Going abroad for retail therapy

The only thing more disappointing than facing the British weather after a break in the sun is comparing the prices we are asked to pay for electrical goods with those charged abroad.

It can be tempting to pick up a bargain on the way home along with the duty free plonk or wait until you get home and buy from a foreign website.

But will your glow of satisfaction fade like a holiday romance when you try to plug in your new toy at home or will hidden extras pile pounds on to your final bill?

Let us guide you through the technical, practical and legal maze of buying abroad.

Sprechen sie software?
If you buy a computer abroad, its operating system may prove to be a tongue twister. For instance, a Spanish copy of Windows XP has Spanish menus, commands and help files programmed into it and you cannot plaster an English-language interface over the top.

If you are fluent in any of the 24 localised versions of Windows XP then fine, but if you don't know el taskbar from a tortilla, beware.

Most English-language programs will run happily in their native tongue regardless of the operating system language.

However, when Computeractive reader Stephen Shearer bought a Packard Bell PC in Germany, he overlooked the fact that the 'free' bundled software would be double-Deutsch when he got it home.

Packard Bell refused to swap the discs for English versions and he was left with the choice of forking out for new software or learning a new language.

"The only German I ever spoke was when I said 'auf wiedersehen' to my cash," says Mr Shearer.

US software may also prove problematic despite our shared language. For instance, a tax return application designed for the IRS will be incompatible with our own dear Inland Revenue, as would any legal reference compilation.

You can make minor tweaks to the way your operating system displays times, dates and currencies by clicking on Control panel from the Start menu and opening the Regional and Language options box. Drivers supplied with products like printers and scanners may also be localised.

However, it is usually possible to download an English-language driver from the manufacturer's website, so this is less of an issue.

Hardware headache
With computer hardware, the primary concerns are power supplies and plugs. Any item sold in a European country will run on 230-240V, so all you need is a plug adapter to convert the supplied cable to fit your wall socket.

However, hardware sold in the US and some other countries runs at 120V. Unless the item's own power supply can be switched from 120V to 230/240V, you need a power transformer between it and the wall socket.

Remember that a full computer system typically has several power supplies - one for the computer itself, the monitor, printer, scanner, speakers and any external disk drives - so factor in the additional costs.

Power aside, you should also consider regional differences. For instance, the French keyboard has accents, a circumflex and an AWERTY (rather than a QWERTY) layout.

You can either use Windows to change the input language to English, via the Regional and Language settings, and remap such keys or throw out the keyboard and buy a cheap UK replacement instead.

The latter option is not, of course, possible with notebook computers.

The chances are that a modem designed to interact with a foreign telephone system, especially in the US, will choke on a BT line but you can tell Windows what kind of dial tone to listen out for.

Again from the Control panel, double-click the Modems icon and specify where you are dialling from using the drop-down menu.

Mobile phones also require some forethought; can you change the on-screen language from, say, Swedish to English? Moreover, only a tri-band phone will work in the US as well as Europe.

If you are tempted by a bargain-priced DVD player, watch out for regional coding. This usually means that a player sold in one global region, such as the US (Region 1) is unable to play discs coded for another region, such as Europe (Region 2).

Multi-region players are available, which can play DVDs from anywhere and many DVD players can have their regional coding easily disabled, usually with a special sequence of key presses on the remote control.

Similarly, if you ship a television in from the US, it will be designed to receive NTSC broadcasts by default. Here, and throughout Europe, we use a different, incompatible system called PAL, so you need a TV that can switch from one to the other (many, but not all, can do this).

In the computer market, industry standards mean that most plugs and sockets are truly international. A USB port is a USB port whether it is made in Japan or Jarrow.

Spare parts are potentially a problem but if you stick with international brands then replacement inkjet cartridges, laser toner, notebook batteries and other consumables should be readily available.

You should also note that accompanying documentation such as instruction manuals and guarantees will usually be written in the native language.

Eur-options
If you are satisfied that all the technical and practical gremlins have been dealt with, it's time to face up to the demon taxman.

When importing any goods from abroad, you may be liable for customs (or import) duty and VAT charges over and above the purchase price. How, then, do you work out the real cost of your goods?

