Brussels fines Gucci, Chloé, and Loewe for fixing prices in independent stores.
The European Commission finds that fashion brands have violated European competition law.
BrusselsNew fine from Brussels for anti-competitive practices against major fashion brands. The European Commission announced this Tuesday that it has imposed a financial penalty of 157 million euros on Gucci, Chloé and Loewe to set the price of their products sold by independent retailers, whether stores or online platforms. "These types of anti-competitive actions increase prices and reduce consumer choice," concludes a statement issued by the EU executive.
The European Commission opened an investigation into these three companies because it considered them to be in violation of EU competition law. Ultimately, it confirmed the illegality of these price control practices, but the collaboration of the fined companies with the EU authorities has resulted in a "lower" fine, according to the EU executive.
Brussels claims that Gucci, Chloé, and Loewe—with their main headquarters in Italy, France, and Spain, respectively—distributed their "high fashion" products to all types of retailers, such as leather goods, shoes, and luxury accessories, and applied the well-known practice of maintaining the selling price. According to the European Commission, this is a market strategy implemented in all EU Member States.
Specifically, the European Commission states that the three fashion companies not only set the exact prices at which their products were to be sold, but also limited the discount rates and the periods during which sales could be applied. Furthermore, Brussels points out that in "some cases," Gucci, Chloé, and Loewe completely prohibited independent retailers from offering any type of discount to their customers.
The European Commission notes that the objective of this commercial strategy by the three fashion brands is to control other companies' prices and prevent any online store or platform from offering their products below the price at which they are sold through their direct sales channels, as well as at a greater discount.
It should be remembered that Brussels is the European Union body responsible for ensuring compliance with European competition law within the EU. However, in some cases, companies refuse to cooperate with EU authorities and avoid taking the measures imposed by the European Commission, which often results in higher financial penalties, and the case often ends up in EU courts.