Germany demands Bangladesh factory visit to validate bicycle origin

[Bilal9]

REZAUL KARIM | June 19, 2023 00:00:00​

---

The German customs administration is persuading Bangladesh to allow inspections of Bangladeshi bicycle factories in a bid to eliminate any doubts regarding the country of origin, according to sources familiar with the matter.

The administration has proposed a visit to the facilities of Bangladeshi producers in order to expedite future import processes for bicycles and e-bicycles from Bangladesh.

The visit recommendation comes in response to a request made by the Bangladeshi mission in Germany concerning the issue of duties. The Bangladesh embassy in Berlin has urged the Ministry of Commerce to take action on this proposal.

Currently, the export of bicycles manufactured in Bangladesh to its largest market, Germany, is suffering due to the imposition of anti-dumping duties and other tariffs, with suspicions regarding their country of origin, said sources.

German customs authorities said that "imports from Bangladesh are not treated differently from those coming from other countries".

It has generally been established that bicycles and e-bicycles imported into the European Union (EU) are often falsely declared with a different origin in order to evade anti-dumping duties on bicycles originating from China. Consequently, such imports are subjected to more rigorous and risk-based inspections.

The administration is hopeful that a visit will specifically address any doubts regarding Bangladeshi exporters, thereby facilitating future imports into the EU.

Currently, Germany alone accounts for bringing in 25 per cent of bicycles exported by Bangladesh to the EU bloc.

Meanwhile, domestic bicycle manufacturers and exporters have requested the Ministry of Commerce to collaborate closely with the German embassy in Dhaka and the Bangladesh embassy in Berlin for the greater benefit of Bangladesh.

The president of the Bangladesh Bicycle and Parts Manufacturers and Exporters Association (BBPMEA) has already written a letter to the ministry urging action.

"Germany is considered the largest buyer/importer of our bicycles for a long time. But in recent times, our importers in Germany are facing a serious trouble with German customs, particularly at Hamburg port, as they doubt the origin of Bangladeshi bicycles and consider them to be of Chinese origin."

"On the basis of their reasonable doubt as to the authenticity of the bicycles exported by Bangladesh, German customs are charging full tariff with anti-dumping duty on importers," he added.

The association argued that such an approach goes against the principles of the Generalized System of Preferences (GSP) verification policy and the EU rules of origin administrative cooperation.

"German customs are needlessly challenging the Bangladeshi origin of bicycles, which could have disastrous consequences for our products in the German market," he added.

As a result, German bicycle importers are feeling nervous, worried, anxious, disappointed and to some extent, frightened about this issue. If this situation persists, the association fears that Bangladeshi bicycle exports to Germany may come to a complete halt in the near future, leading to an annual loss of US$ 30-40 million.

In this regard, according to the verification policy, if any deviation or violation regarding origin raises doubts among the customs authorities of the EU, they are obligated to notify the local authority or the Export Promotion Bureau (EPB) of Bangladesh to verify the authenticity of the country of export declaration.

Industry insiders said that there have been no deviations from the rules of origin and noted that they are prepared to cooperate with investigations from any end.

Bicycle exporters are registered with the EU's Registered Exporter System (REX) and have consistently received export trophies over the past two decades, building a strong reputation.

The European Anti-Fraud Office (OLAF) team has conducted multiple visits to bicycle factories in Bangladesh and expressed utmost satisfaction with these visits, as mentioned by the insiders. Besides, officials from the EU delegation in Dhaka have recently visited the factories as well.

Bangladesh has been exporting bicycles to EU countries with zero tariffs under the Everything But Arms (EBA) initiative since 2001 and the REX system since 2019.

As a result, bicycle exports to EU countries have significantly increased, reaching US$ 167.5 million in fiscal year (FY) 2021-22. In FY 2020-21, a total of 1.0 million bicycles were exported globally.

Currently, local bicycle exporters benefit from a 4.0 per cent export subsidy, according to the Bangladesh Bank.

According to the European Commission, the REX is a certification system that allows economic operators to self-declare the origin of goods through statements of origin.

 

[saif]

REZAUL KARIM | June 19, 2023 00:00:00​

---

The German customs administration is persuading Bangladesh to allow inspections of Bangladeshi bicycle factories in a bid to eliminate any doubts regarding the country of origin, according to sources familiar with the matter.

The administration has proposed a visit to the facilities of Bangladeshi producers in order to expedite future import processes for bicycles and e-bicycles from Bangladesh.

