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Innovation has always defined the British luxury sector and continues to do so. Today, this innovation is protected through Intellectual Property (IP) rights, which encompasses product development and design, particular skills and methods of production, brand identity and communications.
Investment in innovation and quality of design and production is protected and encouraged by the company being able to enforce its IP rights, and therefore provides British luxury brands with legal recourse against counterfeiters, infringers and unauthorised distributors.
This in turn protects brands’ long-term commercial and creative success, as well as being part of the basis for the sector’s significant contribution to employment. In short, the value of luxury brands is inextricably linked to their intellectual property.
Likewise, businesses’ retail networks often comprise directly owned or managed stores, multi-brand digital retailers and world-famous department stores, as well as distributors and boutiques in key locations around the world.
Luxury brands’ ability to choose the most appropriate locations and partners to distribute their products is underpinned by the principle of selective distribution governed by the Vertical Block Exemption Order (VBEO). This enables brands to carefully select and invest in a network of partners, which is appropriate for their products and delivers retail experiences that are in line with or exceed their customers’ expectations.
In 2022, after an intensive campaign, Walpole was successful in persuading the UK government to renew this order – which is a foundation stone of the luxury business model – following the UK’s departure from the European Union. We continue to campaign to ensure that this regulation is maintained.
In 2025, after several years of engagement with Government, Walpole was successful in securing a commitment to maintain the existing exhaustion of rights regime, which is an essential part of the luxury business model.
Likewise, in the EU, Walpole works with ECCIA colleagues to ensure that its European equivalent, the Vertical Block Exemption Regulations, is protected in EU law.
