Court to rule on online luxury resellers

Amazon Marketplace enables third-party sellers to sell new and used goods

One of Europe's top courts is due to open a landmark case that could determine whether luxury goods companies can ban online sales.

The case has been brought by German make-up and perfume brand Coty. It wants to stop one of its retailers from selling its goods on online marketplaces such as Amazon.

Owners of luxury brands argue that they should have the right to choose who distributes their products, to protect their image and exclusivity.


The dispute is in the spotlight now because the European Commission is pushing for more cross-border online sales to boost growth and jobs and catch up with the US and Asia.

Among other questions, the court will consider whether protection of a luxury image is a legitimate reason for a selective distribution system. The case originally went to a court in Germany, but, later, guidance was sought by the European Court of Justice.

The ruling could have a significant impact on the future relationship between brands and resellers and impose widespread bans on the sale of luxury goods on Amazon Marketplace and eBay.

As well as fighting to control their distribution channels, luxury brands are also battling to control the amount of counterfeit goods online. Matt Jones, a solicitor at law firm EIP said the ruling would provide clarity on where luxury goods can be sold.

"Luxury brands do not want their stuff sold on platforms that also sell fake goods and cheap alternatives," he told the BBC.