• Switzerland edition
 
Competition watchdog cuts Swatch's obligations
Swatch display at 2013 Baselworld watch and jewellery show. Photo: AFP

Competition watchdog cuts Swatch's obligations

Published: 25 Oct 2013 15:07 GMT+02:00
Updated: 25 Oct 2013 15:07 GMT+02:00

Swiss regulator Comco said it had approved a landmark deal with Swatch Group allowing the watchmaking giant to sell fewer mechanical movements to the rest of the sector.
   
The decision ends years of wrangling over the world number one watchmaker's obligations on the market.
   
"The accord will allow Swatch Group to reduce step-by-step its deliveries of mechanical movements," Comco said, underlining that it would have to treat all its clients equally.
   
Best known for its multicoloured plastic watches, Swatch is also the sector's top producer of components via its division ETA SA Manufacture Horlogere Suisse.
   
Mechanical movements are what measure time in a watch, making them the very heart of the industry.
   
Given Swatch's dominant market position, it is obliged to supply components across the sector.
   
Swatch has been battling that obligation for a decade, arguing that it was being forced to bear the burden of investment for the Swiss watch industry.
   
In 2001, Comco opened a competition probe at Swatch's request.
   
In July this year, Comco rejected an initial deal negotiated with Swatch, but fresh talks yielded an accord this week.
   
Under its terms, Swatch will in 2014 and 2015 be able to deliver 75 percent of the average number of mechanical movements sold to competitors between 2009 and 2011.
   
In 2016 and 2017, the proportion will fall to 65 percent, and then to 55 percent in 2018 and 2019.
   
From December 31, 2019, Swatch will no longer have to sell mechanical movements to other companies.
   
Comco underlined that it reserved the right to reexamine the deal in the event that the market evolved in ways that had not been predicted.
   
In addition, it said, the rules would not apply small and medium-sized watch companies that found themselves in difficulty as a result.
   
Since Comco launched its probe in 2011, a string of leading watchmakers have stepped up their production investment, notably by taking over supplier companies.
   
But the reduction in deliveries could also drive a shake-up in the sector, potentially leading to concentration of business in fewer hands, given the limited ability of smaller brands to invest in production.
   
The Comco agreement with Swatch does not allow the group to rein in the supply of what are known in the sector as "assortments", including such small parts as springs.
   
Comco did not oppose reduced deliveries of assortments on principle.
   
It said further investigation was needed, as it appeared premature to cut them given the lack of alternative suppliers to Swatch, which has a near-monopoly in that part of the trade.

Don't miss...X
Left Right

Your comments about this article

Today's headlines
Teen shot dead in Saint Gallen city mosque
Photo: Saint Gallen cantonal police

Teen shot dead in Saint Gallen city mosque

UPDATE: One person was killed Friday in a shooting in the prayer hall of a mosque in the Swiss city of Saint Gallen, police said. Media reports said the victim was 18 and was killed as a result of a row between Albanian families. READ  

Swiss hailed for saving Jews from Holocaust
Ruth Goduner, daughter of Paul Gruninger, admires plaque celebrating her father's deeds with police officials. Photo: Saint Gallen cantonal police

Swiss hailed for saving Jews from Holocaust

A Swiss policemen who saved thousands of Jews from the Holocaust and ended up being punished for forging their entry documents was honoured by his former force on Friday. READ  

‘Mugged’ youth admits he stabbed himself
Photo: R. Nial Bradshaw

‘Mugged’ youth admits he stabbed himself

A man who claimed to have been attacked and stabbed by muggers in Balsthal, in the canton of Solothurn, has confessed to police that he made the incident up and actually stabbed himself. READ  

Rhaetian Railway derailment
Graubünden derailment claims first fatality
Five people were seriously injured in the incident. Photo: Graubünden cantonal police

Graubünden derailment claims first fatality

An 85-year-old man injured in the Rhaetian Railway train derailment in the canton of Graubünden on August 13th has died in hospital. READ  

Jura to vote on extending expat political rights
Photo: FutUndBeidel

Jura to vote on extending expat political rights

Foreigners may be allowed to become local councillors in the canton of Jura if the population votes in favour of an extension of political rights for expat residents in a referendum on September 28th. READ  

Swiss workers face increased physical risks
Physical and mental risks at work can lead to ill health. Photo: Christopher Meredith

Swiss workers face increased physical risks

More than half of employed people in Switzerland are exposed to physical risks in the workplace, ten percent more than five years previously, according to figures released by the Federal Statistics Office this week. READ  

Violent fare-dodger jailed by Zurich court
The Austrian was caught without a ticket on a Zurich bus. Photo: Tim Adams

Violent fare-dodger jailed by Zurich court

An Austrian man who tried to evade police after being caught fare-dodging in Zurich last year was jailed this week for pulling a gun on his pursuers and firing several shots. READ  

Lost passenger sparks Geneva airport scare
Photo: Geneva airport/File

Lost passenger sparks Geneva airport scare

A lost passenger sparked a security alert at Geneva airport on Thursday that forced staff to halt boarding and caused disruption to several flights, a spokesman said. READ  

Julius Bär sued over 'lost' East German cash
Photo: Sporst

Julius Bär sued over 'lost' East German cash

Berlin is suing one of Switzerland's largest banks in its bid to recuperate hundreds of million euros that went missing during the reunification of East and West Germany, the bank said on Thursday. READ  

Swiss travel firm Kuoni suffers weak results
Photo: Eddie

Swiss travel firm Kuoni suffers weak results

Shares in Switzerland-based global travel group Kuoni plunged on Thursday after the company posted weak results for the first half of 2014, blaming unrest in many parts of the world. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Politics
Woman accuses Swiss politician in nude selfies scandal of lying
National
Villagers in Graubünden valley reject hydro plant to protect vultures
Business & Money
Court rules against appellation for absinthe from Neuchâtel valley
National
Two hundred passengers rescued after landslide derails Swiss train
Travel
Switzerland remains world champion for per capita train travel
Culture
Social media backlash forces Polanski to bow out of Locarno film festival
National
Two policemen identified among three Israelis killed in train crash
Features
Untouched Alps: The Local explores Switzerland's only national park
National
Swiss government secretary tweets nude ‘selfies’ taken at work
International
Swiss couples fined in Ibiza for making love in van without seatbelts
National
Schumacher medical record theft suspect hangs himself in Zurich cell
National
Thousands of motorists drive without permits in Switzerland: report
National
Switzerland celebrates the centennial of national park in Graubünden
National
Animal rights group protests over dead fish throwing at festival
National
Federer forced to tear down kids' play area at Graubünden holiday home
National
Zurich taxis charge world’s most expensive fares: new survey
National
Swiss bus driver charged with careless driving in fatal Norway crash
National
European Union rejects Swiss bid to rejig freedom of movement deal
Tech
Hackers exploit 'holes' in Swiss online banking systems: IT experts
Sport
Video of Bern football player's spectacular own goal goes global
Tech
Switzerland stays on top of innovation rankings for fourth year
National
Roger Federer and Lindsey Vonn play tennis at Jungfraujoch (VIDEOS)
Business & Money
Competition commission launches probe into Swiss car leasing 'fiddle'
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Latest news from The Local in Sweden

More news from Sweden at thelocal.se

2,071
jobs available