Having destroyed social democracy for the "poor" in New Zealand to almost
universal acclaim (in certain circles), the Government of New Zealand
appears (equitably) to be applying similar rough justice to the "rich"
with almost universal condemnation (in the same circles) hmmm...
M
---------- Forwarded message ----------
Date: Tue, 26 May 1998 19:12:06 -0400 (EDT)
From: James Love <[EMAIL PROTECTED]>
To: Multiple recipients of list INFO-POLICY-NOTES
<[EMAIL PROTECTED]>
Subject: New Zealand lifts ban on parallel imports -- US Objects
New Zealand lifts ban on parallel imports -- US Objects
As the world rushes toward globalization of markets, some business
interests are trying to use trade negotiations to restrict cross boarder
trade in goods. So called "parallel imports" occur when goods are
purchased in one country are imported into another. (Not to be confused
with illegal counterfeit goods, or goods which infringe on patents or
copyrights).
Under international law, countries can decide if "exhaustion" of rights"
(sometimes called the "first sale doctrine") permit such "parallel
imports." A hot area of dispute concerns goods protected under
copyright, trademark or patent laws. High courts in Japan
(http://okuyama.com/c3v01ok.htm), the United States
(http://laws.findlaw.com/US/000/96-1470.html) and the European Union
have said that international law permits the parallel imports of goods
protected by intellectual property rights. However, the United States
Trade Representative (USTR) is on a crusade to ban parallel imports, and
has placed several countries on the USTR's "watch list" or threatened
trade sanctions over the issue of parallel imports of music CDs,
software or pharmaceutical drugs.
The dispute is largely about the ability of a manufacturer or publisher
to set different prices in different countries. A study of music CD's
in Australia by the Australian Consumers' Association
(http://www.cptech.org/ip/pi/acasubcd.html) indicated Australian
consumers were paying $ 6.33 more than consumers in other countries for
popular music CDs. CPT looked at prices for HIV drugs and found
significant differences in prices for the same drugs sold by the same
companies in different countries
(http://www.cptech.org/pharm/sa/sa-10-97.html). Other researchers, such
as K Balasubramaniam, have found similar results for other
pharmaceutical drugs. In Japan, the Fair Trade Commission has
intervened to ensure that consumers benefit from parallel imports of
goods such as Steinway pianos, which were priced higher in Japan than
elsewhere. This is considered a very sensitive issue with software,
which is often sold at very different prices in different countries, and
for the emerging trade in copyrighted goods over the Internet.
Firms that are seeking to make parallel imports illegal often assert
that parallel imports are related to piracy or counterfeit goods, or
undermine a firms ability to protect the image of a brand. Consumer
groups from several countries say that piracy or counterfeit products
are illegal in any case, and can be addressed without bans on parallel
imports. Rules from country to country are quite different. The UK
reportedly relies upon parallel imports for about 10 percent of its
pharmaceutical products, for example.
The following is a news report about New Zealand's recent decision to
liberalize rules concerning parallel imports.
James Love
[EMAIL PROTECTED]
----------------------------
>From FT.com (the Financial Times), Wednesday, May 20, 1996.
(distributed as a non-commercial fair use)
PARALLEL IMPORTS: US warns as New Zealand lifts ban
By Gwen Robinson in Wellington
The US has threatened action against New Zealand for its abrupt move to
remove restrictions on parallel imports - allowing importers to bring in
brand-name goods without a franchise.
New Zealand has become the first country in the Organisation for
Economic Co-operation and Development to open its market to parallel
imports, after parliament voted at the weekend immediately to lift the
ban. The vote followed the government's announcement of the measure in
the national budget late last week.
Charlene Barshefsky, US trade representative, had convened an immediate
special review of Wellington's decision, said Josiah Beeman, US
ambassador to New Zealand. Mr Beeman this week publicly condemned New
Zealand's action and warned "severe consequences" of the move that would
go "far beyond the New Zealand market".
New Zealand's decision is particularly sensitive for US car,
pharmaceutical and CD manufacturers, which claim large market shares
through exclusive marketing deals in the country.
However, Mr Beeman said the issue was not a bilateral matter. "Rather,
it is a precedent-setting action by an OECD nation that could have an
adverse impact on overall world trade," he said.
In a sharp response to US protests, Jenny Shipley, New Zealand prime
minister, warned the US to stop interfering in New Zealand affairs: "We
will not be told how to run our country."
Some domestic business groups have warned the move could trigger a flood
of cheap imports and undermine investment and intellectual property
rights in the country. But the government insisted that removing the ban
would benefit consumers through lower prices and wider availability of
goods, which are currently limited through exclusive franchise networks.
At the same time, the government would increase protection of copyright
holders rights through stiffer penalties for imports of pirated goods,
said John Luxton, commerce minister.
Consumer groups, importers and retailers welcomed the move and the
Manufacturer's Federation said the "advantages would outweigh the
drawbacks" as manufacturers would be able to buy cheaper machinery and
equipment.
The Australian government, which has been fighting a similar battle in
parliament to remove parallel import restrictions on CDs, hailed New
Zealands decision. "The NZ decision was taken in support of a more open
and competitive economy and in the interests of consumers and local
businesses," Daryl Williams, Australian attorney-general, and Richard
Alston, communications minister, said in a joint statement.
The Australian governments proposed legislation has been blocked in
parliament's upper house by opposition parties. The deadlock revolves
around claims by the recording industry and artists that the removal of
restrictions would flood Australia with counterfeit CDs.
The Australian government said New Zealand's move showed such claims
were spurious, and provided "a ringing endorsement" of the government's
determination to ensure "all Australians benefit from cheaper CDs."
Political analysts said the parallel importing decision was motivated by
a push to deregulate the motor vehicle industry, and was hastily
introduced to accompany a decision to abolish vehicle tariffs of 22.5
per cent.
A five-year scheme to phase out vehicle tariffs, which initially stood
at 35 per cent, was introduced by the coalition when it gained power two
years ago. At the same time, the government facilitated tariff-exempt
imports of used cars, which grew rapidly last year to make NZ the
world's largest market for Japanese used-vehicle exports. Also in 1997,
the government decided to accelerate the schedule for phasing out new
vehicle tariffs to 2000.
But New Zealands vehicle importers and assemblers, including Toyota,
Nissan and Chrysler, were still able to use provisions of the countrys
copyright legislation to block imports of nearly-new cars. The end of
parallel-import restrictions has ended that right. Motor industry
executives warned this week the move would undermine confidence among
foreign investors. "By legislating the substance out of import
restrictions, the government has opened the market to every man and his
dog to dump anything they want in New Zealand," said David Cumming,
Chrysler Jeeps New Zealand general manager. "In a wider context, the
decision will lead people to question their investments in the country
if people can sell anything they like off the back of a truck."
New Zealand-based car makers and importers have launched a campaign to
protest against the government's decision, claiming the legislation
would undermine intellectual property rights and remove manufacturers
rights to control the image of their brands in the marketplace.
