Legal Framework for Capital Raising
IPO Eligibility and Methods
Under Rule 3 of the 2015 Rules, an issuer may offer securities via the Fixed Price Method or the Book-Building Method. A minimum paid-up capital of BDT 300 million is generally required for the main board.
| Compliance Milestone | Regulatory Authority | Statutory Reference |
|---|---|---|
| Appointment of Issue Manager | BSEC / DSE / CSE | Rule 7, Public Issue Rules 2015 |
| Due Diligence Certificate | Issue Manager / Legal Counsel | Annexure A, B, C of 2015 Rules |
| Prospectus Vetting | BSEC (CI Department) | Section 2A, SE Ordinance 1969 |
| Consent for Publication | BSEC | Rule 15, Public Issue Rules 2015 |
The IPO Roadmap: From Resolution to Listing
Mandatory Prospectus Disclosures
Pursuant to Rule 4 and Annexure G, the prospectus must contain audited financial statements for the preceding five years or since incorporation. Under the Financial Reporting Act, 2015, these must be audited by a firm enlisted with the Financial Reporting Council (FRC).
- Preparation: The Issuer prepares the draft prospectus in consultation with the Issue Manager and Underwriters.
- Submission: Application to BSEC under Rule 8 for vetting and consent.
- Publicity: Post-consent, the abridged version of the prospectus is published in national dailies as per Rule 16.
- Allotment: Electronic subscription and pro-rata allotment as per BSEC Directive dated April 01, 2021.
Consult Barrister Liton Sarkar
For specialized advisory on capital market compliance and BSEC filings.
Schedule Scoping SessionFrequently Asked Questions
What is the minimum public offer size required for an IPO?
According to Rule 3(2)(p) of the BSEC (Public Issue) Rules 2015, the issuer must offer at least 10% of its paid-up capital or BDT 300 million (at par value), whichever is higher.
Can a company with accumulated losses apply for an IPO?
Under Rule 3(2)(a), an issuer must have a positive net profit after tax for at least the last financial year to qualify for the Fixed Price method, though exceptions exist for the Book-Building method under specific infrastructure criteria.
What are the lock-in requirements for sponsors?
Rule 10 of the BSEC (Public Issue) Rules 2015 mandates a lock-in period of 3 years for all shares held by sponsors and directors from the date of issuance of the prospectus or the first day of trading.
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