The chamber has stated that there is a customs notification (No 44, 18 January 1964) under which such grey imports when made without the consent of the owner of the trademark are liable for confiscation, the customs authorities are neither aware of this notification nor do they tend to enforce it even after it has been brought to their attention. This has primarily to do with the desire to enhance customs duty collection, according to Assocham.
In a release, the chamber said grey imports were emerging as a big threat to the fast moving consumer goods (FMCG) produced in the country primarily due to two reasons: In several categories, domestic producers do not have economies of scale and their input costs suffer taxes and duties at multiple stages. Also, grey imports do not incur any expenditure on advertising on television or visual media as they take a free ride on the demand and goodwill built by the local producer or licensee of the trademark.
Assocham has suggested that importers should be required to specify the brand of the product imported in all the customs documents including the bill of entry instead of just mentioning the generic product category to enable proper assessment of value for duty purposes.
It has also stated that import of goods under those brands or trademarks by anyone other than authorised importers be confiscated.