Real State And Development Company Law in Bangladesh

Real estate law in Bangladesh covers the legal aspects of buying, selling, leasing, and managing real property. This area of law includes land, buildings, and other immovable property, and is governed by a mix of statutory law, case law, and customary practices.

House with gavel and law books. Real estate law and house auction concept. 3d illustration

Key Aspects of Real Estate Law in Bangladesh

1. Land Ownership and Title

  • Types of Land Ownership: Includes freehold, leasehold, and government-owned land.
  • Title Deeds: Legal documents that establish ownership of land. Common types of deeds include sale deeds, gift deeds, and exchange deeds.
  • Title Verification: Before purchasing property, it is essential to verify the title to ensure that the seller has legal ownership and the right to sell.

2. Land Registration

  • Registration Act, 1908: Requires the mandatory registration of certain documents, including sale deeds, leases over a certain period, and mortgages.
  • Registration Process: Involves the submission of the necessary documents to the Sub-Registrar’s Office, payment of stamp duty and registration fees, and recording of the transaction in official records.

3. Transfer of Property

  • Transfer of Property Act, 1882: Governs the transfer of property between living persons, covering sales, mortgages, leases, exchanges, and gifts.
  • Sale of Property: Involves a formal agreement (sale deed) between the buyer and seller, followed by registration and transfer of title.
  • Gifting Property: Property can be transferred as a gift, requiring a gift deed and registration.

4. Leasing and Renting

  • Lease Agreements: Legal contracts between a landlord and tenant, specifying the terms of the lease, such as duration, rent, and responsibilities.
  • Rent Control: The Premises Rent Control Ordinance, 1991, governs the relationship between landlords and tenants, including rent control measures and eviction procedures.
  • Eviction Laws: Tenants can be evicted for non-payment of rent, violation of lease terms, or for personal use by the landlord, following legal procedures.

5. Land Disputes and Litigation

  • Boundary Disputes: Common disputes over the boundaries of properties, which may require court intervention or arbitration.
  • Adverse Possession: Legal principle where someone occupying land without the legal owner’s permission may acquire legal ownership if certain conditions are met over a specific period.
  • Encroachments: Unauthorized use or occupation of someone else’s property, often leading to legal action.

6. Property Development and Construction

  • Development Agreements: Contracts between landowners and developers for the development of property, outlining profit-sharing, responsibilities, and timelines.
  • Building Codes and Regulations: Laws governing the construction of buildings, including the Bangladesh National Building Code (BNBC), zoning regulations, and environmental clearances.
  • Approval from Authorities: Real estate projects often require approval from local authorities like the Rajdhani Unnayan Kartripakkha (RAJUK) in Dhaka.

7. Mortgages and Financing

  • Mortgage Loans: Financial agreements where property is used as collateral for a loan, governed by the Transfer of Property Act, 1882.
  • Foreclosure: Legal process where the lender can sell the mortgaged property to recover the loan if the borrower defaults.
  • Refinancing: The process of replacing an existing mortgage with a new one, usually with better terms.

8. Inheritance and Succession

  • Intestate Succession: When someone dies without a will, property is distributed according to personal laws (e.g., Islamic law for Muslims, Hindu law for Hindus).
  • Wills and Probate: Legal processes to validate and execute a deceased person’s will, distributing property according to their wishes.
  • Gift and Trusts: Property can also be transferred through gifts or placed in a trust for beneficiaries.

9. Land Use and Zoning

  • Zoning Laws: Regulations that control land use, dividing areas into zones such as residential, commercial, or industrial.
  • Environmental Laws: Compliance with environmental regulations, especially for large-scale developments or construction near sensitive areas.
  • Land Acquisition: The government can acquire private land for public purposes under the Acquisition and Requisition of Immovable Property Act, 2017, with compensation to the owners.

10. Legal Framework and Authorities

  • Land Reforms: Bangladesh has various land reform laws aimed at redistributing land to landless peasants and preventing the concentration of land ownership.
  • RAJUK (Rajdhani Unnayan Kartripakkha): The urban development authority responsible for planning and development in Dhaka.
  • Ministry of Land: The government body overseeing land management and administration in Bangladesh.

Common Real Estate Disputes in Bangladesh

  1. Title Disputes: Issues arising from unclear or fraudulent title deeds.
  2. Boundary Disputes: Conflicts over the exact boundaries of a property.
  3. Inheritance Disputes: Disputes among heirs over the distribution of inherited property.
  4. Eviction and Tenant Disputes: Legal conflicts between landlords and tenants, often over rent, lease terms, or eviction.
  5. Contractual Disputes: Breach of agreements related to property development, sale, or leasing.
  6. Mortgage and Foreclosure Issues: Disputes related to the enforcement of mortgage agreements and foreclosure proceedings.

Alternative Dispute Resolution (ADR) in Real Estate

  • Mediation: Often used to resolve real estate disputes amicably without going to court.
  • Arbitration: Binding resolution of disputes by an arbitrator, often stipulated in real estate contracts.

Real Estate Investment Considerations

  1. Due Diligence: Thorough verification of property title, legal clearances, and compliance with local laws before purchase.
  2. Legal Compliance: Adherence to all legal requirements, including registration, tax payments, and construction norms.
  3. Market Conditions: Understanding local real estate market trends, property values, and potential legal challenges.

Real estate transactions and disputes in Bangladesh require careful attention to legal details, due diligence, and compliance with local regulations.

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