The draft legislation is being floated for public consultations prior to formal introduction into GMC
In a significant step toward strengthening Bhutan’s commercial and corporate legal framework, the Gelephu Mindfulness City Authority (GMCA) has launched a two-week public consultation on six major pieces of draft legislation aimed at enhanacing business regulation, investor confidence, and market transparency within the Gelephu Mindfulness City (GMC). The consultations end on April 20, 2026.
The draft legislation covers a broad spectrum of commercial activity and includes the Business Names Registration Act 2026, Limited Liability Partnerships Act 2026, Limited Partnerships Act 2026, Partnership Act 2026, Sale of Goods Act 2026, and the Unfair Contract Terms Act 2026.
The Business Names Registration Act 2026 seeks to introduce a formal system for registering business names. The law is intended to promote transparency and accountability by ensuring that all entities operating within GMC are properly recorded. It will also complement the existing Companies Act 2025 and support the broader regulatory framework.
The next is the Limited Liability Partnerships Act 2026, which aims to introduce LLPs as a new business structure within GMC. LLPs combine the operational flexibility of partnerships with the limited liability protections typically associated with companies. This model is widely used by professional service firms such as law practices, accounting firms, consulting agencies, and architectural firms.
By recognizing LLPs under GMC law, authorities hope to attract high-value professional services into the city, contributing to job creation and knowledge transfer.
Similarly, the Limited Partnerships Act 2026 is designed to facilitate investment-driven business structures. Limited partnerships are commonly used in sectors such as private equity, venture capital, real estate, and project financing. “The proposed law will define the rights and responsibilities of general and limited partners while ensuring proper registration and public disclosure,” the GMCA reiterated.
It added that the introduction of limited partnerships could play a pivotal role in developing Bhutan’s domestic investment fund industry, an area that remains largely untapped.
The Partnership Act 2026, meanwhile, seeks to modernize and clarify the legal framework governing traditional partnerships. It outlines the rights and obligations of partners, both among themselves and in their dealings with third parties, providing a clearer legal foundation for business operations.
In addition to business structures, the proposed legislation also addresses commercial transactions and consumer protection.
The Sale of Goods Act 2026 aims to standardize and simplify the legal principles governing the sale of goods. It introduces clear rules on the transfer of ownership and risk between buyers and sellers, while also embedding essential contractual safeguards. For instance, the law ensures that goods must match their description and meet acceptable quality standards unless explicitly agreed otherwise.
According to the GMCA, this would reduce disputes and improve confidence in commercial transactions.
Complementing this is the Unfair Contract Terms Act 2026, which seeks to ensure fairness in contractual relationships. The law places limits on the extent to which businesses can exclude or restrict liability through contract terms.
Under the proposed framework, clauses that attempt to exclude liability for serious harm—such as death or personal injury caused by negligence—will not be enforceable. Other limitation clauses will only be valid if they meet a statutory test of reasonableness.
According to the GMCA, this approach balances the need for contractual freedom with the protection of parties from unfair or abusive terms.
“The introduction of these laws is intended to promote fairness, certainty, and trust in commercial dealings, while maintaining the flexibility businesses need to innovate and grow,” the GMCA added.
Officials say the initiative marks a foundational phase in shaping a modern and comprehensive legal ecosystem to support Bhutan’s emerging economic hub in Gelephu.
The draft legislation, which has been opened for public consultation on April 6, will run for two weeks and conclude on April 20, 2026. The Authority has invited feedback from businesses, legal professionals, investors, and the general public, emphasizing that stakeholder input will play a critical role in refining the proposed laws.
According to the Authority, the consultation reflects GMC’s commitment to inclusive policymaking and global best practices.
“These draft laws are designed to establish a robust and transparent commercial framework for GMC. Public feedback is essential to ensure that the legislation is practical, inclusive, and aligned with the needs of businesses and investors,” the GMCA stated.
The Authority emphasized that the consultation process is open to all stakeholders and encouraged timely submissions. Feedback received during this period will be reviewed and incorporated where appropriate before the legislation is finalized.
Submissions must be made by April 20, 2026, after which no further inputs will be considered.
The move comes as Bhutan accelerates efforts to develop the Gelephu Mindfulness City as a strategic economic hub, with a focus on sustainable development, innovation, and international investment.
Meanwhile, observers note that a strong legal and regulatory framework is critical to achieving these ambitions. By aligning its commercial laws with international standards while adapting them to the Bhutanese context, GMC aims to position itself as a competitive and credible destination for business.
Tashi Namgyal, Thimphu
