MILAN (Reuters) - An Italian court has ended early special administration imposed on a unit of the Armani fashion group over labour practices of its Chinese-owned subcontractors, it said on Tuesday,
Italian Court Ends Special Administration for Armani Over Labor Issues
MILAN (Reuters) - An Italian court has ended early special administration imposed on a unit of the Armani fashion group over labour practices of its Chinese-owned subcontractors, it said on Tuesday, because the company had taken all the necessary corrective action. Giorgio Armani Operations, described as the industrial arm of the Armani group, was placed under court administration for a year in April after an investigation found it had subcontracted work in Italy to Chinese-owned companies that exploited workers. Over the past 10 months, the company has adopted the required organisational model and supplier control procedures, the Milan court said in a statement.
"In detail, the fashion house resolved relationships with 'at-risk' suppliers extremely quickly and also developed several best practices that received court approval," the judges said. According to the April ruling, Giorgio Armani Operations had outsourced the production of bags, belts and leather goods to two companies, which in turn subcontracted the work to four Chinese companies with workshops on the outskirts of Milan.
Giorgio Armani Operations welcomed the ruling and said that two of its numerous suppliers "betrayed the founding values of the Armani Group, which has never pursued profit as an end in itself and has never waived respect for workers and consumers".
"As also highlighted in the revocation decision, the company already had a structured and tested system of controls and protection of its supply chain", it said in a statement.
In October, the Milan court had lifted the judicial administration imposed on the Alviero Martini fashion brand in January 2024.
In addition to Alviero Martini and Armani, judges had also placed an Italian subsidiary of French luxury giant LVMH, which makes Dior-branded handbags, under the same form of special administration, again for lack of control over its supply chain.
The case on LVMH is still ongoing, having started months later.
Investigations by Italian magistrates, in particular the Milan prosecutor's office, over the last year have uncovered alleged exploitation of workers in the fashion and luxury supply chain. Milan's Court of Justice proposed in June a nationwide scheme for luxury companies to step up checks on suppliers to ensure they comply with labour laws.
(Reporting by Emilio Parodi, editing by Giselda Vagnoni and Tomasz Janowski)
