When your brand new car breaks down, you can contact an official garage, or opt for an often less expensive independent repair service. If your expensive watch stops working, you often do not have that option. Only a selective club of repairers may call themselves ‘official repairers’ and only they will have access to the parts and know-how needed for repair. The European authorities were asked whether such a closed repair network is allowed.
The trend towards a more limited but higher-quality repair network can be found today in various sectors where manufacturers and importers want to extend to the secondary services market the quality and luxury offered to consumers on the primary product market. In that scenario, manufacturers and importers select a limited number of previously screened repairers who meet strict, objective and non-discriminatory criteria. Only these selected repairers are supplied with repair parts.
You might ask yourself whether this trend toward fewer repairers is in fact allowed. What about free competition on the repair market? A recent ruling by the European General Court of 23.10.2017 in the case T712/14, between the European Confederation of Watch & Clock Repairer’s Associations and the European Commission, brings further clarification.
Open repair network in the automotive sector
The motor vehicle sector traditionally has sector-specific legislation with its own directives. The European Commission does not hide the fact that it wishes to keep the repair market open. This means that the so-called 3Ts (technical info, tools and training) must also as a rule be offered to ‘independent market participants’. This includes, for example, independent repairers, but also roadside assistance services and distributors of spare parts.
In short, in the automotive sector, the gates to the repair network must essentially be kept open, and know-how and components must not be reserved solely for the official network.
Closed repair network for luxury watches
The recent judgement of 23.10.2017 examined whether the compulsory ‘openness’ of the repair network also applies to the luxury watches segment. The judge came to the conclusion, as did the Commission, that the rules of the automotive sector do not apply here. Because, according to the European General Court, not only does the watch sector rely on a much less profitable repair market, but the need to have many repair centres close to the consumer is less important: watches can – quite easily – be sent to a specific repair point. There is, therefore, no need for an abundance of repairers.
The enormous complexity of the restoration of these luxury timepieces and the prevention of counterfeit watches were also cited as reasons by the General Court to follow the luxury watch manufacturers in the reasoning that the sector needs limits to guarantee quality.
What about other sectors?
Whether the judgment can analogously be applied to other sectors cannot be said with certainty. What can be said is that if a watch is not a car, and the repair markets differ, the same reasoning may possibly apply to many other ‘high quality’ and ‘high tech’ products. After all, these types of products can easily be distributed via a high-quality distribution network. It therefore looks as if we will increasingly evolve towards high-quality repair networks, parallel to high-quality distribution networks.
Quality above all else, also in repairs. So take a deep breath when your watch dial goes on the blink again.
Tine Bogaerts
Daan De Jaeger
