None in 2018/19
Bangladesh
Doing Business
2020
Page 71
Figure – Paying Taxes in Chittagong and comparator economies – Measure of Quality
Chittagong India Nepal Pakistan Sri
Lanka
Dhaka South
Asia
0
10
20
30
40
50
60
Index score
44.3
49.3
33.3
10.5
49.3
44.4
41.2
Bangladesh
Doing Business
2020
Page 72
Details – Paying Taxes in Chittagong
Tax or
mandatory
contribution
Payments
(number)
Notes on
Payments
Time (hours)
Statutory tax
rate
Tax base
Total tax and
contribution
rate (% of
profit)
Notes on TTCR
Corporate
income tax
5.0
144.0
35%
taxable profit
30.37
Municipal tax
(property tax)
1.0
7%
rental value
2.25
Capital gains tax
0.0
jointly
15%
capital gains
0.76
Tax on interest
0.0
withheld
10%
interest income
0.26
included in other
taxes
Value added tax
(VAT)
12.0
171.0
Variable rate (up
to 15%)
value added
0.00
not included
Vehicle tax
1.0
fixed fee
depending on
type of vehicle
0.00
small amount
Personal income
tax
12.0
120.0
varies
gross salaries
0.00
withheld
Stamp duty on
contracts
1.0
varies
type of contract
0.00
small amount
Land
development tax
(khajna)
1.0
Fixed fee
depending on
area of land and
locality where
situated
area of land
0.00
small amount
Totals
33
435
33.4
Bangladesh
Doing Business
2020
Page 73
Details – Paying Taxes in Chittagong – Tax by Type
Taxes by type
Answer
Profit tax (% of profit)
31.1
Labor tax and contributions (% of profit)
0.0
Other taxes (% of profit)
2.3
Bangladesh
Doing Business
2020
Page 74
Details – Paying Taxes in Chittagong – Measure of Quality
Names of taxes have been standardized. For instance income tax, profit tax, tax on company's income are all named corporate income tax in this table.
The hours for VAT include all the VAT and sales taxes applicable.
The hours for Social Security include all the hours for labor taxes and mandatory contributions in general.
The postfiling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax correction
and time to complete a corporate income tax correction.
N/A = Not applicable.
Notes:
Answer
Score
Postfiling index (0-100)
44.3
VAT refunds
Does VAT exist?
Yes
Does a VAT refund process exist per the case study?
Yes
Restrictions on VAT refund process
none
Percentage of cases exposed to a VAT audit (%)
50% - 74%
Is there a mandatory carry forward period?
No
Time to comply with VAT refund (hours)
58.0
0.0
Time to obtain VAT refund (weeks)
18.0
71.4
Corporate income tax audits
Does corporate income tax exist?
Yes
Percentage of cases exposed to a corporate income tax audit (%)
50% - 74%
Time to comply with a corporate income tax correction (hours)
37.0
34.9
Time to complete a corporate income tax correction (weeks)
9.3
71.0
Bangladesh
Doing Business
2020
Page 75
Trading across Borders
records
the
time
and
cost
associated
with
the
logistical
process
of
exporting
and
importing
goods.
measures
the
time
and
cost
(excluding
tariffs)
associated
with
three
sets
of
procedures—documentary
compliance,
border
compliance
and
domestic
transport—within
the
overall
process
of
exporting
or
importing
a
shipment
of
goods.
The
most
recent
round
of
data
collection
for
the
project
was
completed
in
May
2019.
.
Doing Business Doing Business
See
the
methodology
for
more
information
What the indicators measure
Documentary compliance
Obtaining, preparing and submitting documents during
transport, clearance, inspections and port or border handling in
origin economy
•
Obtaining, preparing and submitting documents required by
destination economy and any transit economies
•
Covers all documents required by law and in practice, including
electronic submissions of information
•
Border compliance
Customs clearance and inspections
•
Inspections by other agencies (if applied to more than 20% of
shipments)
•
Handling and inspections that take place at the economy’s port
or border
•
Domestic transport
Loading or unloading of the shipment at the warehouse or
port/border
•
Transport between warehouse and port/border
•
Traffic delays and road police checks while shipment is en
route
•
Case study assumptions
To make the data comparable across economies, a few assumptions are made about the traded
goods and the transactions:
Time is measured in hours, and 1 day is 24 hours (for example, 22 days are recorded as
22×24=528 hours). If customs clearance takes 7.5 hours, the data are recorded as is. Alternatively,
suppose documents are submitted to a customs agency at 8:00a.m., are processed overnight and
can be picked up at 8:00a.m. the next day. The time for customs clearance would be recorded as
24 hours because the actual procedure took 24 hours.
Time:
Insurance cost and informal payments for which no receipt is issued are excluded from the
costs recorded. Costs are reported in U.S. dollars. Contributors are asked to convert local currency
into U.S. dollars based on the exchange rate prevailing on the day they answer the questionnaire.
Contributors are private sector experts in international trade logistics and are informed about
exchange rates.
Cost:
- For all 190 economies covered by
, it is assumed a shipment is in a warehouse in
the largest business city of the exporting economy and travels to a warehouse in the largest
business city of the importing economy.
- It is assumed each economy imports 15 metric tons of containerized auto parts (HS 8708) from
its natural import partner—the economy from which it imports the largest value (price times
quantity) of auto parts. It is assumed each economy exports the product of its comparative
advantage (defined by the largest export value) to its natural export partner—the economy that is
the largest purchaser of this product. Shipment value is assumed to be $50,000.
- The mode of transport is the one most widely used for the chosen export or import product and
the trading partner, as is the seaport or land border crossing.
- All electronic information submissions requested by any government agency in connection with
the shipment are considered to be documents obtained, prepared and submitted during the export
or import process.
- A port or border is a place (seaport or land border crossing) where merchandise can enter or
leave an economy.
- Relevant government agencies include customs, port authorities, road police, border guards,
standardization agencies, ministries or departments of agriculture or industry, national security
agencies and any other government authorities.
Assumptions of the case study:
Doing Business
Bangladesh
Doing Business
2020
Page 76
Trading across Borders - Dhaka
Figure – Trading across Borders in Dhaka – Score
Time
to
export:
Border
compliance
0.0
Cost
to
export:
Border
compliance
61.5
Time
to
export:
Documentary
compliance
13.6
Cost
to
export:
Documentary
compliance
43.8
Time
to
import:
Border
compliance
22.9
Cost
to
import:
Border
compliance
25.0
Time
to
import:
Documentary
compliance
40.2
Cost
to
import:
Documentary
compliance
47.1
Figure – Trading across Borders in Dhaka and comparator economies – Ranking and Score
DB 2020 Trading Across Borders Score
0 100
85.1: Nepal (Rank: 60)
82.5: India (Rank: 68)
73.3: Sri Lanka (Rank: 96)
68.8: Pakistan (Rank: 111)
31.8: Chittagong
31.8: Dhaka
Note: The ranking of economies on the ease of trading across borders is determined by sorting their scores for trading across borders. These scores are the simple
average of the scores for the time and cost for documentary compliance and border compliance to export and import.
