Focus on… Doing business in a post-COVID-19 world, Tanjib Alam and Associates

Introduction:

The ongoing sprawl of Covid-19 in human lives has significantly impacted the fates and fortunes of people as well as business entities in the doldrums. As a law firm with foresight, we have been advising our clients on the probable legal challenges that might arise due to the pandemic so that our clients can always stand a step ahead of its competitors despite the tremble Covid-19 has presented.

What trends are law firms seeing?

Owing to the changes brought by the pandemic, most of the hearings of cases are being conducted virtually ever since the Supreme Court of Bangladesh made the facility available for lawyers. Hence, law firms are seeing a shift of trend towards a more tech-based practice both in the courtrooms as well as clients conferencing. Being a top tech savvy law firm in Bangladesh, Tanjib Alam and Associates adjusted to the “new normal” quite comfortably, while majority of the law firms and their lawyers are still struggling with this shift.  In advising our clients, we hold most of the meetings virtually through the use of Zoom, Google Hangouts, Teams while maintaining communication over telephone or WhatsApp.

At the very beginning of the pandemic, Tanjib Alam and Associates was prompt in anticipating a standstill in nationwide financial activities, factories and offices. Considering the unprecedented challenge for its corporate clients, the firm, on its own motion, provided legal advice on several cost cutting measures to secure survival during the pandemic and its aftermath.

How have governments reacted to protect businesses whilst encouraging investment?

As the pandemic was rolling out and businesses started suffering, the Government of Bangladesh was poised to take several initiatives to help combat the health and economic crisis that was sweeping across the nation. In response to the dire situation, it announced a fund of approximately US$500 million to facilitate payment of wages of workers in export oriented industries. It further announced a stimulus package covering equivalent of US$ 3.6 billion to be provided to affected industries and service sector organizations as working capital through banks at low-interest rate where the government and the affected industry would equally split the payment of interest rate. Another package pertaining to small and medium enterprises (SMEs), including cottage industries, would provide equivalent to US$ 2.4 billion as working capital to the SMEs.  As soon as these packages had been announced, our firm commenced in-depth analysis in order to advise its clients without any undue delay. Resultantly, many of our clients has been able to successfully avail the benefits of these packages, whereas many of their competitors could not, due to lack of prompt and authentic legal advice.

In addition, a number of initiatives have been taken by the government to promote further investment in Bangladesh by offering convenient business environment. These initiatives include reduction of time needed to obtain electricity, trade license, TIN number, land registry, mutation, Customs clearance and VAT registration for businesses, all doable virtually. The Government is also in its advanced stage in bringing reform in the Companies Act to further ease of doing business, these reforms include single member company, buying back own shares, minority protection regime in line with advanced legal system. Owing to all these positive steps, it is seen that the surging ratio of investment in Bangladesh has not been impacted in the Covid-19 emergence.

What risk mitigation factors can be advised and what technology is available to assist in-house and directors?

In house counsels have long been accustomed to have vis a vis meeting with their legal counsel as well as government and regulatory authorities. Due to the emergence of the pandemic, the roles of the in-house counsels have changed to many extents. While it is possible to attend meetings virtually with the external legal counsels, the same might be challenging with a government agency or regulatory authority. Although some of the government departments in Bangladesh have taken initiatives to offer virtual services, thanks to them, majority of the departments are yet to facilitate this service. As a result, in house counsels would have to take the burden of moving physically amidst the pandemic in order to submit documents for regulatory compliances and to receive approvals or permissions. It is pertinent to note that one of the most significant risk mitigating factors for in-house counsels is to make sure that all the agreements their business is entering into is thoroughly reviewed and vetted so that the business is well aware of the obligations it is imposing on itself and the rights it is entitled to. Although this is a timeless piece of general advice to the in-house counsels, its applicability and significance is now greater than ever. In addition, businesses should always explore and investigate any change of payment terms requested by the counterparty due to the restriction on movement. Further, it is advisable to in-house counsels not to reduce salaries of the employees, temporary layoffs or terminate an employee unless it is certain that such actions are in compliance with the provisions in the Bangladesh Labour Act, 2006 and Bangladesh Labour Rules, 2015. Non-complaint actions against employees may lead to unwanted litigation, that would cost the business more than it would save from the action impugned.Tanjib Alam and Associates has acted as counsel in the acquisition by Alipay of some of the shares of bKash Limited. It involved drafting and reviewing of legal documents throughout all stages until closing of the transaction and advising bKash Limited on relevant legal issues.