PARALLEL OR GREY IMPORTS
Parallel or grey imports…
Parallel importing in Australia is also known as grey imports. Some people refer to it as direct importing too. It occurs when a business imports and sells products without the manufacturer’s approval. Thus, the import happens outside of the formal manufacturer distribution channels. It may be a genuine product. However, the manufacturer does not approve of such a sale. Hence, the buyers are supporting and selling in Australia without the manufacturer’s authorisation. In case there is any fault with the products, the manufacturer or brand owner does not have any obligation. It is the importer’s responsibility. So, when a business sells gray imports in Australia, it must be aware of its obligations. The importer has an obligation to the consumers. Thus, the business must understand the outcomes and consequences too. Parallel imports have their risks and benefits. Thus far, there are more risks than benefits. The products are often bought by businesses or individuals from overseas dealers. They may be authorised agents to sell in the domestic market. In fact, they often may not have manufacturers’ approval to export. Since the manufacturer or brand owner is not aware of such a sale, there may be difficulty in obtaining proper export documents too.
Grey import awareness
There are several indicators that may suggest parallel imports. The importer purchases products from a supplier other than the manufacturer or brand owner. This particular model or type of product is otherwise not available in the Australian market. It may not be made for the Australian market too. The price is normally cheaper than what a consumer would expect to pay in Australia. Furthermore, the product may be refurbished. It may not be brand new.
For example, Exclusive Cheese sources premium quality Cheddar cheese. It is from a well-known supplier in England. The supplier is only to sell these Cheddar in the domestic market. So, when Exclusive Cheese sells cheese to Australian consumers it is a parallel import. Thus far, the original manufacturer does not authorise Exclusive Cheese as a supplier of cheese in Australia. Hence, if there are any issues with the cheese, it is the importer’s risk.
Obligations of the parallel importer
If a business plan to be a parallel importer, it must be aware of certain obligations. There is a need to comply with regulatory requirements as well as other laws. For instance, if you plan to import therapeutic goods, these normally must meet enter on the Australian Register of Therapeutic Goods. Thus, you may need to establish a formal record-keeping system. There will be certain compliance such as customer complaints and concerns.
Thus far, the obligation extends to comply with labelling requirements or product safety. You may need to provide accurate information about the products to the customers. Other obligations are to ensure you do not mislead consumers. It includes the return or refund policy and warranty rights. It is important to note, the importer does not have the backing of the manufacturer or the brand owner. Furthermore, you must know all obligations under Australian Consumer Law.
ACCC consideration
The ACCC recognise there is a potential benefit to consumers. The fact that it may be cheaper or may not be available in Australia. Thus far, there may be certain disadvantages to consumers too when buying parallel imports. There are definitely many advantages to buying the same products from approved dealers in Australia. This is particularly so true if consumers experience problems with these products.
While buying a parallel import is not illegal in Australia, it does put you at risk. So far, the risk may be the product may be not safe to use. It may not comply with Australian regulations. Thus, it may not pass local safety requirements and may be uncertified.
Warranties, refunds, and return risks
As a parallel importers, they are responsible when something goes wrong with the products. If a product develops a fault, they are responsible. Hence, they need to rectify the issues. So, when there is a defect, it is the importer’s responsibility. They must fix the problem. Thus far, they may provide a repair, replacement, or refund. According to the consumer guarantee provisions it needs to be done within a reasonable time. It needs to be rectified at the importer’s cost.
The parallel importer has the ultimate responsibility. It must provide a reasonable remedy. According to Australian law. the supplier overseas is not liable whatsoever. In fact, potentially the importer is deemed as a manufacturer. Thus, it places extreme responsibilities on the importer. Moreover, there is no obligation on the manufacturer. Australian law does not deem a connection to the supply of the products in Australia. Thus far, there may not be much fallback on its business insurance too.
