*NEWS*SAMSUNG IN FIGHT OVER TONER IMPORTS

[Anonymous]

Channel ready to fight Samsung’s initiative on parallel imports
INDIA OCT 2006
Resellers feel they have the right to import products on which they pay appropriate duties to the government, on the other hand Samsung is engaging itself into a campaign in order to put a blemish on parallel import marketsAs the Korean electronics major Samsung Electronics moves ahead with its initiative to put tabs on parallel imports of toners, LCDs, HDDs and printers, the channel community is bracing up to fight for their right to import.With an aim to counter the growing menace of “grey market goods” also known as “parallel imports” in the Indian market, Samsung India Electronics Pvt. Ltd. along with its parent company Samsung Electronics Company Ltd. has initiated legal action under the trade mark law against distributors and sellers of “grey market” versions of its toner ink cartridges before the Delhi High Court in August 2006.As part of this initiative, the company has identified and taken legal action against certain dealers in India, who were found engaged in the business of pushing grey market goods.According to official spokesperson from Samsung, Justice Vikramjit Sen of the Delhi High Court, inter alia, granted ex-parte interim injunctions against 7 dealers across Delhi, Indore, Kolkata and Bangalore which includes Metro Technologies from Bangalore and Saboo Computers from Kolkata – restraining them importing, exporting, distributing, selling, advertising, directly or indirectly dealing in grey market ink cartridges/toners or any other products of the plaintiffs under the trademark “Samsung” or under any other mark as may be deceptively similar to the Plaintiffs’ amounting to infringement of the Plaintiffs’ registered trademarks.“The Judge was presented with the evidence that the Samsung toner ink cartridges were being illegally imported into India and that they were not authorized to be marketed and sold in the Indian market; that the said grey market toners did not conform to Indian labeling laws and regulations (which is an offence under Standard of Weights & Measures Act, 1976); and that the grey market toners were not supported by company warranties and replacement policies, thus creating deception and huge losses to the unsuspecting consumers,” the spokesperson from Samsung added.It is interesting to note that Samsung had moved to Court in the month of August in the face of customer complaints with faulty toner cartridges, that were clearly grey market imports.“This judgment is historic in the fact that it is the first judgment acknowledging the menace of parallel imports. For us, this judgement gives us a tool to ensure that the toners our customers get from dealers carry the appropriate warranties, being issued by SIEL. We will continue with our system of checks to ensure that this menace of grey market imports is countered as far as possible ” states Sanjay Sharma, VP-IT Business, Samsung India. Moving forward, the Company is planning to carry out similar initiatives for its checking parallel import for its Printers, LCD, OMS and HDD categories as well.

What channel feel!
While Samsung has gone ahead with its drive for putting an end to parallel imports, the channel community is not particularly amused by this move. Resellers engaged in import business feel that it is perfectly legal to import goods and global companies like Samsung should understand the market dynamics well before going all out against it.“We know that Samsung has named us but, we have nothing to do with imports. We are resellers in the Kolkata region. More so, when Samsung’s team came up to our office, they didn’t find anything. Even the high court commissioner came for checking and gave us his certificate after finding absolutely nothing. Samsung is just trying to mislead everyone here. They want to create panic in the market so that it becomes a difficult situation for importers,” informs, Rajesh Saboo, CEO at Kolkata based Saboo Computers. “We will certainly not sit idle on this issue. We will be taking this up with our association here. See, Samsung as a company will need to understand that anyone can import anything in India, its all legal and you pay duties to the government for importing products. So the whole issue is baseless as far as legalities are concerned,” he added.Speaking about the market of products being imported from other countries, Manoj Gupta, CEO at Delhi based Fortune Marketing said that there are a lot of companies who work towards diminishing the parallel imports market. “Some companies do tend to work towards reducing the parallel imports market, but this does not mean that importing goods is illegal. Since importing a genuine product is absolutely legal, I don’t think that there is any issue about this,” he added.Expressing his concern for the channel community, KVR Menon, CEO at Hyderabad based Orient Business Services said that it is absolutely legal to import products and goods and big MNCs will never be able to abolish the parallel channel.“If I am importing products and goods, I am doing it by paying duty at the customs. It is legal. But yes the products should be genuine and not counterfeit ones. So even if a big vendor like Samsung decides to do something about this situation, they should block the service of any imported products. They just cannot stand against the reselling of imported or gray market products,” he added.    
India has witnessed an increasing influx of grey-market goods, which pose serious threat to brand owners, such as Samsung. Grey-market goods usually enter the Indian market from China, Thailand, Singapore and the Middle East. This form of unauthorized parallel trading not only undermines the legitimate differential pricing structures of companies, but also compromises their established distribution standards with vendors and, of course, their reputation among customers.

[Author]

October 10, 2006 at 11:23 AM