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Grey Market, Parallel Import Or Smuggled? What’s The Difference?

A few weeks ago one of the biggest online stores in the country was raided by the Bureau of Customs for allegedly selling smuggled high-end phones and devices. While Kimstore was one of the higher profile companies to be targeted by the BOC because of alleged smuggled gadgets, they’re not unique – there have been several raids on similar shops in the past with the same reason: selling smuggled or mis-declared gadgets to the public.

But what really constitutes selling smuggled gadgets? Why are there sellers that are able to offer “grey market” or parallel units in the country? Well according to two sources within high profile international companies that does business here, the government has very distinct definitions of smuggled units.

According to Samsung, there’s two ways a phone is considered to be smuggled. One is that there’s no receipt from the BOC that shows that import taxes were paid, and the second is that there are not NTC stickers that show that the phone is type approved by the NTC which means that the device fee was paid and that the device is registered with the NTC.

Some will probably ask the obvious: what if a particular seller would import, say, a Galaxy S7 Edge from a legitimate source (from Samsung HK) and brought it over here and they paid the correct taxes, is that still considered as smuggling?

Well, according to Samsung, it is, since they’re the ones that are duly authorized by the government to import any and all Samsung-branded phones and devices to the Philippines. As we understand it, neither the NTC nor the BOC should issue receipts because the Samsung is the only authorized importer, and that they are the only company that has the proper permits to do so.

That also applies to phones not officially offered here. Let’s take Huawei and their Mate 9 Pro, for example. Any Mate 9 Pro sold commercially, is considered smuggled since Huawei is the only authorized importer for any and all Huawei-branded phones. Doesn’t matter if they don’t carry the device – if it’s a Huawei phone not officially on their roster being sold by another company, then that’s considered a smuggled unit.

Okay, so what about phones sold locally that don’t have an official presence here, like Xiaomi and the like? Well, that’s allowed as long as the seller complies with the rules of importation with BOC and pays the correct taxes when it’s imported, and have type approvals with the NTC.

What if you’re buying one for yourself? That’s perfectly legal as well, provided you pay the correct taxes (if the phone is 10K and under, you don’t have to pay any tax) and have it type approved with the NTC. We actually have a very good article on importing your own phone here.

John Nieves

John is a veteran technology and gadget journalist with more than 10 years of experience both in print and online. When not writing about technology, he frequently gets lost in the boonies playing soldier.

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13 Comments

      1. What maybe true ten years ago maybe not be the same today. Bad laws or archaic laws needs to be repealed. That is just common sense.

        1. That’s true. I’m just thankful that they increased the minimum tax-free amount to 10K. I’ve bought so much stuff recently because of that.

  1. > What if you’re buying one for yourself? That’s perfectly legal as well,… and have it type approved with the NTC.

    I don’t need it approved by the NTC, just what’s the point? It’s not like they’re gonna help with the warranty issues in case something happens to the phone. All work will be done by yourself. Stupid requirement.

    1. Stupid requirement, but if your phone is checked by customs or your local post when it arrives, they WILL require you to show the NTC certification from there.

      1. That’s why use a mailing forwarder like lbc shipping cart, jinio or msb. They handle the taxing of the gadget. I’ve read many people buying phone overseas this way without getting tax or asked for stpid requirement like this.

        1. That’s an option, though those mail forwarders IIRC are all for sites in the US. I don’t think there are mail forwarders like that for Aliexpress, Bangood or other Asian sites.

  2. I bought a Huawei phone from Amazon, presuming as the web site said a 12 month warranty. But Huawei said no warranty when I called and gave the serial number. AT&T where I had it activated delightedly said they were not responsible. Amazon was puzzling.The first person I talked to hung up when I asked how could I get a phone without a warranty. The second would not put ’12 months warranty’ in writing. I suggested that Amazon was selling smuggled goods. Is there another solution?

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