EU Probes Watch Manufacturers Over Parts Supply Policies

Parts Policy Probe

European Union (EU) antitrust regulators have announced that they will investigate claims that luxury watch manufacturers are refusing to supply spare parts to independent watchmakers and repairers, a breach of EU competition rules. The European Commission did not identify the companies involved in the probe, however Swatch Group has confirmed that it is one of the targets.

Reuters quotes Swatch Group spokesperson Beatrice Howald as stating that the investigation “concerns almost the entire watch industry” and that Swatch Group is “confident regarding the outcome of this investigation.” As this story goes to press, Richemont and LVMH have not issued statements.

The regulators will investigate a complaint lodged in 2004 by the European Confederation of Watch & Clock Repairers’ Associations, or CEAHR. That complaint claimed that the manufacturers’ parts policies threaten to drive independent watchmakers out of business, as there are no alternate sources for most spare parts.

The complaint was rejected in 2008, however this past December the Luxembourg-based General Court of the European Union annulled the rejection, saying regulators erred in dismissing it.

In a statement issued last week, regulators said “An initiation of proceedings does not imply that the commission has conclusive proof of an infringement. It only means that the commission will investigate the case as a matter of priority”.

How long the investigation might take remains unclear.

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