Originals to Pay Over $3 Million for Hindering Personal Imports

The Israeli Competition Authority has reached an agreement with Originals, the importer of Rockport shoes in Israel, requiring the company to pay over 3 million shekels to the state. The penalty stems from actions taken by Originals that allegedly harmed personal and parallel imports of Rockport footwear.

An investigation by the authority revealed that due to significant price differences between Israel and the United States, Israeli consumers were purchasing Rockport shoes directly from the U.S. website, often using third-party services for shipping to Israel. When Originals raised concerns about these price disparities with the global Rockport brand owner and sought better commercial terms, the brand owner proposed blocking Israeli access to the U.S. website and redirecting them to Originals' Israeli site.

According to the Competition Authority, Originals complied with this request, providing the global owner with its website address for the redirection. This action, the authority contends, facilitated the obstruction of personal imports. Originals claimed that the proposed solution was not suitable for the issue discussed during negotiations, yet they proceeded with the redirection.

Following the authority's investigation, the ability for users in Israel to access the U.S. Rockport website was reinstated. The agreement with Originals, which is part of the Irani Group and also owns Factor 54, includes a payment of over 3 million shekels to the treasury, without an admission of guilt by the company.

This case is part of a broader effort by the Competition Authority to combat attempts to block parallel and personal imports. A recent amendment to the Competition Law, effective September 2023, prohibits direct importers from taking actions that could harm such imports. The authority has been actively investigating violations of this law and has contacted 13 major direct importers across various sectors.