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eBay must pay £30.6m (€38.8m) in damages to posh handbag group LVMH for allowing fake versions of its designer bags to be sold on the auction site.

The online tat house said it would appeal the decision and accused the French company of using the issue of fakes to crack down more generally on online sales.

The case was brought on two separate grounds - that eBay failed to take enough action to stop counterfeit goods being sold in 2006 and that it allowed genuine, but unauthorised, sales of certain perfume brands.

The Paris commercial court awarded damages of €16.4m to Louis Vuitton, €19.28m Christian Dior and €3.2m to the perfume brands. It rejected eBay's claim that it was just a host and that individual traders were responsible for the legality of their lots.

The second part of the case seems to put French law at odds with European Commission thinking on this issue. European Consumer Protection Commissioner Meglena Kuneva said last week she wanted to see an end to such restrictions, a move supported by eBay. The EC is likely to push for a single price across Europe and to allow consumers to buy products online from other countries as they wish.

eBay issued the following statement: “If Counterfeits appear on our sites we take them down swiftly, but today’s ruling is not about our fight against counterfeit; today’s ruling is about an attempt by LVMH to protect uncompetitive commercial practices at the expense of consumer choice and the livelihood of law-abiding sellers that eBay empowers everyday."

LVMH makes Louis Vuitton, Fendi, Dior perfumes, TAG watches as well as several champagne brands and Hennessy cognac.

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