Unauthorized Sales Risks in the EU: What Brands Need to Know in 2026

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In 2025, European eCommerce brands are grappling with a surge in unauthorized sales, genuine products sold through channels not approved by the brand. These “grey market” sales are legal in many cases (unlike outright counterfeits), but they can quietly siphon revenue and damage brand equity. The rapid growth of online retail has only amplified the issue. Over the past decade, e-commerce’s share of retail sales in Europe roughly tripled (from ~7% to 21%), bringing unparalleled global reach for brands and, with it, new opportunities for grey-market resellers. In this post, we’ll explore the key business risks tied to unauthorized and grey market sales in the EU , from pricing inconsistencies across countries to diluted promotions and margin erosion, with sector-specific examples. We’ll also provide a checklist of brand protection priorities for European markets, and show why proactive detection and enforcement (using solutions like MarqVision’s Unauthorized Sales product) is essential to protecting your digital shelf.

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Understanding Grey Markets and Unauthorized Sales in Europe

Grey market goods are authentic products sold outside the manufacturer’s authorized distribution channels. Unlike black market goods, which are illegal or counterfeit, grey-market items are genuine, but their sale is “unauthorized” by the brand. This can happen through parallel imports (buying products in one country and reselling in another without permission) or unauthorized third-party sellers offering products on online marketplaces. In the European Union, trademark rights are subject to regional exhaustion, meaning once a product is sold within the European Economic Area (EEA) with the trademark owner’s consent, it can generally be resold anywhere in the EEA. This free movement of goods benefits consumers, but it also enables arbitrage: opportunistic sellers exploit price differences between countries by moving products across borders. For example, a pair of shoes first sold in Warsaw can be resold in Paris freely, and the brand owner cannot invoke trademark law to stop it, but a pair first sold outside the EU (say, in Argentina) could be stopped if imported into Europe without consent.

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The result is a thriving grey market where goods intended for one region find their way into another, often through channels like marketplace resellers or unauthorized e-commerce sites.

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What drives the grey market? Often, it’s price differences between markets. Brands may set different retail prices or run promotions in different countries. grey-market sellers purchase products where they are cheaper (or heavily discounted) and then ship them to higher-priced markets. Global shopping events and promotions can inadvertently fuel this: for instance, during major sales events, brands offer steep discounts to boost local sales, only to see some distributors stock up and divert excess goods to other countries at cut-rate prices.

In one striking example, it was reported that nearly all Coca-Cola Zero sold in Switzerland at one point had been imported from countries like Poland and Ukraine, where it retailed for half the Swiss price. Such cases illustrate how easily products can flow through unintended channels in pursuit of a price edge.

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It’s important to note that unauthorized sales need not involve illegal products at all. They are typically legitimate items, but sold by rogue distributors or resellers who aren’t part of the brand’s official network (and often have no formal relationship with the brand). The grey market spans many sectors, from fashion and cosmetics to electronics and fast-moving consumer goods. Durable consumer goods like apparel, luxury accessories, and consumer electronics have been particularly prone to grey-market activity because they often have significant price gaps between regions and are valuable enough to make parallel importing worthwhile. Even everyday items aren’t immune: premium infant formulas and beverages, for example, see significant cross-border diversion when local shortages or price differences occur. In all cases, the core issue is the same: the brand loses control over who sells their product, at what price, and under what conditions. Next, we’ll delve into why that loss of control poses serious business risks.

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Why Unauthorized Sales are a Serious Risk for Brands

Unauthorized and grey-market sales can seem, at a glance, like a harmless side effect of globalization, or even a way for savvy consumers to find bargains. But for brand owners and authorized distributors, these sales come with major downsides. Below we highlight the key risks, from price erosion and margin loss to brand dilution and channel conflict, that European brands need to watch out for in 2025.

Price Erosion and Margin Loss

One of the most immediate impacts of unauthorized sales is pricing pressure. Grey-market sellers often list products at significantly lower prices than official retail, largely because:

• They source inventory from the cheapest available markets or through bulk promotions.
  
  
• They operate with lower overhead or simply disregard official pricing policies.
  
  

This dynamic creates a price war in which authorized sellers feel compelled to drop their prices to compete, undermining carefully managed pricing strategies. The resulting discounts cut directly into profit margins for both the brand and its official retail partners. Over time, the product itself becomes devalued in the eyes of consumers, if they repeatedly see it sold at 30% below retail on online marketplaces, they begin to question its true value or assume the standard price is a rip-off. As a result, brand equity erodes, and even premium items risk being perceived as bargain-bin products.

