Paris (AFP) - Some of the world's top modeling agencies were hit with a 2.4-million euro fine ($2.7 million) by French competition authorities on Thursday for colluding and fixing prices. Elite, IMG and Next – which have some of the biggest catwalk stars on their rosters, including Gigi Hadid, Kate Moss and Karlie Kloss – actively "distorted the basis for commercial negotiations and created obstacles to competition to the detriment of their clients," the French competition watchdog said in its 100-page report.
The fines, which come in the middle of Spring/Summer 2017 runway shows of Paris Fashion Week, hit almost every agency involved in the French market. Almost 40 agencies in total were fined, with the heaviest sanction of 600,000 euros falling on the Marilyn Agency, which represents Claudia Schiffer, Bar Refaeli, Maggie Rizer, and Eva Herzigova, among other top models.
French authorities have also accused the modelling agencies' French union, the Synam, of drawing up and effectively enforcing its pricing guides for photo shoots, media campaigns and fashion shows "with little or no room for negotiation.” As such, the organization has been slapped with a 50,000 euro fine.
The watchdog said that for a decade leading up to 2010 Syam "was ambiguous as to the 'official' nature of these pricing schedules, which not only covered minimum salary, but also established the total price that clients were invoiced for modelling services. "Prices not only included the model's remuneration, but also the agency's margin," its statement added.
It also accused the agencies of holding meetings where they would discuss "the drawing up, distribution and application of the union pricing schedules.” They also agreed on a ban on making public their own pricing schedules, it said. The deal helped support price fixing, the watchdog added, "as demonstrated by statements made by several of the agencies: 'We charge the rates that everyone charges, namely the rates distributed by the Synam.’” According to its findings, in 2015 the minimum rate to hire models for fashion shows and publicity campaigns was 91.80 euros for a rookie and 176.90 for a more experienced model.
In August 2015, some of Britain's top model agencies were raided amidst allegations that they are engaged in price fixing. Investigators from the Competition and Markets Authority (CMA), a government department in the United Kingdom responsible for strengthening business competition and preventing and reducing anti-competitive activities, started an investigation into a number of firms in March, including Storm Model Management (which reps Jourdan Dunn, Anna Ewers, Behati Prinsloo Levine, Eva Herzigova, Cindy Crawford and Karolina Kurkova, amongst others and which launched the careers of Kate Moss and Cara Delevingne), Premier Model Management (which has Naomi Campbell, Christy Turlington, Bar Refaeli, and top men’s faces like Simone Nobili and go-to Givenchy model Filip Hrivnak) and Models 1 (which has Anne V, Linda Evangelista, Olivia Palermo, and Amber and Yasmine Le Bon on its board). The investigative efforts, which are being headed up by the cartels and criminal group at the CMA, come the heels of reports that the three top agencies have been colluding to drive up appearance fees for the models on their rosters.