European Commission Fines Luxury Fashion Houses
(MENAFN) The European Commission announced on Tuesday that it had imposed fines totaling more than €157 million (approximately $182 million) on high-end fashion labels Gucci, Chloe, and Loewe for breaching antitrust regulations by collectively agreeing on retail pricing strategies.
According to findings from the European Commission’s inquiry, the three luxury brands "restricted the ability of the independent third-party retailers they work with to set their own online and offline retail prices."
This means that these companies curbed the freedom of external retailers to establish their own pricing models, both in physical stores and digital platforms.
The investigation concluded that such coordinated pricing tactics resulted in elevated costs for consumers and diminished their range of purchasing options.
These actions were deemed to be anti-competitive, violating fair market practices by manipulating pricing in the retail sector.
The Commission explained that Gucci, Chloe, and Loewe engaged in a scheme known as resale price maintenance, which disrupted the autonomy of retailers by enforcing limitations on their pricing methods.
This undermined the retailers’ independence in executing their business strategies.
As stated by the Commission, "Gucci, Chloe and Loewe strived to have their retailers apply the same prices and sales conditions they applied in their own direct sales channels," reflecting a deliberate effort to synchronize pricing across all distribution avenues.
The penalties imposed were broken down as follows: Gucci received the largest fine at €119.67 million, Chloe was fined €19.69 million, and Loewe faced a penalty of €18 million.
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