Indicator
Best Regulatory
Performance
Time to export: Border compliance (hours)
168
53.4
12.7
1 (19 Economies)
Cost to export: Border compliance (USD)
408
310.6
136.8
0 (19 Economies)
Time to export: Documentary compliance (hours)
147
73.7
2.3
1 (26 Economies)
Cost to export: Documentary compliance (USD)
225
157.9
33.4
0 (20 Economies)
Time to import: Border compliance (hours)
216
85.7
8.5
1 (25 Economies)
Cost to import: Border compliance (USD)
900
472.9
98.1
0 (28 Economies)
Time to import: Documentary compliance (hours)
144
93.7
3.4
1 (30 Economies)
Cost to import: Documentary compliance (USD)
370
261.7
23.5
0 (30 Economies)
Bangladesh
Doing Business
2020
Page 77
Figure – Trading across Borders in Dhaka – Time and Cost
Export
-
Border
Compliance
Export
-
Documentary
Compliance
Import
-
Border
Compliance
Import
-
Documentary
Compliance
0
50
100
150
200
250
Time (hours)
0
200
400
600
800
1000
Cost (USD)
168
408
147
225
216
900
144
370
Time (hours) Cost (USD)
Bangladesh
Doing Business
2020
Page 78
Details – Trading across Borders in Dhaka
Characteristics
Export
Import
Product
HS 61 : Articles of apparel and clothing accessories,
knitted or crocheted
HS 8708: Parts and accessories of motor vehicles
Trade partner
Germany
India
Border
Chittagong port
Chittagong port
Distance (km)
263
263
Domestic transport time (hours)
18
18
Domestic transport cost (USD)
231
300
Details – Trading across Borders in Dhaka – Components of Border Compliance
Time to Complete (hours)
Associated Costs (USD)
Export: Clearance and inspections required by
customs authorities
96.0
151.9
Export: Clearance and inspections required by
agencies other than customs
0.0
0.0
Export: Port or border handling
72.0
256.3
Import: Clearance and inspections required by
customs authorities
120.0
400.0
Import: Clearance and inspections required by
agencies other than customs
0.0
0.0
Import: Port or border handling
96.0
500.0
Bangladesh
Doing Business
2020
Page 79
Details – Trading across Borders in Dhaka – Trade Documents
Export
Import
Bill of Lading
Bill of lading
Commercial Invoice
Cargo release order (Gate Pass)
Customs Export Declaration
Certificate of origin
Packing List
Commercial invoice
Certificate of origin
Customs import declaration
Terminal Handling Receipts
Packing list
Technical standards certificate
Technical standard/Cleanliness certificate
Cargo release order
Terminal handling receipts
Customs Transit Document
Letter of credit
Foreign exchange authorization
SOLAS certificate
Pre shipment inspection - clean report of findings
Utilized Declaration for garments
Letter of Credit
SOLAS certificate
Bangladesh
Doing Business
2020
Page 80
Trading across Borders - Chittagong
Figure – Trading across Borders in Chittagong – Score
Time
to
export:
Border
compliance
0.0
Cost
to
export:
Border
compliance
61.5
Time
to
export:
Documentary
compliance
13.6
Cost
to
export:
Documentary
compliance
43.8
Time
to
import:
Border
compliance
22.9
Cost
to
import:
Border
compliance
25.0
Time
to
import:
Documentary
compliance
40.2
Cost
to
import:
Documentary
compliance
47.1
Figure – Trading across Borders in Chittagong and comparator economies – Ranking and Score
DB 2020 Trading Across Borders Score
0 100
85.1: Nepal (Rank: 60)
82.5: India (Rank: 68)
73.3: Sri Lanka (Rank: 96)
68.8: Pakistan (Rank: 111)
31.8: Chittagong
31.8: Dhaka
Note: The ranking of economies on the ease of trading across borders is determined by sorting their scores for trading across borders. These scores are the simple
average of the scores for the time and cost for documentary compliance and border compliance to export and import.
Indicator
Best Regulatory
Performance
Time to export: Border compliance (hours)
168
53.4
12.7
1 (19 Economies)
Cost to export: Border compliance (USD)
408
310.6
136.8
0 (19 Economies)
Time to export: Documentary compliance (hours)
147
73.7
2.3
1 (26 Economies)
Cost to export: Documentary compliance (USD)
225
157.9
33.4
0 (20 Economies)
Time to import: Border compliance (hours)
216
85.7
8.5
1 (25 Economies)
Cost to import: Border compliance (USD)
900
472.9
98.1
0 (28 Economies)
Time to import: Documentary compliance (hours)
144
93.7
3.4
1 (30 Economies)
Cost to import: Documentary compliance (USD)
370
261.7
23.5
0 (30 Economies)
Bangladesh
Doing Business
2020
Page 81
Figure – Trading across Borders in Chittagong – Time and Cost
Export
-
Border
Compliance
Export
-
Documentary
Compliance
Import
-
Border
Compliance
Import
-
Documentary
Compliance
0
50
100
150
200
250
Time (hours)
0
200
400
600
800
1000
Cost (USD)
168
408
147
225
216
900
144
370
Time (hours) Cost (USD)
Bangladesh
Doing Business
2020
Page 82
Details – Trading across Borders in Chittagong
Characteristics
Export
Import
Product
HS 61 : Articles of apparel and clothing accessories,
knitted or crocheted
HS 8708: Parts and accessories of motor vehicles
Trade partner
Germany
India
Border
Chittagong port
Chittagong port
Distance (km)
20
20
Domestic transport time (hours)
4
4
Domestic transport cost (USD)
77
85
Details – Trading across Borders in Chittagong – Components of Border Compliance
Time to Complete (hours)
Associated Costs (USD)
Export: Clearance and inspections required by
customs authorities
96.0
151.9
Export: Clearance and inspections required by
agencies other than customs
0.0
0.0
Export: Port or border handling
72.0
256.3
Import: Clearance and inspections required by
customs authorities
120.0
400.0
Import: Clearance and inspections required by
agencies other than customs
0.0
0.0
Import: Port or border handling
96.0
500.0
Bangladesh
Doing Business
2020
Page 83
Details – Trading across Borders in Chittagong – Trade Documents
Export
Import
Bill of lading
Bill of lading
Commercial invoice
Cargo release order (Gate Pass)
Customs Export Declaration
Certificate of origin
Packing List
Commercial invoice
Certificate of origin
Customs import declaration
Terminal Handling Receipts
Packing list
Technical standards certificate
Technical standard/Cleanliness certificate
Cargo release order
Terminal handling receipts
Customs Transit Document
Letter of credit
Foreign exchange authorization
SOLAS certificate
Pre shipment inspection - clean report of findings
Utilized Declaration for Garments
Letter of Credit
SOLAS certificate
Bangladesh
Doing Business
2020
Page 84
Enforcing Contracts
.
