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Hello Kitty parent Sanrio faces $6.9 million fine from EU

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Geneva Abdul, The New York Times

<div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img src="http://sa.kapamilya.com/absnews/abscbnnews/media/2019/reuters/07/11/hk.jpg"/><figcaption>A Hello Kitty mural is shown in this photo from Sanrio&#x27;s official Facebook page. The European Commission fined Sanrio 6.2 million euros, or around $6.9 million, for illegally restricting where manufacturers can sell the licensed toys, bags and other products.</figcaption></figure></div>LONDON — “You can never have too many friends,” says Hello Kitty. But the character — who wears a red bow but has no mouth — doesn’t appear to have found one among the European Union’s antitrust regulators.The European Commission fined Sanrio, the Japanese company that licenses Hello Kitty and a range of other characters, 6.2 million euros, or around $6.9 million, for illegally restricting where manufacturers can sell the licensed toys, bags and other products.The restrictions led to less choice and higher prices for consumers, the commission said.“Traders who sell licensed products cannot be prevented from selling products in a different country,” Margrethe Vestager, the union’s competition commissioner, said in a statement.“Consumers, whether they are buying a Hello Kitty mug or a Chococat toy,” she continued, “can now take full advantage of one of the main benefits of the Single Market: the ability to shop around Europe for the best deals.”Hello Kitty, who is said to be a third grader from the London suburbs, debuted in 1974 and now appears on 50,000 different products in 130 countries, with sales that have reached nearly $8 billion a year. She appears alongside a collection of other Sanrio characters, including Aggretsuko, a raging red panda; Badtz-Maru, a grumpy penguin; and Gudetama, an indolent egg.The fine was announced Tuesday after a two-year investigation by European antitrust regulators.They said Sanrio barred businesses that had purchased the right to make Hello Kitty merchandise from selling the items outside their home country. Sanrio also restricted the languages used on the products. Sanrio’s restrictions were in force for about 11 years through December, the commission said.The company did not contest the penalty.“Sanrio fully accepts the European Commission’s decision and remains committed to enforcing and enhancing our compliance program across the group, in the interests of retaining the trust of all stakeholders,” it said in a statement.Sanrio’s sales, which come from products as well as licensing, have been shrinking across Europe the past eight years. The company’s overall sales in Europe fell 18 percent for the fiscal year that ended in March, which it blamed on the increasingly crowded market for intellectual properties including movies and entertainment characters.The European Commission noted that Sanrio had fully cooperated with the investigation, earning a 40 percent reduction in the fine.Yet even as the commission’s antitrust actions strive to ensure that cross-border sales are not widely prevented, some question the overall effectiveness of the penalties.Policymakers should ask whom the fines hurt in the end: existing shareholders or future consumers, said Sean Ennis, director of the University of East Anglia’s Center for Competition Policy.“While some of the fines will likely come out of profits, I believe price increases can be a result of fines,” he said in an email. He urged a simpler solution: “An alternative that avoids hurting consumers is for antitrust authorities to insist that, if a company’s practices are found illegal, the company must promptly cease and desist those practices.”The investigation was one of three separate antitrust investigations to determine whether Nike, Sanrio and Universal Studios had restricted cross-border and online sales of merchandising products. In March, Nike was fined 12.5 million euros for similar violations. The investigation against Universal Studios is underway.<div>2019 New York Times News Service</div>

The European Commission fined Sanrio, the Japanese company that licenses Hello Kitty and a range of other characters, 6.2 million euros, or around $6.9 million, for illegally restricting where manufacturers can sell the licensed toys, bags and other products.

The European Commission fined Sanrio, the Japanese company that licenses Hello Kitty and a range of other characters, 6.2 million euros, or around $6.9 million, for illegally restricting where manufacturers can sell the licensed toys, bags and other products.

Hello Kitty parent Sanrio faces $6.9 million fine from EU

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Hello Kitty parent Sanrio faces $6.9 million fine from EU

Geneva Abdul,

The New York Times

Published Jul 11, 2019 08:37 AM PHT

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