CSR to Become Legal Obligation
Initiatives being taken to Amend 'Company Law' to attract investment
An exchange-of-views meeting being held at FBCCI office in Motijheel on Monday. Photo: Agamir Somoy.
The government is set to introduce major amendments to the Companies Act, 1994, aiming to improve the business environment in the country, strengthen digitization and attract both domestic and foreign investment.
A detailed discussion on these issues took place today (Monday) at an views exchange meeting held at the FBCCI office in Motijheel, Dhaka, on the draft amendments to the Companies Act, 1994.
The meeting was presided over by FBCCI Administrator Md. Fazlul Haque, with Commerce Minister Khandakar Abdul Muktadir attending as the chief guest. Commerce Secretary Md. Ataur Rahman Khan was also present at the meeting.
The meeting informed that five strategic objectives have been set to modernize the law and elevate it to global standards. These include simplifying business operational procedures, opening doors for small and medium entrepreneurs, ensuring maximum use of information technology, providing a legal basis for corporate social responsibility, and establishing good governance in the business arena.
During the event, Mohammad Mostafa Jamal Haider, Director General (Joint Secretary) of the Trade Organization Division under the Ministry of Commerce, presented the draft proposal titled "Companies Act, 1994 (Third Amendment-2026)" in detail.
It was reported that a total of 40 changes are being introduced to make the act more contemporary. Among these, several new definitions are being added, multiple sub-sections are being amended, and various administrative provisions are also being updated.
Small and medium entrepreneurs in the country are expected to benefit the most from the proposed amendments. Previously, the requirement of a minimum paid-up capital of Tk 25 lakh for forming a One-Person-Company (OPC) would discourage ordinary entrepreneurs.
According to the proposals presented at the meeting, this capital limit has been reduced by 80 percent to only Tk 5 lakh. Additionally, the previous obligation regarding a specific turnover threshold has been completely removed. This will allow sole proprietors to easily bring their businesses under the purview of a registered company.
Significant steps are also being taken to reduce administrative and legal complexities. From now on, instead of going to the High Court, changes to a company's Memorandum of Association or Object Clause can be made directly with the approval of the Registrar of Joint Stock Companies.
This will save entrepreneurs from lengthy judicial processes, time, and legal costs. Furthermore, instead of vague deadlines, specific timeframes are being set for submitting any information or reports.
To ensure the use of modern technology, legal recognition will now be given for maintaining all company registers either alongside paper records or entirely through electronic means. Information such as NID, passport, TIN, mobile number, and email of directors and owners of each company will be stored in the government's secure online database.
For the first time in Bangladesh, Corporate Social Responsibility (CSR) is being introduced as a legal obligation under the Companies Act. By incorporating this provision in line with the models of other advanced and emerging economies worldwide, it is expected to not only gain the trust of foreign investors but also accelerate the achievement of the Sustainable Development Goals (SDGs).
To ensure transparency in business and prevent money laundering and tax evasion through the creation of fake or shell companies, a clear definition of "beneficial ownership" has been added in accordance with international standards.
Additionally, the path has been opened for exchanging information with foreign regulatory authorities when required for investigations into money laundering and corruption. Previously, documents and records of a dissolved company had to be kept for three years; the proposal now suggests extending this period to five years.
To clearly specify the name and type of each company, it is being made mandatory to add suffixes to the company name—PLC for Public Limited Companies, Limited for Private Companies, and OPC for One Person Companies.
For large companies and those listed on the stock exchange, it has been made mandatory to appoint qualified company secretaries. Furthermore, Chartered Accountants, lawyers, or tax advisors are being formally granted legal status as "Company Representatives."
The guests present at the meeting expressed optimism that if the proposed amendments are ultimately implemented, Bangladesh's position in global business rankings will improve significantly. Revenue will increase, and a new momentum will be infused into the country's domestic economic activities.