The visit recommendation comes in response to a request made by the Bangladeshi mission in Germany concerning the issue of duties. The Bangladesh embassy in Berlin has urged the Ministry of Commerce to take action on this proposal.

Currently, the export of bicycles manufactured in Bangladesh to its largest market, Germany, is suffering due to the imposition of anti-dumping duties and other tariffs, with suspicions regarding their country of origin, said sources.

German customs authorities said that "imports from Bangladesh are not treated differently from those coming from other countries".

It has generally been established that bicycles and e-bicycles imported into the European Union (EU) are often falsely declared with a different origin in order to evade anti-dumping duties on bicycles originating from China. Consequently, such imports are subjected to more rigorous and risk-based inspections.

The administration is hopeful that a visit will specifically address any doubts regarding Bangladeshi exporters, thereby facilitating future imports into the EU.

Currently, Germany alone accounts for bringing in 25 per cent of bicycles exported by Bangladesh to the EU bloc.

Meanwhile, domestic bicycle manufacturers and exporters have requested the Ministry of Commerce to collaborate closely with the German embassy in Dhaka and the Bangladesh embassy in Berlin for the greater benefit of Bangladesh.

The president of the Bangladesh Bicycle and Parts Manufacturers and Exporters Association (BBPMEA) has already written a letter to the ministry urging action.

"Germany is considered the largest buyer/importer of our bicycles for a long time. But in recent times, our importers in Germany are facing a serious trouble with German customs, particularly at Hamburg port, as they doubt the origin of Bangladeshi bicycles and consider them to be of Chinese origin."

"On the basis of their reasonable doubt as to the authenticity of the bicycles exported by Bangladesh, German customs are charging full tariff with anti-dumping duty on importers," he added.

The association argued that such an approach goes against the principles of the Generalized System of Preferences (GSP) verification policy and the EU rules of origin administrative cooperation.

"German customs are needlessly challenging the Bangladeshi origin of bicycles, which could have disastrous consequences for our products in the German market," he added.

As a result, German bicycle importers are feeling nervous, worried, anxious, disappointed and to some extent, frightened about this issue. If this situation persists, the association fears that Bangladeshi bicycle exports to Germany may come to a complete halt in the near future, leading to an annual loss of US$ 30-40 million.

In this regard, according to the verification policy, if any deviation or violation regarding origin raises doubts among the customs authorities of the EU, they are obligated to notify the local authority or the Export Promotion Bureau (EPB) of Bangladesh to verify the authenticity of the country of export declaration.

Industry insiders said that there have been no deviations from the rules of origin and noted that they are prepared to cooperate with investigations from any end.

Bicycle exporters are registered with the EU's Registered Exporter System (REX) and have consistently received export trophies over the past two decades, building a strong reputation.

The European Anti-Fraud Office (OLAF) team has conducted multiple visits to bicycle factories in Bangladesh and expressed utmost satisfaction with these visits, as mentioned by the insiders. Besides, officials from the EU delegation in Dhaka have recently visited the factories as well.

Bangladesh has been exporting bicycles to EU countries with zero tariffs under the Everything But Arms (EBA) initiative since 2001 and the REX system since 2019.

As a result, bicycle exports to EU countries have significantly increased, reaching US$ 167.5 million in fiscal year (FY) 2021-22. In FY 2020-21, a total of 1.0 million bicycles were exported globally.

Currently, local bicycle exporters benefit from a 4.0 per cent export subsidy, according to the Bangladesh Bank.

According to the European Commission, the REX is a certification system that allows economic operators to self-declare the origin of goods through statements of origin.

What does Germany think? Bangladesh cannot make bicycles on her own? I am surprised at Germany's monumental stupidity.

 

[Bilal9]

What does Germany think? Bangladesh cannot make bicycles on her own? I am surprised at Germany's monumental stupidity.

A lot of countries do this, import Chinese parts and claim 100% indigenous production.

India's cellphone industry (especially local brands like Karbonn, Micromax) is based on import of Chinese components (close to 80~90% is imported).

Even the labels are imported from China in some cases.

 

[bluesky]

What does Germany think? Bangladesh cannot make bicycles on her own? I am surprised at Germany's monumental stupidity.

Germany is not another Bangladesh where people love to play fraud. Germany has strict laws and certain procedure to ascertain the origin of an imported industrial product.

It is following its own rules on bicycle import and imposition of taxes or duties.

