Chinese phones disappear from capital after raids

Chinese mobile phones that had attracted a large number of customers have disappeared from the shelves of phone shops in Abu Dhabi following repeated raids by local authorities, according to dealers.

The raids by the Ministry of Economy seeking to enforce copyrights and intellectual property protection laws and restore discipline to the market have been welcomed by dealers of Nokia, Samsung and other famous GSM brands.

The cheap phones from the world’s most populous nation had filled most of the shops on both sides of Defence Road, Abu Dhabi’s main mobile handset market, before they were no longer seen on the shelves and shop fronts.

“We no longer deal in Chinese mobile phones and I don’t think there is any other shop in this area doing so,” said Mohammed Hairi, owner of Al Sultan Mobiles, which was one of the largest Chinese handset dealers in the capital.

“The inspectors from the Ministry of Economy have left us not choice but to stop trading in such handsets…they earlier had told us not to deal in cloned handsets or those which carry famous GSM brands in violation of existing laws…but during their last raid late last month, they said no Chinese phones of any brand are allowed….they have seized all my Chinese phones and fined me Dh2,000.”

During a surprise raid on the nearly 150 mobile phone shops on Defence Road three weeks ago, nearly10 Ministry of Economy inspectors seized more than 500 Chinese phone handsets worth over Dh2,500.”

The inspectors, conducting their biggest raids on the busy mobile phone market in the Capital, took traders off guard when they stormed their shops and cleaned up their shelves and drawers of all Chinese products.

“We have warned them many times but they will not listen,” said one of the inspectors.

“They continued to trade in Chinese handsets, chargers and batteries which carry such famous brands as Nokia and Sony Ericsson…they don’t realize that they are violating copyright and intellectual property laws in the country.”

Shop owners said they were fined Dh2,500 each for the offence and had all their Chinese mobile handsets and accessories confiscated.

Dealers said some shops are still trading in Chinese mobiles but secretly since they want to dispose of a large remaining stock of such handsets.

“Some shops have Chinese mobiles concealed under their tables or inside drawers or back rooms….when a customer asks for one, they double check to make sure he is not an inspector in disguise,” one dealer said.

In previous raids, the inspectors had seized only Chinese products which are produced as copy of well-known global brands. But traders said the inspectors last week seized all Chinese products, including those which are not branded.

“They took all my Chinese phones last month…I had around 70 of them and they put all of the boxes inside a big bag and took them….I was also made to pay Dh2,500 as a fine… I had made good business in such products,” said Muhannad Ayash, a mobile phone dealer on Defence Road.

Like in other countries, China has invaded the UAE’s lucrative mobile phone market, one of the fastest growing telecom markets in the world, as it had done with its cheap watches, radio and TV sets, and other electronics.
 

Although its mobile handsets are much cheaper than other mobile phones, it has introduced some innovative features to lure customers, including offering two or three batteries in one package, large headsets, TV and Radio facility, and developing handsets that take two or three sim cards at the same time.

In the past, authorities had made no move against the dumping of massive, cheaper quantities of Chinese mobile phones on the grounds the country is an open economy.

But they decided to act after receiving complaints from mobile phone dealers that clone Chinese handsets and accessories are now flooding the market in violation of the existing intellectual property laws. Some major dealers have complained such products have hurt their business.

“These fake Chinese products have hurt our business…I think what the authorities have just done is a very good move,” said a local distributor for Samsung. “Let’s hope this ban on such products will stay.”

The bulk of Chinese mobile phones marketed in the UAE are imported through Dubai and large quantities are re-exported to nearby Gulf states and other countries.

Despite their inferior quality and the absence of any authorized local dealers, demand for such handset in the UAE has remained strong given their cheap prices, which could retail at just Dh200.

Besides handsets, Chinese phone batteries, chargers and covers, branded on such famous phone makers as Nokia, Sony Ericsson and Samsung, had filled up the shelves of cellular phone shops, prompting authorities to take action.

Over the past few months, inspectors have been seen confiscating thousands of such items on Defence Road but many shops continued to deal in such phones in defence of official warnings given their high profitability.

The UAE has one of the world’s largest mobile phone penetration ratios, exceeding 200 per cent at the end of 2009.

The high ratio is a result of the country’s massive per capita income, which surpassed Dh150,000 last year, as well as continuously updated mobile services and strong domestic demand.

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