Bangladeshi Real Estate and Developers Act

February 10, 2024


Pymes Law


Construction is a key driver of our GDP growth. There are several real estate companies in this industry. They agreed with the landowner to let a real estate developer company build it. In 2010, the government passed the Real Estate Development and Management Act to protect landowners against developers.

Additionally, recent government circulars require developer businesses to be rehab-registered, which ensures a certain level of quality and standards as per the Bangladesh Developer Act.

What is real estate or property law in Bangladesh?

Land and any structure thereon or real estate under the Natural Resources Act. Therefore, real estate is not personal property. The property can be residential or commercial. Bangladesh is seeing greater foreign investment and property development.

It drives the country’s economic development and largest employment sector. Interests lead to conflicts, they say. It applies to sectors. Complex financial agreements are causing difficulties due to the increase in real estate purchases This highlights the need for skilled real estate attorneys in dealings.

The Real Estate Development and Management Act, along with other relevant laws, mainly regulates real estate concerns. Selling land and buildings is called ‘Real Estate’. Section 2(12) of the Real Estate (Development and Management) Act, 2010 defines “real estate” as residential, industrial, commercial, mixed plots, flats, apartments and other landed properties for development and sale.

Bangladeshi Real Estate Law

  • Bangladesh Constitution;
  • Contracts Act 1872;
  • 2010 Real Estate Development and Management Act;
  • Real Estate Development and Management Regulations, 2011;
  • Certain Relief Act 1877;
  • Arbitration Act of 2001;
  • Transfer of Property Act, 1882;
  • Registration Act of 1908;
  • Private Residential Scheme Land Development Rules, 2004;
  • 1952 Building Construction Act; Building Construction Rules 1996;
  • Urban Development Act of 1953;
  • Private Residential Projects Land Development Rules 2004;
  • Partnership-based Infrastructure Development (Construction of Flats) Public Land Rules, 2008;
  • 2006 National Building Code of Bangladesh;
  • Trade Organizations Ordinance 1961;
  • Government Circulars, Notices, etc

Developers need to comply

Developer prospectus and public media advertisement for sale of real estate must provide registration number, approval number, memo number, grant date, etc. Land owners and developers need other government approvals to design, allocate and build.

Rights and Obligations of Landlord and Developer

Under the laws of this country, parties to contracts must know their rights and obligations to comply with all laws without dispute or disturbance. If a disagreement arises, the parties to the agreement—the landlord, the development business, etc.—can settle it amicably or through arbitration, which binds them. If a party is not willing to present and resolve their dispute in an arbitration panel, they may approach the court.

Rights and Duties of Landowners

Required documents to be supplied:

Land owners can buy property documents from development businesses, according to the agreement and national law. The development agency requires power of attorney from the landowner.

Compensation for Delays:

The Rehab Code of Conduct requires the landlord and the development business to enter into a mutual agreement that guarantees recovery of monthly rent if the developer delays.

Exchanging possession:

The developer must control the site for development per the agreement. After developing the property, the company must pay its share to the landowner.

Delay Penalty:

Under Bangladesh’s Real Estate Development and Management Act, owners of contaminated land who delay or terminate a development company’s power of attorney without 30 days’ notice can be fined up to ten lakh rupees or imprisoned for two years. Land owners are entitled to compensation under the treaties and laws of this country if the development agency delays possession.

Developer’s right to sue:

Real estate issues may include landowners suing developers for breach of contract, including delays in land development and possession.If no other legal remedy works, the landowner can file a constitutional writ.

Rights and Duties of Developer Companies

Company formation, registration, and membership

Businesses developing in Bangladesh must first form and register with the appropriate government bodies such as RJSC. Violators face two years imprisonment or a fine of Rs 10 lakhs. A developer who launches a real estate project without approval faces the same fate. Rehab and other authorities are required to legally operate Bangladeshi developer enterprises

Provide necessary documents

The development business must provide the necessary documents at the time of handover to the land owner and buyers and guarantee parking, telephone, water, gas etc. after construction as per the contract. Land owners must provide the necessary documents to the developers to develop the property. The development company shall provide the sale deed and registration to the customer within three months of payment.

