Hearing deferred on Bangladesh’s counterfeit RMG export

In response to Bangladesh's request to postpone, the United States Trade Representative’s (USTR) open hearing – scheduled to be held in Washington, USA, on allegations of exporting counterfeit clothes with logos of internationally renowned brands – has been deferred to February 24 from February 22.

However, Bangladesh will not have the opportunity to participate in the hearing.

This review is called “Special 301 Review on IPR (Intellectual Property Rights) Protection and Enforcement”. If the allegation is proven in the review, the United States, the largest buyer of Bangladeshi clothing as a single country, may impose additional duties, set quotas, or even ban the clothes made in Bangladesh.

In this regard, Hafizur Rahman, Director General of the World Trade Organisation (WTO) Cell of the Ministry of Commerce and also an additional secretary, told The Business Post, “The commerce ministry sent a letter requesting to postpone the date for the review of the United States. They extended the time fulfilling the request. A letter of explanation is now being drafted which will be sent to the USTR through email.”

In January 2022, US trade body the American Apparel and Footwear Association (AAFA) and France's Union des Fabricants (UNIFAB) complained that the entrepreneurs of Bangladesh's ready-made garment sector had counterfeited different designs of clothes made on the orders given by the buyers of their country and sold to buyers from different countries, which is in violation of intellectual property law.

The USTR, which oversees the protection and enforcement of intellectual property rights, initiated this review after receiving complaints about Bangladeshi products. The USTR has informed the commerce ministry of Bangladesh about the initiation of the review.

According to AAFA's complaint, in 2022, 56 consignments of products were seized in different countries of the world, where counterfeit garment products made in Bangladesh were found.

In 2022, counterfeit products made in Bangladesh were seized in 12 countries. These countries are Australia, Italy, Malaysia, Trinidad and Tobago, Japan, United Arab Emirates, United Kingdom, United States, Romania, Saudi Arabia, Germany and the Philippines.

In 2022, nearly 1.75 lakh garments were seized in Malaysia through 17 raids, all of which were counterfeit products manufactured in Bangladesh.

Bangladesh is also among the top exporters of counterfeit shoes, handbags and jewellery. According to the Intellectual Property Office of the European Union, Bangladesh is the largest source of counterfeit clothing after China and Turkey.

The AAFA complaint mentioned that due to the lack of proper policy framework, disinterest of the law enforcement agencies in controlling such crimes and widespread corruption, the protection of intellectual property is ‘kind of impossible’ in Bangladesh.

The complaint said, “We know that Bangladesh as an LCD country receives international support in terms of development and trade. But if Bangladesh is allowed to grow as a producer of counterfeit products, there will be no way to tackle the impact it will have on international trade.”

The AAFA opined that assisting the Bangladeshi authorities in creating a strong foundation for protecting intellectual property will lead to sustainable development of a legitimate business environment. Addressing these fundamental issues will pave the way to Bangladesh's transition from an LDC to a developing country.

According to the data of Bangladesh Bank, in 2021-22 fiscal year, Bangladesh exported ready-made garments worth Tk 2,82,639 crore. Out of this, clothes worth Tk 59,624 crore were exported to the United States, which is 21 per cent of the total RMG exports.