The first factor is where you shop. If you buy goods from within the EU, you pay the local country's VAT at the point of purchase and are not liable for further VAT when you bring them into the UK. This applies whether you carry the goods across the border yourself or have them shipped in.

Similarly, goods bought within the EU do not attract customs duty. Shopping with EU member states is an attractive, easy and economical option - which is, after all, the point.

Note that the Customs and Excise webpage entitled Shopping on the internet is terribly misleading, for it seems to suggest that VAT and duty might be payable when you order goods online from EU countries.

This is not the case and Computeractive had it confirmed four times. You will only be charged VAT or duty if the goods are shipped from a non-EU country, so if you order a camera from a German website but the camera is actually shipped from Japan, you will have to pay.

The moral is to confirm where goods are shipped from with your supplier.

Going global
The picture is considerably muddier when bringing goods in from non-EU countries. Here you will bebilled for VAT at the full rate of 17.5 per cent.

To add insult to injury, VAT is calculated on the sum of the purchase price (including any local VAT already paid), plus duty, plus postage, plus insurance.

Duty is an import charge. It is applied to some, but not all, goods at a rate of between zero and 85 per cent, which can make all the difference between a steal and a bum deal.

You, not your supplier, are liable for duty; the exporter merely declares the value of the goods on a form.

To determine in advance the duty that will be due on a purchase, you need the commodity code that applies to that precise product - and there are some 15,000 or so to choose from.

A table of the most popular codes can be found at the Customs and Excise website.

If that is of no help, try searching the decidedly un-user friendly TARIC (Integrated Tariff of the Community) website.

Thus armed, plug the code into the TARIC site and click on the duty rate button. Alternatively - and this is our preferred option - give the very helpful people on the Customs and Excise Nation Advice Line a ring.

VAT and duty are usually collected on a cash-on-delivery basis, so that your parcel arrives with a bill that you must pay to the postman. The Post Office or the international carrier may also charge you for its part in clearing your goods through customs.

If you carry goods through customs yourself, you can sidestep VAT and duty so long as the value of your goods is less than £145. When shipping goods, the allowance is a mere £18.

It used to be possible to avoid VAT on goods sourced in non-EU countries if they were supplied in digital rather than physical form, such as software downloaded from a website.

However, the EU closed this loophole in July 2002. International vendors are now required to charge EU consumers VAT at their local rate (17.5 per cent in the UK).

Does distance add danger?
Your instinct may tell you that buying abroad adds an element of risk that simply isn't there when shopping at home, a risk that is amplified when you order online.

Your instinct is, of course, quite correct. We asked Simon Halberstam, head of e-commerce law at Sprecher Grier Halberstam, to elaborate.

"Every EU member state is supposed to have its own version of the Distance Selling Regulations that protect you when buying goods on the internet. This gives you a cooling-off period and a right to cancel.

"You may have to send the goods back and you may be expected to pay the carriage but EU countries cooperate on such matters. You are less likely to have an easy recourse if you shop outside the EU.

"Distance selling protection does not cover you when you buy something in person on holiday.

"If the product has a material defect, you should have the right of return but the logistics may make this difficult. The law is one thing but reality quite another," he says.

The trouble is that in the event of a problem, claim or dispute, you have to fight your corner according to the laws of the country in which you bought the goods.

Within the EU, and to an extent the Commonwealth, this is helped by limited harmonisation of trade laws. Elsewhere, you may be on your own.

Warranty-wise, we strongly suggest that you establish the terms and conditions before confirming a purchase.

Some warranties will cover you worldwide while others have strict territorial restrictions; some will let you send equipment sourced abroad to a UK repair centre, while others insist you ship it back to the country of origin.

Playing it safe
So what self-protection measures can the canny shopper take? Aside from the pre-purchase tips listed above, the single best thing you can do is pay by credit card.

Under the Consumer Credit Act (1974), your card issuer is jointly liable for any claim against a supplier who fails to deliver a product, delivers it in a damaged condition or misleads you about it.

This protection extends to purchases made abroad, in person, or online but unsurprisingly, credit card companies are less than thrilled by this and reckon they should no longer be bound by the terms of pre-internet legislation.

As matters stand, the Office of Fair Trading and Lloyds TSB are embarking upon a test case to settle this in the eyes of the law.

