US sports brand Nike was fined 12.5 million euro ($14 million) on Monday by European Commission (EU) for blocking cross-border sales of soccer merchandise for some of Europe’s best-known clubs.
According to reports in Reuters, the EU said that Nike’s illegal practices occurred between 2004 to 2017 which were related to licensed merchandise for FC Barcelona, Manchester United, Juventus, Inter Milan, AS Roma and the French Football Federation. The sanction came after a two-year investigation triggered by a sector inquiry into e-commerce in the 28-country bloc. The EU wants to boost online trade and economic growth.
The case focused on Nike’s role as a licensor for making and distributing licensed merchandise featuring a soccer club’s brands.
European Competition Commissioner, Margrethe Vestager stated that Nike’s actions deprived soccer fans in other countries of the opportunity to buy their clubs’ merchandise such as mugs, bags, bed sheets, stationery and toys.
“Nike prevented many of its licensees from selling these branded products in a different country leading to less choice and higher prices for consumers,” she said in a statement.
Nike’s practices included clauses in contracts prohibiting out-of-territory sales by licensees and threats to end agreements if licensees ignored the clauses. The fine was cut by 40 percent after the brand cooperated with the EU enforcer.