Swatch Group x COMCO – Ban Lifted on ETA, Delivery now Available to Third Parties

COMCO, the Swiss Competition Commission, has just announced that ETA (Swatch Group’s movement manufacturer) is now free to deliver movements to third parties with no obligations or restrictions. Last December 2019, the regulator issued an unexpected decision preventing Swatch from delivering to clients at its own discretion. Criticized by many, this provisional measure meant that ETA had to stop supplying movements to third parties, except for small and mid-size watch companies… Until a final decision would be made in summer 2020.

Given Swatch Group’s dominant position in mechanical movement manufacturing, a settlement was signed with COMCO in 2013 ensuring ETA movement deliveries to third parties (with a step-by-step reduction until 2020). The idea was to ensure that sufficient competition and alternative sources would have developed in that time frame.

Although the final decision was expected in 2019, the regulator extended its investigations for a few months. A COMCO provisional ruling de facto prevented ETA from delivering to third parties and was the subject of considerable criticism.

Six months later, ETA is finally free to deliver movements at its own discretion. “The most important supply source and competitor of ETA, Sellita Watch Co. S.A. (Sellita) offers comparable alternatives for several of ETA’s best-selling mechanical movements in terms of price, quantity and quality. Some ETA customers have developed and extended their own production.” The Swatch Group company is still seen in a dominant position and as such cannot abuse the situation. The decision of COMCO can be appealed to the Federal Administrative Court.

For more information, the COMCO press release is available here in French.