Background
8.Parallel importing is the importation of goods without the authority of the trade mark owner or copyright holder. There are two parallel importing streams of relevance; first, where New Zealand-produced goods are exported from New Zealand under authorised channels (i.e. under trade mark or copyright licences) and subsequently returned to New Zealand through unauthorised channels; second, where overseas-produced goods are imported into New Zealand through unauthorised distribution channels. Both situations result in the commercial distribution and retail of goods in New Zealand by parties lacking formal trade mark or copyright licences to do so.
9. New Zealand has generally allowed the parallel importing of goods since 1998. Cabinet has previously agreed to keep the wider issues of parallel importing in the creative industries under review [POL Min (01) 30/3; CAB Min (01) 35/5 refer]. One of the outcomes of the subsequent review was a 9 month ban on parallel importing films from their international release date, which came into effect in October 2003. The purpose of the ban was to maintain the economic viability of provincial cinemas and domestic film production. The legislation giving effect to the ban has a 5-year sunset clause and is due to expire in October this year.
10. The 2005 review provided analysis on the costs and benefits of parallel importing and its economic impact on investment in, and promotion of, New Zealand's creative industries. The 2005 review did not consider the impact of the 9 month ban on parallel importation of films because the ban had only recently been implemented and it was considered too early for its impact to be effectively assessed. The 2005 review indicated that there was industry concern about the negative impacts of parallel importing in the computer programme, sound recording and book industries. However, the 2005 review did not find evidence of detrimental effects on promotion of and investment in those industries.
11. The 2005 review considered the extent to which parallel importing had occurred in the book, sound recording and computer programme industries since the lifting of the general ban. The 2007 review built on the 2005 review and also analysed the impact on the motion picture production, distribution and exhibition industries.
12. In conducting the 2007 review, LECG contacted a number of key stakeholder groups and industry representative bodies1. The list of consulted groups is attached as annex 1.
13. The 2007 review was finalised in November 2007 and its report was made available for targeted stakeholder consultation. Responses were received from: the New Zealand Motion Picture Exhibitors' Association Inc; the Motion Picture Distributors' Association; the Motion Picture Association and the New Zealand Film Commission.
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