Swatch Group AG, the world’s biggest watchmaker, is among timepiece manufacturers being probed by European Union antitrust regulators over allegations they refused to supply spare parts to independent watch menders.
The European Commission said today it will investigate a 2004 complaint by the European Confederation of Watch & Clock Repairers’ Associations, or CEAHR, after an EU court ruled that regulators were wrong to dismiss the group’s objections.
The probe “concerns almost the entire watch industry,” Swatch said in a statement. “We are confident regarding the outcome of this investigation.”
The maker of Omega and Breguet watches reported a 24 percent increase in earnings in the first half as rising incomes in Asia fueled demand for luxury goods. LVMH Moet Hennessy Louis Vuitton SA, the maker of Tag Heuer watches, said net income climbed 25 percent in the first half.
The start of EU formal antitrust proceedings “means that the commission will investigate the case as a matter of priority,” regulators said in an e-mailed statement. Companies risk fines of as much as 10 percent of global yearly revenue if they are found guilty of violating EU competition rules.
Cie. Financiere Richemont SA, the maker of Cartier watches, supported EU regulators in the court case defending their prior decision not to begin an investigation. Alan Grieve, a spokesman for Richemont, declined to comment.
Olivier Labesse, a spokesman for LVMH, and Virginie Chevailler, a spokeswoman for Rolex, declined to comment on the probe. A spokesman for Patek Philippe wasn’t immediately available. CEAHR didn’t immediately respond to an e-mail seeking comment.