AWA Objects to Gray-Market Proposal
Trademark security, quality are at risk, says AWA
Consumers and manufacturers would be harmed significantly by a U.S. Treasury
Department proposal that would allow gray-market watch imports into the
country, says the American Watch Association, Washington, DC. Trademark
security and quality problems would occur, hurting the industry overall,
and retailers could bear the brunt of many consumer complaints.
If the proposal becomes law, gray-market goods could enter the U.S. legally
as long as they are labeled "materially different." AWA, which
represents 45 major watch companies doing business in the U.S., made several
points in written comments to the department, including:
- The proposal runs counter to case law that protects companies from
products that infringe on legal U.S. trademarks.
- A large number of malfunctioning or inadequately cased watches could
result. The reason: imported watch movements must be stamped with country
of origin, name of manufacturer or purchaser and number of jewels, if any,
before entering the U.S. Many countries don't have these requirements,
so goods initially intended for those countries would have to be restamped
before entering the U.S. During this restamping, importers of gray-market
watches could damage gaskets and affect water resistance, damage case backs
or leave plastic or metallic pieces that could damage the movement.
- Consumers would blame the trademark owner or retailer, even though
the fault would lie with the gray marketer and even though the label or
tag would identify a watch as a gray-market item.
- It would be impossible to enforce a provision requiring everyone along
the supply chain to keep the gray-market label attached to the product.
The proposal has no timetable for becoming law, says Toby Collado, executive
director of AWA. For information, call AWA at (703) 759-3377.
by Michael Thompson
Copyright © 1998 by Bond Communications.