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The financial toll is far from trivial. A recent analysis by Oliver Wyman found that by 2021, roughly 13% of global consumer goods sales occurred through grey-market channels (products sold in markets other than those intended by the manufacturer).

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These parallel sales:

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• Typically occur at 20–30% below the target price
  
  
• Shaved about 3 percentage points off brands’ gross margins on average
  
  
• Forced manufacturers to compensate authorized distributors for their losses through discounts or incentives, costing another ~2 percentage points of margin
  
  

This kind of margin erosion directly threatens a brand’s profitability and its ability to reinvest in growth. Ultimately, overall profit margins shrink significantly due to grey-market price undercutting. Grey-market sellers pocket the difference, while the brand and its official partners either lose sales or are forced to sell at much thinner margins.

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The problem compounds as unauthorized sellers proliferate. On major marketplaces, multiple unauthorized vendors often compete to undercut each other on price. This drives a downward spiral in pricing across the board. Authorized retailers, seeing their business cannibalized, may demand better wholesale prices or cease promoting the brand. In the worst cases, key retailers might even stop carrying the brand’s products if they cannot make sufficient margin. Thus, unauthorized sales not only eat into margins, they strain the entire pricing architecture a brand has built, and can lead to revenue loss both online and in traditional channels.

Channel Conflict and Diluted Promotions

Unauthorized sales also create channel conflict and distribution chaos. Brands typically invest heavily in their authorized channels, selecting reputable retail partners, negotiating minimum advertised price (MAP) policies or recommended retail prices, and running promotions in a controlled manner. grey-market activity blows a hole in these arrangements. When an unauthorized seller floods the market with cut-price goods, it undermines official promotions and sales campaigns. For instance, a brand might run a limited-time in-store promotion in France, only to find that a reseller has bought up excess stock on discount and is now reselling it online in Germany at a price that undercuts the local market. The money that the brand spent on that French promotion is now effectively fueling a grey-market pipeline elsewhere, diluting the intended impact of the campaign. This arbitrage can happen quickly, especially with bulk buyers and marketplace sellers monitoring price drops across Europe.

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Such scenarios anger authorized distributors and retail partners. Brick-and-mortar retailers who find themselves consistently underpriced by third-party marketplace sellers (offering the same product obtained from abroad) feel the brand has failed to “police” its channels. This erodes trust and cooperation between brands and their partners. Retailers may reduce orders or devote less shelf space and marketing support to the brand’s products if they believe unauthorized sellers will steal the demand at lower prices. Thus, grey-market sales frustrates retail partners and creates rifts in distribution relationships. Even in cases where promotions aren’t directly co-opted, the mere presence of an unauthorized seller can cause channel conflict. Authorized resellers have to explain to customers why the same product is available cheaper online from unknown sellers, which is a no-win conversation that weakens the brand’s premium positioning.

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Another facet of channel conflict is the impact on the “digital shelf” – the way a product appears in search results and buy boxes on e-commerce platforms. Unauthorized sellers can mess with this visibility. For example, they might create duplicate product listings or use slightly different product identifiers to list the same item, aiming to capture search traffic. They may also win the Amazon Buy Box by offering a lower price than the brand’s official listing. When brands or authorized sellers lose the Buy Box to grey-market sellers, they lose sales and visibility online. In some cases, unauthorized sellers have created multiple listings for the same product to crowd out the official listing in search results. The end result is that the brand’s own presence on the digital shelf is diminished – legitimate listings get pushed down or lose prominence to unauthorized ones. This not only costs sales but also undermines the consistency of the brand’s presentation online.

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Ultimately, the grey market can throw a brand’s omni-channel strategy into disarray. It disrupts inventory planning (as products leak into unintended markets), complicates pricing strategy, and forces the brand into a reactive stance with distributors. All the while, unauthorized actors reap rewards from the brand’s marketing and distribution efforts without investing in them. It’s no wonder that leading manufacturers cite the grey market as a major bottleneck to growth, undercutting pricing and frustrating their channel partners.

Brand Dilution and Customer Experience Risks

Perhaps the most insidious long-term risk of unauthorized sales is damage to brand image and customer trust. Brands invest years (and significant budgets) to cultivate a certain image – whether it’s exclusive luxury, premium quality, or reliable customer service. grey-market sellers can undermine all of these by delivering experiences that the brand cannot control.

