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Australia to probe apparel importers over online deals
May '12
The Australian Competition and Consumer Commission (ACCC) will investigate into agreements entered into by apparel importers with international suppliers for stopping sales of their products to Australian consumers on overseas websites.

The announcement came following reports that an increasing number of Australian importers are entering into agreements with global apparel brands for either hiking the prices of their garments for purchase through their online portals or for completely putting a break on selling their clothes online to Australian consumers.

ACCC Chairman Rod Sims said such uncompetitive practices violate competition legislation and hence, companies found flouting the law would be prosecuted.

He said it is their top priority to make sure that Australians get advantage from the online revolution. He added that the Competition and Consumer Act provisions would be used against those companies where evidence is found that they have entered into exclusive agreements that reduce competition or hike suppliers' prices.

Reacting to the ACCC Chairman's statement, local distributors said such a step could invite closure of several Australian apparel wholesalers and retailers.

The Fashion Distributors Association of Australia said the distributors, who have exclusive rights to market and sell global apparel brands in Australia, are forced to enter into such agreements with the international brands in view of the Government's reluctance to reduce the Au$ 1,000 GST-free threshold for imported goods.

If the Government decreases the GST threshold to Au$ 50 or Au$ 100, distributors will not enter into such deals as their prices would instantly become competitive with those offered on overseas websites, it added.

Fibre2fashion News Desk - India

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