Protecting the Single Market: vertical restraints back in focus

Over the past eighteen months, the European Commission has (re-) intensified its scrutiny of resale price maintenance (RPM), online sales restrictions, and practices restricting parallel trade. Fines very recently imposed on Gucci, Chloé, and Loewe reaffirm that vertical restraints are once again a central enforcement priority for the Commission. 
 

Latest enforcement action against Gucci, Chloé and Loewe

On 14 October 2025, the Commission fined Gucci, Chloé, and Loewe a total of €157m for imposing fixed or minimum resale prices on their independent distributors, in breach of Article 101 of the Treaty on the Functioning of the European Union (TFEU), which prohibits agreements that prevent or restrict competition within the Single Market.

The Commission found that Gucci, Chloé and Loewe (together the “Fashion Companies”) ran textbook RPM schemes across almost their entire product ranges (including apparel, leather goods, shoes, and fashion accessories) throughout the European Economic Area (EEA). The Fashion Companies restricted both their online and brick-and-mortar retailers from freely setting their retail prices, by requiring them not to deviate from: 

• recommended retail prices;
• maximum discount rates; and/or
• specific periods for sales. 

The Fashion Companies sought to have their independent retailers apply the same prices as in the Fashion Companies’ direct sales channels, thus eliminating any price competition at the retail level. In addition, Gucci imposed online sales restrictions for a specific product line, by requiring its retailers to stop selling the product online. The Fashion Companies monitored retailers’ prices and pursued deviators, securing widespread compliance. 

Under EU competition law, RPM arrangements between suppliers of goods and their independent distributors are viewed as “hardcore restrictions” and generally presumed to infringe Article 101 TFEU without having to examine their actual effects on the market. Blanket bans on online sales are also treated as hardcore restrictions.

The Commission pursued separate investigations against each of the Fashion Companies, having opened them on an ex officio basis. However, it announced the fines together, given the periods of infringement overlapped and many of the affected retailers sold products from all three Fashion Companies. As is typical in such cases, the infringement decisions were not addressed to the relevant retailers – despite them being party to the anticompetitive agreements. 

The Gucci/Chloé/Loewe cases are not isolated decisions 

Recent enforcement by the Commission 

The Gucci, Chloé, and Loewe decisions follow a pair of recent Commission cases that reaffirmed its enforcement priorities on vertical restraints and Single Market integrity:

November 2024: Pierre Cardin 

In this case, the Commission found a single and continuous infringement involving both (i) contractual clauses; and (ii) coordinated actions within Pierre Cardin’s exclusive licensing network that partitioned the EEA. More specifically, the Commission found that:

• Pierre Cardin included clauses in its licence agreements that: restricted all out‑of‑territory sales, including “passive” (i.e. unsolicited) sales; imposed total bans or prior‑authorisation requirements on online sales; and prevented licensees from selling to customers who failed to guarantee they would not exports the products. Further restrictions included prohibitions on sales to duty‑free shops, discounters and supermarkets, and broad “prestige” clauses backed by monetary penalties and termination rights. Although Pierre Cardin amended its template agreements in 2018 to expressly allow passive sales, many restrictive clauses and actions persisted until they were replaced or expired by July 2019.
• Ahlers (Pierre Cardin’s largest EEA licensee) implemented a monitoring system to detect parallel flows into its territories, reported back to Pierre Cardin any noticed deviation, and exerted pressure by withholding royalties to Pierre Cardin to secure absolute territorial exclusivity. Pierre Cardin intervened following Ahlers’ complaints, including sending termination or cease-and-desist letters to licensees for exporting or selling to exporters, requiring audits, and black‑listing discounters in its licence agreements. The Commission characterised these measures as concerted practices aimed at halting any out‑of‑territory sales by licensees and their customers, and limiting sales to particular customer groups. Reflecting the reinforcing role of Ahlers’ monitoring and royalty withholding, the Commission imposed a higher fine on the licensee than on Pierre Cardin. 

May 2024: Mondelez

In this case, the Commission adopted a settlement decision finding 22 infringements of Article 101 and two infringements of Article 102 TFEU across Mondelez’s chocolate, biscuit and (pre‑2015) coffee businesses. 

The infringing conduct under Article 101 involved: 

1. agreements with exclusive distributors that prevented out‑of‑territory passive sales without Mondelez’s prior consent; and
2. agreements with brokers and certain retailers that limited the Member States or customer types to whom they could resell residual or obsolete stock. 