Law’s death penalty

If a power of attorney is not executed, the land owner must execute the sale deed in favor of the developer’s share of the property to the purchaser within 15 days of the development company’s written request and complete registration. The development company can execute the sale deed and register as the owner of the property if the land owner does not agree.

Repair and maintenance responsibility

If construction defects are required to be repaired after handover, the developer will pay for two years. The developers must maintain the real estate for one year after the transfer under the agreement.

Transfer of Possession

For estate development, the owner of the land has to give possession to the developer company. The development corporation must hand over the flats or plots to the land owners within the time limits stipulated in the agreement deed and under the Real Estate Development and Management Act of the country.

In case of natural calamities, political unrest, unusual increase in the price of building materials, delay in obtaining utility connections from the appropriate authorities, or other force majeure, the developer company must pay rent compensation if it delays handing over to the landlord.

Penalty of developer business for special tasks

A developer who mortgages the property without the consent of the buyer can face a jail term of up to one year or a fine of five lakh rupees.

Using substandard materials, not using proper quality and quantity of materials for construction, building outside of approved designs or not selling land as promised without the owner’s knowledge will be punishable with three years imprisonment or a fine of Tk 20 lakh.

Developers who intentionally delay development without paying compensation, refuse to hand over property, or violate the landlord’s agreement are liable to a fine of Tk 20 lakh and/or two years in jail.

A developer company failing to supply water, gas, electricity etc. as promised in the prospectus at the time of transfer of a flat shall be liable to a fine not exceeding five lakh rupees and imprisonment not exceeding one year.

Lawsuits against developers and Bangladeshi real estate and developer laws

Landowners can sue developer businesses for breach of contract, such as persistent delays in land development, ownership of allotted properties, etc.

A constitutional writ may be filed by the landowner if no other US remedy is available

Property owners may be sued

The Bangladeshi Developer Act allows the developer to sue the landowner for real estate disputes.

JV agreement

After lengthy negotiations, the landowner and the developer signed a joint venture agreement. This agreement specifies the amount, duration, advance and delay penalties of the developer and landlord shares. The Landlord must sign and execute this Agreement under Section 10 of the 2010 Real Estate Development and Management Act. No law requires registration of this agreement.

Power of Attorney

The landlord must provide a power of attorney to the developer under section 10 of the Real Estate Development and Management Act 2010. The developer can then apply to RAJUK/CDA for layout plan approval, signing third party sale agreement and other duties.

Formalization of the Treaty of 1872

A landlord-real estate developer agreement must follow Section 10 of the 1872 Contract Act, which stipulates a valid contract.

Make the agreement in writing

Parties who negotiate without fraud under the Negotiable Act of 1872 must transfer the land to the real estate developer in writing. The terms of the contract must be specified. Define contractual consequences for non-compliance

2010 Real Estate Development and Management Act

Section 15 of the Real Estate Development and Management Act, 2010 delayed the transfer. As per Land Developer-Landlord Agreement, Landlord is entitled to payment if the apartment/plot is delayed. The landlord receives rent payments under a written contract.

Delay by Landlord

Land owner can be fined 50 thousand rupees. 10 lakhs or imprisonment for 2 years for failure to transfer ownership of the land to the developer as per consent under Section 28 of the same Act. Under Section 29 of Chapter 36 of the Real Estate Development and Management Act of 2010, a landlord may be fined or imprisoned for revoking a developer’s power of attorney without 30 days’ notice.

Dispute resolution

Section 36 of the Real Estate Development and Management Act 2010 requires land owners and developers to resolve disputes amicably. Failing that, the Arbitration Act 2001 will decide.


Real estate laws in Bangladesh are extensive. Although daunting, managing a large real estate business and its processes is important. An apartment buyer, landlord or developer should check the land or real estate documents and have the property appraised with a lawyer, surveyor or engineer. This sector improves unused land and attracts domestic and foreign investors, increasing GDP. Government intervention in the market is necessary to set realistic policies. Unplanned urbanization has made Dhaka unsustainable and unmanageable. Unplanned growth should be controlled through legislation.

Written by Pymes Law



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