Grey market and the Consumer Protection Act

The South African grey market is – well – a grey area: it is legal, but poorly regulated.

That is set to change with the new Consumer Protection Act, which comes into force on 1 April 2011. The bidorbuy sellers who rely on grey imports would do well to sit up and take note.

The grey market mainly consists of imported high-value electronic goods. Such goods reach South African shores faster through grey imports than through official channels (witness the case of iPads). And when the official imports are available, the grey ones are always cheaper. But the grey market has one huge pitfall: very elusive warranties and guaranties.

According to the new Consumer Protection Act, the retailers must:

  • Label grey products,
  • Make it easier for shoppers to return faulty goods;
  • Make it easier for shoppers to get refunds.

The new Act includes an implied warranty of quality on all goods, allowing consumers to return faulty goods, get the seller to repair it, or get a full refund. The requirement to clearly label gray product is nothing new – but now it will have to be respected. The monitoring of the implementation of the new Act it is expected to be much stricter, and the fines are much higher: businesses found flouting the law face a R1 million fine or 10 percent of turnover, depending on which is the greater amount.

Analysts say that the new Consumer Protection Act will make grey market products more expensive and less attractive. Some go as far as to claim that the law is the final nail in the coffin of grey market.

Also see: The Consumer Protection Act and bidorbuy Buyers and Sellers

Comments

  1. Its good that consumers are being protected but does this mean that our overpriced, international imports market will get even less competitive?

    I’m tired of looking at items in the US being less than half the cost of exactly the same item here.

  2. EltoroTrading is a seller of so-called “grey” products. We are however probably one of the only to offer a warranty equal to that of the manufacturer, plus the option of a very good extended service contract or warranty.

    This is our warranty:
    EltoroTrading warrants to the original end-user purchaser, when delivered in new condition in its original container, that the product will be free from defects in materials and workmanship under normal use and service for a period of one (1) year from the date of original purchase. Product returned to a EltoroTrading South Africa and proven to be defective upon inspection will, at EltoroTrading’s sole discretion and without charge, be (a) repaired utilizing new, remanufactured, repaired and/or recycled parts; (b) exchanged for a new Product or; (c) exchanged for a refurbished Product, as determined by the repair facility. Warranty exchange or replacement does not extend the original warranty period of the Product.

    THIS WARRANTY DOES NOT COVER ANY ACCESSORIES.

    We can also supply additional Mack World Wide warranties, ranging from extension of the standard warranty conditions by the manufacturer, to

  3. WARRANTY

    LuxuryTime warrants all watches to be brand new, genuine and free of defects. Every watch description states the warranty period & if the watch warranty is covered by LuxuryTime or manufacturer. Some watches will come with an International warranty card(We sell both Grey imports and local stock)

    LuxuryTime generally offers a 2 (two)-year warranty from the date of purchase – unless stated otherwise. The warranty covers malfunctions due to manufacturing & material defects, battery replacement & water resistance under regular use within the manufacturer specifications.

    The warranty does not cover damages such as scratches, finish, crystals or glass, leather or f abric straps, damage due to excessive wear & tear, damage resulting from wear under conditions exceeding the watch manufacturer’s water resistance limitations & damage due to physical and/or accidental abuse.

    All warranty repairs must be handled directly through LuxuryTime Watches opened or repaired by any other source will void all warranties. LuxuryTime will cover all parts and labour or replace the watch at our discretion within the warranty period.

    We offer the strongest form of protection for all our buyers – Unconditional 7 Day Money back Guarantee.(No questions asked)

    Our warranty includes FREE pickup and delivery to your door within the warranty period- watches will only take 5-10 days to service or repair and go to the same watchmakers with the same qualifications using the same spare parts as the official agents use – Only difference is you not going to wait 1-3 months should something go wrong (We have had clients complaining for waiting as long as a year from the agents), with us you wait 5-10 days and get the watch back delivered to your door.

    It doesn’t end just here, after we have serviced or repaired your watch you will get an extended 1 year warranty on the work done.