The US clothing company Guess was fined €40m by European Union antitrust regulators on December 17. An investigation by launched by the European Commission two years ago found that Guess illegally blocked cross-border sales in Europe.

The investigation followed a year-long inquiry into the cross-border online sales practices of 1,900 companies.

As reported by the Reuters news agency, the European Commission said Guess’ distribution deals with retailers restricted them from using the Guess brand names and trademarks for online search advertising and also prevented them from setting the retail price independently.

Retailers were also required to get authorisation from Guess before they were allowed to sell online, while the criteria for such approval was not based on any specified quality criteria. Sellers were also not allowed to sell to consumers outside their authorized areas.

According to the Commission, this system allowed Guess to partition off certain European markets, resulting in retail prices 5-10% higher in central and eastern Europe than in western Europe, the Commission said. The illegal practices occurred up to October 31 last year.