Court Rejects Judicial Administration for Paul & Shark and Aspesi Over Labor Abuses

Judge Roberto Crepaldi ruled against the prosecutors' move, arguing that the legal grounds for the requested measure were not met, as there was no proof that Paul & Shark’s CEO, Andrea Dini, and Aspesi’s board member, Francesco Umile Chiappetta, acted "in concert" in committing the offense.

This development is part of a labor abuse case filed earlier this month by Milan prosecutors Daniela Bartolucci and Paolo Storari. The prosecutors found that both companies subcontracted part of their manufacturing to Chinese-owned firms Gmax 365 Srl and M&G Confezioni Srl, located in Garbagnate Milanese, near Milan, who allegedly exploited their workers with reportedly underpaid, 14-hour work shifts.

Crepaldi attributed full responsibility to the manufacturing companies, whose owners are under investigation.

The prosecutors' investigation revealed that Paul & Shark and Aspesi subcontracted part of their production to Chinese companies. These companies, Gmax 365 Srl and M&G Confezioni Srl, are accused of exploiting their workers.

Workers allegedly faced 14-hour shifts with low wages, leading to the prosecutors' investigation. Judge Crepaldi held the manufacturing companies responsible for these practices.

This case highlights concerns about supply chain management in the fashion industry.

Over the past two years, supply chain scandals have hit the luxury fashion industry in Italy, impacting its reputation and business practices. Investigations uncovered links between luxury brands like Tod’s, Loro Piana, Valentino, Dior, and Giorgio Armani, and subcontractors allegedly involved in sweatshop schemes.

All the above brands, except Tod's, have been placed under judicial administration to enhance audits and oversight. Tod's obtained that the judicial administration procedure be handled by an Ancona, Italy court, which has yet to rule.

Dior and Giorgio Armani have resolved their investigations and had their judicial oversight lifted.

Last fall, some 13 fashion companies fell under the scrutiny of the same Milan prosecutors and were asked to provide documents on governance and supply chain audits for preliminary probes. The names involved included Prada, Versace, Gucci, Dolce & Gabbana, Ferragamo, Missoni, Givenchy Italia, Yves Saint Laurent Manifatture, Alexander McQueen Italia, Adidas Italy, Off-White Operating, Coccinelle and Pinko.

None of these companies have been put under judicial administration.

The investigation underscores the need for greater transparency and accountability in the fashion industry's supply chain.

The court's ruling and the ongoing investigations highlight the importance of effective oversight and rigorous audits in the fashion industry. The lack of control in the supply chain has allowed labor exploitation and damaged the reputation of the brands involved.

Brands that have been placed under judicial administration must implement measures to correct and improve their practices. This includes greater transparency, more frequent audits, and stricter oversight of their suppliers.

The fashion industry faces the challenge of ensuring fair labor conditions and an ethical supply chain.