The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local first-instance court, and the quality of judicial processes
index, evaluating whether each economy has adopted a series of good practices that promote quality and efficiency in the court system. The most recent round of data
collection was completed in May 2019.
See the methodology for more information
What the indicators measure
Time required to enforce a contract through the courts
(calendar days)
Time to file and serve the case
•
Time for trial and to obtain the judgment
•
Time to enforce the judgment
•
Cost required to enforce a contract through the courts (% of
claim value)
Average attorney fees
•
Court costs
•
Enforcement costs
•
Quality of judicial processes index (0-18)
Court structure and proceedings (-1-5)
•
Case management (0-6)
•
Court automation (0-4)
•
Alternative dispute resolution (0-3)
•
Case study assumptions
The dispute in the case study involves the breach of a sales contract between two domestic
businesses. The case study assumes that the court hears an expert on the quality of the goods in
dispute. This distinguishes the case from simple debt enforcement.
To make the data on the time and comparable across economies, several assumptions about the
case are used:
- The dispute concerns a lawful transaction between two businesses (Seller and Buyer), both
located in the economy’s largest business city. For 11 economies the data are also collected for the
second largest business city.
- The Buyer orders custom-made furniture, then fails to pay alleging that the goods are not of
adequate quality.
- The value of the dispute is 200% of the income per capita or the equivalent in local currency of
USD 5,000, whichever is greater.
- The Seller sues the Buyer before the court with jurisdiction over commercial cases worth 200% of
income per capita or $5,000 whichever is greater.
- The Seller requests the pretrial attachment of the defendant’s movable assets to secure the
claim.
- The claim is disputed on the merits because of Buyer’s allegation that the quality of the goods
was not adequate.
- The judge decides in favor of the seller; there is no appeal.
- The Seller enforces the judgment through a public sale of the Buyer’s movable assets.
Bangladesh
Doing Business
2020
Page 85
Enforcing Contracts - Dhaka
Figure – Enforcing Contracts in Dhaka – Score
Time
0.0
Cost
25.0
Quality of judicial processes index
41.7
Figure – Enforcing Contracts in Dhaka and comparator economies – Ranking and Score
DB 2020 Enforcing Contracts Score
0 100
46.0: Nepal (Rank: 151)
43.5: Pakistan (Rank: 156)
41.2: India (Rank: 163)
41.2: Sri Lanka (Rank: 164)
22.2: Chittagong
22.2: Dhaka
Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their scores for enforcing contracts. These scores are the simple average of
the scores for each of the component indicators.
Standardized Case
Claim value
BDT 424,446
Court name
Joint District Judge
City Covered
Dhaka
Indicator
Best Regulatory
Performance
Time (days)
1442
1,101.6
589.6
120 (Singapore)
Cost (% of claim value)
66.8
29.9
21.5
0.1 (Bhutan)
Quality of judicial processes index (0-18)
7.5
7.1
11.7
None in 2018/19
Bangladesh
Doing Business
2020
Page 86
Figure – Enforcing Contracts in Dhaka – Time and Cost
Chittagong Dhaka India Nepal OECD
high
income
Pakistan South
Asia
Sri
Lanka
0
200
400
600
800
1000
1200
1400
1600
Time (days)
0
10
20
30
40
50
60
70
80
Cost (% of claim value)
1442
66.8
1442
66.8
1445
31.0
910
27.3
589.6
21.5
1071
20.5
1,101.6
29.9
1318
22.8
Time (days) Cost (% of claim value)
Bangladesh
Doing Business
2020
Page 87
Figure – Enforcing Contracts in Dhaka and comparator economies – Measure of Quality
Dhaka
Chittagong
India
Nepal
Pakistan
Sri Lanka
OECD high income
South Asia
0 2 4 6 8 10 12 14
Sub-Indicator Score
3 1 0.5 3
3 1 0.5 3
2.5 1.5 2 4.5
2.5 0.5 0 3
2 1.2 0.5 2
2.5 1 0.5 4.5
2.5 3.2 2.4 3.6
2.4 1.2 0.8 3.1
Alternative dispute resolution (0-3) Case management (0-6) Court automation (0-4) Court structure and proceedings (-1-5)
Details – Enforcing Contracts in Dhaka
Indicator
Time (days)
1442
Filing and service
30
Trial and judgment
1047
Enforcement of judgment
365
Cost (% of claim value)
66.8
Attorney fees
40
Court fees
8.3
Enforcement fees
18.5
Quality of judicial processes index (0-18)
7.5
Court structure and proceedings (-1-5)
3.0
Case management (0-6)
1.0
Court automation (0-4)
0.5
Alternative dispute resolution (0-3)
3.0
Bangladesh
Doing Business
2020
Page 88
Details – Enforcing Contracts in Dhaka – Measure of Quality
Answer
Score
Quality of judicial processes index (0-18)
7.5
Court structure and proceedings (-1-5)
3.0
1. Is there a court or division of a court dedicated solely to hearing commercial cases?
No
0.0
2. Small claims court
1.5
2.a. Is there a small claims court or a fast-track procedure for small claims?
Yes
2.b. If yes, is self-representation allowed?
Yes
3. Is pretrial attachment available?
Yes
1.0
4. Are new cases assigned randomly to judges?
Yes, but manual
0.5
5. Does a woman's testimony carry the same evidentiary weight in court as a man's?
Yes
0.0
Case management (0-6)
1.0
1. Time standards
0.5
1.a. Are there laws setting overall time standards for key court events in a civil case?
Yes
1.b. If yes, are the time standards set for at least three court events?
Yes
1.c. Are these time standards respected in more than 50% of cases?
No
2. Adjournments
0.5
2.a. Does the law regulate the maximum number of adjournments that can be granted?
