Parliament: Trade - MPs support bid to cut prices of designer goods

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The Independent Online
HIGH-PROFILE CAMPAIGNS by supermarkets such as Asda and Tesco to offer "designer" brands of shoes and clothes at lower prices were backed by a committee of MPs.

Although companies including Levi Strauss and Nike have used their legal muscle to stop the supermarkets' sales of their goods, citing trademark concerns, the Select Committee on Trade and Industry said in a report published yesterday that cheaper imports could lead to lower prices.

The move would be a key step towards "globalisation", in which products with a manufacturer's trademark made anywhere in the world could be imported to the UK for sale.

The MPs noted that, in the UK, prices of cars, motorbikes, shoes, clothes and perfumes are kept artificially high by manufacturers - even though the same companies are supplying the same products more cheaply in nearby countries.

The makers often claim goods then imported into the UK from these countries are inferior. There is little if any firm evidence for this, MPs said. They accused clothing and shoe companies of "conniving" in supplying products abroad, then decrying their UK arrival.

The select committee chairman, Martin O'Neill, backed the supermarkets' view that trademark owners of designer brands such as Levi Strauss jeans, Calvin Klein perfumes and Prada bags should not have the right to determine exactly where their goods are sold.

The supermarkets claim customers are being ripped off by the brand owners, who repeatedly try to stop them selling designer goods at discounted prices. A European Union directive states retailers can buy goods from unauthorised suppliers only within the EU. However, the report says trademark rights should be abandoned internationally, to usher in lower prices.

The committee warned, though, that such moves could be dangerous for the pharmaceutical and music industries.

With pharmaceutical goods there was the "hazardous" risk of incorrect or missing instructions in foreign products. The music industry could face massive revenue losses.