In Law360, McGuireWoods London partner Matthew Hall shared insights on the European Commission’s total fine of more than €157 million ($181.7 million) on three leading fashion houses for breaches of European Union competition law related to online and offline resale price maintenance. The fine was reduced due to the companies’ cooperation with the commission.
Resale price maintenance, Hall explained, occurs when a supplier restricts an independent retailer’s ability to determine resale prices, “including when a fixed or minimum resale price is established.” Hall observed that despite a 2023 judgment by the European Court of Justice holding that resale price maintenance does not constitute an automatic violation of competition law, the risk of a severe fine remains high.
In this instance, the European Commission fined three fashion houses for restricting “the ability of its online and brick-and-mortar retailers — independent resellers — to set their own retail prices in the European Economic Area.” Hall also discussed the Czech Office for Protection of Competition’s recent fine on a consumer electronics distributor for setting minimum retail prices as an example of enforcement by an EU member state authority.
Hall recommended that companies consider reporting and cooperating with investigating authorities if infringement is identified. These actions could significantly reduce or eliminate any fine, Hall added.
He also advised companies selling to resellers to incorporate resale price maintenance in their compliance and training programs, noting, “The outline of the rules, at least, needs to be understood by businesspeople so that they can raise issues and ask for advice as necessary.”