Fashion and luxury newsletter

ICA fines Armani Group €3.5 million for misleading social responsibility claims

On 16 July 2024, the Italian Competition Authority (ICA) launched an investigation (case PS12793) into Giorgio Armani S.p.A. and G.A. Operations S.p.A. for disseminating misleading ethical and social responsibility statements capable of influencing consumers’ commercial decisions. Following its investigation, the ICA issued its decision on 29 July 2025, finding that the companies engaged in an unfair commercial practice in violation of Articles 20 and 21 of the Italian Consumer Code and imposed an administrative fine of €3.5 million.

Specifically, the ICA held that from April 2022 to February 2025, the two companies issued non-verifiable and inaccurate claims regarding their commitment to employees’ rights and sustainability. The ICA’s investigation revealed that the problematic statements were found across various channels, including the companies’ Code of Ethics and the websites armani.com and armanivalues.com. While the companies publicly promoted a strong commitment to social responsibility throughout their supply chain, the ICA’s investigation revealed that a substantial part of their production of leather goods and accessories had been outsourced to suppliers and sub-suppliers operating under illegal or highly inadequate conditions.

This case establishes a clear precedent: ethical and social responsibility claims leveraged as commercial attributes must withstand the same rigorous legal scrutiny applicable to all advertising communications. Should such claims be found to be misleading, the resulting financial penalties and reputational damage may be significant, including potentially leading to serious erosion of consumer trust.

Key takeaways from the EC’s Pierre Cardin case

On 28 November 2024, the European Commission (EC) fined Pierre Cardin and its licensee, Ahlers Group, €5.7 million for restricting cross-border sales and limiting access to certain customer groups, in breach of EU competition rules.

According to the EC, the companies entered into agreements to block other licensees and their customers from selling Pierre Cardin products outside allocated territories and to prevent sales to discount retailers. This would have granted Ahlers territorial exclusivity in breach of EU internal market rules.

On 6 February 2025, Ahlers appealed to the General Court (Case T-87/25), seeking the annulment of the EC’s decision or, in the alternative, a reduced fine. The case is pending, and the date of the hearing is not available yet.

This case reinforces the principle that, within the EU, retailers and distributors should generally be free to sell products wherever and to whomever they choose (unless a relevant exemption applies, noting the EU Vertical Agreements Block Exemption Regulation recognises that certain territorial and customer restrictions can be permissible in the context of exclusive distribution and selective distribution systems) The EC consistently treats territorial restrictions designed to segment the internal market as serious infringements of competition law and this case is part of the EC’s broader action against restrictions of parallel trade within the EU. The case therefore highlights the need for fashion companies (like companies in all sectors) to ensure full compliance with EU competition rules, taking care to avoid problematic territorial and customer restrictions. To mitigate risks in this regard, companies should implement robust systems for continuous monitoring and regular review of their distribution agreements and commercial practices.

To read more about this case, see: Fashion faux pas! Pierre Cardin and its distributor Ahlers fined for carving up the EU internal market through anticompetitive licensing agreements, Alexandra Rogers, Matej Ovecka

SHEIN sanctioned for deceptive marketing: EU and national investigations ongoing

On 26 May 2025, the European Commission and the Consumer Protection Cooperation (CPC) Network formally notified SHEIN of multiple breaches of EU consumer law, following a joint investigation by authorities in Belgium, France, Ireland and the Netherlands. The alleged beaches include fake discounts, artificial urgency tactics, misleading return policies, deceptive product labelling, greenwashing, and lack of transparency regarding contact information. 

SHEIN was given until 26 June 2025 to respond and submit proposed commitments before the national authorities could impose enforcement measures, including fines based on SHEIN’s annual turnover in the relevant EU Member States.

On 3 July 2025, the French consumer authority – France’s Directorate for Competition, Consumer Affairs and Fraud Prevention (DGCCRF) – fined SHEIN €40 million after finding that most promotions between October 2022 and August 2023 were misleading, and that environmental claims lacked supporting evidence. In a statement issued in response, SHEIN confirmed that it had received a warning from the DGCCRF in March 2024 and implemented corrective actions by May 2024. SHEIN also stated that these measures did not impact consumer prices and reiterated its commitment to transparency and regulatory compliance. The DGCCRF has stated that it will continue to monitor SHEIN’s commercial practices to ensure ongoing compliance.

The joint investigation is being run in parallel with a Digital Services Act (DSA) investigation, with SHEIN having been designated as a Very Large Online Platform (VLOP) in April 2024, in accordance with Article 33 of the DSA. On 6 February 2025, the EC published a press release announcing that it had sent SHEIN a request for information, seeking internal documents and more detailed information on risks linked to the presence of illegal content and goods on its marketplace, the transparency of its recommender systems, and access to data for qualified researchers. SHEIN had to provide the required information by 27 February 2025, and the Commission will determine next steps based on its assessment of the information provided. This could entail the formal opening of proceedings pursuant to Article 66 of the DSA. 

The CPC Network's coordinated action against SHEIN is without prejudice to separate proceedings by national authorities – including proceedings in Italy by the ICA. Similarly, the coordinated action is without prejudice to investigations and proceedings that the European Commission has initiated under the DSA or may decide to initiate in the future. 

The SHEIN investigations illustrate the increasing enforcement pressure on online fashion platforms to comply with EU consumer protection and digital regulation requirements. Allegations of misleading practices, greenwashing, and lack of transparency – combined, in SHEIN’s case, with obligations under the DSA as a Very Large Online Platform – highlight the need for fashion companies to ensure that their digital interfaces, marketing strategies and sustainability claims are accurate, verifiable and user-friendly. To remain compliant, companies should establish proactive systems for monitoring, auditing and updating their consumer-facing practices and digital operations, including to ensure alignment with evolving regulatory requirements across the EU.