April 2018 — Question 54
What is the difference between restricted gray market goods and goods bearing counterfeit marks?
- AThere is no difference. Gray Market and counterfeit goods are considered the same.
- BGray Market goods are harder to distinguish than counterfeit goods.
- CThe seizure process is different between Gray Market and counterfeit goods.
- DGray Market goods bear a trademark or trade name which has been applied with the approval of the trademark owner as genuine and is recorded with Customs and Border Protection.✓ CBP's answer
- EGray Market products are of lesser quality products just like counterfeit products.
Why this answer
19 CFR 133.23(a) defines restricted gray market articles as foreign-made goods bearing a genuine trademark or trade name, one applied under the authority of or with the approval of the owner, that are imported without the U.S. owner's consent. Counterfeit goods, by contrast, bear a spurious mark that was never authorized. The legal difference is therefore the authenticity of the mark, which is what option D states. Option B tempts because gray market goods often are harder to spot in practice, but relative difficulty of detection is a practical observation, not the distinction the regulatory definition draws. Watch for: Choosing the practical observation that gray market goods are harder to distinguish instead of the regulatory definition.
Original CBLE Simulator explanation — the question and key above are CBP's; this analysis is ours. Verify against the current edition before relying on it in practice.
CBP's cited authority
Answer and citations as published in CBP's official answer key for the April 2018 examination.
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