The Australian consumer watchdog has commenced an investigation into Pandora Australia’s actions against high-profile US jewellery brand Alex and Ani.
The matter started in December 2015 when former Pandora Australia president Karin Adcock announced she had secured the Australian and New Zealand distribution rights to Alex and Ani.
One week later, on 14 December, Pandora Australia and New Zealand president Brien Winther advised the brand’s retail stockists, “Pandora would not consider allowing you to distribute Alex and Ani products from your store whilst you are an authorised Pandora retailer.”
In a confidential email, Winther reminded stores about the terms and conditions of their Authorised Retailer Agreement, adding, “… you must not sell any products that could reasonably be regarded as Competing Products of Pandora Jewelry unless of course Pandora has previously given you written approval to do so.”
The email came as a shock to many in the industry, with reports of stores contacting Pandora to complain.
Several retailers subsequently raised the matter with the Australian Competition and Consumer Commission (ACCC) for breach of the Consumer and Competition Act 2010. The issue was also brought to the attention of the New Zealand Commerce Commission.
Jeweller can now confirm that senior ACCC investigators have contacted a number of people and conducted in-depth interviews in relation to the matter.
One person, who wished to remain anonymous, said the ACCC investigators were well informed of the situation, while another said the investigators were “ascertaining if there is a prima facie case”– that is, sufficient evidence to support it.
When asked in December why Pandora had not acted on products similar to Pandora such as Endless, Thomas Sabo, Nikki Lissoni and Chrysalis, Winther responded, “Every situation is different.”
Adcock said she believed that the Pandora and Alex and Ani products were quite dissimilar, adding that the only ‘competition’ she could see was for the consumer dollar, while Winther told Jeweller that Australia was taking a lead from the US where Alex and Ani was seen as a direct competitor to Pandora.
As previous Jeweller reports have explained, Section 47 of the Act deals with exclusive dealing, which is broadly described on the ACCC’s website as follows: “Exclusive dealing occurs when one person trading with another imposes some restrictions on the other’s freedom to choose with whom, in what, or where they deal. Most types of exclusive dealing are against the law only when they substantially lessen competition, although some types are prohibited outright.”
The ACCC website mentions one type of exclusive dealing, ‘full line forcing’, whereby a supplier refuses to supply goods or a service unless the intending purchaser agrees not to buy goods of a particular kind or description from a competitor.
Jeweller contacted the ACCC and was told that the commission did not comment on “potential investigations”.