Introduction
Between the prestige of the “Made in France” label, the protected status of haute couture, and the complexity of selective distribution networks, luxury houses operate within a dense legal environment. Manufacturers, distributors, and commercial agents are not subject to the same rules, and confusing these statuses can prove costly when a contract ends. As online sales reshape traditional networks and due diligence obligations multiply, what are the key rules for securing the manufacture and distribution of luxury goods in France?
Haute couture, a legally protected designation
The term ‘haute couture’ is not a marketing claim: it is a legally controlled designation in France. Only houses approved under the official procedure may use it. The ‘Haute Couture’ designation is granted by ministerial decision, following the opinion of a control and classification commission established within the Fédération de la Haute Couture et de la Mode.
To qualify, a house must in particular:
- design made-to-order garments for private clients;
- own at least two workshops, one of which must be in Paris;
- employ at least twenty employees;
- present two runway shows per year in Paris, traditionally in January and July, comprising at least 25 looks combining day and evening wear.
These criteria may nonetheless be applied with some flexibility, particularly for smaller houses.
Example: a young brand promoting itself as ‘haute couture’ without meeting these criteria risks being found liable for a misleading commercial practice and unfair competition, regardless of its style or price point.
The ‘Made in France’ label: a regulated but non-trivial guarantee
Consumers are increasingly attached to the ‘Made in France’ label, which is also viewed internationally as a mark of quality. This label indicates that a product was mainly manufactured and assembled in France. No prior authorisation is required to use it, but manufacturers must comply with non-preferential origin rules, and indicating a false origin is unlawful.
Two levels of control apply:
- the DGCCRF, which investigates the proper use of the label within France;
- French Customs, which controls compliance with origin rules and may, at the request of businesses, issue a Made in France Information ruling (IMF) determining whether a product may bear a French-origin marking.
Consumers can also report misleading practices relating to product origin through the Signal Conso platform.
Manufacturing contracts and sensitive materials
Contracts entered into with manufacturers, subcontractors, and suppliers are a key issue for luxury houses. They should notably govern confidentiality, ownership of creations and know-how, subcontracting conditions, quality requirements, material traceability, and the respective liabilities of the parties.
Particular vigilance is required where products incorporate materials subject to specific regulations, notably certain furs, leather from protected species, and diamonds.
Distributor or commercial agent: two statuses, two very different legal regimes
Under French law, it is essential to avoid confusing a distribution agreement with a commercial agency agreement: the consequences of termination differ radically depending on the qualification applied.
| Distributor | Commercial agent | |
| Nature | Buys and resells in its own name and on its own account, setting its own margin | Negotiates or concludes contracts in the name and on behalf of the principal |
| Organisation of the relationship | May be appointed for a defined territory, on an exclusive or non-exclusive basis | Relationship governed by the specific status of commercial agents under articles L. 134-1 et seq. of the French Commercial Code. |
| Termination | No statutory compensation in principle for loss of customers or business; compensation may nonetheless be awarded in certain circumstances | Compliance with a statutory notice period, except notably in case of serious misconduct, and a right in principle to compensation upon termination |
| Notice period | No fixed statutory period: its length depends in particular on how long the relationship has lasted and industry practice | Notice period set by the statutory regime governing commercial agency |
| Risk in case of termination | Possible liability for the sudden termination of an established commercial relationship; a notice period of at least 18 months in principle rules out liability for insufficient notice | The termination indemnity is separate from the notice period and remains due in principle, subject to the exceptions provided by law |
Selective distribution, the preferred model for luxury goods
Selective distribution is the most commonly used distribution structure for luxury goods in France. It may fall outside the prohibition on anticompetitive agreements where resellers are chosen on the basis of objective, qualitative criteria, applied uniformly and without discrimination, where the characteristics of the product require such a network to preserve its quality, and where the criteria do not go beyond what is necessary (the so-called ‘Metro’ criteria, from the October 25, 1977 decision of the European Court of Justice in case 26/76).
Even where an agreement does not strictly meet these conditions, it may benefit from the exemption under the Vertical Block Exemption Regulation (VBER), subject in particular to the condition that the supplier’s and buyer’s market shares do not exceed 30% and that the agreement does not contain hardcore restrictions. Under this framework, the supplier may set qualitative or quantitative criteria for appointing distributors. The supplier may, under conditions, prevent its authorised distributors from selling to unauthorised resellers in the relevant territory, but may not restrict sales to end customers.