Yes
2.b. Are adjournments limited to unforeseen and exceptional circumstances?
Yes
2.c. If rules on adjournments exist, are they respected in more than 50% of cases?
No
3. Can two of the following four reports be generated about the competent court: (i) time to disposition report; (ii)
clearance rate report; (iii) age of pending cases report; and (iv) single case progress report?
No
0.0
4. Is a pretrial conference among the case management techniques used before the competent court?
No
0.0
5. Are there any electronic case management tools in place within the competent court for use by judges?
No
0.0
6. Are there any electronic case management tools in place within the competent court for use by lawyers?
No
0.0
Court automation (0-4)
0.5
1. Can the initial complaint be filed electronically through a dedicated platform within the competent court?
No
0.0
2. Is it possible to carry out service of process electronically for claims filed before the competent court?
No
0.0
3. Can court fees be paid electronically within the competent court?
No
0.0
4. Publication of judgments
0.5
4.a Are judgments rendered in commercial cases at all levels made available to the general public
through publication in official gazettes, in newspapers or on the internet or court website?
No
4.b. Are judgments rendered in commercial cases at the appellate and supreme court level made
available to the general public through publication in official gazettes, in newspapers or on the internet
or court website?
Yes
Alternative dispute resolution (0-3)
3.0
1. Arbitration
1.5
1.a. Is domestic commercial arbitration governed by a consolidated law or consolidated chapter or
section of the applicable code of civil procedure encompassing substantially all its aspects?
Yes
1.b. Are there any commercial disputes—aside from those that deal with public order or public policy—
that cannot be submitted to arbitration?
No
1.c. Are valid arbitration clauses or agreements usually enforced by the courts?
Yes
Bangladesh
Doing Business
2020
Page 89
2. Mediation/Conciliation
1.5
2.a. Is voluntary mediation or conciliation available?
Yes
2.b. Are mediation, conciliation or both governed by a consolidated law or consolidated chapter or
section of the applicable code of civil procedure encompassing substantially all their aspects (for
example, definition, aim and scope of application, desig
Yes
2.c. Are there financial incentives for parties to attempt mediation or conciliation (i.e., if mediation or
conciliation is successful, a refund of court filing fees, income tax credits or the like)?
Yes
Bangladesh
Doing Business
2020
Page 90
Enforcing Contracts - Chittagong
Figure – Enforcing Contracts in Chittagong – Score
Time
0.0
Cost
25.0
Quality of judicial processes index
41.7
Figure – Enforcing Contracts in Chittagong and comparator economies – Ranking and Score
DB 2020 Enforcing Contracts Score
0 100
46.0: Nepal (Rank: 151)
43.5: Pakistan (Rank: 156)
41.2: India (Rank: 163)
41.2: Sri Lanka (Rank: 164)
22.2: Chittagong
22.2: Dhaka
Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their scores for enforcing contracts. These scores are the simple average of
the scores for each of the component indicators.
Standardized Case
Claim value
BDT 424,446
Court name
Joint District Judge
City Covered
Chittagong
Indicator
Best Regulatory
Performance
Time (days)
1442
1,101.6
589.6
120 (Singapore)
Cost (% of claim value)
66.8
29.9
21.5
0.1 (Bhutan)
Quality of judicial processes index (0-18)
7.5
7.1
11.7
None in 2018/19
Bangladesh
Doing Business
2020
Page 91
Figure – Enforcing Contracts in Chittagong – Time and Cost
Chittagong Dhaka India Nepal OECD
high
income
Pakistan South
Asia
Sri
Lanka
0
200
400
600
800
1000
1200
1400
1600
Time (days)
0
10
20
30
40
50
60
70
80
Cost (% of claim value)
1442
66.8
1442
66.8
1445
31.0
910
27.3
589.6
21.5
1071
20.5
1,101.6
29.9
1318
22.8
Time (days) Cost (% of claim value)
Bangladesh
Doing Business
2020
Page 92
Figure – Enforcing Contracts in Chittagong and comparator economies – Measure of Quality
Chittagong
Dhaka
India
Nepal
Pakistan
Sri Lanka
OECD high income
South Asia
0 2 4 6 8 10 12 14
Sub-Indicator Score
3 1 0.5 3
3 1 0.5 3
2.5 1.5 2 4.5
2.5 0.5 0 3
2 1.2 0.5 2
2.5 1 0.5 4.5
2.5 3.2 2.4 3.6
2.4 1.2 0.8 3.1
Alternative dispute resolution (0-3) Case management (0-6) Court automation (0-4) Court structure and proceedings (-1-5)
Details – Enforcing Contracts in Chittagong
Indicator
Time (days)
1442
Filing and service
30
Trial and judgment
1047
Enforcement of judgment
365
Cost (% of claim value)
66.8
Attorney fees
40
Court fees
8.3
Enforcement fees
18.5
Quality of judicial processes index (0-18)
7.5
Court structure and proceedings (-1-5)
3.0
Case management (0-6)
1.0
Court automation (0-4)
0.5
Alternative dispute resolution (0-3)
3.0
Bangladesh
Doing Business
2020
Page 93
Details – Enforcing Contracts in Chittagong – Measure of Quality
Answer
Score
Quality of judicial processes index (0-18)
7.5
Court structure and proceedings (-1-5)
3.0
1. Is there a court or division of a court dedicated solely to hearing commercial cases?
No
0.0
2. Small claims court
1.5
2.a. Is there a small claims court or a fast-track procedure for small claims?
Yes
2.b. If yes, is self-representation allowed?
Yes
3. Is pretrial attachment available?
Yes
1.0
4. Are new cases assigned randomly to judges?
Yes, but manual
0.5
5. Does a woman's testimony carry the same evidentiary weight in court as a man's?
Yes
0.0
Case management (0-6)
1.0
1. Time standards
0.5
1.a. Are there laws setting overall time standards for key court events in a civil case?
Yes
1.b. If yes, are the time standards set for at least three court events?
Yes
1.c. Are these time standards respected in more than 50% of cases?
No
2. Adjournments
0.5
2.a. Does the law regulate the maximum number of adjournments that can be granted?
Yes
2.b. Are adjournments limited to unforeseen and exceptional circumstances?
Yes
2.c. If rules on adjournments exist, are they respected in more than 50% of cases?
No
3. Can two of the following four reports be generated about the competent court: (i) time to disposition report; (ii)
clearance rate report; (iii) age of pending cases report; and (iv) single case progress report?
