Parallel importing and the TPP

A brief recap

The TPP in four easy steps (and one really tough one):

• What?• Who?• Where?• When?• Why?

Dong, Dollars, Peso, Ringgit:

• Combined GDP = US$21 trillion.• Value to NZ = US$2.9 billion per year.

We don’t want to get left behind:

• 4 of our top 10 trading partners are negotiating the TPP.

Potential TPP benefits

Concerns about the IP chapter

People opposed to the TPP fear:

• Longer copyrights.• Less copyright exceptions.• More software patents.• Laws protecting TPMs.• A ban on parallel imports.

Ban on parallel imports

Article 4, IP chapter lets licensees:

• Stop the importation of books, sound recordings, computer programs and so on into their territory.

• A footnote extends that right to “a broader range of goods”.

About parallel imports

What is parallel importing?

• It’s the importation of lawfully-manufactured goods from overseas.

• It dodges local distributors who charge more for the same product.

• It takes advantage of better retail prices in other countries.

Different countries, different prices

Why do prices vary between countries?

• Different exchange rates.• Multinationals set different prices in different regions.

• Peaks and troughs of different economies.

Parallel imported films

Greater variety

Better prices, quicker distribution

Samsung Galaxy Note II Blackberry Z10

Common parallel import problems:

• No support from official distributors.• Repairs can take longer.• Foreign manuals; incompatible plugs.• Wiring not up to standard.• Concerns about perishable goods.

Problems with parallel imports

Parallel imports offer consumers:

• Better prices.• Greater variety.• Quicker distribution.

Parallel imports in a nutshell

The Warehouse:

• $1.732 billion in 2012• 1st batch of parallel imports in 1998.

Trade Me:

• 20,000 small businesses.• 5000 of them sell parallel imports.

Impact on businesses

“The issues that lie behind [intellectual property rights] are taking on a significant political dimension in many of our societies.”

- Leaked New Zealand response

Making an impact