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The Dangers of Parallel Import, What is parallel import? It is when an item is brought into another country and sold without the owner’s permission. For example, if Nike owns the trademark of the trainer, a seller selling the same trainers on Amazon is engaging in parallel import. Although Amazon sellers have the right to sell the trainers, this method of illegal trading may not be a wise option. Read on to find out why this practice is dangerous. If you have bought an item from an Amazon seller, you should check the product’s certification.
Legality of parallel imports
A trademark owner has various options to stop parallel imports. First, trademark owners can sue for trademark infringement, but this claim will likely not work against sellers who do not own the trademark. Second, trademark infringement claims are unlikely to succeed against sellers who claim to be authorized dealers or exclusive resellers. In such cases, trademark owners can pursue other legal remedies. These remedies may include consumer complaints, which are common with parallel imports.
The Supreme Court may need to consider whether to harmonise laws governing parallel imports. Parallel import laws must be harmonized, especially if the importing and exporting country follow different exhaustion principles. Harmonisation is necessary to prevent any conflict. For now, the Supreme Court will address the question of whether the importers must check the license agreement of prospective imported goods. It will also be important to ensure that parallel importers are aware of all relevant intellectual property rights.
Conditions for authorisation
Regulatory bodies in the EU have developed a number of rules to facilitate the parallel import of medicinal products. Parallel import of medicinal products is based on the patent exhaustion principle, a commitment derived from the EU’s commitment to free movement of goods. In order to comply with these rules, importers must have the same or similar therapeutic properties as products marketed in the UK. Parallel import applications must also comply with EU regulations for labelling and leaflets.
In addition to the similarities in the formulation and active substance, there must also be similarities in the therapeutic effect of a parallel imported medicinal product. In order to qualify, the medicinal product must meet public health requirements, and the trademark proprietor must be notified and supplied with a specimen of the repackaged product. The importation of generic medicines should be done under the supervision of the authorities of the destination country. If the importer does not meet these requirements, the importer may be prevented from obtaining a parallel import licence.
Cost-saving technique
There are several ways to reduce the cost of parallel imports. In addition to price differences, parallel imports can reduce the market share of local products. For example, an exchangeable product with a long shelf-life in Sweden may be out of stock for several weeks and can be imported at a discount from a Chinese manufacturer. Parallel import competition can also reduce the size of local markets. Using an individual parameter estimate, the cost of parallel imports is reduced by 0.12% when N_PI_Substancest = 1. Similarly, a further parallel trader will not reduce the price of the same item further.
The dynamic nature of parallel import orders allows rights holders to block access to new websites, which makes it difficult for parallel importers to avoid the effects of this order. While parallel importers must ensure that their products are identical, they must also ensure that they contain identical ingredients and therapeutic effects. This means that they may have slight differences in color, shape, or taste. It is critical to inform the consumer about these differences before importing.
Dangers for market
The dangers of parallel imports for the market are often overlooked, but are extremely real. While the average market share of parallel imports is 49%, the effect on prices is much smaller than this number might indicate. For example, a local product in Sweden could be out of stock for weeks and then suddenly appear in the market in another country. But if the importer doesn’t have any other products in stock in their country, there may be no way to find a replacement locally.
Parallel imports also threaten the profits of authorized distribution channels. Typically, manufacturers must separate their markets by geography and price discrimination. Parallel importation threatens this model by allowing consumers to access cheaper products without sacrificing quality. Some argue that parallel importation may help consumers and increase profits. Ultimately, the two methods are related. While parallel importation creates another channel for authentic goods, there are risks for both the manufacturer and the market.
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