Customs Tightens Grip on Phones

The Federal Customs Service has stiffened the rules for importing cell phones, requiring that each handset be inspected individually and leaving stranded hundreds of thousands of units in Moscow warehouses.

Dmitry Nekrasov, head of the service's processing and inspection department, signed the new rules, which were sent to customs posts Friday. The changes took effect Monday, spokespeople for Samsung, Nokia, Motorola and Sony Ericsson, as well as two sources in the customs service, told Vedomosti.

Under the rules, customs officials are required to inspect all mobile phone cargo, opening boxes to ensure that the telephones meet all of their stated technological specifications. Checks must be made on battery models, memory cards and International Mobile Equipment Identity numbers. An executive at one of the firms said the new rules would last until September.

Until 2005, 90 percent of cell phones were imported into the country illegally. In August of that year, the Interior Ministry cracked down on semilegal import schemes and seized a major cargo of contraband phones. As a result, retailers had to stop working with middlemen and import the phones themselves. In 2007 and 2008, phone makers began clearing their own goods through customs.

A customs service source said the rules were intended to increase collection rates to compensate for falling import volumes. A spokesperson for the service declined to comment, but sources close to the service said they would primarily be checking import prices.

Phone makers said the rules had paralyzed customs work. Over the first two days that the rules have been in effect, customs points at Sheremetyevo and Domodedovo have not processed a single Nokia handset, spokeswoman Viktoria Yeremina said.

By Tuesday, more than 440,000 Nokia telephones worth about 30 million euros ($42 million) have piled up at the two posts, and the figure is rising, she said.

Another few hundred thousand Samsung units are also caught at customs, said Dmitry Kuznetsov, director of the company's telecoms department. Motorola managed to get a major shipment through customs last week and now has just tens of thousands of units awaiting clearance, spokesman Kirill Lubnin said.

Sony Ericsson is not meeting its delivery schedules and is losing money because it has to pay for temporary storage, marketing manager Viktoria German said.

Nokia sent a letter to customs service chief Andrei Belyaninov requesting that he call off the 100 percent inspection rule, Yeremina said. Samsung's Kuznetsov said he thought that the rules would be reflected on retailers' shelves in the next week or two.

For now, producers and retailers have some reserves, but they're "not elastic," Yevroset president Alexander Malis said. He said his company had enough phones for two or three weeks. Svyaznoi spokeswoman Yelena Nogotkova said the retailer had enough stock for one month.