To defuse the ticking retail frenzy of grabbing the latest Apple phone- the iPhone 4S, Chinese authorities and American-owned Apple Inc. have joined forces to tackle the problem of illegally selling the handset in China's black markets.

In Beijing and Hong Kong, customers are so eager to get a hold of the iPhone 4S that the Chinese government has adopted a new retail policy to closely monitor and regulate orders and sales of the latest Apple product in these cities.

As a follow through of Apple Inc.'s three-week postponement of sales block to the mainland stores, Chinese authorities are also on alert for alleged buyers in Hong Kong, who illegally sell the iPhone 4S in the 'black markets' of China, thus, they are cheaper and void of taxes, which is also a loss for China's government coffers.

In Hong Kong, the official retail price of a 16GB iPhone 4S is HK$5,088 ($660) - compared with 4,988 yuan ($790) in Apple stores on the mainland, China Daily News said.

Apple Inc has banned direct sales in HK and in the mainland stores, and transactions are made online through its website and a buyer is selected through a lottery reserving system.

Hong Kong iPhone buyers are asked to give their personal information - including a government-issued ID card number - to reserve and purchase a mobile phone.

With the lottery selection, those selected are given an e-mail confirmation of the order within the day and not later 9 p.m. They are informed of the date and time to pick up the Apple handset. Those not Those not selected have to try again on a different day.

"Due to high demand, we are accepting a limited number of iPhone reservations per day," a notice in the Apple Store in Hong Kong said. "Only those who receive e-mail confirmation will be able to purchase an iPhone. We will not be selling the iPhone 4 or iPhone 4S to walk-in customers."