Business Reporter :
The Bangladesh Securities and Exchange Commission (BSEC) is considering to give waiver to the Japanese companies from its mandatory provision of forming public limited company (PLC).
The commission is contemplating the waiver, following requests from a good number of Japanese companies, which opined that the BSEC rule concerned is not in line with the Japanese investors’ policy, said the insiders.
A high-level delegation of officials of Japan-Bangladesh Chamber of Commerce and Industry (JBCCI), JETRO and Japanese Commerce and Industries Association recently met BSEC Chairman Professor M Khairul Hossain and other officials to discuss the issue.
The chamber is lobbying to withdraw the rule, saying that many Japanese companies have expressed their reluctance to invest in Bangladesh for the rule.
According to the BSEC rule, effective from 2010, if the paid-up capital of a company exceeds BDT 100 million, it will need to get the regulator’s approval. If the company’s paid-up capital exceeds Tk 400 million and Tk 500 million, it will have to be converted into a PLC and to go for IPO respectively.
The chamber receives lots of questions from the Japanese companies about the provision and feel discouraged to investment afresh or increase their investment in Bangladesh, said JBCCI Director Tareq Rafi Bhuiyan.
“The Japanese companies concerned think that the decision whether to be a PLC or go for IPO is their own decision, and they will do these according to their convenience,” he told the NN over phone.
Meanwhile, a press release of JBCCI said large-scale Japanese investments are expected to come to Bangladesh soon, following the recent mutual visits of the prime ministers of Bangladesh and Japan.
The JBCCI delegation during its visit informed the BSEC chairman that around 9,000 Japanese companies are now operating in Thailand and 3,000 in Indonesia. Compared to these, Bangladesh has only 223 Japanese companies despite offering attractive facilities for investment.
“There is a huge potential of investment from a number of Japanese companies, both large and small,” it added. The JBCCI press release said the BSEC chairman assured that any Japanese-owned or Japanese joint venture company (of any form), which will apply to the regulator for waiver on conversion to PLC, will be given permission within three business days.
The BSEC chairman also told the NN that the commission has assured the JBCCI delegation of releasing their application within three days, but said the waiver is now under consideration. “We are now reviewing their applications, as there are lots of stakeholders involved with the relaxation of the provision.”
He, however, said the final decision will come after examining the impact of the waiver on the market, in case the provision remains mandatory for other local and international companies.
He also assured that in future, no Japanese company, Japanese Joint Venture Company will have to be converted into a PLC although its paid-up capital exceeds BDT 400 million. Besides, it will not go for IPO if its paid-up capital exceeds BDT 500 million.
A PLC needs to take approval from BSEC when its paid-up capital exceeds BDT 100 million, as it is a requirement. But the BSEC chairman assured of expediting the approval process.
The Bangladesh Securities and Exchange Commission (BSEC) is considering to give waiver to the Japanese companies from its mandatory provision of forming public limited company (PLC).
The commission is contemplating the waiver, following requests from a good number of Japanese companies, which opined that the BSEC rule concerned is not in line with the Japanese investors’ policy, said the insiders.
A high-level delegation of officials of Japan-Bangladesh Chamber of Commerce and Industry (JBCCI), JETRO and Japanese Commerce and Industries Association recently met BSEC Chairman Professor M Khairul Hossain and other officials to discuss the issue.
The chamber is lobbying to withdraw the rule, saying that many Japanese companies have expressed their reluctance to invest in Bangladesh for the rule.
According to the BSEC rule, effective from 2010, if the paid-up capital of a company exceeds BDT 100 million, it will need to get the regulator’s approval. If the company’s paid-up capital exceeds Tk 400 million and Tk 500 million, it will have to be converted into a PLC and to go for IPO respectively.
The chamber receives lots of questions from the Japanese companies about the provision and feel discouraged to investment afresh or increase their investment in Bangladesh, said JBCCI Director Tareq Rafi Bhuiyan.
“The Japanese companies concerned think that the decision whether to be a PLC or go for IPO is their own decision, and they will do these according to their convenience,” he told the NN over phone.
Meanwhile, a press release of JBCCI said large-scale Japanese investments are expected to come to Bangladesh soon, following the recent mutual visits of the prime ministers of Bangladesh and Japan.
The JBCCI delegation during its visit informed the BSEC chairman that around 9,000 Japanese companies are now operating in Thailand and 3,000 in Indonesia. Compared to these, Bangladesh has only 223 Japanese companies despite offering attractive facilities for investment.
“There is a huge potential of investment from a number of Japanese companies, both large and small,” it added. The JBCCI press release said the BSEC chairman assured that any Japanese-owned or Japanese joint venture company (of any form), which will apply to the regulator for waiver on conversion to PLC, will be given permission within three business days.
The BSEC chairman also told the NN that the commission has assured the JBCCI delegation of releasing their application within three days, but said the waiver is now under consideration. “We are now reviewing their applications, as there are lots of stakeholders involved with the relaxation of the provision.”
He, however, said the final decision will come after examining the impact of the waiver on the market, in case the provision remains mandatory for other local and international companies.
He also assured that in future, no Japanese company, Japanese Joint Venture Company will have to be converted into a PLC although its paid-up capital exceeds BDT 400 million. Besides, it will not go for IPO if its paid-up capital exceeds BDT 500 million.
A PLC needs to take approval from BSEC when its paid-up capital exceeds BDT 100 million, as it is a requirement. But the BSEC chairman assured of expediting the approval process.
