Sunday, May 08, 2005

In effect an end to exclusive agency - Gulf News

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A further move by the Abu Dhabi Government is the establishment of an authority to purchase consumables direct from producers overseas and import and sell the products through co-operative societies in the UAE.

The thinking behind this is to overcome what is perceived as undue inflationary price increases in consumables following a recent raise in the salaries of government employees.

The action being taken effectively means the government is sanctioning parallel imports from suppliers, disregarding existing agency agreements. It can therefore be viewed as easing the control agents have over the right to import from specified and registered suppliers.

While this is in accordance with World Trade Organisation requirements, which the UAE has said it will fully comply with soon, it will cause concern for existing agents, even if it does free-up the market for consumers.
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