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One issue is brand dilution. When products meant to be premium are widely available at bargain prices via unofficial channels, the prestige of the brand can fade. Customers may start perceiving the brand as less exclusive or lower quality simply because it’s so easy to find heavy discounts through unauthorized sellers. As one industry observer put it, the grey market can turn a premium brand into a “bargain brand” over time. This shift in perception can hurt the brand’s ability to command premium pricing in the long run.

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Even more damaging is when unauthorized sellers compromise the customer experience. These sellers have no obligation to uphold the brand’s standards. They might store or ship products improperly, provide no after-sales support, or misrepresent product features to boost sales. For example, unauthorized online sellers have been known to list products with incorrect or misleading information on marketplaces – implying an item has features or warranties that it actually doesn’t. Unwitting customers may buy based on that false info and end up disappointed, blaming the brand for an underperforming product that “didn’t match expectations.” Likewise, unauthorized sellers often do not (or cannot) honor manufacturer warranties or return policies. A customer who bought from a grey-market source might find they cannot get a faulty item serviced or return a product that doesn’t fit, something they would easily do if they had bought from an authorized retailer. This kind of poor experience reflects badly on the brand, even though the brand wasn’t the one selling to that customer.

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There are also consumer safety and quality concerns tied to unauthorized sales. In sectors like beauty or electronics, products sold via unauthorized channels might be expired, region-incompatible, or lacking proper regulatory compliance. grey market resellers may peddle expired cosmetics, “international version” electronic devices without EU certification, or other items not meant for the local market. If these products malfunction or cause harm, consumers will hold the brand responsible. Consider electronics: a smartphone model intended for another region might not have the correct charger or might lack certain frequency bands; if sold in Europe unofficially, it may give users a subpar experience or even cause safety issues. 

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Customers who unknowingly buy a grey-market imported gadget and encounter problems may assume the issue lies with the brand, not realizing that the product wasn’t sold with the proper warranty, packaging, or support for their region. In those situations, it’s the experience, not the product’s legitimacy, that drives dissatisfaction. Similarly, these customers might leave negative reviews (“broke after 2 weeks” or “arrived without proper packaging”) that drag down the brand’s reputation online. In aggregate, unauthorized sales can still damage product reviews and ratings, as noted by brand protection experts, because the brand has no control over how the product is handled, presented, or supported in these channels.

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Finally, grey-market channels can interfere with important consumer safety recalls or updates. If a product is recalled for safety reasons, brands reach out to distributors and registered customers – but items that went through unofficial paths might not be traceable, risking consumer safety and exposing brands to a PR fallout. All these factors demonstrate that unauthorized sales aren’t just a financial or channel issue; they pose a reputational and customer loyalty threat. Research compiled by the International Trademark Association underscores this: billions in revenue are lost to grey markets worldwide, and customers suffer “negative experiences that harm the goodwill and reputation of a brand,” including issues with product integrity, warranty coverage, and even notification of recalls. In short, unauthorized sales undermine brand consistency. They cause inconsistent pricing, uneven customer experiences, and loss of control – exactly the things strong brands strive to avoid.

ok It’s a multi-faceted problem that hits the business on all sides.

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Next, we’ll shift from problems to solutions, what can brand managers and eCommerce leaders do to combat these threats in the European market?

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Brand Protection Priorities for European Markets: A Checklist

Tackling unauthorized sales requires a comprehensive strategy. European brands need to proactively monitor and enforce across all channels and markets. Below is a checklist of brand protection priorities to help safeguard your products and “digital shelf” in EU markets:

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• 1. Conduct Supply Chain Audits and Tighten Agreements: Start at the source. Review your distribution agreements and supply chain for any gaps that could enable diversion. Include clear territorial restrictions and clauses that prohibit re-selling into other markets without permission. Make sure your sales team isn’t inadvertently feeding the grey market, for example, avoid over-supplying distributors beyond what their local market demand justifies, especially around big promotions. If you offer steep channel discounts for events or bulk buys, consider adding controls (or post-sale incentives) so that partners don’t simply turn around and dump excess stock elsewhere for a quick profit. In short, stipulate where your products can be sold and enforce penalties for violations.
  
