France’s Competition Authority, the equivalent of the US Justice Department’s Anti Trust Department, has fined Rolex €91.6 million (£80 million) for preventing its authorised dealers selling new watches online.
Rolex has a worldwide policy of only selling its watches through official jewellers’ brick and mortar stores, with online used only for marketing of new watches.
Rolex does not sell directly to consumers online or through physical stores.
The French authority rejected a defence from Rolex’s lawyers that restrictions are needed to prevent counterfeiting and parallel trade in its watches.
Rolex was cited for a decade of restrictive practices that prevent its partners from selling online.
The watchmaker successfully defended its practice of enforcing recommended retail prices for its retailers, with the authority accepting that preventing the sale of fake Rolex watches and grey market trading are legitimate commercial aims.
However, its ruling noted that Rolex’s competitors have not used the same tactics despite facing similar risks.
France’s Competition Authority opened its investigation into Rolex back in 2017 following complaings from Union de la Bijouterie Horlogerie and Pellegrin & Fils.
This led to a raid of Rolex’s French offices in 2019.
Pellegrin & Fils, a former Rolex AD, said was it had been cut from the network of partners in 2013 with no justification.
The retailer’s lawyers said the “eviction” came after it tried to convince Rolex to allow it to sell its watches online, and suggested it was signed out to make it an example to other partners to keep them in line.
Rolex has declined to comment but is free to appeal to the Paris Court of Appeal.
When you visit Paris, as soon as you leave the airport you see serious problems that their government needs to tackle. Yet they spend time and money on this? Rolex should pull out of France.
Online has become has become a panacea has opposed to an option. A bricks & mortar store appears empathetic to the history of horology. Everyone loves to hate Rolex – ‘Long Live The King’.
Why shouldn’t Rolex be able to restrict its sales to physical retail? It has made the case about the necessary controls to avoid fakes and this is inarguable. Few can deny the perils of buying a watch online.
Considering that Rolex can’t make enough watches to satisfy world demand, perhaps this is to the time to just pull out of France.
Be nice to get information on any watch stories out there.
Rolex through its AD’s have been flaunting UK regulations for a long time, they are just lucky the FCA is a shambles and doesn’t understand their own regulations, so they haven’t been held to account in the UK. Good on the French for taking them on.
That last comment is sour and sore, Rolex have every right to protect their corporation and their Watches.. So, the last statement comes from bitter jealousy, probably an Omega heartthrob!
This firm is criminalised.
When you only sell from authorised rolex retailers (shops etc)and demands out strip supplies you are open to retailers picking and choosing who they sell to so basically if your face doesn’t fit you’ve no chance of buying a new watch
Do you mean that £100 Rolex I bought on line is a fake. Who’d of thought it! Get a Casio, more accurate.
Have tried buying a Rolex from their shop I n Selfridges , sure they are on display for sale but try getting passed the body guards who will prevent you getting into the store on the other hand new watches are being sold by private stores at inflated prices
In reply to “sore .. sour” comment Rolex were fined $90.m hardly sounds Iike innocent ??
And what’s this thing?
where critical comments are attacked as sore and sour? Rolex aren’t every watch owners ex wife
My immediate reaction on reading this was, pity we can’t do the same here! I wanted to buy a Rolex and so far I’ve waited 3yrs. having made a journey to an AD and been interviewed! Frankly I’m begining to doubt I’ll ever be offered one, and don’t really care any more now having bought a stunning Omega in the meantime. I simply REFUSE to pay more than the RRP to a dealer for a pre-owned one out of principal. Conversely however, it seems perverse that any company/trader should be obliged to sell online if they don’t wish to! That’s simply wrong.
I agree trying to buy a Rolex seems to be impossible! I having been on a waitlist for years with no contact! As mentioned if your face does not fit then forget it.
If I manufacture a product and clearly instruct via authorised distribution contract, that no product of mine will be sold online, well you either conform or you will not get any product from me to sell. Is that simple! Dont try to debate on this subject
My wife purchased a Submariner for my 60th birthday, went on waiting list and received a call from Goldsmiths 5 days later that one was available which she snapped up. Yes, she may have been lucky but thank you Goldsmiths.
The fine is not for failing to sell online. And no-one is trying to force Rolex to sell on-line. Rolex only sell to authorised dealers so it would be pointless in any case. The fine is for preventing authorised dealers from selling on-line if they wish to. Rolex are exercising control over independent suppliers and that is anti-competitive – hence the fine.
What might be coming down the track?
Resale price maintenance has long been illegal in both UK and EU. The UK government issued guidance on RPM with the following key points: Suppliers must not: dictate the sale price; set a minimum sale price; use threats or incentives to make resellers stick to recommended resale prices.
Resellers are entitled to set the price of the product they sell; if a seller agrees to sell at a fixed or minimum price set by a supplier, both may be found to be breaking competition law. Hiding RPM agreements (written or verbal) is illegal.
I’m not a fan of Rolex but I do believe that as a manufacturer, you should be able to decide how they are sold.
If you are a distributor then you have a simple choice which is sell the brand under the agreed conditions or don’t supply the brand.
We are talking about a luxury item and not consumables.
Surely if everything is reduced to clicks online we reduce even more human interaction, reduce the AD experience and appeal/Brand and the need for bricks and mortar stores? Besides ADs can’t get enough stock to allow online trading.
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