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.