According to three people with direct knowledge of the matter, EU antitrust regulators are investigating how Kering’s (PRTP.PA) Gucci and other fashion firms set prices of handbags and leather goods for distributors.

Reuters reported previously that the European Union raided Gucci’s Milan site, which makes such products, at dawn in response to a Reuters report. Kering confirmed at the time that Gucci had cooperated with EU regulators.

An EU competition watchdog is investigating whether the companies are imposing consumer prices on multi-brand retailers selling their products and threatening not to sell to them if they don’t.

EU antitrust laws prohibit such practices, and breaches can result in fines of up to 10% of a company’s global revenue.

Guess, a U.S. clothing company, was fined 40 million euros ($43 million) for preventing retailers from setting the retail price of its products independently.