The Swiss Competition Commission (Comco) has announced that it is opening an investigation against Swatch Group arising out of the Group’s plan to stop supplying mechanical watch movements and components to third parties. Comco said yesterday that the purpose of the investigation is to determine whether Swatch Group’s decision is an abuse of its dominant market position and so a violation of the cartel law.
In a press statement, Swatch Group said that it initiated the Comco investigation itself in an effort to find a mutually agreeable solution to allow the Group to reduce its deliveries to third parties, which Swatch Group says is in the interest of the entire watch industry.
The parties have agreed that Swatch Group will be allowed to decrease deliveries next year.
In September 2009, WatchTime reported that Comco had opened an investigation into ETA’s business practices, and in December of that year, then-CEO Nicolas G. Hayek Sr. stated in an interview “We no longer intend to produce or deliver to third-party watchmakers.”
Hayek Sr. passed away in June 2010, and in a recent interview with WatchTime’s Joe Thompson, Hayek’s son and successor Nick Hayek reiterated his support for the policy announced by his father: “We are committed to continue to reduce deliveries to third parties, as my father said. We want to continue to deliver [movements and components] to some partners in the industry. But we must have the right to say ‘This one, yes’ and ‘This one, no.’ Not everybody can come in, as in a supermarket, and say, ‘You have to give me parts.’ We can decide. That’s what we are working on with the cartel commission. We met with them, and both sides agreed to further explore ways of achieving this. It will take some time.”
You can read the complete interview with Nick Hayek in the June issue of WatchTime, on newsstands now.
