SPECIAL REPORT – Five more apparel brands have joined H&M by agreeing to honour payments for wholly or completely produced ready-made garment orders from Bangladesh. These are the world’s largest apparel retailer, Spanish-based Inditex, British multinational retailer Marks and Spencer, French retail company Kiabi and US retail companies PVH and Target.
The news means the spotlight will now shift to other brands which are continuing to play hardball over this issue by refusing to pay for cancelled orders, even though in many of these cases, orders are partially completed or ready to ship. Among the most significant of these is Primark (estimated US$273m orders cancelled from Bangladesh) and C&A (US$166m orders cancelled from Bangladesh).
Brands cancelling orders, and effectively leaving suppliers high and dry with stock and materials they cannot shift are hiding behind ‘force majeure’ (meaning ‘superior force’), a recognised contractual principle. However, Apparel Insider has this week consulted several leading law firms, and the consensus among them was that issues around force majeure and cancelled orders are far from cut and dried.
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