Online sales and selective distribution: what a contract can (and cannot) provide
A selective distribution agreement cannot prevent distributors from making effective use of the internet as a sales channel. This principle was established by the Court of Justice of the European Union in the Pierre Fabre case of October 13, 2011 (No. C-439/09). Indeed, the objectives of preventing counterfeiting and preserving a brand’s prestigious image do not, on their own, justify preventing distributors from making effective use of the internet.
A selective distribution agreement may, however, impose certain conditions on how products are sold online. A supplier may, for example, impose requirements relating to a distributor’s website or restrict the use of online marketplaces, as the Court of Justice accepted in the Coty case of December 6, 2017 (No. C-230/16). The French Commercial Practices Review Commission also confirmed, in opinion No. 24-5 of April 9, 2024, that marketplace bans are not, in themselves, contrary to competition law for luxury goods, and do not require the distributor to operate a physical store.
Import, export, and due diligence: key control points
No specific customs rules apply to fashion and luxury goods: they follow the standard regime applicable to goods imported from non-EU countries, with import duties ranging, depending on the product, from 0% to around 17% of value.
Certain materials and financial flows are, however, subject to heightened scrutiny:
- exotic leather is governed by CITES (the Convention on International Trade in Endangered Species of Wild Fauna and Flora), which requires a licensing system for import, export, and re-export;
- diamonds fall under the Kimberley Process, aimed at ending the financing of armed conflict through the trade in ‘blood diamonds’;
- since 2021, a cooperation protocol between the DGCCRF and TRACFIN has strengthened anti-money-laundering and counter-terrorism-financing oversight in the luxury sector, notably jewellery and watchmaking;
- as an EU member state, France enforces trade sanctions against Russia and Belarus, which include an export ban on certain luxury goods.
Finally, Law No. 2017-399 of March 27, 2017 on the corporate duty of vigilance requires parent companies employing at least 5,000 employees in France (or 10,000 worldwide) to establish, implement, and publish a vigilance plan covering their entire value chain, including subcontractors and suppliers.
Practical checklist before signing a manufacturing or distribution contract
- Clearly qualify the relationship (distributor, commercial agent, business introducer) to anticipate the consequences of termination;
- check that reseller-selection clauses are consistent with the Metro criteria and the VBER;
- regulate, without banning, online resale (website charter, marketplace restrictions);
- provide for a notice period proportionate to the length of the relationship;
- include compliance clauses for sensitive materials (fur, exotic leather, diamonds);
- anticipate the group’s applicable vigilance and non-financial reporting obligations;
- verify the lawful use of ‘haute couture’ and ‘Made in France’ claims in commercial communications.
Conclusion
Manufacturing and distributing luxury goods in France sits within a demanding legal framework that combines protected designations, competition law, and compliance obligations. The line between distributor and commercial agent, the balance between selective distribution and online sales, and the traceability of sensitive materials are the priority areas of vigilance for securing these commercial relationships over the long term.
Dreyfus Law Firm assists its clients in managing complex intellectual property cases, offering personalized advice and comprehensive operational support for the complete protection of intellectual property.
Nathalie Dreyfus, with the support of the entire Dreyfus team
Q&A
Must a distribution agreement be in writing to be valid?
No: a verbal or implied agreement can be enough to establish an ‘established commercial relationship’ protected against sudden termination. A written contract is nonetheless strongly recommended to secure each party’s rights and obligations.
What happens if a distributor breaches a marketplace-restriction clause?
It exposes the distributor to a contractual claim from the supplier (formal notice, termination for cause, damages), separate from any competition-law sanction, since the clause itself is lawful.
Can a supplier unilaterally switch existing distributors to a selective distribution model?
No: such a substantial change to the contract cannot be imposed unilaterally. It requires either the distributor’s agreement or compliance with the termination notice period applicable to the ongoing relationship.
Must a selective distribution agreement be notified to a competition authority before implementation?
No: the Vertical Block Exemption Regulation operates on a self-assessment basis. Companies assess for themselves whether their agreement meets the Metro criteria and the Regulation, with no prior authorisation procedure.
Is misuse of the ‘Made in France’ label subject to criminal sanctions?
It can be characterised as a misleading commercial practice under the French Consumer Code, exposing the offender to criminal and administrative sanctions distinct from the DGCCRF’s and Customs’ controls.
Does the duty of vigilance cover subcontractors located outside France?
Yes: the law covers the group’s entire value chain, including subsidiaries, subcontractors, and suppliers established abroad, provided they fall within its vigilance scope.
This publication is intended for general public guidance and to highlight issues. It is not intended to apply to specific circumstances or to constitute legal advice.