• Switzerland's news in English
 

Competition watchdog cuts Swatch's obligations

AFP · 25 Oct 2013, 15:07

Published: 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.

Your comments about this article

Today's headlines

Swiss economy shows surprising growth in Q2

23 minutes ago

Domestic spending kept Switzerland’s economy expanding in the second quarter as government figures released on Friday showed a surprise upturn in growth.

Italian base jumper dies in Bernese Oberland
Base jumpers in Lauterbrunnen in the canton of Bern. Photo: AFP

Italian base jumper dies in Bernese Oberland

48 minutes ago

A 46-year-old Italian plunged to his death in the Bernese Alps Thursday after crashing onto rocks during a base jump, the latest in a series of such accidents in Switzerland in the past year, police said.

Manhunt launched after Geneva hotel holdup
Photo: Geneva cantonal police

Manhunt launched after Geneva hotel holdup

1 hour ago

Geneva cantonal police launched a hunt for a man suspected of holding up a luxury hotel overlooking Lake Geneva on Thursday, two days after another armed robbery in the city.

US penalizes UBS for dealing with 'terrorist'
Photo: UBS

US penalizes UBS for dealing with 'terrorist'

10 hours ago

UBS, Switzerland's largest bank, has agreed to pay American authorities $1.7 million to settle "apparent" violations of rules banning transactions benefiting officially designated terrorists, the US Treasury Department said on Thursday.

Wawrinka could face Murray in US Open
Switzerland's Wawrinka at last year's US Open. Photo: Getty Images North America/AFP

Wawrinka could face Murray in US Open

10 hours ago

World number one Novak Djokovic could meet eighth-seed Rafael Nadal in the US Open quarterfinals while Andy Murray and Stan Wawrinka could meet in another quarterfinal under the US Open draw announced on Thursday.

Report confirms rising number of immigrants
Citizens gather in Appenzell Innerrhoden for an annual Landsgemeinde (assembly of the people). Photo: AFP/File

Report confirms rising number of immigrants

14 hours ago

Immigration is continuing to drive Switzerland’s growth in population, which rose by almost 100,000 to more than 8.2 million by the end of 2014, official government figures confirm.

Bern window smashing stunt promotes safety
Car is lowered into pool of water for window smashing demonstration. Photo: BFU

Bern window smashing stunt promotes safety

23 hours ago

Visitors to Bern were treated on Wednesday to the unusual sight of a man smashing his way out of a car submerged in a pool of water in front of the federal parliament.

Federer to defend Brisbane title in 2016
Photo: AFP/File

Federer to defend Brisbane title in 2016

1 day ago

Switzerland's 17-time Grand Slam champion Roger Federer and five-time major-winner Maria Sharapova will defend their Brisbane International titles in the lead-up to the Australian Open in January, organizers said on Thursday.

Lower tax revenues push Geneva's budget in red
Geneva Finance Minister Serge Dal Busco. Photo: Eugen Billard/Wikimedia Commons

Lower tax revenues push Geneva's budget in red

1 day ago

The canton of Geneva is freezing new spending and delaying an initiative to hire new prison guards as lower than expected tax revenues this year are expected to send the government’s budget ballooning almost 250 million francs into the red.

Swiss airports to start spot bomb checks
Photo: Zurich airport

Swiss airports to start spot bomb checks

1 day ago

Passengers flying out of Swiss airports will potentially face an extra level of screening starting next week when a new process to detect explosives will go into effect.

RECEIVE OUR NEWSLETTER AND ALERTS

Photo: Federal Housing Office
National
Buying home in Switzerland is 'cheaper than renting'
National
Central bank to launch new high-tech banknotes — six years late
National
Swiss speed climber summits all 4,000m peaks in the Alps
National
Report: Switzerland is world's safest country (barring extreme sports)
National
Where are the top ten spots to visit in Switzerland for tourists?
National
Two Japanese climbers found dead after scaling Matterhorn's summit
National
High Geneva accommodation costs force unpaid UN intern to live in tent
National
Zurich farmer ordered to remove cow bells after noise complaints
National
Gays file criminal complaint against Swiss bishop over speech
National
The Expat Guide: Moving to Switzerland
National
Briton who ends life in Switzerland: 'Ideal shelf life for people is 70'
National
Aargau farmer under fire after pigs gassed to death by own excrement
National
Cows trample German woman to death in Graubünden Alps
National
Hot times: Swiss city to host first naked performance festival
Features
Expat American author's time in Zurich inspires racy bestseller
National
10 amazing places to be on Swiss National Day — or any other day
National
Swiss army pilfers water from French lake for cows in Switzerland
National
Swiss Army airlifts water to thirsty cows facing drought conditions
International
Canary Islands: diver killed in collision with Swiss windsurfer
National
VIDEO: Seagull steals camera for amazing bird's eye selfie
Switzerland celebrates first ascent of Matterhorn
Politics
Immigrant recruits may not be loyal: Swiss defence minister
Solar Impulse 2 round-the-world flight halted for repairs
Society
Teenager gets high on vegetarian meal at Zurich club
National
Greece seeks tax revenues from assets 'hidden' in Swiss banks
Culture
Paris police arrest Swiss artist for naked Eiffel Tower selfies
National
Scientists uncover largest Swiss dinosaur skeleton ever found
National
National weather office extends danger alerts as heatwave takes hold
National
Most severe heatwave in Switzerland since 2003 on the way
Travel
Bogglingly expensive Geneva club sandwiches remain 'priciest in world'
Politics
Anti-immigration nationalist party remains most popular: poll
National
Greek finance minister slams Swiss over lack of tax evasion info
Business & Money
Insects proposed for sale in Swiss supermarkets next year
National
'Oh God — I'm coming': noisy lovers' complaint goes public
National
Canton of Ticino threatens closing Italy border to asylum seekers
National
Just in case: Swiss National Bank prepares for Grexit 'crisis'
National
Russian crisis fuelled by sanctions threaten 40,000 Swiss jobs: study
National
Art Basel: Art for art's sake — or to make an investment?
National
New survey ranks Zurich Europe's priciest city for expatriates
National
Quarter of residents in Switzerland 'have multiple homes'
Features
Veggie lovers and 'flexitarians' challenge Swiss meat-eating habits
National
Forest officials struggle to save Switzerland's dying ash trees
Education
Historian finds ancient Egyptian papyrus texts in Basel uni library
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

4,397
jobs available