The European Commission said it has fined fashion companies Gucci, Chloé and Loewe for “fixing resale prices, in breach of EU competition rules.”
The Commission said its investigation revealed that the three companies “restricted the ability of the independent third-party retailers they work with to set their own online and offline retail prices for products designed and sold by Gucci, Chloé and Loewe under their respective brand names.”
It said: “This kind of anticompetitive behaviour increases prices and reduces choice for consumers.
“The fines, which were reduced in all three cases due to the companies’ cooperation with the Commission, amounted to over €157 million in total.”
Gucci was fined €119,674,000, Chloé was fined €19,690,000 and Loewe was fined €18,009,000.
The Commission added: “Gucci, Chloé and Loewe are fashion companies headquartered in Italy, France and Spain respectively. They are all active in the design, production, and distribution of high-end fashion products, including apparel, leather goods and various accessories.
“The Commission’s investigation revealed that these three fashion companies engaged in a practice called resale price maintenance (RPM).
“They restricted the ability of both their online and brick-and-mortar retailers, which are independent resellers, to set their own retail prices for almost the entire range of products designed and sold by Gucci, Chloé and Loewe under their respective brand names, including apparel, leather goods, shoes and fashion accessories.
“The infringements covered the whole territory of the European Economic Area (‘EEA’).
“In particular, the three fashion companies interfered with their retailers’ commercial strategies by imposing restrictions on them, such as requiring them to not deviate from: (i) recommended retail prices; (ii) maximum discounts rates; and (iii) specific periods for sales. In certain cases, and at least temporarily, they also prohibited retailers from offering any discounts.
“Gucci, Chloé and Loewe strived to have their retailers apply the same prices and sales conditions they applied in their own direct sales channels.
“To ensure compliance with their pricing policies, the three fashion companies monitored the retailers’ prices and followed up with deviating retailers. The retailers in general adhered to the companies’ pricing policies, either from the start or after being requested to do so.
“These anticompetitive practices by Gucci, Chloé and Loewe deprived the retailers of their pricing independence and reduced competition between them. At the same time, Gucci, Chloé and Loewe aimed to protect their own sales from competition from their retailers.
“In addition, Gucci imposed online sales restrictions for a specific product line by asking its retailers to stop selling the product online. Gucci’s retailers complied with these instructions …
“The practices ended, for all three fashion companies, in April 2023, when the Commission carried out unannounced inspections at their premises.
“Today’s decisions conclude that the anti-competitive practices in each of the three cases constitute a single and continuous infringement of Article 101 of the Treaty on the Functioning of the European Union (‘TFEU’) and of Article 53 of the EEA Agreement, which prohibit agreements and other restrictive business practices that may affect trade and prevent or restrict competition within the Single Market.
“The three fashion companies acted independently of each other. However, the duration of the three cases overlaps and many of the retailers concerned sell products designed by all three designers.
“The three decisions concern the high-end segment of the fashion industry and send a strong signal against RPM practices for sales online and in brick-and-mortar shops to the entire industry. This kind of anticompetitive behaviour increases prices and reduces choice for consumers.”
Teresa Ribera, Commission Executive Vice-President for Clean, Just and Competitive Transition, said: “Today we have fined three European fashion houses for interfering with their independent retailers’ prices in breach of EU competition rules.
“In Europe, all consumers, whatever they buy, and wherever they buy it, online or offline, deserve the benefits of genuine price competition. This decision sends a strong signal to the fashion industry and beyond that we will not tolerate this kind of practices in Europe, and that fair competition and consumer protection apply to everyone, equally. “