Rolex Fined €91.6 Million EUR for Banning Online Sales
The Haute Autorité de la Concurrence found that the Swiss watchmaker’s selective distribution agreement has restricted competition for more than a decade.
Rolex is facing a €91.6 million EUR fine for banning the online sale of its product by authorized distributors for more than a decade, per France’s Haute Autorité de la Concurrence.
The national competition regulator stated that the luxury watch brand’s digital sales prohibition was “serious,” as it “amounted to closing a commercialization channel, to the detriment of consumers and distributors, while online distribution has been growing momentum for the past 15 years for luxury goods, including watches.”
Rolex previously justified the ban as a measure of protecting its branded products from counterfeiting, but the board dismissed the Swiss label’s argument, stating that it was not proportionate. Additionally, the regulator cited several competitors that have “put solutions in place,” particularly technologically, to engage in online sales while safely combatting counterfeiters.
The organization explained that because Rolex created “a program for the online purchase of pre-owned watches, whose authenticity it guarantees” with a retailer, “an absolute ban on the online selling of its products cannot therefore be justified.” However, Rolex did not face any penalties for alleged price restricting, with regulators stating that “the evidence in the case did not prove Rolex France had restricted the pricing freedom of its authorized retailers.”
Rolex has not yet commented on the news. The Haute Autorité de la Concurrence expects Rolex France, Rolex Holding SA, Rolex SA and the Hans Wilsdorf Foundation to clear the fine.