 

[PradoTLC]

REZAUL KARIM | June 19, 2023 00:00:00​

---

The German customs administration is persuading Bangladesh to allow inspections of Bangladeshi bicycle factories in a bid to eliminate any doubts regarding the country of origin, according to sources familiar with the matter.

The administration has proposed a visit to the facilities of Bangladeshi producers in order to expedite future import processes for bicycles and e-bicycles from Bangladesh.

The visit recommendation comes in response to a request made by the Bangladeshi mission in Germany concerning the issue of duties. The Bangladesh embassy in Berlin has urged the Ministry of Commerce to take action on this proposal.

Currently, the export of bicycles manufactured in Bangladesh to its largest market, Germany, is suffering due to the imposition of anti-dumping duties and other tariffs, with suspicions regarding their country of origin, said sources.

German customs authorities said that "imports from Bangladesh are not treated differently from those coming from other countries".

It has generally been established that bicycles and e-bicycles imported into the European Union (EU) are often falsely declared with a different origin in order to evade anti-dumping duties on bicycles originating from China. Consequently, such imports are subjected to more rigorous and risk-based inspections.

The administration is hopeful that a visit will specifically address any doubts regarding Bangladeshi exporters, thereby facilitating future imports into the EU.

Currently, Germany alone accounts for bringing in 25 per cent of bicycles exported by Bangladesh to the EU bloc.

Meanwhile, domestic bicycle manufacturers and exporters have requested the Ministry of Commerce to collaborate closely with the German embassy in Dhaka and the Bangladesh embassy in Berlin for the greater benefit of Bangladesh.

The president of the Bangladesh Bicycle and Parts Manufacturers and Exporters Association (BBPMEA) has already written a letter to the ministry urging action.

"Germany is considered the largest buyer/importer of our bicycles for a long time. But in recent times, our importers in Germany are facing a serious trouble with German customs, particularly at Hamburg port, as they doubt the origin of Bangladeshi bicycles and consider them to be of Chinese origin."

"On the basis of their reasonable doubt as to the authenticity of the bicycles exported by Bangladesh, German customs are charging full tariff with anti-dumping duty on importers," he added.

The association argued that such an approach goes against the principles of the Generalized System of Preferences (GSP) verification policy and the EU rules of origin administrative cooperation.

"German customs are needlessly challenging the Bangladeshi origin of bicycles, which could have disastrous consequences for our products in the German market," he added.

As a result, German bicycle importers are feeling nervous, worried, anxious, disappointed and to some extent, frightened about this issue. If this situation persists, the association fears that Bangladeshi bicycle exports to Germany may come to a complete halt in the near future, leading to an annual loss of US$ 30-40 million.

In this regard, according to the verification policy, if any deviation or violation regarding origin raises doubts among the customs authorities of the EU, they are obligated to notify the local authority or the Export Promotion Bureau (EPB) of Bangladesh to verify the authenticity of the country of export declaration.

Industry insiders said that there have been no deviations from the rules of origin and noted that they are prepared to cooperate with investigations from any end.

Bicycle exporters are registered with the EU's Registered Exporter System (REX) and have consistently received export trophies over the past two decades, building a strong reputation.

The European Anti-Fraud Office (OLAF) team has conducted multiple visits to bicycle factories in Bangladesh and expressed utmost satisfaction with these visits, as mentioned by the insiders. Besides, officials from the EU delegation in Dhaka have recently visited the factories as well.

Bangladesh has been exporting bicycles to EU countries with zero tariffs under the Everything But Arms (EBA) initiative since 2001 and the REX system since 2019.

As a result, bicycle exports to EU countries have significantly increased, reaching US$ 167.5 million in fiscal year (FY) 2021-22. In FY 2020-21, a total of 1.0 million bicycles were exported globally.

Currently, local bicycle exporters benefit from a 4.0 per cent export subsidy, according to the Bangladesh Bank.

According to the European Commission, the REX is a certification system that allows economic operators to self-declare the origin of goods through statements of origin.

Do the Germans suspect some thing fishy ?

 

[Skull and Bones]

Do the Germans suspect some thing fishy ?

Bangladesh gets special tax benefit because of their LDC status, so many Chinese companies set up assembly units in Bangladesh to ship Chinese products under of garb of ‘Made in Bangladesh’.

 

[bluesky]

Do the Germans suspect some thing fishy ?

I believe, it is not suspicion actually. Usually, by rule inspectors from the Western countries visit exporting countries to inspect the production chain and report the result to another govt body for evaluation if certain low tax clauses are applicable or not.

