The concept of nation branding is no longer new to Bangladesh. Over the last decade, policymakers in Bangladesh have increasingly recognized its importance. This is evident in initiatives like the "Beautiful Bangladesh" campaign, aimed at promoting tourism.
When it comes to branding Bangladesh as an investment destination, I have witnessed firsthand efforts led by high-ranking government officials, in collaboration with BIDA, to improve Bangladesh's rankings in the World Bank's, now discontinued, "Doing Business" report. Significant reforms have been undertaken to digitize processes at ports, the company registrar, and BIDA. The Securities and Exchange Commission has also organized roadshows in various countries to encourage investment in the stock market. Additionally, the RMG sector has carried out substantial branding efforts for Bangladesh’s RMG sector in western markets to grow Bangladesh’s market share.
However, despite efforts in these areas, there has not been any significant push to "brand" Bangladesh’s legal system. Many might object to the term “branding” when it comes to the legal system. The legal system, being a collection of institutions and rules governing those institutions, is not a product to be marketed.
Traditionally, branding has been associated only with products that can be bought and sold for a price. However, the advent of nation branding has challenged this perception. Countries now recognize that in a globalized world, they compete with each other on various dimensions. A country’s image is shaped by political, economic, and cultural factors and how these are perceived by a global audience. In today’s information-rich environment, people can form perceptions about a country through the readily available information presented to them.
When making decisions about investment destinations, sourcing locations, or joint-venture partners, various political, economic, and cultural factors are considered. These include political stability, economic growth and potential, market size and access, infrastructure and connectivity, labour force skills, fiscal incentives, and so on. One crucial factor is the legal system, which is often the most challenging to brand.
A transparent and predictable legal and regulatory system is a key message to convey to investors who have several countries to choose from. It's important to note that the judiciary and courts are at the head of a legal system, but the broader definition includes the parliament that makes laws, the executive that enforces them, and various quasi-judicial bodies and regulators that apply the laws on a day-to-day basis.
A transparent and predictable legal and regulatory system is a key message to convey to investors who have several countries to choose from
Key considerations for a competitive legal system can include:
- Legal certainty and stability
- Predictability: Investors need confidence in a stable and predictable legal environment. Frequent changes in laws can create uncertainty, complicating long-term planning.
- Contract enforcement: A reliable legal system ensures contracts are honoured and disputes are resolved fairly and efficiently. Concerns about nationality bias, especially with state-owned entities, are common.
- Property rights protection
- Security of investments: Strong protection of property rights, including intellectual property, gives investors confidence that their assets and innovations will be safeguarded.
- Expropriation risk: Legal frameworks protecting against arbitrary government expropriation are crucial.
- Regulatory transparency
- Clarity: Clear and transparent regulations help investors understand the requirements and processes needed to operate in the country.
- Fairness: A transparent, non-discriminatory regulatory environment reduces the risk of corruption and ensures a level playing field for all businesses.
- Dispute resolution mechanisms
- Arbitration and mediation: Effective alternative dispute resolution frameworks such as these provide investors with confidence that disputes can be resolved without lengthy litigation.
- Judicial efficiency: Efficient court systems that handle commercial disputes effectively are crucial for investor confidence.
Several countries have leveraged the attractiveness of their legal systems to solicit investments and bolster their economies. Traditionally, the UK's common law system has been highly regarded, with the London Court of International Arbitration (LCIA) being an early stalwart of international commercial arbitration. New York, Paris, and Switzerland have established legal systems that benefit from being economic hubs while also contributing to their economies by being known as fair, neutral, and expert arbiters of legal issues.
In recent history, Singapore and Dubai have proactively branded their legal infrastructure. Singapore has promoted its arbitral institution SIAC and its judiciary as experts in resolving commercial disputes, making it a first choice for dispute resolution in the region, even for non-Singaporean parties. Dubai’s DIFC Courts have brought in expert judges from various jurisdictions to create a premier dispute resolution forum in the Middle East, prioritizing commercial expertise.
Obstacles in rebranding
If branding a legal system is so important to a nation, why hasn’t Bangladesh prioritized it? One reason could be a lack of alignment among various stakeholders. The parliament, judiciary, and executive are all key actors in reforming a legal system and showcasing its qualities. While attracting investment has been a priority for a section of the executive, the judiciary may not share the same priority, and common action plans have not been pursued.
Another reason is that while administrative reforms like digitization can be decided and implemented with relatively simple decision making processes within organizations, reforms in the legal and regulatory frameworks require changes in legislation and active participation of the judiciary, necessitating a higher degree of cooperation between different state organs.
Lastly, it is arguable that vested interests within the executive benefit from a weaker legal system. A capable and efficient legal system ensuring justice is a threat to groups that benefit from a lack of accountability and oversight. There are always beneficiaries of lack of transparency and accountability who play a part in slowing down efforts to carry out reforms within the system that can have an impact on these factors.
In summary, while Bangladesh has attempted to make significant strides in nation branding, the legal system remains under-branded. For Bangladesh to attract more foreign investment, it is crucial to prioritize reforms in its legal and regulatory system, ensuring it is perceived as transparent, predictable, and fair. Learning from jurisdictions like Singapore and Dubai, Bangladesh can enhance its legal infrastructure, align priorities among key stakeholders, and promote its legal system internationally to build investor confidence and drive economic growth.
Saqeb Mahbub, Barrister-at-Law, is a Partner at Mahbub & Company and an Advocate of the Supreme Court of Bangladesh. He is also an Officer of the Asia Pacific Regional Forum of the International Bar Association.