  
• 2. Harmonize Pricing and Promotions Across Europe: While complete price uniformity across EU countries may not be practical, strive to minimize glaring price disparities that invite arbitrage. Develop a regional pricing strategy so that your product isn’t dramatically cheaper in one EU market than another (after currency and taxes). Similarly, coordinate major promotions, a deep discount in one country can spill over as grey stock in another. By aligning promotions (for example, synchronizing EU-wide sales events or keeping discount magnitudes similar), you reduce the incentive for opportunistic resellers to stock up in Country A and dump products in Country B. The goal is to take away the easy “price gaps” that grey marketers exploit.
  
  
• 3. Implement Selective Distribution for Premium Lines: If you’re a luxury or premium brand (fashion, cosmetics, high-end electronics, etc.), consider a selective distribution system in Europe. This means you carefully choose authorized retailers who meet certain criteria and forbid sales to unauthorized parties. Selective distribution is recognized under EU competition law for luxury goods to preserve brand image. In practice, it lets you pursue those who breach the network. Additionally, you can differentiate the product by market – e.g. market-specific packaging, labels, or warranties – to discourage resellers from moving stock across borders. For instance, include region-specific serial numbers or language-specific manuals that make grey imports less attractive. High-end brands also use tactics like warranty limitations (a warranty valid only if purchased from an authorized EU dealer) to dissuade grey-market activity. These measures raise the friction for unauthorized resellers.
  
  
• 4. Monitor Online Marketplaces and the Digital Shelf 24/7: You can’t protect what you don’t see. Invest in robust online monitoring covering major marketplaces (Amazon, eBay, Zalando, Allegro, etc. across Europe) and price comparison sites. The goal is to get real-time visibility into where your products are appearing and at what price. Price monitoring tools or digital shelf analytics software are extremely useful – they can instantly flag MAP violations or unusually low pricing and identify sellers offering your product below the authorized price. Set up alerts for when new third-party sellers list your items or when prices drop below a threshold. This continuous surveillance is crucial given the speed at which online sellers can pop up. By catching problems early, you can take action before a rogue listing does widespread damage (like grabbing the Buy Box or spawning copycats).
  
  
• 5. Enforce, Enforce, Enforce – Consistently: Monitoring is only half the battle; enforcement is the other. Develop a tiered enforcement plan to deal with unauthorized sellers swiftly. This might include sending cease-and-desist letters or warning notices for first-time violators, escalating to takedown requests on platforms, and even pursuing legal action if necessary (especially for repeat offenders or those dealing in imported goods from outside the EEA). Many e-commerce platforms offer brand protection programs – leverage those partnerships. For example, enrol in Amazon’s Brand Registry and programs like Project Zero, which can help brands remove suspected infringing or unauthorized listings quickly. When a retailer is caught selling grey-market stock, be prepared to apply sanctions as per your contracts, this could mean reducing their supply, reclaiming marketing funds, or ultimately cutting ties if they won’t comply. The key is to be proactive and uniform: every known violation should be addressed. This signals to the market (and to your legitimate partners) that you will not tolerate free-riding on your brand. It also helps establish a record of enforcement, which can deter other would-be violators.
  
  
• 6. Strengthen Distributor and Retailer Relationships: Authorized partners are your eyes and ears on the ground. Maintain open communication so they can report suspicious activities (like someone trying to buy large volumes from them or local stores suddenly stocking product sourced elsewhere). You might consider a “trusted reseller” program with incentives: e.g. reward partners who strictly adhere to MAP and report grey-market incidents. Ensure your authorized retailers feel supported, if they know you are actively fighting unauthorized competition, they are more likely to invest in promoting your brand. In contrast, if partners feel you aren’t protecting them, they may lose motivation to push your products. So, treat this as a joint effort against a common enemy (unauthorized sellers). Some brands even help compensate key retailers for losses due to grey-market undercutting (as we saw, that 2% margin compensation in the Oliver Wyman study) which, while painful, can preserve long-term partnerships.
  
  

• 7. Educate Consumers and Build Awareness: Finally, bring the message to your end customers. A portion of shoppers don’t even realize the difference between an authorized seller and an arbitrary marketplace seller. Through marketing and on your official website, educate consumers about the benefits of buying from authorized channels – genuine warranty, customer service, assured quality, etc. You don’t want to scare customers, but you can highlight that unauthorized sources may sell outdated or non-compliant stock and that only official channels guarantee the full brand experience. Some brands use hologram stickers, QR codes or special tags on products for the EU market, so consumers can verify authenticity and authorized status. When customers understand why a rock-bottom online price might be too good to be true, many will make informed choices to stick with authorized sellers. Over time, a well-informed customer base shrinks the pool of demand that grey marketers rely on.
  
