Occurs when goods are purchased in one country and imported them to another, where they are distributed in parallel to the manufacturer’s normal distribution channels in that country. Parallel trade only occurs when the purchase price for a product is significantly lower in one country compared to another. When a company sells products at different prices in different countries, there will always be an economic incentive for parallel importing. Within the European Economic Area (EEA) all movements of goods between the countries must be free and unrestricted. The purpose is to stimulate competition in the area which ultimately will lead to lower prices for the consumers.

See also:
Distribution
Trade allowance
Supply Chain
Trade barrier
European Union (EU)