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Bangladesh to frame policy for apparel buying houses

Bangladesh government, in a bid to infuse accountability among buying houses in the export-oriented apparel industry, is set to frame a policy for their functioning. Last month, the commerce ministry prepared a draft and sent it to all stakeholders for approval. The draft asks buying houses to register with the Export Promotion Bureau and warns without registration, no buying house will be able to handover letters of credit on behalf of buyers to manufacturers.

Md. Abdur Rahim Khan, Deputy Chief at the commerce ministry's textile cell says this was a first draft and is aimed at expanding the export market by creating a favourable reputation for their sector. The move comes post a few cases of fraud by some buying houses. Last year, 26 Bangladeshi garment exporters became victims after two local garment buying houses, Vanguard and ASM Apparels, placed work orders on behalf of the ‘importer’ Y&X, saying the latter is owned by a Bangladeshi-born British citizen named Manjur Billah.

The duo offered higher prices on the condition that the raw materials have to be bought from select textile factories in China. The deception was noticed post the first batch of consignments was unclaimed for over one month at a UK port.

Currently, there is no policy on buying houses and there is no controlling authority for them, Md. noted. The final draft policy will be out in a month or two. Kazi Iftaquer Hossain, President, Bangladesh Garment Buying House Association, stresses that they have been demanding a policy for the last 10 years to bring in discipline in the sector.

Apart from BGBA, there are many buying houses operating in the country, totalling 1,500. A policy would play an instrumental role in resolving issues or disputes that occur among buyers, buying houses and exporters. As per the draft policy, buying houses and apparel manufacturers will have to carry out business based on contracts and send the copies of contracts to their respective organisations.