Legal framework of parallel importation in Bangladesh

In ordinary parlance, parallel importation is understood as a mechanism of selling a non-counterfeit and branded product imported from another country in the local market without permission of the trademark owner. It is also widely termed as "grey market imports". This notion of parallel importation has stemmed from the resold theory or the doctrine of international exhaustion of branded commodities.  This process happens when bypassing any native suppliers or manufacturers, importers purchase the genuine products in an overseas market with the permission of the original owner and subsequently, imports the same into the domestic market without any approval of the owner to resell those products. 

In recent years, the Bangladeshi legal regime has witnessed an upward spiral in the cases of "parallel importation." The court has delved into the focal question—whether there is any prohibition on parallel importation under the existing laws of Bangladesh. Lately, the High Court Division (HCD) has determined the issue by establishing a precedent in Unilever Bangladesh Limited v The Chairman of NBR and ors (2010). Unilever Bangladesh Limited has launched this legal action challenging the importation of parallel goods namely Vaseline, Knorr, Dove, Toothbrush, Close-Up Milk Calcium Nutrient and Axe and empty branded packing materials such as bottles, tubes, containers, wrappers, packets, labels etc. of the branded products of Unilever Plc. (which are locally produced, packaged, and marketed by them) into Bangladesh without their prior permission.

In this case, it was contended that section 15 of the Customs Act, 1969 prohibits such importation. However, the Court decided otherwise and opined that "on a bare reading of Section 15 of the Customs Act, 1969 it reveals that there is neither absolute bar in importing parallel goods nor said section gives any unfettered right to the importers to import parallel goods. Section 15 of the said Act is balanced legislation. Section 15(d)(e)(g) and (h) of the said Act authorized the importers to import parallel goods subject to compliance with the procedure/conditions as mentioned in the said provision. If any importer fails to satisfy the conditions laid down in Section 15(d)(e)(g) and (h) of said Act the customs authority is empowered under section 17 of the Customs Act, 1969 to detain and confiscate the imported goods. Therefore, we are of the view that there is no wholesale restriction in section 15 of the said Act in importing parallel goods."

Thereafter, the Court has assessed another legal provision, supplementary to section 15 of the Customs Act and that is order 4 of the Amdani Niti Adesh 2021-2024.  As per provision of order 4 (5), any aggrieved person is entitled to bring any objection regarding violation of any conditions of parallel importation to the notice of the Trade and Tariff Commission. Upon receiving any such objection, the Trade and Tariff Commission shall examine the objection and make a detail recommendation to the Ministry of Commerce. Thus, it is fair enough to say that there is no wholesale prohibition on the importation of parallel goods under the Customs Act, 1969 nor under the Amdani Niti Adesh 2021-2024. However, importers are bound to comply with certain statutory conditions in this regard. Order 5 of the Amdani Niti Adesh 2021-2024, for instance, stipulates that in case of import of registered branded product, an attested copy of intellectual property (IP) certificate from the country of origin issued by the concerned government or authorised authority or department is to be produced before the customs authority at the time of the release of the imported goods.

The writer is final year law student, University of Dhaka.