Knowing our people, I am almost certain that many of the cycle parts, such as, Chain, Gears, are imported from China and assembled in BD.

Otherwise, how suddenly BD started producing quality bicycle?

 

[AViet]

A lot of countries do this, import Chinese parts and claim 100% indigenous production.

India's cellphone industry (especially local brands like Karbonn, Micromax) is based on import of Chinese components (close to 80~90% is imported).

Even the labels are imported from China in some cases.

I doubt even 1% is actually made in India. Technologically, it is possible to manufacture simple component like plastic covers in India or Vietnam with imported mold (calculated, designed and manufactured in China) and imported plastic materials). But commercially, such component cannot compete against Chinese-made ones for sure.

I"ve visited Fushan in Guangdong province and entered a factory which manufactured components for kitchen wares for brands all over the world. Highly likely that the German or Spanish famous brands of kitchen ware were ordering their products there and just re-labelling them. A piece of igniter here costs only 10 cents (whole sale price).

 

[Bilal9]

Do the Germans suspect some thing fishy ?

A lot of countries like Cambodia and Laos import Chinese parts for export items and claim 100% local origin.

Tariff facilities given by countries like Germany to a country like say, Laos - is to help them develop their own industry.

If they import cheaper Chinese parts, then that law is defrauded and they can export items to Germany cheaper than it costs to make in Laos.

This is called dumping, Indians have also accused us of re-exporting Chinese parts and products before and have assigned punitive anti-dumping tariffs or CVD (countervailing duty). Of course in the Indian case, it is to protect their own industry and it is totally false.

In any case, German Customs officials can come to Bangladesh and see for themselves whether we make our bike parts in Bangladesh per spec or import them from China.

Locally the bike market is of course large, but a brand called Veloce dominates the premium segment.

Here is one of their latest and lowest priced offering (Jupiter 1.0), and the specs follow. Priced at Tk. 23,000 and up locally. Export items may have different components and priced differently. As can be seen below, most of the frameset components are made locally in Bangladesh, only exceptions are driveline components such as high quality derailleurs/chainsets/brake components. And these latter auxiliaries are always add-ons from vendors like Shimano (Japan) and SR-Maeda (Taiwan), even for bikes made in say Vietnam or China.

Frameset:
Frame: 6061 light weight alloy with internal cable routing
Color: Sky Blue

Drivetrain:
Transmission: 21 Speed
Front Derailleur: Shimano Tourney TY500
Rear Derailleur: Shimano Tourney TX800
Shifter: Shimano EF500
Crank: Shimano TY301
Freewheel: Shimano TZ500

Components:
Handle Bar: Veloce 720mm Alloy
Stem: Veloce
Suspension: SR Suntour 29B 100mm
Headset: Veloce
Brake set: Zoom
Chain: KMC Super
Pedal: Meghna UL-284 PVC
Rim: Meghna Double Wall Alloy
Seat post: Veloce
Hubs: Veloce
Grips: Meghna Lock On

Wheelset:
Tires: 29″ X 2.25″ Meghna
Rotor: Zoom 160mm
B.B: Thun
Saddle: Veloce

 

[Bilal9]

I believe, it is not suspicion actually. Usually, by rule inspectors from the Western countries visit exporting countries to inspect the production chain and report the result to another govt body for evaluation if certain low tax clauses are applicable or not.

Knowing our people, I am almost certain that many of the cycle parts, such as, Chain, Gears, are imported from China and assembled in BD.

Otherwise, how suddenly BD started producing quality bicycle?

Making chains and gears ain't exactly rocket science @bluesky bhai.

All you need is a bunch of hydraulic punching presses (25 ton capacity is fine). And of course some good quality turning centers and hobbing machines.

Major companies are involved in this - such as Meghna group. They won't risk export market for cheating on small things such as this.

Don't believe comments from these Ullu Bhakts, they don't know anything.

I have seen footage of chain and sprocket making. They even make sprockets and chainsets for motorcycles locally.

 

[Bilal9]

Bangladesh gets special tax benefit because of their LDC status, so many Chinese companies set up assembly units in Bangladesh to ship Chinese products under of garb of ‘Made in Bangladesh’.

Do you have any proof when you claim such things ?

Or is it something you pulled out of your nether regions as usual ?

There is such a thing as "certificate of origin" for qualifying for GSP. Yes, even in Bharatvarsh....

 

[bluesky]

Making chains and gears ain't exactly rocket science @bluesky bhai.

All you need is a bunch of hydraulic punching presses (25 ton capacity is fine).

