Govt now mulls alternative | The Daily Star
12:00 AM, October 25, 2012 / LAST MODIFIED: 12:00 AM, October 25, 2012

Amendment to Companies Act

Govt now mulls alternative

The government may halt the move to amend the Bangladesh Companies Act, 1994 subject to the existing law allowing it to appoint administrators to troubled companies, said Commerce Secretary Ghulam Hussain yesterday.
It may seek special permission from court to appoint administrators to Destiny Group that breached the law by indulging in illegal banking.
"We will stop the amendment process, if the existing law allows us to appoint such administrators. If not, we will amend the law in such a way so that the companies are not harmed,” Hussain told The Daily Star by phone.
He said the government would soon introduce multi-level marketing law for companies like Destiny Group.
Hussain also called upon the businesspeople not to panic, saying the government was looking for an alternative and had decided to withdraw the provision of giving administrators the “indemnity power” from the proposed act.
Meanwhile, two jurists -- Rafique-ul Huq and M Zahir -- advised him not to go for amending the law, as options are there in the current law.
“Even if the law is amended, the ministry will insert a 'safeguard clause' in the act so that it cannot be misused for political purposes,” Hussain said.
The commerce secretary said he would talk to two more lawyers today to know whether the administrators could be appointed under the existing law.
“We will also seek opinions from lawyers, businesspeople, experts and researchers at a meeting on October 30. I hope all the misunderstandings will end after the meeting,” the secretary said.
Earlier, businesspeople, economists and lawyers opposed the proposed amendment to the act, when the cabinet approved it on Monday.
Dr Kamal Hossain, president of Gonoforum, in a statement yesterday also protested the proposed amendment on the grounds that it would be detrimental to citizen's rights and a violation of the constitution.
The indemnity for administrators suggests that anyone harmed by the officials' actions would not have the right to seek justice, he said.
Dr Kamal termed the cabinet's approval to the proposed amendment by bypassing the House and without discussing it in parliament unexpected and against the norms. This act would be exposed to political misuse, he added.
He urged the government not to bypass the stakeholders in the decision-making process.
Asked, jurist Rafique-ul Huq said it was possible to appoint administrators for the Destiny Group under the existing law, although the process was a bit lengthy.
“It's not right to amend a law only for a single company,” Huq said.
Another jurist M Zahir is also against the proposed amendment.
"The government's intervention in any company is not expected,” he said, adding that the proposed amendment would encourage negative activities by the government.
Tanjib-ul Alam, a Supreme Court advocate, said appointing administrators in any private company by amending the companies law is anti-constitutional.
Echoing the views of both Huq and Zahir, he said the existing law permited the appointment of administrators in any troubled company.
“I have a meeting with the commerce secretary tomorrow [today] as I was invited to give my opinions in this regard,” he said.

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