No
0.0
4. Is a pretrial conference among the case management techniques used before the competent court?
No
0.0
5. Are there any electronic case management tools in place within the competent court for use by judges?
No
0.0
6. Are there any electronic case management tools in place within the competent court for use by lawyers?
No
0.0
Court automation (0-4)
0.5
1. Can the initial complaint be filed electronically through a dedicated platform within the competent court?
No
0.0
2. Is it possible to carry out service of process electronically for claims filed before the competent court?
No
0.0
3. Can court fees be paid electronically within the competent court?
No
0.0
4. Publication of judgments
0.5
4.a Are judgments rendered in commercial cases at all levels made available to the general public
through publication in official gazettes, in newspapers or on the internet or court website?
No
4.b. Are judgments rendered in commercial cases at the appellate and supreme court level made
available to the general public through publication in official gazettes, in newspapers or on the internet
or court website?
Yes
Alternative dispute resolution (0-3)
3.0
1. Arbitration
1.5
1.a. Is domestic commercial arbitration governed by a consolidated law or consolidated chapter or
section of the applicable code of civil procedure encompassing substantially all its aspects?
Yes
1.b. Are there any commercial disputes—aside from those that deal with public order or public policy—
that cannot be submitted to arbitration?
No
1.c. Are valid arbitration clauses or agreements usually enforced by the courts?
Yes
Bangladesh
Doing Business
2020
Page 94
2. Mediation/Conciliation
1.5
2.a. Is voluntary mediation or conciliation available?
Yes
2.b. Are mediation, conciliation or both governed by a consolidated law or consolidated chapter or
section of the applicable code of civil procedure encompassing substantially all their aspects (for
example, definition, aim and scope of application, desig
Yes
2.c. Are there financial incentives for parties to attempt mediation or conciliation (i.e., if mediation or
conciliation is successful, a refund of court filing fees, income tax credits or the like)?
Yes
Bangladesh
Doing Business
2020
Page 95
Resolving Insolvency
studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate,
which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings.
To determine the present value of the amount recovered by creditors,
uses the lending rates from the International Monetary Fund, supplemented with
data from central banks and the Economist Intelligence Unit. The most recent round of data collection was completed in May 2019.
.
Doing Business
Doing Business
See the methodology for more
information
What the indicators measure
Time required to recover debt (years)
Measured in calendar years
•
Appeals and requests for extension are included
•
Cost required to recover debt (% of debtor’s estate)
Measured as percentage of estate value
•
Court fees
•
Fees of insolvency administrators
•
Lawyers’ fees
•
Assessors’ and auctioneers’ fees
•
Other related fees
•
Outcome
Whether business continues operating as a going concern or
business assets are sold piecemeal
•
Recovery rate for creditors
Measures the cents on the dollar recovered by secured
creditors
•
Outcome for the business (survival or not) determines the
maximum value that can be recovered
•
Official costs of the insolvency proceedings are deducted
•
Depreciation of furniture is taken into account
•
Present value of debt recovered
•
Strength of insolvency framework index (0- 16)
Sum of the scores of four component indices:
•
Commencement of proceedings index (0-3)
•
Management of debtor’s assets index (0-6)
•
Reorganization proceedings index (0-3)
•
Creditor participation index (0-4)
•
Case study assumptions
To make the data on the time, cost and outcome comparable across economies, several
assumptions about the business and the case are used:
- A hotel located in the largest city (or cities) has 201 employees and 50 suppliers. The hotel
experiences financial difficulties.
- The value of the hotel is 100% of the income per capita or the equivalent in local currency of USD
200,000, whichever is greater.
- The hotel has a loan from a domestic bank, secured by a mortgage over the hotel’s real estate.
The hotel cannot pay back the loan, but makes enough money to operate otherwise.
In addition,
evaluates the quality of legal framework applicable to judicial
liquidation and reorganization proceedings and the extent to which best insolvency practices have
been implemented in each economy covered.
Doing Business
Bangladesh
Doing Business
2020
Page 96
Resolving Insolvency - Dhaka
Figure – Resolving Insolvency in Dhaka – Score
Recovery rate
31.3
Strength of insolvency framework index
25.0
Figure – Resolving Insolvency in Dhaka and comparator economies – Ranking and Score
DB 2020 Resolving Insolvency Score
0 100
62.0: India (Rank: 52)
59.0: Pakistan (Rank: 58)
47.2: Nepal (Rank: 87)
45.0: Sri Lanka (Rank: 94)
28.1: Chittagong
28.1: Dhaka
Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their scores for resolving insolvency. These scores are the simple average
of the scores for the recovery rate and the strength of insolvency framework index.
Indicator
Best Regulatory
Performance
Recovery rate (cents on the dollar)
29.1
38.1
70.2
92.9 (Norway)
Time (years)
4.0
2.2
1.7
0.4 (Ireland)
Cost (% of estate)
8.0
9.9
9.3
1.0 (Norway)
Outcome (0 as piecemeal sale and 1 as going concern)
0
..
..
..
Strength of insolvency framework index (0-16)
4.0
6.5
11.9
None in 2018/19
Bangladesh
Doing Business
2020
Page 97
Figure – Resolving Insolvency in Dhaka – Time and Cost
Chittagong Dhaka India Nepal OECD
high
income
Pakistan South
Asia
Sri
Lanka
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
Time (years)
0
2
4
6
8
10
12
Cost (% of estate)
4.0
8.0
4.0
8.0
1.6
9.0
2.0
9.0
1.7
9.3
2.6
4.0
2.2
9.9
1.7
10.0
Time (years) Cost (% of estate)
Bangladesh
Doing Business
2020
Page 98
Figure – Resolving Insolvency in Dhaka and comparator economies – Measure of Quality
Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the
strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.”
Dhaka
Chittagong
India
Nepal
Pakistan
Sri Lanka
OECD high income
South Asia
0 2 4 6 8 10 12 14
Sub-Indicator Score
2 2 00
2 2 00
4.5 2 1 0
4 2 0 2
5.5 2.5 2 1.5
3 2.5 1 0.5
5.3 2.8 2.1 1.9
3.6 2.1 0.9 0.6
Management of debtor's assets index (0-6) Commencement of proceedings index (0-3) Creditor participation index (0-4) Reorganization proceedings index (0-3)
Figure – Resolving Insolvency in Dhaka and comparator economies – Recovery Rate
Dhaka India Nepal Pakistan Sri Lanka Chittagong South Asia
0
10
20
30
40
50
60
70
80
Recovery rate(cents on the dollar)
29.1
71.6
41.2
42.8
43.0
29.1
38.1
Bangladesh
Doing Business
2020
Page 99
Details – Resolving Insolvency in Dhaka
Indicator
Score
Proceeding
foreclosure
After 90 days of automatic stay, the Bizbank would initiate foreclosure through Artha Rin Adalat Bankruptcy Court
which is established under the Artha Rin Adalat Act 2003 for banks and non-banking financial institutions (NBFIs).
