PARIS — The European Commission is once again taking aim at the fashion sector with several investigations into anti-competitive practices.
Antitrust regulators on Tuesday conducted unannounced inspections on a number of undisclosed companies in several countries of the 27-member bloc to investigate business practices that could lead to fragmentation in the single market. Among the companies inspected was Gucci, parent company Kering said on Wednesday after Reuters reported the brand was among those targeted.
Price fixing, collusion and limiting production are among the infractions being investigated, the EC said in a statement.
“The Commission has concerns that the companies concerned may have violated EU antitrust rules that prohibit cartels and restrictive business practices including certain horizontal and vertical restrictions,” it said.
“Unannounced inspections are a preliminary investigative step into suspected anti-competitive practices,” it added. Investigators are looking for evidence of collusion and operating as a “secret cartel” among associated companies.
In a separate statement, Kering said: “In the scope of an inspection carried out as part of a preliminary investigation into the fashion sector in several countries under EU antitrust rules, the European Commission has started on April 18, 2023, an inspection at the Italian premises of Gucci, a subsidiary of Kering. The group is fully cooperating with the Commission in the context of this investigation.”
The Commission also sent requests for information to several companies across the sector, but did not release information about the firms being investigated, or the countries where the raids took place. It specified that the investigations were new and not related to prior inquiries conducted in May 2022 and June 2021.
The 2021 raid targeted French fashion house Pierre Cardin and its licensing and distribution deal with German clothing-maker Ahlers. Six months later, the commission opened a formal investigation into Pierre Cardin and Ahlers for blocking cross-border and online sales as well as restricting sales to specific consumer groups.
The EC is the executive arm of the European Union, in charge of implementing the regulations of the European Parliament and the EU.
It has been increasingly active in pursuing suspected anti-competitive practices. The price fixing practices fall under the anti-trust regulations that prohibit agreements between companies that distort competition within the single market trading bloc. In recent years, it has stepped up its efforts to enforce rules against curbs on cross-border imports and online sales.
In March, the EC launched unannounced investigations into several beauty and fragrance companies linked to the supply of fragrance or fragrance ingredients.
Companies that breach the EU anti-trust rules face fines of up to 10 percent of their global turnover.
The EC said inspections being carried out doesn’t mean companies are guilty and that they do not prejudge the investigation’s outcome.
With contributions from Joelle Diderich