Luxury Retailer Disdainful of Amazon Wins Appeal

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A German court, believing Coty was acting anti-competitively, sought a ruling from European Union courts.

European competition law can not stop a luxury retailer that does not want its wares being trafficked via the online retail giant Amazon, the EU's highest court ruled Wednesday.

Many luxury brands have taken a dim view of Amazon for a long time-they want to be able to maintain their luxury image by only selling their products through high-end channels, and Amazon isn't that.

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Coty's German subsidiary and retailer, Parfumerie Akzente, had been selling Coty cosmetics on Amazon and other online sites, despite its parent asking it to stop.

The ECJ has delivered this important ruling in a case brought by Coty Germany GmbH versus Parf├╝merie Akzente GmbH, after the beauty company sought to have the unauthorised online distribution of its products banned.

"Authorised merchants such as us may sell brand-name products on outward-visible third-party platforms, provided that we meet the conditions that are necessary and reasonable for preserving the luxury image", Chief Executive Kai Renchen said in a statement.

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"After years of uncertainty, this means luxury brands can determine how they are placed on digital platforms and it is a clear ruling for the protection of luxury brands' image, the defence of our teams' work and the protection of consumers' rights and information".

However, e-tailers such as Amazon and eBay have countered that the ruling to curb online sales will be harmful to small businesses while being anti-competitive.

It is no secret that some luxury brands are not too keen on online sales. The court further said that it would not breach the rules of competition.

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