Sweeping amendments to the Companies Act 1994 are drafted for easing business operations, ensuring money-laundering prevention, digitising company records, strengthening corporate governance and empowering the regulator with autonomous powers.
The Registrar of Joint Stock Companies and Firms (RJSC) is proposed to be empowered to tackle money laundering, a nefarious practice that has hollowed up Bangladesh's financial sector, among other functions governing the business world.
The proposed Third Amendment Act 2026 includes provisions for digital registration and record-keeping, beneficial ownership disclosure, information sharing with law-enforcement agencies, mandatory company secretaries for large companies and tougher penalties for violations. The draft has been prepared based on recommendations from different agencies and institutions, including Bangladesh Financial Intelligence Unit (BFIU), and directions contained in a High Court order in a related writ petition, officials said.
Under the proposed amendment to the Section 12 of the law, approval for alteration of a company's memorandum of association would be shifted from the courts to the RJSC.
In the third proposed amendment, Section 11 would be recast to streamline company name changes and empower the Registrar to impose fines of up to Tk 1.0 million for non-compliance with name-change directives.
Consequently, the sections 13, 15 and 16 would be repealed, while section 14 would be amended to provide for an appeal against the Registrar's decision.
The amendment to Section 193 would also empower the Registrar to directly impose a fine of up to Tk 50,000 on a company failing to provide required information or explanation, instead of referring the matter to court.
The draft proposes allowing electronic systems for maintaining registers of members, transferring shares, recording mortgages and charges, issuing meeting notices and registering memoranda and articles of association.
A new section, 401A, would allow automatic registration of applications submitted using the model memorandum and articles of association provided electronically by the Registrar.
Another new section, Section 34A, would introduce a definition of "Beneficial Ownership" and require declarations where a registered shareholder is not the actual beneficiary owner.
Failure to submit the prescribed declaration would incur a fine of up to Tk 50,000.
New Sections 401D and 401E would establish a framework for sharing company information with domestic law-enforcement agencies and international authorities to prevent money laundering and terrorist financing.
The draft proposes substantial increases in several penalties. The fines for failing to change a company's name would rise from Tk 500 to Tk 5,000 per day, while the penalty for the responsible officer would increase from Tk 100 to Tk 500 a day.
The penalty for violations concerning the annual list of members would rise from Tk 200 to Tk 500, while the fines for a liquidator's failure to file returns would increase from Tk 100 to Tk 500.
Several statutory deadlines would also be extended. The period for directors to acquire qualification shares would increase from 60 to 120 days. The deadline for registering a charge would rise from 21 to 30 days, while the period for notifying satisfaction of a charge would also increase from 21 to 30 days.
The deadline for a liquidator to file returns would be extended from seven to 30 days.
At the same time, the period for retaining documents after a company's dissolution would increase from three to five years in line with anti-money laundering and counter-terrorist financing standards.
Under a proposed new section, Section 125A, every listed public company and any company with paid-up capital exceeding Tk 500 million would be required to appoint a company secretary.
The draft also proposes a new section, Section 184A, requiring company boards to form a Corporate Social Responsibility (CSR) committee.
The proposed amendment would significantly widen the scope of One- Person Companies (OPCs).
The paid-up capital range would be expanded from Tk 2.5 million to Tk 50 million to Tk 0.5 million-Tk 500 million.
The existing fixed annual -turnover threshold would be removed, with an OPC requiring to convert into a private or public limited company only when both its paid-up capital and annual turnover exceed Tk 1.0 billion.
The process for removing defunct companies from the register would also be simplified.
Instead of relying solely on postal notices, newspaper publication would be allowed as an alternative. Two consecutive years of inactivity would also be introduced as a criterion for striking off.
A company would additionally be allowed to voluntarily apply for removal from the register with the consent of three-fourths of its total members.
The amendment would require members and directors of companies to provide more detailed information during registration, including parents' names, National ID or passport numbers, mobile numbers, Taxpayer Identification Numbers (TINs) and email addresses.
The move is intended to create a more reliable and transparent database of shareholders and directors.
A senior official of the commerce ministry says, "If enacted, the proposed amendments would represent one of the most comprehensive updates to the nearly three-decade-old Companies Act, bringing company administration closer to international standards while strengthening Bangladesh's framework for preventing money laundering and terrorist financing."
He, however, says that the draft will now undergo the requisite process for final approval.
