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January 2, 2005

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Challengs For Legal Reforms In Bangladesh

Ensuring the compliance of the World Trade Organisation

Mohammad Monirul Azam

Bangladesh declared its readiness to become a member of the World Trade Organisation (WTO) from the very beginning of the founding or transformation of this organisation from earlier GATT to present WTO on January 1, 1995 after the successful completion of the Uruguay Round and thereby establishment of the WTO. It is widely anticipated that the entry into the WTO will speed up the economic development while providing foreign investors free access to domestic markets and for more favourable environment for our export-oriented industries. However the accession to the WTO raises some potential legal challenges and to take the full advantage of the world trading system, implementation of the WTO agreements is a must. It's a complete package, either one have to accept the whole or reject the whole, there is no provision for the partial implementation.

Therefore, present legal system of Bangladesh will have to be reorganised at every level to satisfy the requirements of the WTO. To meet this purpose, legal, administrative, and judicial resources must be put into place to act as efficient and integrated whole for the effective implementation of the WTO agreements and to minimise the conflicts with other WTO members. This short article will outline some of the major challenges for the legal reforms in Bangladesh in line with the obligations of the WTO agreements.

Promulgating and repealing laws or regulations
Bangladesh redoubled its efforts to reshape its legal environment in line with WTO obligations just after the accession to the WTO. It is also noting that a permanent Law Commission was established just one year after the accession to the WTO by an Act of parliament in 1996. And the Government has adjusted and is continuing to adjust its laws, regulations, and rules governing such areas as international trade, foreign investment, intellectual property protection and customs inspection, as well as arbitration and dispute resolutions as per the directions of the law commission. Although there is no specific direction to meet the WTO compliance while drafting laws, over the years it is observed that most of the times the law commission has given this prime concern while drafting any law.

In many areas regulated by WTO rules, such as service, information technology, competition policy and market monopoly, there are at present no applicable provisions within the legal system of Bangladesh. In line with WTO commitment to open its markets to various services and remove price controls, great changes in laws and regulations is a must.

Bangladesh have to make either new legislation or replace the century old legislation in a number of areas. Mainly legislation related financial services, sale of goods, carriage of goods, travel agencies, environmental services, architectural services, medical services, education, engineering, transportation, cargo-handling, customs-clearance services for maritime transport, maritime agency services, aircraft repair and maintenance services, air transport computer reservation services, freight transportation and forwarding by rail and by road, and storage and warehousing etc.

Modifying existing laws and regulations not in conformity with WTO Bangladesh may need to abolish laws, rules, and regulations that are unsuitable for modification or contrary to WTO compliance and replace them, where necessary, with new legislation.

To date, it has repealed legislation regarding copyright repealing earlier law, enacted a new law in 2000 and also introduced changes in the patent and trademarks legislation.

Although Government either amended or repealed a number of laws, till date there is no systematic study so far, within the knowledge of this writer to examine the legal system of Bangladesh in line with WTO obligations. Someone may think it is not necessary, but to take the benefits under the WTO agreements and to pose the threat and detrimental effects (if any), against the national interest in the WTO agreements, a systematic study is a must to pave the possible avenues to serve the national interest.

For example The State Council of China after its accession to the WTO has examined all the administrative regulations passed prior to 2001, and has already abolished 221 regulations. China within a very short span of time (officially became a member of the WTO on December 11, 2001) has modified laws, regulations, and rules governing areas such as foreign investment, customs, intellectual-property protection, foreign trade, foreign exchange, and insurance etc. In the field of foreign trade alone, China has finished the revised drafts of 148 laws. Moreover, China either abolished or amended around 571 laws after accession to the WTO due to conflicting with WTO rules.

Preparing administrative and judicial institutions
In addition to the necessary statutory changes, all the WTO members have to ensure that all laws, regulations, and rules are applied and administered in a uniform and impartial manner. To meet this purpose, programs for the training and education of government employees, stakeholders and judges to understand the WTO system is a must.

To ensure WTO compliance, numerous changes in customs procedures and inspections dispute resolutions and governmental screening systems are also necessary.
In addition, the government has to concentrate on shortening the customs process, use of Electronic Data Interchange (EDI) and to modernise the customs administration etc.

Recently established ICC arbitration centre in Bangladesh and newly enacted Arbitration Act 2001 replacing the earlier law of 1940 is a very positive step forward. In addition to this, the government may create a body to handle WTO complaints from foreign-funded enterprises. Finally, to protect the national interests, the government has to take special care by providing legal and technical assistance, arranging constant training and capacity building programs and promoting research activities relating WTO rules.

Concluding remarks
The legal environment in Bangladesh, with the aid of presently established Anti-Corruption Commission and if constitutional commitment is fulfilled by the separation of the judiciary from the executive as per the direction of the Supreme Court and along with the establishment of the office of the Ombudsman and Human Rights Commission in the coming days, may step forward towards ensuring transparent and sustainable legal system and good governance in the country.

These efforts, combined with the political commitment and the expectation of more changes to come in the near future to meet the WTO compliance and protection of the national interest as well, will make Bangladesh more thriving and prosperous. However, it may take a longer time for Bangladesh to play an efficacious role under the rules of a market-oriented economy. But within a favourable and smooth legal system, after fulfilling the WTO compliance and framing strategies for protecting national interest as well, within 10 to 15 years it may transform into a mature and stable market-oriented economy and would be able to take maximum benefits.

The author is a Lecturer, Department of Law, University of Chittagong.

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