Fashion brand Giorgio Armani and one of its companies were penalised US $ 4 million by Italy’s antitrust authority for engaging in unfair business practices, the agency said Friday.
The Giorgio Armani group has denied the charge and stated that it will challenge the decision.
In contrast to the real working conditions at suppliers and subcontractors, the two businesses “issued misleading ethical and social responsibility statements,” the regulator said.
The authority pointed out that Armani contracted with outside producers to produce the majority of its bags and leather accessories. These outside vendors then subcontracted to other manufacturers, some of which violated health and safety regulations and illegally employed workers.
Despite promoting sustainability as part of its marketing strategy, the watchdog claimed that Armani’s claims did not accurately represent the state of some of its extended supply chain.
When Italian authorities placed one of Armani’s divisions under judicial administration last year, the matter initially came to light. However, in February, the measure was removed.
The Giorgio Armani business said in an official statement that it expressed “disappointment and bitterness” by the regulator’s decision and that it plans to appeal it in a regional administrative court in Italy.
In order to determine whether the French fashion brand had deceived customers, Italy’s antitrust watchdog opened a similar probe against Dior, which is owned by LVMH, last year. In order to avoid penalties, Dior agreed to a number of remedies in a deal negotiated in May.
Due to labour violations found in their supply chains, Italian authorities earlier this year also placed luxury brand Valentino and cashmere specialist Loro Piana under judicial administration.
