Bangladesh factory safety group seeks to delay closure, flags lingering risks

Esprit Holdings

28/11/2018 09:32

By Zeba Siddiqui and Ruma Paul
    DHAKA, Nov 28 (Reuters) - A group set up by European fashion
brands to improve factory safety in Bangladesh has sought a stay
on a court order that calls for its local operations to end this
week, its executive director said on Wednesday.
    The group comprises more than 200 firms - including global
clothing giants such as H&M  HMb.ST  and Zara-owner Inditex
 ITX.MC  – who are signatories to the Accord on Fire and
Building Safety in Bangladesh, formed after the Rana Plaza
factory collapse in 2013, which killed more than 1,100 people.
    The five-year pact was set to expire in May 2018 but its
brand signatories agreed last year to extend it to 2021 to
complete remaining safety fixes, while the Bangladesh government
set up a national regulatory body to take over its work.
    A High Court in Bangladesh in May, however, ordered the
Accord to shut down by Nov. 30, following a petition filed by a
local readymade garments supplier against the pact.
    The group's inability to inspect factories through the
agreement may prompt brands to cut ties with Bangladeshi
suppliers, which would hit the country's economy, which is
heavily reliant on garment exports.  urn:newsml:reuters.com:*:nL8N1WV2YQ
    "We have submitted an appeal to the Supreme Court...and are
working to have a stay issued against the High Court judgement
that would close down our office," Rob Wayss, the Accord's
executive director told Reuters.
    The appeal is likely to be heard on Thursday, a government
official said, declining to be named as the information was not
public. Shamsuzzaman Bhuiyan, head of the department of factory
inspections at the labour ministry declined to comment, saying
the matter was before the court. 
    Low wages have helped Bangladesh build the world's
second-largest garment industry, behind China, with some 4,000
factories employing about 4 million workers. The sector exports
more than $30 billion worth of clothes a year, mainly to the
United States and Europe.
    Wayss said the group would move its work to its Amsterdam
office if it is forced to shut down in Bangladesh, as the
legally-binding contract signed between its brand members
extends up to 2021.
    However, moving operations out of Bangladesh would likely
increase the Accord's costs and also harm suppliers, said Wayss.
    "Right now, they can come to the office any day of the week,
we can review designs together, we can give them feedback," said
Wayss. "Our ability to do that when we don't have an office and
infrastructure is reduced, so the industry is harmed."
    Bangladeshi Commerce Minister Tofail Ahmed told Reuters last
week the Accord was no longer needed as the government's
national regulatory body, the Remediation Coordination Cell, was
able to do the job. 
    However, Wayss said that body still has work to do before it
is ready to fully police standards in the sector.
    "It's in its infancy, they have just hired their staff, they
really don't have their systems in place, their engineers need a
lot of additional training just like ours did," he said, adding
safety fixes at over 500 of the factories the Accord oversees
are still incomplete.

 (Reporting by Zeba Siddiqui and Ruma Paul
Editing by Euan Rocha and Sam Holmes)
 ((euan.rocha@tr.com; +91 22 6180 7257; Reuters Messaging:
euan.rocha.reuters.com@reuters.net))