Major companies are involved in this - such as Meghna group.

Don't believe comments from these Ullu Bhakts, they don't know anything.

I have seen footage of chain and sprocket making. They even make sprockets and chainsets for motorcycles locally.

I am not familiar with cycle parts. But, one issue may be for cycle chain that needs a certain tensile strength.

I remember I used to ride a Ralley cycle that everyone liked. Everything was perfect. Then came the Phoenix cycles whose chains would elongate after a year of riding. Chains would then fall off the gears.

I noticed also the gear teeth wear out too early. These things happen when the steel used is below the standard tensile strength.

So, the relevant people must be aware of this Tensile Strength matter.

I would not say BD makers import the parts and assemble them before exporting. But, considering the thievery minds of both BD and Chinese, it may be that the Chinese companies sell the finished parts and BD locals just assemble them and attach Bangladesh Make stickers.

I personally would like a vigorous inspection by the Rule-loving Germans. If they found frauds, BD makers will be forced to rectify the issues. This will boost our cycle industry and exports in the future.

Foreign pressure is a nexessary component to improve the quality of our products.

 

[Bilal9]

What does Germany think? Bangladesh cannot make bicycles on her own? I am surprised at Germany's monumental stupidity.

No it's not stupidity. We have India next door, so suspecting fraud and cheating is natural.

 

[Bilal9]

I am not familiar with cycle parts. But, one issue may be for cycle chain that needs a certain tensile strength.

I remember I used to ride a Ralley cycle that everyone liked. Everything was perfect. Then came the Phoenix cycles whose chains would elongate after a year of riding. Chains would then fall off the gears.

I noticed also the gear teeth wear out too early. These things happen when the steel used is below the standard tensile strength.

So, the relevant people must be aware of this Tensile Strength matter.

I would not say BD makers import the parts and assemble them before exporting. But, considering the thievery minds of both BD and Chinese, it may be that the Chinese companies sell the finished parts and BD locals just assemble them and attach Bangladesh Make stickers.

I personally would like a vigorous inspection by the Rule-loving Germans. If they found frauds, BD makers will be forced to rectify the issues. This will boost our cycle industry and exports in the future.

Foreign pressure is a nexessary component to improve the quality of our products.

Yes - if the metal chain links were made of inferior steel, they would wear out, elongating the chain. Cheaper chains used to be sourced from China, but they are moving upmarket too, slowly. The notion that China is only a source of low quality products is slowly changing, they make some high quality products too. Like high quality stereo, high fidelity and consumer optical products. Just like the Japanese started in the 1950's. And China's catching up on producing these items is about ten times more rapid than what happened in the case of Japan, Korea and Taiwan because they have local raw materials, R&D talent, investors and support, being a far larger country then these other Asian ones.

Chinese companies assembling products in Bangladesh and exporting them are subject to "rules of origin" inspections just like any other foreign company in Bangladesh. Plus importing partially made items from China and then slapping "made in Bangladesh" label to export, is much more expensive rather than making items locally. Labor cost in Bangladesh is one third or lower compared to China. It's not worth it.

Very expensive $800 Chinese digital camera lenses are being sold in the US market nowadays under Chinese brand-names like 7Artisan, TTArtisan, Meike, ZhongYi etc. If quality is not high - then a Chinese company cannot command such prices and get away with it. These Chinese lenses (highly optimized CAD/CAM optical designs with hybrid aspherical components) are one fourth as expensive as Leitz/Leica lenses but approach German/Japanese optical quality. Chinese local luxury items like Tube-driven Esoteric Hi-Fidelity amps are very successful in EU nowadays. These amplifiers are priced around a thousand dollars apiece. Camera lenses selections for Leicas are given below, there are others made for 4/3rds, Nikon Z and Canon Mirrorless mounts.

Rangefinder Lenses | Leica M Mount Lenses | B&H Photo

See B&H's vast selection of Rangefinder Lenses from top brands like Leica, ZEISS, Voigtlander and Meyer-Optik Gorlitz, all at unbelievable prices.

www.bhphotovideo.com

And of course we all know about DJI drones and action cameras, the DJI company is headquartered in China.

Re: your chain issue - competition bicycle riders for racing bikes change chains every six months or more often nowadays. Chains aren't that expensive.

It's all a matter of balancing price vs. quality. You get what you pay for. Paying less and expecting a bargain is not possible any longer.

 

[saif]

No it's not stupidity. We have India next door, so suspecting fraud and cheating is natural.

You told the truth about India.