  

Each of these steps reinforces the others, and together, they form a robust defense. However, implementing this checklist across dozens of online platforms and multiple countries can be daunting to manage manually. That’s where technology and automation come into play as a force-multiplier in the fight against unauthorized sales.

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Embracing Proactive Digital Shelf Protection

In the digital age, proactive monitoring and enforcement is the name of the game. Rather than playing whack-a-mole with unauthorized sellers after damage is done, leading brands are turning to technology to protect the digital shelf in real time. This is where solutions like MarqVision’s Unauthorized Sales platform prove invaluable. These tools act as a central command center for grey-market enforcement – giving brands the ability to monitor, find, and fight unauthorized sales at scale across the web.

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What does proactive digital shelf protection look like in practice? Firstly, it means having AI-powered monitoring that can instantly detect your products appearing where they shouldn’t. For example, MarqVision’s system uses AI models to recognize your SKUs and can achieve over 94% accuracy in flagging unauthorized listings, eliminating the need to manually review countless product pages. The moment a new seller lists your item on a European marketplace, you’ll know. Even more, these platforms offer hourly price tracking on key sites. If someone drops your product’s price below the allowed minimum, you get an alert or automated report. This kind of speed is crucial – unauthorized undercutting can happen overnight, and early detection allows you to respond before it cascades.

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Secondly, proactive solutions streamline enforcement workflows. Instead of a fragmented approach (legal sends some letters, sales keeps an eye on Amazon, marketing notices complaints on social media), a unified platform lets you coordinate action in one dashboard. You can automatically send out compliance notices or cease-and-desist emails to sellers in violation, often straight from the software. MarqVision, for instance, enables automatic emailing of MAP violation notices to unauthorized sellers and keeps a record of these communications. You can also generate takedown requests to marketplaces with a few clicks, referencing your IP rights or distribution policies. By centralizing these tasks, brands ensure nothing falls through the cracks and that every offender is documented for follow-up.

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Another powerful aspect is seller intelligence. Advanced platforms tap into databases of known marketplace sellers – MarqVision’s network spans over 10 million sellers worldwide to help identify who the actors are behind the listings. This means you can sometimes unmask repeat offenders (even if they operate under different store names) and see patterns, like all the grey stock coming from a particular source or country. Such insights help trace supply chain leaks. For example, if many unauthorized listings seem to originate from a certain region, you can investigate if an authorized distributor there is overselling or diverting product. This intelligence closes the loop, allowing you to fix problems at the source in addition to treating symptoms online.

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The outcome of embracing these proactive, tech-driven measures is tangible. You regain control over your products, pricing, and channels – essentially, your rules prevail again. Brands that implement robust digital shelf protection see stronger pricing consistency and MAP compliance, because violators are caught and corrected swiftly. They also often regain the Buy Box on marketplaces, since fewer undercutters slip through unnoticed. Cleaned-up channels lead to better relationships with both retailers and customers: authorized partners feel protected (seeing prompt action against violators), and customers encounter a more consistent, quality-assured experience wherever they shop. Ultimately, there’s a clear ROI in recovered sales and protected margin. The revenue that was leaking to grey-market sellers comes back to the brand and its approved sellers. In short, proactive digital shelf protection isn’t just about avoiding losses, it’s about reclaiming growth.

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Safeguard Your Brand – A Call to Action

Unauthorized sales and grey-market diversion are complex challenges, but they are not insurmountable. With the right mix of policy, vigilance, and technology, brands can dramatically reduce grey-market volumes and keep their European markets healthy and fair. As we head deeper into the 2020s, one thing is clear: ignoring this issue is no longer an option. Brands that remain passive risk margin erosion, partner alienation, and brand dilution, while those who act decisively stand to protect not just revenue, but brand integrity.

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The good news is that innovative solutions are at hand. MarqVision’s Unauthorized Sales offering, for example, is designed to give brands the upper hand by combining AI-driven detection with instant enforcement tools – protecting your margins, providing real-time channel visibility, and empowering you to act on revenue leaks. Instead of scrambling to react, you can stay one step ahead of unauthorized sellers.

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Ready to reclaim control of your digital shelf? Learn more about how MarqVision’s Unauthorized Sales solution can help identify, eliminate, and prevent grey-market sales of your products across Europe. Don’t let unauthorized sellers dictate your brand’s story or prices. With a proactive strategy and the right partner, you can ensure that your products, pricing, and promotions stay on your terms.