Grey market

International efforts to promote free trade, including reduced tariffs and harmonised national standards, facilitate this form of arbitrage whenever manufacturers attempt to preserve highly disparate pricing.

Sometimes the term dark market is used to describe secretive, unregulated trading in commodity futures, notably crude oil in 2008.

Grey markets sometimes develop for video game consoles[7] and titles whose demand temporarily exceeds their supply causing authorised local suppliers to run out of stock.

These regional name variations may also be used to prevent the sale of bootleg arcade games,[citation needed] including those from Japanese versions.

Automobile manufacturers segment world markets by territory and price, thus creating a demand for grey import vehicles.

Before 1987, the Range Rover, Mercedes-Benz G-Class, and Lamborghini Countach, all revolutionary designs, were grey import vehicles in the United States.

The grey market provided a clear signal to these manufacturers that the United States had significant demand for these cars, and their present-day US model descendants remain popular.

For instance, a Canadian consumer who wants access to American television and radio services that are not available in Canada may approach a grey market reseller of Dish Network or DirecTV.

VPN services also market access to programming restricted by broadcasting deals through spoofing an IP address within a different territory.

The judges ruled that right holders cannot license their content on an exclusive territorial basis as it breaches EU law on competition and free movement of goods and services.

However, whilst this ruling allows domestic viewers to subscribe to foreign satellite services, pubs may still need permission from rights holders such as the Premier League to broadcast content.

Mr Justice Kitchin ruled that QC Leisure and other suppliers of foreign satellite systems could carry on with their businesses if they could prevent copyright elements such as branding of football matches from being shown in a public place.

However, the ruling from Justice Kitchin prevented Ms Murphy from showing matches in her pub via foreign satellite systems because branding is subject to trade mark law.

It is impossible to quantify an exact figure, but sources[17][not specific enough to verify] suggest that as many as 500,000 mobile phones are bought and sold outside official distribution channels through their trading platforms every day.

The driving forces behind a heavily active mobile phone grey market include currency fluctuations, customers demands, manufacturers policies, market-specific features, and price variations.

Purchasing some games from online content distribution systems, such as Valve's Steam, simply requires entering a valid CD key to associate with an account.

In 2007, after the release of The Orange Box, Valve deactivated accounts with CD keys that were purchased outside the consumer's territory in order to maintain the integrity of region-specific licensing.

This generated complaints from North American customers who had circumvented their Steam end-user licence agreement by purchasing The Orange Box through cheaper, market retailers.

Websites such as Taobao and eBay enable customers to buy products designed for foreign regions with different features or at cheaper costs, using parallel importation.

In the early days of camera sales during the 1960s and 70s, when lenses had amber coating, the bargain basements for Japanese equipment were Hong Kong and Singapore, through which goods were channeled to European shop windows bypassing the often substantial levy of the official importers.

Canon gives their hard-selling DSLR cameras names like "Rebel" in the US and "EOS xx0/xx00" outside it, aimed at preventing the competitively priced US-merchandise reaching Europe where sales are slower but achieve a higher profit.

Trade or bartering of frequent-flyer miles is prohibited by nearly all major airlines, although an authorised medium exists for specific frequent flyer programs.

[21][non-primary source needed] Unauthorised exchanges of frequent flyer miles – of which several exist – are also major examples of grey markets.

Import restrictions on formula from these sources has led to parents willing to pay a premium for foreign brands leading to the emergence of milk-powder runners, who buy formula at ticket price over the counter in Hong Kong, carry the tins over the border to Shenzhen before returning to Hong Kong to repeat the process.

The effect of the runners led to a shortage of infant formula in Hong Kong forcing the government to impose an export restriction of two tins per person per trip.

In response to the resultant damage to their profits and reputation, manufacturers and their official distribution chain will often seek to restrict the grey market.

In 2002, Levi Strauss, after a 4-year legal case, prevented the UK supermarket Tesco from selling grey market jeans.

Manufacturers may refuse to supply distributors and retailers (and with commercial products, customers) that trade in grey market goods.

Local laws (or customer demand) concerning distribution and packaging (for example, the language on labels, units of measurement, and nutritional disclosure on foodstuffs) can be brought into play, as can national standards certifications for certain goods.

Consumer advocacy groups argue that discrimination against consumers—the charging of higher prices on the same object simply because of where they happen to live—is unjust and monopolistic behaviour on the part of corporations towards the public.