Artha Rin Adalat Bankruptcy Court would then review the case and makes decision on Mirages's application. Once a
decree has been passed against the entity, the bank files for execution of the decree and the Court conducts a
piecemeal sale of Mirage's assets in a public auction.
Outcome
piecemeal sale
No, the hotel will stop operating and Mirage assets will be sold piecemeal in a public auction conducted by the Artha
Rin Courts after granting the order on the BizBank's foreclosure application.
Time (in years)
4.0
A foreclosure procedure will approximately take 4 years in total. BizBank would initiate foreclosure after the 90 days
automatic stay, and after filing the application to the Artha Rin Bankruptcy Court, it usually takes another year to get a
decree from the Artha Rin Bankruptcy Court (1-2 years). The execution of the decree until BizBank is repaid some or
all of the money owed to it from the auction proceeds would take additional 1 to 2 years.
Cost (% of estate)
8.0
The costs associated with the case would amount to approximately 8% of the value of the debtor's estate. Cost
incurred during the entire insolvency process mainly include court or government agency fees (1%), attorney fees (up
to 5%), costs of notification and publication (1%), fees of accountants, assessors, inspectors and other professionals
(1%), and auctioneer fees (1%).
Recovery rate
(cents on the dollar)
29.1
Bangladesh
Doing Business
2020
Page 100
Details – Resolving Insolvency in Dhaka – Measure of Quality
Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the
strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.”
Note:
Answer
Score
Strength of insolvency framework index (0-16)
4.0
Commencement of proceedings index (0-3)
2.0
What procedures are available to a DEBTOR when commencing insolvency proceedings?
(b) Debtor may file for
liquidation only
0.5
Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor?
(b) Yes, but a creditor
may file for liquidation
only
0.5
What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (a)
Debtor is generally unable to pay its debts as they mature (b) The value of debtor's liabilities exceeds the value
of its assets
(a) Debtor is
generally unable to
pay its debts as they
mature
1.0
Management of debtor's assets index (0-6)
2.0
Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the
debtor?
No
0.0
Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts?
Yes
1.0
Does the insolvency framework allow avoidance of preferential transactions?
Yes
1.0
Does the insolvency framework allow avoidance of undervalued transactions?
No
0.0
Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of
insolvency proceedings?
No
0.0
Does the insolvency framework assign priority to post-commencement credit?
(c) No priority is
assigned to post-
commencement
creditors
0.0
Reorganization proceedings index (0-3)
0.0
Which creditors vote on the proposed reorganization plan?
N/A
0.0
Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as
what they would obtain in a liquidation?
No
0.0
Are the creditors divided into classes for the purposes of voting on the reorganization plan, does each class vote
separately and are creditors in the same class treated equally?
No
0.0
Creditor participation index (0-4)
0.0
Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency
representative?
No
0.0
Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor?
No
0.0
Does the insolvency framework provide that a creditor has the right to request information from the insolvency
representative?
No
0.0
Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting
creditors' claims?
No
0.0
Bangladesh
Doing Business
2020
Page 101
Resolving Insolvency - Chittagong
Figure – Resolving Insolvency in Chittagong – Score
Recovery rate
31.3
Strength of insolvency framework index
25.0
Figure – Resolving Insolvency in Chittagong and comparator economies – Ranking and Score
DB 2020 Resolving Insolvency Score
0 100
62.0: India (Rank: 52)
59.0: Pakistan (Rank: 58)
47.2: Nepal (Rank: 87)
45.0: Sri Lanka (Rank: 94)
28.1: Chittagong
28.1: Dhaka
Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their scores for resolving insolvency. These scores are the simple average
of the scores for the recovery rate and the strength of insolvency framework index.
Indicator
Best Regulatory
Performance
Recovery rate (cents on the dollar)
29.1
38.1
70.2
92.9 (Norway)
Time (years)
4.0
2.2
1.7
0.4 (Ireland)
Cost (% of estate)
8.0
9.9
9.3
1.0 (Norway)
Outcome (0 as piecemeal sale and 1 as going concern)
0
..
..
..
Strength of insolvency framework index (0-16)
4.0
6.5
11.9
None in 2018/19
Bangladesh
Doing Business
2020
Page 102
Figure – Resolving Insolvency in Chittagong – Time and Cost
Chittagong Dhaka India Nepal OECD
high
income
Pakistan South
Asia
Sri
Lanka
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
Time (years)
0
2
4
6
8
10
12
Cost (% of estate)
4.0
8.0
4.0
8.0
1.6
9.0
2.0
9.0
1.7
9.3
2.6
4.0
2.2
9.9
1.7
10.0
Time (years) Cost (% of estate)
Bangladesh
Doing Business
2020
Page 103
Figure – Resolving Insolvency in Chittagong and comparator economies – Measure of Quality
Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the
strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.”
Chittagong
Dhaka
India
Nepal
Pakistan
Sri Lanka
OECD high income
South Asia
0 2 4 6 8 10 12 14
Sub-Indicator Score
2 2 00
2 2 00
4.5 2 1 0
4 2 0 2
5.5 2.5 2 1.5
3 2.5 1 0.5
5.3 2.8 2.1 1.9
3.6 2.1 0.9 0.6
Management of debtor's assets index (0-6) Commencement of proceedings index (0-3) Creditor participation index (0-4) Reorganization proceedings index (0-3)
Figure – Resolving Insolvency in Chittagong and comparator economies – Recovery Rate
Chittagong India Nepal Pakistan Sri Lanka Dhaka South Asia
0
10
20
30
40
50
60
70
80
Recovery rate(cents on the dollar)
29.1
71.6
41.2
42.8
43.0
29.1
38.1
Bangladesh
Doing Business
2020
Page 104
Details – Resolving Insolvency in Chittagong
Indicator
Score
Proceeding
foreclosure
After 90 days of automatic stay, the Bizbank would initiate foreclosure through Artha Rin Adalat Bankruptcy Court
which is established under the Artha Rin Adalat Act 2003 for banks and non-banking financial institutions (NBFIs).
Artha Rin Adalat Bankruptcy Court would then review the case and makes decision on Mirages's application. Once a
decree has been passed against the entity, the bank files for execution of the decree and the Court conducts a
piecemeal sale of Mirage's assets in a public auction.
