Definition
In Korea, a parallel import is a genuine product brought in by an importer other than the official one that signed an exclusive sales deal with the overseas headquarters. This importer buys legally from foreign retail stores or wholesalers and sells the goods at home. These are not knockoffs. They come from the same factory as the real thing and simply arrive through a different trade route.
Why is the same genuine product so much cheaper?
When you shop for sneakers or a bag from a famous overseas brand, you often find that an online store charges tens or even hundreds of dollars less than the official department store. With a gap that big, it's natural to wonder, "Is this fake?"
But many of these products are not fake at all. They are genuine items that came in as parallel imports. The official importer, which has an exclusive deal with the brand's headquarters, adds the cost of advertising required by headquarters, department store fees, and fancy branded store interiors to the price tag.
A parallel importer, on the other hand, buys large quantities at a discount from big overseas outlets or local wholesalers, often during sales. Without the cost of glossy stores or big marketing campaigns, they can sell at a much lower price than the official store.
A bit more precisely: where legal ends and illegal begins
To be more precise, a parallel import that meets the requirements is a legal way of distributing goods. The government allows it and backs it up with systems such as customs verification. Since 1995, Korea has permitted parallel imports that meet certain requirements, to stop exclusive importers from setting domestic prices too high and to give consumers more choice on price.
Legally, only "genuine goods" made by the overseas headquarters or a properly licensed factory count. Even then, some cases are not allowed, depending on the relationship between the trademark holders in Korea and abroad. At customs, the goods go through the import declaration process, and the importer must openly pay the regular import duty and value-added tax as the law requires.
If someone sells fake goods and passes them off as parallel imports, that breaks Korea's customs law and infringes a trademark, which can bring heavy criminal penalties. In the end, a parallel import is not different in quality or authenticity. The only things that differ are the route and the importer that carry it across the border.
Is it okay to buy just because it's cheaper?
A low price doesn't mean a parallel import is always the right choice. There are some inconveniences and risks you need to accept before you buy.
The biggest one is after-sales service (A/S) at an official service center. Official importers offer free warranties and free repairs only for products sold through their own distribution channels. If you bought a watch or an appliance as a parallel import, the official center may refuse to take it, or you may have to go to a private repair shop and pay the full repair bill yourself.
These products are also made to overseas standards, so there may be no Korean-language manual, and the plug or voltage on electronics may not match Korean standards. So don't look only at the price tag. Compare how easy after-sales service is against how big the discount is, and then decide.
Common misconceptions
Parallel imports aren't sold in official stores, so they must be fakes.
Parallel imports are genuine products too. They were made by the overseas brand and sold through proper stores. Only the route they took and the seller are different.
Where you meet it
A famous overseas luxury bag sold on an online marketplace for 30% less than at the official department store
Imported cosmetics and supplements bought in bulk from big overseas retailers and sold at warehouse-style discount stores in Korea
In one sentence
A parallel import is when someone other than the official importer legally brings in genuine goods from abroad and sells them cheaper by cutting out the extra markup in the supply chain.