by Joana Whyte, Associate Lawyer at SRS Advogados and member of CEDU
Until recently, the fashion industry had never been an obvious sector of focus for competition authorities. However, in the past few months, national competition authorities from Italy, the United Kingdom and France have been particularly attentive to this industry, initiating investigations for competition law infringements which culminated in the imposition of fines on several entities, reminding us all that competition law applies to all sectors of the economy.
In November 2016, the Italian Autorità Garante della Concorrenza e del Mercato concluded that eight major modelling agencies, representing 80% of Italy’s market share, including Elite Model Management, Major Model Management and the association of the fashion industry – Assem, had participated in a cartel during the relevant period from May 2007 to March 2015. The activity occurred in the context of negotiations with customers, including fashion houses, luxury car dealers, consumer goods brands and advertising companies on services ranging from runway shows to photoshoots for catalogues and promotional events.
The investigation was triggered by a leniency application put forward by IMG Italy, S.r.L on 18th September 2014. Following a thorough investigation, the Italian Competition Authority applied a total fine of €4.5 million on the investigated entities[i]. The evidence provided by IMG was considered to be decisive for the investigation. In particular, IMG provided useful elements for understanding the nature of the cartel, the purposes it pursued, and the ways in which it was achieved, and therefore was granted total immunity by the Autorità.
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