Italy’s antitrust authority has opened an investigation into alleged unfair trade practice against several companies in the Armani and Dior luxury groups, due to illegal working conditions in the workshops that supply them, the organization reported on Wednesday.

The investigations by the Competition and Market Authority (AGCM) come after the Milan Public Prosecutor’s Office placed several Armani and Dior companies under judicial administration following investigate their supply chain and suppliers and verify the exploitation of their workers.

According to the Competition and Market Authority (AGCM), in some cases Armani and Dior suppliers employed workers who would receive inadequate wages, as well as working hours that exceed the legal limits and in inadequate health and safety conditions.

On its website, the AGCM revealed that it “has initiated an investigation against certain companies of the Armani Group (Giorgio Armani SpA and GA Operations SpA) and the Dior Group (Christian Dior Couture SA, Christian Dior Italia Srl and Manufactures Dior Srl) for “Possible illegal conduct in the promotion and sale of clothing items and accessories, in violation of the Consumer Code.”

In both cases, it is being investigated whether the companies did “false claims about their ethical and social responsibility, particularly in relation to working conditions and compliance with the law in their suppliers,” explains the AGCM on its website. Armani and Dior “would have emphasized craftsmanship and the excellence of the workmanship,” but “Contrary to such claims, they were supplied in workshops and factories with workers who received inadequate wages to make certain articles and clothing accessories”. They also worked “working hours that exceeded the legal limits and in insufficient health and safety conditions, in contrast to the levels of productive excellence that the company boasted of.”

On Tuesday, AGCM officers, with the help of the Special Antitrust Unit of the Guardia di Finanza (financial police), carried out inspections at the headquarters of the companies Giorgio Armani SpA and GA Operations SpA, as well as at the premises of the company Christian Dior Italia Srl.

Armani considered “the hypotheses outlined to be unfounded” The Antitrust Authority assured “full cooperation” with the AGMC and expressed “confidence that the investigations will have a positive outcome,” in a statement. Dior has assured that it cooperates with the Justice system and that it is “aware of the seriousness of the violations committed” by its suppliers.He also stressed that he will work “to improve his controls and procedures” in the face of practices that “were hidden from him,” and added that “in the future he will not place any more orders with these suppliers.”

Last June, Manifactures Dior Srl, which was responsible for the internal production of part of the French brand’s 2024 handbag and accessories collection and subcontracted to other companies, was placed under judicial administration. “The price of the Dior leather bag model marked for example with the code PO312YKY “While it costs customers 2,600 euros in the store, Dior paid 53 euros to buy it from the factory with Chinese workers”the newspaper ‘Corriere della Sera’ reported at the time.