Outcome
piecemeal sale
No, the hotel will stop operating and Mirage assets will be sold piecemeal in a public auction conducted by the Courts
after granting the order on the BizBank's foreclosure application.
Time (in years)
4.0
A foreclosure procedure will approximately take 4 years in total. BizBank would initiate foreclosure after the 90 days
automatic stay, and after filing the application to the Artha Rin Bankruptcy Court, it usually takes another year to get a
decree from the Artha Rin Bankruptcy Court (1-2 years). The execution of the decree until BizBank is repaid some or
all of the money owed to it from the auction proceeds would take additional 1 to 2 years.
Cost (% of estate)
8.0
The costs associated with the case would amount to approximately 8% of the value of the debtor's estate. Cost
incurred during the entire insolvency process mainly include court or government agency fees (1%), attorney fees (up
to 5%), costs of notification and publication (1%), fees of accountants, assessors, inspectors and other professionals
(1%), and auctioneer fees (1%).
Recovery rate
(cents on the dollar)
29.1
Bangladesh
Doing Business
2020
Page 105
Details – Resolving Insolvency in Chittagong – Measure of Quality
Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the
strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.”
Note:
Answer
Score
Strength of insolvency framework index (0-16)
4.0
Commencement of proceedings index (0-3)
2.0
What procedures are available to a DEBTOR when commencing insolvency proceedings?
(b) Debtor may file for
liquidation only
0.5
Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor?
(b) Yes, but a creditor
may file for liquidation
only
0.5
What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (a)
Debtor is generally unable to pay its debts as they mature (b) The value of debtor's liabilities exceeds the value
of its assets
(a) Debtor is
generally unable to
pay its debts as they
mature
1.0
Management of debtor's assets index (0-6)
2.0
Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the
debtor?
No
0.0
Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts?
Yes
1.0
Does the insolvency framework allow avoidance of preferential transactions?
Yes
1.0
Does the insolvency framework allow avoidance of undervalued transactions?
No
0.0
Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of
insolvency proceedings?
No
0.0
Does the insolvency framework assign priority to post-commencement credit?
(c) No priority is
assigned to post-
commencement
creditors
0.0
Reorganization proceedings index (0-3)
0.0
Which creditors vote on the proposed reorganization plan?
N/A
0.0
Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as
what they would obtain in a liquidation?
No
0.0
Are the creditors divided into classes for the purposes of voting on the reorganization plan, does each class vote
separately and are creditors in the same class treated equally?
No
0.0
Creditor participation index (0-4)
0.0
Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency
representative?
No
0.0
Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor?
No
0.0
Does the insolvency framework provide that a creditor has the right to request information from the insolvency
representative?
No
0.0
Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting
creditors' claims?
No
0.0
Bangladesh
Doing Business
2020
Page 106
Employing Workers
presents detailed data for the employing workers indicators on the
website (
). The study does not present
rankings of economies on these indicators or include the topic in the aggregate ease of doing business score or ranking on the ease of doing business.
Doing Business Doing Business
http://www.doingbusiness.org
The most recent round of data collection was completed in May 2019.
.
See the methodology for more information
What the indicators measure
(i) whether fixed-term contracts are prohibited for permanent
tasks; (ii) maximum cumulative duration of fixed-term contracts;
(iii) length of the maximum probationary period; (iv) minimum
wage;(v) ratio of minimum wage to the average value added per
worker.
Hiring
(i) maximum number of working days allowed per week; (ii)
premiums for work: at night, on a weekly rest day and overtime;
(iii) whether there are restrictions on work at night, work on a
weekly rest day and for overtime work; (iv) length of paid annual
leave.
Working hours
(i) whether redundancy can be basis for terminating workers; (ii)
whether employer needs to notify and/or get approval from third
party to terminate 1 redundant worker and a group of 9 redundant
workers; (iii) whether the law requires employer to reassign or
retrain a worker before making worker redundant; (iv) whether
priority rules apply for redundancies and reemployment.
Redundancy rules
(i) notice period for redundancy dismissal; (ii) severance
payments, and (iii) penalties due when terminating a redundant
worker. Data on the availability of unemployment protection for a
worker with one year of employment is also collected.
Redundancy cost
Case study assumptions
To make the data comparable across economies, several assumptions about the worker and the
business are used.
- Is a cashier in a supermarket or grocery store, age 19, with one year of work experience.
- Is a full-time employee.
- Is not a member of the labor union, unless membership is mandatory.
The worker:
- Is a limited liability company (or the equivalent in the economy).
- Operates a supermarket or grocery store in the economy’s largest business city. For 11
economies the data are also collected for the second largest business city.
- Has 60 employees.
- Is subject to collective bargaining agreements if such agreements cover more than 50% of the
food retail sector and they apply even to firms that are not party to them.
- Abides by every law and regulation but does not grant workers more benefits than those
mandated by law, regulation or (if applicable) collective bargaining agreements.
The business:
Bangladesh
Doing Business
2020
Page 107
Employing Workers - Dhaka
Details – Employing Workers in Dhaka
Answer
Hiring
Fixed-term contracts prohibited for permanent tasks?
No
Maximum length of a single fixed-term contract (months)
No limit
Maximum length of fixed-term contracts, including renewals (months)
No limit
Minimum wage applicable to the worker assumed in the case study (US$/month)
0.0
Ratio of minimum wage to value added per worker
0.0
Maximum length of probationary period (months)
3.0
Working hours
Standard workday
8.0
Maximum number of working days per week
5.5
Premium for night work (% of hourly pay)
0.0
Premium for work on weekly rest day (% of hourly pay)
0.0
Premium for overtime work (% of hourly pay)
100.0
Restrictions on night work?
No
Restrictions on weekly holiday?
No
Restrictions on overtime work?
No
Paid annual leave for a worker with 1 year of tenure (working days)
17.0
Paid annual leave for a worker with 5 years of tenure (working days)
17.0
Paid annual leave for a worker with 10 years of tenure (working days)
17.0
Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days)
17.0
Redundancy rules
Dismissal due to redundancy allowed by law?
Yes
Third-party notification if one worker is dismissed?
Yes
Third-party approval if one worker is dismissed?
No
Third-party notification if nine workers are dismissed?
Yes
Third-party approval if nine workers are dismissed?
No
Retraining or reassignment obligation before redundancy?
No
Priority rules for redundancies?
Yes
Priority rules for reemployment?
