Coty can impose online sales ban on luxury products

Luxury beauty company Coty can stop retailers from selling its products online, Europe’s top court has ruled.

The European Court of Justice (ECJ) said a supplier could prohibit the selling of its goods on platforms such as Amazon to protect its luxury image.

European Court of Justice.

It said: "A supplier of luxury goods can prohibit its authorised distributors from selling those goods on a third-party internet platform such as Amazon.

"Such a prohibition is appropriate and does not, in principle, go beyond what is necessary to preserve the luxury image of the goods."

The case involved Coty’s German subsidiary and German retailer Parfumerie Akzente, which sells Coty’s goods on sites including Amazon against the company’s wishes.

Coty told the court that its main concern was to safeguard the cachet of its luxury brands such as Marc Jacobs, Calvin Klein and Chloe.

Brand owners have previously argued that they should have the right to choose their distributors to protect their image and exclusivity.

Online platforms say such curbs are anti-competitive and hurt small businesses.

The issue is significant in Europe, whose companies account for 70% of global luxury good sales.

Coty brought the original case in a Frankfurt court, which subsequently sought guidance from the ECJ.

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