New rules drafted by the European Commission intended to help
luxury-brand owners protect their brand image are set to restrict
the online sale of branded goods. According to a joint statement
by e-retail association IMRG, the Belgian distance-selling
association BeCommerce, the French ecommerce and distance-selling
federation FEVAD, and Dutch home-shopping association
Thuiswinkel.org, an “overstrict” interpretation of
the regulation on vertical agreements and concerted practices
could enable brand owners to insist that only stores with a
bricks-and-mortar presence will be able to distribute their
goods-putting Amazon and eBay, as well as smaller online
retailers and cataloguers, at a disadvantage.
According to the joint statement, French legislation already
allows suppliers to refuse to let retailers without physical
stores stock their products “where the need for such
outlets is justified”. However, the associations are
concerned that the new rules will be used by brand owners to
“exclude online or catalogue-only retailers from the market
in which they operate”.
The associations call for the new rules-specifically point 54
which directly relates to this issue-to be reexamined so that a
supplier wishing to uphold the ruling is required to provide
“an objective justification for excluding a retailer,
depending on the products and the online retailers
involved”.
Among other concerns are that the restrictions would drive prices
up, limit consumer choice, and restrict competition. The new
regulations come into force this June and will be valid until
2022, with a one-year transitional phase.
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