Govt issues advisory against two Bhutanese cos on trade risks

Synopsis

The government has advised exporters, banks and trade bodies to exercise heightened caution while dealing with Bhutan-based Legoy Powersports and Druk A-Z Store, citing potential trading risks and lack of cooperation in resolving concerns involving the two firms.

New Delhi: The government has advised exporters, Export Credit Guarantee Corporation, banks and other stakeholders to exercise “heightened vigilance” while dealing with two Bhutan-based firms, Legoy Powersports and Druk A-Z Store, due to potential trading risks. In a trade notice, the Directorate General of Foreign Trade said the issue with regard to these companies was taken up through the appropriate diplomatic and administrative channels but no substantive response was received from the firms concerned or the relevant authorities.

“The continued absence of cooperation and engagement has impeded efforts to verify the facts of the case and achieve an amicable resolution,” the DGFT said, and advised all stakeholders to exercise enhanced caution and undertake comprehensive due diligence before entering into any commercial arrangement or transaction with the aforesaid entities; and sensitise and appropriately advise exporters, importers, and other trade participants regarding the concerns associated with these firms.

It has also been advised to carefully assess the risk profile of any proposed transaction involving these entities and take this development into consideration while processing applications, extending financial or credit support, providing trade facilitation services, or issuing certifications and recommendations.

“Promptly report any adverse experience, payment-related issues, contractual disputes, or other relevant information concerning these entities to DGFT for further examination and necessary action,” it said, adding that this advisory is being issued purely as a precautionary measure based on the information presently available and is intended to alert the trading community to the potential risks associated with dealings involving these two firms.