International purchase of pre-owned Rolex - how we did it.

[renmore]

I recently bought this 1990s Datejust from forum user Flumazenil. I am absolutely thrilled with it and so excited about giving it to my husband for his birthday next week.

I thought I would share the process of buying a watch online from a personal dealer and having it shipped from the US to Australia, in case our experience can help anyone else.

I had been looking for a watch since just before Christmas, and was considering purchases from stores here in Australia, ebay, and other online stores such as Alan Furman and Bernard Watch Co. Once I had expressed serious interest in the watch Flumazenil was selling on TRF, we had to establish a trust between us, as I was about to send him more than $2000 with no guarantee I was going to ever see the watch! He was able to provide me with his business website and other tracking information that established his identity and credibility. He asked the same from me, which I still think is quite funny, because I don't think he had anything to lose from receiving my money

He suggested UPS for shipping. They quoted US$150 including insurance. I thought this was quite high, compared to what shops like Bernard Watch Co etc quoted, so I checked out FedEx. They were a lot less, but did not offer insurance, so that would have to be bought through a third party (too hard!). Someone else recommended US postal service, but I am not sure if they do insurance as well. In the end, the seller was comfortable with UPS, he'd done the legwork and research to find out about it, and he was the one going to the trouble of packaging it up and filling out all the forms, so I was happy to go with it.

Because we were insuring it, the full price and contents obviously had to be declared. This meant that I had to pay import duty and GST (Australia's 10% Goods & Services tax) when it arrived in the country - a total of about A$300. (I know people recommend you write 'electrical parts for repair' etc to avoid these costs, but I don't think we could get away with this if we were insuring? Plus, I really didn't want any hold up or hassle for not being above board.)

It was a smooth transaction that really relied on trust and good communication. But this forum provides a great head start on those qualities, and made me feel comfortable about the process.

So thanks to everyone who responded to my various posts asking about this watch or that one, and thanks to Flumazenil for a beautiful watch. Even though I've made my purchase, I look forward to staying a member and learning even more.

[Robb]

Great to hear!!!!! Im from the US and I sold a watch to a forum member in Australia. I used USPS and it went great also.

[Texsubmariner]

It's always good to hear fellow TRF'ers getting good deals done!

[Letsgodiving]

Great story. Your husband will be very pleased I'm sure.

[TARDIS]

Because we were insuring it, the full price and contents obviously had to be declared. This meant that I had to pay import duty and GST (Australia's 10% Goods & Services tax) when it arrived in the country - a total of about A$300

Glad you got the watch.....and you (and hubby) are happy!

Regarding the payment of GST...I am a bit confused here and I am wondering if you are actually required to pay any duty or GST on imports which are pre-owned and not brand new. Did Australian Customs notify you that the watch had arrived in Australia or did you notify customs first?

[renmore]

Originally Posted by TARDIS

Regarding the payment of GST...I am a bit confused here and I am wondering if you are actually required to pay any duty or GST on imports which are pre-owned and not brand new. Did Australian Customs notify you that the watch had arrived in Australia or did you notify customs first?

Hi Steve. I wondered how that would work too. It seems we do pay GST on pre-owned items. For example, when I corresponded with a 2nd hand dealer in Melbourne (http://www.thewatchgallery.com.au) his prices included GST. I imagine you pay GST on items for sale in antique shops as well.

BUT I question having to pay GST for something that was not sold by a dealer, but an individual person. You don't pay GST on items bought from ebay, do you? I think I will look into this further and let you know what I find out.

The customs bit was taken care of by UPS. So when I arrived to pick up the parcel, they had an invoice for me for the amount, and had obviously taken care of all the paperwork, declaration etc.

[renmore]

Originally Posted by Robb

Great to hear!!!!! Im from the US and I sold a watch to a forum member in Australia. I used USPS and it went great also.

Hi Robb. How much did postage cost you for that? Were you able to get insurance included?

