EC team probing alleged abuse of GSP facilities

FE Team | Published: April 22, 2008 00:00:00 | Updated: February 01, 2018 00:00:00

Doulot Akter Mala
A European Commission (EC) anti-fraud team is now in the capital probing into the alleged abuse in the duty free access that Bangladeshi products enjoy in 27 European Union nations, officials said Monday.
The mission arrived in Dhaka on April 15 for a 10-day visit during which it would examine the country's Generelised System of Preference (GSP) certification system, under which Bangladeshi exporters enjoy duty-free access to the EU nations.
Bangladesh along with all the least developed nations enjoy the GSP facilities on export of products to the EU. The EU awarded the facilities to the poor nations to improve their economic conditions.
But recently the EC, the secretariat of the European Union, has alleged that there have been rampant abuses in GSP facilities entitled for Dhaka, as exporters from other countries were found availing them by using Bangladesh's name.
The EC sent the team following widespread allegation and some proven cases that other countries, which were not entitled the GSPs, were using Bangladesh's name to avail duty free access to the EU, a commerce ministry official said.
During their stay, the eight-member investigation mission --- better known by their French acronym OLAF--- will have access to all the government data and certificates issued since January 1, 2005, he said.
"The team will conduct a thorough check of GSP certificates of origin (COO) issued from January 1, 2005 to 31 March 2008 by the country's Export Promotion Bureau (EPB)," the official said.
"The EC has alleged that some COO issued by the EPB was in fact used by the exporters who produced their items in a third country not in Bangladesh," he added, speaking on condition of anonymity.
The investigation team will identify both unscrupulous exporters and officials who may be involved in the forgery, another official said.
"They will scrutinise some contradictory 'verification reports' that were sent by the EPB earlier," he said,
The team, led by Michael Dittrich, will examine the reliability of the GSP issuance and verification system and scrutinise the Certificate of Origin regime of Bangladesh.
Faizul Latif Chowdhury, senior commerce official at Bangladesh Embassy in Brussels, has urged the government to provide all possible help to the EU for conducting the investigation properly.
"After investigation, the team will suggest to the EU whether COO issuance procedure of the country is reliable or not," Chowdhury said in a letter to the commerce ministry.
If the investigation team finds loopholes in COO issuance for GSP, it might recommend taking security deposit for imports from Bangladesh, he noted.
Last August, Germany has imposed the security deposit rule after it found a number of cases of GSP facility abuses.
Later, the largest EU member country withdrew the rule after assurance by the Bangladesh government that it would take sufficient measures in this regard.
Since then the government has taken the issue seriously and even has been using the COO published from EU as a precautionary measure to thwart the malpractices, commerce ministry officials said.
Since their arrival, the OLAF team held two separate meetings with the National Board of Revenue (NBR) and the EPB.
EPB vice chairman Md Shahab Ullah said the team held a meeting with him immediately after its arrival.
"The EU is our top market destination. So we are providing all possible assistance to the team. We will act of they recommend any specific actions," Shahab Ullah said.
"They will investigate whether any local companies are involved in the abuse," he added.
The EU team comes a couple of months after the US Customs and Border Protection Authority (CBP) identified some cases in which goods originating in China were claimed to be of Bangladeshi origin to avoid quota restrictions on their items.
Bangladesh last year exported US$12.18 billion dollars to 173 countries across the globe. Of the export, EU accounts for 53.40 per cent while USA 32.29 per cent.