An Economic Analysis of the Use of Selective Distribution by Luxury Goods Suppliers

"This article discusses the economic foundations of competition policy towards vertical restraints on distribution and applies this analysis to the selective distribution restraint in the sale of luxury goods. It also addresses some policy questions raised by the European Commission in the context of its ongoing revision of the Vertical Restraints Guidelines (Guidelines): whether the distinction between active and passive sales makes sense in an internet context, and whether luxury goods suppliers should be subject to regulatory restrictions when setting the criteria for retailers to join their selective distribution networks."