[2careless]

For GST, it doesn't matter whether it's new or pre-owned. As long as it's a "goods" over $1k, duty + GST are charged - approx 15%. see http://www.customs.gov.au/site/page.cfm?u=5549

If the goods is < $1k, it's much better to use postal service as you don't need to declare and it's sent to your address directly. If it's > $1k, I usually ship it via DHL or FEDX. They clear customs faster and you can pay via credit card on the phone. (make sure you put in your phone number so that the freight company can contact you.)

Ed: As for the 2nd hand dealer, since they are GST registered they have to sell goods with GST. When they import stuff, they pay duty + GST. When they buy from locals (e.g. you), as long as you are not GST registered, you don't provide them a tax invoice, they can't claim GST inputs. Anyway, govn't will pocket the GST of the sale.

The matter gets interesting if you are also GST registered, and presumably you're also a dealer. You can presumably buy the watch from the other dealer, and use the tax invoice's GST paid amount as an input to your business, i.e. you saved that 10%. However, when you eventually sell the watch, you will need to report the GST received and pay it back. The question is how long between you buy the watch and you sell the watch (can be several years, who knows :)

[swatty]

Originally Posted by 2careless

For GST, it doesn't matter whether it's new or pre-owned. As long as it's a "goods" over $1k, duty + GST are charged - approx 15%. see http://www.customs.gov.au/site/page.cfm?u=5549

If the goods is < $1k, it's much better to use postal service as you don't need to declare and it's sent to your address directly. If it's > $1k, I usually ship it via DHL or FEDX. They clear customs faster and you can pay via credit card on the phone..

I agree , use Fedex or UPS , for an item worth that amount, they will do all the paperwork , phone you for payment of GST etc and then deliver to your door, with the post , I once spent half a day at the international postage exchange in Granville, never again.

[SPACE-DWELLER]

Good call that all went smoothly! I for my part dare not have an expensive watch sent insured to Denmark since custom's fees and VAT are very high (37 % plus other fees!).

[llamaofdoom]

I might be mistaken, but I don't think the trick is getting the Rolexes out of the US...it's getting them in without by confiscated that's a bit risky.

Rolex USA holds exclusive import rights.

[Earl Camembert]

Originally Posted by llamaofdoom

I might be mistaken, but I don't think the trick is getting the Rolexes out of the US...it's getting them in without by confiscated that's a bit risky.

Rolex USA holds exclusive import rights.

The law states

Section 526 of the Tariff Act of 1922 prohibits the importation of any merchandise of foreign manufacture if that merchandise bears a trademark owned by an American citizen, corporation or association, without that trademark owner's permission. The literal interpretation of section 526 is that any registered American owner of a trademark has absolute control over what can be imported. Thus, the American makers of Duracell batteries should be able to stop the gray market importation of batteries produced abroad by its Belgian subsidiary.

Rolex is not owned by an american corporation so bring them in.

I don't think one watch would be a problem especally when gray market traders take advantage of curency fluctuations. I wonder how many Rolexes are flying out of the 3ed world US of A to be sold to rich countries.

[TARDIS]

Originally Posted by renmore

Hi Steve. I wondered how that would work too. It seems we do pay GST on pre-owned items. For example, when I corresponded with a 2nd hand dealer in Melbourne (http://www.thewatchgallery.com.au) his prices included GST. I imagine you pay GST on items for sale in antique shops as well.

BUT I question having to pay GST for something that was not sold by a dealer, but an individual person. You don't pay GST on items bought from ebay, do you? I think I will look into this further and let you know what I find out.

The customs bit was taken care of by UPS. So when I arrived to pick up the parcel, they had an invoice for me for the amount, and had obviously taken care of all the paperwork, declaration etc.

Thanks for the reply....a good point you raised about eBay purchases!

The grey watch dealers who add another 10% for 'GST' are having a laugh. All their watches are pre-owned and if there is a GST it should be included in the sale price NOT added on afterwards. There are 3 dealers here in Oz I know who try this on, one in Sydney and the other two in Melbourne. If you are interested enough in one of their watches and offer them a cash deal or bank transfer, they may deduct 10% (provided you ask first) giving you a real sob story about how hard it is and how they are doing you a big favor!......
Most of grey dealers make considerable profit on Rolex and other Swiss brands and they can afford to haggle up to 15% or more if they wish to move stock.

Cheers