Rolex SA has been fined about $100 million by the antitrust agency Autorite de la Concurrence. The French watchdog fined the Swiss watchmaker for illegally cracking down on distributors who wanted to sell the watches online. Rolex says that online sales result in the sale of counterfeit watches and parallel trade. However, the French antitrust agency did not buy into this argument.
The French regulator released a statement on Tuesday that said the violations by Rolex were “serious” and amounted to “closing a marketing channel,” which would have a detrimental effect on consumers and retailers. The statement also noted that luxury products, including watches, have been “booming over the past 15 years.”
The regular said that Rolex France was jointly liable along with Rolex Holding SA, Rolex SA, and the Hans Wilsdorf Foundation. They have been fined approximately $100 million by the watchdog. The summary of the decision has to be published on the website of the watchmaker.
The Swiss watchmaker has a global policy that lets its watches be sold only in official jewelry brick-and-mortar stores. New watches can only be marketed but not sold online. Consumers cannot directly buy Rolex watches.
The French agency ruled that these practices are restrictive. It accepted that Rolex could enforce recommended retail prices. It was also accepted that the watchmakers aim to prevent the sale of fake Rolex watches and that trading in the grey market is commercially legitimate.
The agency noted that other watchmakers that compete with Rolex have not used the tactics that Rolex did despite facing similar risks.
In 2017, the French antitrust agency opened an investigation into a complaint by Pellegrin & Fils and the Union de la Bijouterie Horlogerie. Pellegrin & Fils said that it had been removed from the network of partners after it tried to convince the watchmaker to sell Rolex watches online. The company suggested that it had been made an example for other partners so that they could be kept in line.
Rolex has not commented on the ruling. It can file an appeal to the Paris Court of Appeal.
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