Yes
Redundancy cost
Notice period for redundancy dismissal for a worker with 1 year of tenure (weeks of salary)
4.3
Notice period for redundancy dismissal for a worker with 5 years of tenure (weeks of salary)
4.3
Notice period for redundancy dismissal for a worker with 10 years of tenure (weeks of salary)
4.3
Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary)
4.3
Severance pay for redundancy dismissal for a worker with 1 year of tenure (weeks of salary)
5.0
Severance pay for redundancy dismissal for a worker with 5 years of tenure (weeks of salary)
25.0
Bangladesh
Doing Business
2020
Page 108
Severance pay for redundancy dismissal for a worker with 10 years of tenure (weeks of salary)
50.0
Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary)
26.7
Unemployment protection after one year of employment?
No
Bangladesh
Doing Business
2020
Page 109
Employing Workers - Chittagong
Details – Employing Workers in Chittagong
Answer
Hiring
Fixed-term contracts prohibited for permanent tasks?
No
Maximum length of a single fixed-term contract (months)
No limit
Maximum length of fixed-term contracts, including renewals (months)
No limit
Minimum wage applicable to the worker assumed in the case study (US$/month)
0.0
Ratio of minimum wage to value added per worker
0.0
Maximum length of probationary period (months)
3.0
Working hours
Standard workday
8.0
Maximum number of working days per week
5.5
Premium for night work (% of hourly pay)
0.0
Premium for work on weekly rest day (% of hourly pay)
0.0
Premium for overtime work (% of hourly pay)
100.0
Restrictions on night work?
No
Restrictions on weekly holiday?
No
Restrictions on overtime work?
No
Paid annual leave for a worker with 1 year of tenure (working days)
17.0
Paid annual leave for a worker with 5 years of tenure (working days)
17.0
Paid annual leave for a worker with 10 years of tenure (working days)
17.0
Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days)
17.0
Redundancy rules
Dismissal due to redundancy allowed by law?
Yes
Third-party notification if one worker is dismissed?
Yes
Third-party approval if one worker is dismissed?
No
Third-party notification if nine workers are dismissed?
Yes
Third-party approval if nine workers are dismissed?
No
Retraining or reassignment obligation before redundancy?
No
Priority rules for redundancies?
Yes
Priority rules for reemployment?
Yes
Redundancy cost
Notice period for redundancy dismissal for a worker with 1 year of tenure (weeks of salary)
4.3
Notice period for redundancy dismissal for a worker with 5 years of tenure (weeks of salary)
4.3
Notice period for redundancy dismissal for a worker with 10 years of tenure (weeks of salary)
4.3
Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary)
4.3
Severance pay for redundancy dismissal for a worker with 1 year of tenure (weeks of salary)
5.0
Severance pay for redundancy dismissal for a worker with 5 years of tenure (weeks of salary)
25.0
Bangladesh
Doing Business
2020
Page 110
Severance pay for redundancy dismissal for a worker with 10 years of tenure (weeks of salary)
50.0
Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary)
26.7
Unemployment protection after one year of employment?
No
Bangladesh
Doing Business
2020
Page 111
Business Reforms in
Bangladesh
From May 2, 2018 to May 1, 2019, 115 economies implemented 294 business regulatory reforms across the 10 areas measured by Doing Business. Reforms inspired by
have been implemented by economies in all regions. The following are reforms implemented since
2008.
Doing Business Doing Business
DB2020
Starting a Business:
Bangladesh made starting a business less expensive by reducing name clearance and registration fees and abolishing the fee for certifying digital
certificates. This reform applies to both Dhaka and Chittagong.
Getting Electricity:
Bangladesh (Dhaka) made getting electricity faster by investing in digitization and human capital at the utility. Bangladesh (Dhaka) also made
getting electricity less costly by reducing the amount of the security deposit for a new connection.
Getting Credit:
Bangladesh improved access to credit information by expanding the coverage of the credit information bureau. This reform applies to both Dhaka and
Chittagong.
DB2018
Starting a Business:
Bangladesh made starting a business more expensive by increasing the cost of business registration at the Registrar of Joint Stock Companies
and Firms. This reform applies to both Chittagong and Dhaka.
DB2017
Paying Taxes:
Bangladesh made paying taxes more complicated for companies by increasing the time it takes to prepare VAT and corporate income tax returns. This
reform applies to both Chittagong and Dhaka.
DB2016
Getting Electricity:
Bangladesh reduced the application processing time for new connections in both Dhaka and Chittagong thanks to an increase in the country’s
network capacity.
Paying Taxes:
Bangladesh made paying taxes less costly for companies by reducing the corporate income tax rate. This reform applies to both Chittagong and Dhaka.
DB2015
Trading across Borders:
Bangladesh made trading across borders easier by introducing a fully automated, computerized customs data management system,
ASYCUDA (Automated System for Customs Data) World. This reform applies to both Chittagong and Dhaka.
DB2014
Starting a Business:
Bangladesh made starting a business easier by automating the registration process and reducing the time required to obtain a trading license and
to complete the tax and value added tax registration.
DB2013
Getting Electricity:
Bangladesh made getting electricity more difficult by requiring all customers to meet 7% of their electricity needs through solar energy, making it
necessary to install solar panels.
Getting Credit:
Bangladesh improved access to credit information by establishing an online platform for sharing such information.
DB2012
Getting Electricity:
Bangladesh made getting electricity more difficult by imposing a moratorium on new electricity connections from April 2010 to March 2011
because of an electricity supply shortage. This moratorium has led to long delays for customers and has increased the time to obtain an electricity connection.
DB2011
Starting a Business:
Bangladesh made business start-up easier by eliminating the requirement to buy adhesive stamps and further enhancing the online registration
system.
Registering Property:
Bangladesh reduced the property transfer tax to 6.7% of the property value.
DB2010
Starting a Business:
Bangladesh made starting a business easier by launching a full-fledged online business name clearance and registration process.
Paying Taxes:
Bangladesh made paying taxes less costly for companies by reducing the corporate income tax rate—though it also increased the capital gains tax rate.
Trading across Borders:
Bangladesh reduced the time required to clear goods by automating customs clearance procedures at the Chittagong port.
=
reform making it easier to do business.
= Change making it more difficult to do business.
Doing Business
Bangladesh
Doing Business
2020
Page 112
DB2009
Starting a Business:
Bangladesh simplified business registration formalities, reducing the time, cost and number of procedures to start a business.
Registering Property:
Bangladesh speeded up property registration by increasing efficiency at the municipal deed registry office.
DB2008
Starting a Business:
Bangladesh made starting a business more complicated by introducing an additional process for verifying the payment stamp duty
Paying Taxes:
Bangladesh made paying taxes more costly for companies by increasing the corporate income tax rate.
Bangladesh
Doing Business
2020
Page 113
Bangladesh
Doing Business
2020
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