These type of international trade agreements are quite common. Take Wal-Mart for example, an American company with stores in Canada in just about every Canadian neighborhood. Yet Canadians can't legally order a Magnavox DVD/HDD recorder from Wal-Mart USA. Wal-Mart USA under agreement with Wal-Mart Canada will refuse to send a unit to Canada. It's not just Wal-Mart, but if Canadians purchase a Magnavox DVD/HDD recorder from any retailer from the US - Magnavox/Funai will not honor any warrantee work if the recorder is taken back to Canada - it's right in the fine print in the owner's manual. I guess these types of trade agreements are in place to protect local employees and local trade. What I don't know is if these agreements are made by the companies or by our governments.
The strange thing is that some stores like B&H have no such agreements and will gladly sell to Canadians. In fact I contacted B&H once, asking them if I purchase a unit and have it shipped to Canada, will they honor the warrantee if need be. At that time they told me that they will honor a 30-day exchange but any longer and I have to deal with the manufacture. Manufactures like Panasonic, Sony and JVC will not honor out of country warrantee work.
I guess the point behind DVD region coding was to prevent buyers from buying out of continent discs. The funny thing is the smaller non-blockbuster companies sell region-free DVDs. In fact in the past I have purchased off eBay from American dealers based in the USA - region free NTSC discs manufactured in South Korea and Argentina, discs not available in North America. These are not bootlegs; they are official non North American releases released in South Korea and Argentina.