Meanwhile, a Lloyds TSB representative confirmed to us that credit card claims against overseas suppliers are "always looked at individually and resolved on a case-by-case basis".

What's in a name?
Computeractive reader Allan Forsyth points out a couple of pitfalls with shopping overseas while on holiday. The first is unwelcome sales pressure.

"The electrical retailers in Playa del Ingles in Gran Canaria tend to be very pushy and quite rude when they realise you're not buying immediately," he says.

"The prices of digital cameras and camcorders caught my eye on many occasions but I was always hassled to enter the shop and the assistant would expect a very quick transaction to take place."

Mr Forsyth held out and later found that returning something as simple as a scratched pair of sunglasses proved frustrating.

"When I returned to the retailer to ask for a refund, I was told this was not possible. I pointed this out to some other prospective customers and was then forcibly removed from the store!"

In a small world
Everything else being equal - price, availability, quality - we would advise you to shop within the UK, or certainly the EU, whenever possible.

Your consumer rights are better protected and you stand a fighting chance of resolving any problems that may occur.

Everything else is not always equal, however, and you can pick up tremendous bargains overseas both on the hoof and online.

So long as you factor in shipping costs, customs charges, regional differences and limited warranty terms and still come out on top ... well, why not reap the benefits of our ever-shrinking world?

Auction advice
One obvious way to buy from abroad is through an auction site. If you use the UK version of eBay, for instance, you can search for items based in the UK or available to the UK (i.e. the seller is prepared to ship overseas).

The latter option might appeal if you are on the lookout for hard-to-come-by goods or if prices are more attractive abroad. But alongside inevitably higher shipping costs, is there an increased risk of being taken for a ride?

Rosalinda Baldwin from The Auction Guild, an unofficial industry watchdog, thinks not, so long as you take the same precautions as you would do when dealing locally.

"The one exception is if the seller asks for payment by Western Union Wire Transfer, either from the outset or suddenly changes the terms at the conclusion of a sale," she says.

"A wire transfer is a useful emergency measure for getting your friends out of bother on holiday but it is completely insecure.

"Despite what he might tell you, the seller doesn't need your password or identification to collect your money - he just needs to know that the money is coming. If a seller asks for a wire transfer, I can guarantee that the deal is fraudulent.

"Likewise, if a seller says an item is located in Kent but then at the last minute asks you to send your payment to Italy, don't do it. He has broken the terms of the sale and you are under no obligation to pay."

Pre-purchase precautions

• Research the product thoroughly before buying and resist impulse purchases.

• Think about regional variations. Will hardware work straight out of the box in the UK or can it be easily adapted; will localised software leave you tongue-tied?

• Confirm that a quoted price includes local taxes, shipping and insurance. Don't forget to factor in VAT and duty at this end.

• Research overseas sellers as best you can: who are they, what do they sell, how strong is their reputation, do they have a real address, do they answer the telephone?

• Ask your seller about its procedure for dealing with faults or complaints. In particular, what rights of return or cancellation do you have, particularly if the item is faulty or delivery is significantly delayed - and who pays for return shipping?

• Confirm international warranty details in advance, preferably in writing.

• Find out if the seller provides all necessary documentation for customs and ask whether they are used to dealing with overseas buyers?

• Pay with a credit card.

• If you cannot understand a seller's terms because they are written in a different language, do not buy.

• Keep a written record of the entire transaction.

• Never, ever be brow-beaten by sales pressure into a quick buy.

• Trust your instincts; if your gut tells you that the deal is dodgy, dangerous or too good to be true, then walk or click away.

CONTACTS

Office of Fair Trading
Home of consumer advice and protection, including the Consumer Credit Act.
www.oft.gov.uk

HM Customs and Excise
Research your allowances; work out your charges.
www.hmce.gov.uk

The National Advice Service is available on 0845 010 9000
A list of popular Commodity Codes is available here.

TARIC home page
A bamboozling way to work out duty rates can be seen here.

Department of Trade and Industry
Imports, exports and international trading regulations.
www.dti.gov.uk

The Auction Guild
Who's doing what in the online trading world.
www.auctionguild.com

Auction sites
eBay: www.ebay.co.uk
QXL: www.qxl.co.uk
EBid: www.ebid.co.uk