Under Article 102, the Commission defined national wholesale markets for chocolate tablets and found Mondelez to be dominant in several such markets. On that basis, the Commission concluded that Mondelez had committed two abuses restricting cross‑border trade:

1. a refusal by Mondelez Germany to supply residual tablet products to a broker it did not “trust”, to avoid those goods being trans‑shipped into higher‑price Member States; and
2. delisting of certain chocolate tablets in the Netherlands, to stop them being re‑sold in Belgium, thereby easing price pressure there.

The decision highlights that constraints on cross‑border flows can attract enforcement under both Articles 101 and 102, and that territorial restrictions may be sanctioned alongside exclusionary conduct when their objective and effect is Single Market partitioning. 

A slight pause in enforcement

The Mondelez and Pierre Cardin infringement decisions followed a relatively quiet spell for Commission enforcement against vertical agreements and other conduct that risks fragmenting the Single Market. The last comparable case was over three years ago, in January 2021: the Video Games geo-blocking case, in which a PC game distributor and five video game publishers were fined for restricting cross-border sales of digital PC games through the use of territory-based activation keys. 

By way of contrast, in the preceding period going back to 2018, enforcement was brisk, with the Commission delivering a steady flow of decisions focusing on vertical practices restricting cross‑border trade and maintaining artificially high prices. Notable cases include:

• AB InBev (2019), in which the Commission found an abuse of dominance in the Belgian off-trade wholesale beer market, in relation to practices that hindered parallel imports from the Netherlands, including supply limitations during Dutch promotions, packaging changes to deter resale in Belgium, and promotions being conditional on not applying in Belgium.
• Sanrio (2019), Nike (2019), and NBC Universal (2020). In each of these cases the Commission sanctioned the relevant companies under Article 101 TFEU for restricting sales of licensed merchandise across territories. The licensors maintained non-exclusive licensing agreements that contained direct out‑of‑territory restrictions (such as clauses prohibiting sales outside the licensed territory, language limitations, notification obligations, and obligations to remit revenues from out‑of‑territory sales) and indirect enforcement measures (including audits and termination of contracts for breaches of those restrictions). Some also restricted online sales.
• Guess (2018): The Commission sanctioned fashion brand Guess under Article 101 TFEU for geo‑blocking and other restrictions in a selective distribution system that limited authorised retailers’ ability to advertise online, sell online, sell cross‑border and set resale prices. These included restrictions on the use of Guess trademarks in online search advertising, discretionary authorisation requirements for certain online sales, bans on sales outside allocated territories, restrictions on cross‑selling among authorised wholesalers and retailers, and resale pricing restrictions.

The Mondelez and Pierre Cardin decisions, and, more recently, the Gucci, Chloé and Loewe decisions, therefore signal a re‑acceleration in enforcement against such practices, reaffirming the Commission’s commitment to protecting the Single Market across both traditional and digital distribution.

Regulatory and legislative initiatives 

The enforcement upswing has been accompanied by regulatory refresh. In 2022, the Commission updated its Vertical Block Exemption Regulation (VBER) and accompanying Guidelines. Notable changes from the previous version include shifts in the approach to:

• price parity clauses: wide retail parity obligations that prevent sellers from offering better terms on any other sales channel were removed from the VBER safe harbour, reflecting concerns that they suppress intra‑brand price competition across platforms and channels; and
• dual distribution: where a supplier of goods/services sells both directly to consumers and through a distributor, with whom it competes for retail sales. The safe harbour here was narrowed, with more prescriptive guidance on information exchange between such suppliers and their distributors. Protections now hinge on limiting the sharing of sensitive information to what is necessary for the distribution arrangement.

Separately, the Commission faces calls to introduce a legislative ban on cross border sales restrictions and to perfect the Single Market, so that EU companies can better scale up to compete globally. And reviews of the retail sector have highlighted the prevalence of territorial constraints in brand distribution and associated frictions for consumers and retailers. Any such legislative initiative would complement case‑by‑case enforcement, by setting clearer ex ante limits on practices that partition national markets.

Key takeaways

The Commission continues to view competition at the retail level and undisturbed cross‑border trade within the EU as priorities. Businesses should therefore closely review their distribution arrangements, as the Commission and national agencies will not shy away from challenging restrictions on intra‑brand price competition and online sales.  Companies should in particular ensure compliance with the latest VBER and associated Guidelines, with particular attention to possible RPM, online sales restrictions, territorial and customer group limitations, price parity obligations, and information exchange in dual distribution. For operations in the UK, the UK Vertical Agreements Block Exemption Order (VABEO) and accompanying CMA guidance should be applied in parallel, noting areas of alignment and divergence from EU rules.