Grey Market

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Submitted by: Fatema Mhow Wala

Submitted to: Mrs Anjana Gupta

MEANINGThe term grey economy, however, refers to workers being paid under the table, without paying income taxes or contributing to such public services as Social Security and Medicare It is sometimes referred to as the underground economy or "hidden economy."

DEFINATIONA grey market or gray market also known as parallel market is the trade of a commodity through distribution channels which, while legal, are unofficial, unauthorized, or unintended by the original manufacturer


1 . The two main types of grey market are imported manufactured goods that would normally be unavailable or more expensive in a certain country. 2 . Unissued securities that are not yet traded in official markets.

3. Sometimes the term dark market is used to describe secretive, unregulated (though often technically legal) trading in commodity futures, notably crude oil in 2008. This can be considered a third type of "grey market" since it is legal, yet unregulated, and probably not intended or explicitly authorized by oil producers.

RESPONSESThe parties most concerned with the grey market are usually the authorized agents or importers, or the retailers of the item in the target market.

Manufacturers or their licensees often seek to enforce trademark or other intellectual-property rights against the grey market.

DESCRIPTIONUnlike black market goods, grey-market goods are legal. However, they are sold outside normal distribution channels by companies which may have no relationship with the producer of the goods. Frequently this form of parallel import occurs when the price of an item is significantly higher in one country than another. This situation commonly occurs with electronic equipment such as cameras.

AUTOMOBILESAutomobile manufacturers segment world markets by territory and price, thus creating a demand for grey import vehicles. In the United Kingdom the term applies to vehicles imported either new from cheaper European countries or from Japanese domestic models imported secondhand from Japan or Singapore

CELL PHONESThe emergence of the GSM international standard for cell phones in 1990 prompted the beginning of the Grey Market in the cell phone industry. The driving forces behind a heavily active mobile phone grey market include currency fluctuations, customers demands, manufacturers policies and price variations. I .I



It is not uncommon for grey market traders to introduce a product into a market months in advance of the official launch. This was evident with the launch of the iPhone 4, where international grey market traders bought large quantities at Apples retail price then shipped to countries where the product was not available adding a substantial margin to the resale price.

SECURITIESIn securities markets, grey market refers to the buying and selling of securities to be issued in the future, and therefore not yet circulating. This typically occurs some days before an auction of government bonds or bills and that trading is subject to the effective issue of those securities. Sometimes this is taken as a forecast of the prices that markets expect for future issues.

ELECTRONICSThere is a grey market in electronics in which on line retailers will sell merchandise below the manufacturer's authorized selling price, or advertise below the MAP.

TEXT BOOKSCollege level textbooks have a grey market, with publishers offering them for lower prices in developing countries or sometimes the UK. The content of these books is said to differ from the content needed for universities in North America. The content is usually 98% identical to what is taught in different areas of the world. Most commonly the units of measure, spelling of certain words and/or grammar is that of the region it was intended for. Sometimes the editions are not the newest.