Documentary Credit, Not Just Invoices
A large share of Bangladesh's international trade is financed by letters of credit, and accessory suppliers frequently sit behind back-to-back arrangements in which their own payment depends on the primary credit performing. When something goes wrong, the dispute is usually about documents rather than about the goods.
The practical questions are specific: were the documents presented compliant; if discrepancies were raised, were they waived expressly or by conduct; did the bank act within the time allowed; and does the chain of credits leave your counterparty with a defence based on its own non-receipt. These are answered from the paperwork, and they determine whether you are pursuing a bank, a buyer or nobody worth pursuing.
Summary Suit and Its Limits
For a liquidated claim on a written instrument, the summary suit procedure requires the defendant to seek leave to defend, which is refused where no triable issue appears. It is the appropriate route for a straightforward documented debt.
The constraint is systemic rather than procedural: Bangladeshi courts carry very heavy caseloads and an ordinary commercial matter can run for years, with appeals extending it further. Litigation is therefore a lever to threaten credibly rather than a mechanism to rely on for timely recovery.
Arbitration Is the Realistic Alternative
Bangladesh is a party to the New York Convention and has a modern arbitration statute. For any substantial exposure, an arbitration clause with a seat outside Bangladesh - Singapore is the common regional choice - avoids the congestion problem and produces an award enforceable across Convention states.
Where such a clause exists, use it. Where none does and the exposure is ongoing, adding one is the single most valuable change to make to the trading terms.
Three Years
The limitation period for a contractual claim is three years from when the cause of action accrued. Given how long proceedings take once started, a claim brought late in that period leaves no margin, and the practical deadline for deciding on a route is considerably earlier than the legal one.
How Long Does a Bangladeshi Claim Take?
| Stage | Typical Duration | Cost |
|---|---|---|
| Document review and demand Credit, presentation and shipping documents | 3–6 weeks | Low |
| Negotiated settlement Often through the buyer's bank relationship | 2–5 months | Low |
| Summary suit Liquidated claim, leave to defend stage | 1–3 years | High |
| Ordinary proceedings Full trial and appeals | 3–6 years | High |
| Foreign award enforcement Recognition and execution | 1–2 years | Medium |
How Does SXB Global Handle a Bangladeshi Case?
We ask for the credit and the presentation documents before the invoice, because in this market that is where the claim lives. Where the paperwork shows a compliant presentation, the negotiation has a different centre of gravity - and often a different counterparty - than the buyer alone. Where legal proceedings become appropriate, SXB Global coordinates the instruction of appropriately authorised local counsel. Legal services are provided by the relevant independent legal professionals.