M&C represented the Petitioner in a revisional challenge that squarely questions whether the Commercial Court can appoint Arbitrators at all, a power the Arbitration Act, 2001 reserves for the District Judge.
In a significant development for arbitration practice in Bangladesh, the High Court Division has issued a Rule and stayed the operation of an order of the Commercial Court No. 1, Dhaka, which had appointed the Chairman of an Arbitral Tribunal in a high-value partnership dispute in the ready-made garments sector.
The Commercial Court, presided over by an Acting Judge holding current charge, made the appointment under Section 12(4)(Ga) of the Arbitration Act, 2001 after the parties’ nominated arbitrators failed to agree on a Chairman. M&C challenged the order on the ground that the Act vests this power in the District Judge alone, not in the “Court”; that the newly enacted Commercial Court Act, 2026 does not extend the Commercial Court’s jurisdiction to the appointment of arbitrators; and that, the Commercial Court, presided by an Additional District Judge cannot exercise a power conferred specifically on the District Judge of the relevant District.
Finding merit in the challenge, the High Court Division issued a Rule and stayed the appointment of the Chairman pending its hearing, putting the constitution of the Arbitral Tribunal on hold.
The matter is among the early tests of the Commercial Court Act, 2026, and its outcome is expected to shape which forum may constitute arbitral tribunals under the new Commercial Court regime.
Saqeb Mahbub, Partner and Sajid Hassan, Associate, represented the client before the High Court Division and Sohrawardy Arafat Khan, Associate, represented the client before the Commercial Court on behalf of Mahbub & Company.
