Chanel restricts sales to Russians abroad amid Ukraine war

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This article was published 05/04/2022 (997 days ago), so information in it may no longer be current.

PARIS (AP) — Luxury fashion brand Chanel says it has stopped selling its clothes, perfumes and other luxury goods to Russian customers abroad if they plan to take the products back home — a bold response to Moscow’s invasion of Ukraine that some say goes too far.

The move, which some Russians have decried, comes after the Parisian company shuttered its boutiques in Russia. Many companies across all industries have halted business in the country in response to the war.

This further step, Chanel said Wednesday, is simply a case of complying with trade sanctions imposed on Russia by the European Union, Switzerland and others that prohibit transactions with designated individuals.

“The most recent EU and Swiss sanction laws include a prohibition on the ‘sale, supply, transfer or export, directly or indirectly, of luxury goods to any natural or legal person, entity or body in Russia or for use in Russia,’” Chanel said in a statement.

It concerns products valued at over 300 euros ($328) — which is the majority of Chanel’s design output.

“We have rolled out a process to ask clients for whom we do not know the main residency to confirm that the items they are purchasing will not be used in Russia,” Chanel said, without elaborating on what that process looks like.

It’s a difficult measure to enforce, yet some Russian social media influencers have already said they are being asked for identification and denied the ability to buy goods at Chanel boutiques from Paris to the United Arab Emirates.

Russian socialite Anna Kalashnikova said last week that she had seen “Russophobia in action” after not being allowed to purchase earrings and a Chanel bag in an outlet in Dubai.

Fashion insiders say the brand’s decision would not have been easy because they are set to take a financial hit.

“It’s bold for Chanel — this is almost unprecedented. The house is putting its principles above the buck,” said Long Nguyen, a prominent fashion critic.

“Russia is one of their biggest luxury markets, and Chanel is certain to suffer financially from this choice,” he said. “But it’s also political for the brand — as it wants to appeal to Gen Z clients who are largely opposed to the war.”

Nguyen said Chanel’s move represents “more than a mere application of the sanction laws.”

Qing Wang, professor of marketing and innovation at Warwick Business School and a luxury brands expert, said, “Taking a bold political stand like this is not without risks.”

She cited research by PR firm Clutch that found consumers mainly think brands should stay silent on political issues.

“Nearly two-thirds of those surveyed (63%) said they were likely to continue shopping at businesses that stayed silent on issues they care about,” Wang said in a statement. “People’s true opinion on whether Chanel’s actions are appropriate, or a step too far that borders on Russophobia (which could be damaging to the brand), remain to be seen.”

Luxury giants Kering and LVMH did not immediately respond to requests for comment about whether they also plan to curb sales to Russians.