AIC vs. LV in Hangzhou: What's Going On?

A very interesting story has come out of Hangzhou that has led to a lot of questions and very few answers. Louis Vuitton, the high end French luxury brand, has run afoul of Zhejiang AIC, resulting in their Hangzhou shop being closed down. It seems that after a check of a (?, the?) Hangzhou LV boutique in May, some products were found to be "below standards." Zhejiang AIC insists that they didn't force LV to close down the Hangzhou boutique.

According to the AIC, this all comes down to LV's not including a small piece of sample leather with their bags shipped to China, an AIC requirement. LV failed to appeal the ruling and so a number of bags were seized by Zhejiang AIC.

So what's going on? Many immediately jump up and say this has to be political, another Chinese potshot at the French, however this was only one boutique, things are still going strong in Beijing, Shanghai, and other cities. Did they all include the necessary sample or are do they just ignore this requirement (or not have it)? Is this the case of an overzealous local official continuing China's "war" on France? Is this some corrupt officials who are basically stealing LV bags by making this claim?

There has to be more to it, unfortunately we probably won't learn all the sordid (or boring) details as to why this seizure took place, but if LV can take a hit like this, it should serve as a cautionary tale to any small company looking to enter China.

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