Is the Exclusive Agency Just for Show? The Unspoken Underlying Rules among Importers

Mr. Zhang just signed an exclusive agency agreement for the Chinese market with a niche Italian brand last month. However, when the first batch of goods arrived at the port, he found that these goods had already appeared on the shelves of three offline stores. "The customs data clearly shows that it was declared by our company. Why could others sell them first?" This seemingly magical reality is frequently happening in the cross-border trade circle.

Ms. Li's experience is even more astonishing. The French organic skin care products she represents landed on the e-commerce platform three months earlier than her genuine products. Through investigation, it was found that these goods were imported in batches through the express channel under the name of "samples", with the amount of each ticket controlled within the 800-yuan tax-free quota, perfectly avoiding the formal customs declaration process.

• Tactic 1: Ant Moving - Entering the country by breaking up into small parts through personal postal channels
• Tactic 2: Disguising - Declaring as other categories after changing the packaging
• Tactic 3: Backdoor Listing - Taking advantage of the policy loopholes in the cross-border e-commerce bonded areas

Mr. Wang, the general agent of a German kitchenware brand in China, only received 90,000 yuan in compensation after spending 180,000 yuan on legal fees for rights protection. Such cases usually face: Difficulty in Obtaining Evidence (Gray customs clearance leaves no traces), Difficulty in Defining the Nature (The intersection of civil infringement and administrative violation), Difficulty in Implementing (The infringing parties often use shell companies). What's more troublesome is that some brand owners will tacitly allow this kind of "parallel import" in order to expand their market share.

The compliance experts of Zhongshitong Trade suggest adopting a combined defensive strategy:

• Immediately file the intellectual property rights with the General Administration of Customs after signing the contract
• Require the brand owner to provide the list of global distributors and the supply price
• Establish a commodity DNA system (batch code / anti-counterfeiting label / slight adjustment of ingredients)

On this battlefield without gunpowder smoke, there are not only "stowaways" who take advantage of loopholes, but also "arbitrageurs" who harvest by taking advantage of the information gap. Perhaps as a certain practitioner said: "When you find that your agency rights have been infringed, it means that this market is already hot enough to be worth fighting for." Please share your experiences in the comment section. We have compiled an e-book on the anti-infringement guide for import trade, and the first 20 commenters can get it for free.