In recent years, at least 60 percent of the manufacturing costs of a watch had to be incurred in Switzerland before the watch could be labeled “Swiss Made.”
Now watches made in Glashütte, Germany, a mountain town of about 1,600 inhabitants near the country’s border with the Czech Republic that has long been considered the seat of Germany’s high-end watchmaking, are subject to a similar rule.
The regulation affects nine manufacturers, including the internationally known brands A. Lange & Söhne and Nomos Glashütte. And while six of them said in emails that they support the rule, which has been considered an unwritten agreement among local manufacturers since the early 1900s, there were concerns that it could limit growth in the future. (The other three — Mühle-Glashütte, Union Glashütte and Bruno Söhnle — did not reply to queries.)
Passed in February by Germany’s upper house of Parliament, the Bundesrat, the Glashütte Regulation says at least 50 percent of a watch’s “added value” must be created in the town, which would include work such as the assembly and encasing of a movement, the setting of hands, the positioning of the dial and the quality inspection.
It does permit some manufacturing processes, like laser work and electroplating, to be done in nearby communities, including the city of Dresden, about 30 kilometers, or slightly less than 20 miles, to the north.
And it allows some parts, such as a watch’s jewels, to be purchased outside of the region, as long as their value does not exceed the 50 percent. (All six of the watchmakers that replied to email queries — A. Lange & Söhne, Nomos, Moritz Grossmann, Glashütte Original, Tutima Glashütte and Wempe Glashütte — said they already met the standard.)
Manufacturers that violate the regulation could face legal action by German authorities, or even from fellow watchmakers, a Nomos spokesman, Oliver Nyikos, wrote in an email.
The regulation, which took effect immediately after its passage, has been recognized by the European Union, and Mr. Nyikos wrote that it is only the second of its kind in Germany. The first, passed in 1938 and strengthened in 1994, regulates the cutlery industry in the western city of Solingen.
Supporters of the regulation, which had been debated in German watch circles for years, have said it would help preserve a local industry that already has survived wars, a Soviet-era socialist takeover, competition from smartwatches and inexpensive quartz models, and, most recently, the effects of the pandemic.
“So, the special position of the art of watchmaking in Glashütte and the good reputation with the consumer created by our tradition, our work, our investments and innovations — all this is now confirmed by the highest authorities,” Uwe Ahrendt, chief executive of Nomos, wrote in an email.
Sandra Behrens, a spokeswoman for Moritz Grossmann, praised the regulation in an email, calling it a “seal of quality” that would appeal to watch enthusiasts and connoisseurs worldwide; and Glashütte Original, a unit of Swatch Group, wrote that the law guaranteed its customers what it called an “authentic piece of Glashütte watchmaking art.”
Lindita Hoti, a spokeswoman for Wempe, wrote in an email that, while the manufacturer strongly supported the regulation, which it helped formulate, there were concerns that it could hinder development as the town’s building space already is severely limited.
“Does the limited offer of available space threaten to slow down the development in some years time?” she wrote. “The settlement of further companies, be it suppliers or watch manufactures, will be a great challenge.”
The mayor of Glashütte, Sven Gleissberg, wrote in an email that he was unaware of any complaints or concerns from local watchmakers about the regulation, which he viewed as “an essential basis for further development of the watch industry, the protection and expansion of jobs” and a guarantee that watches stamped “Glashütte” were indeed made there.
“Overall, I assume that the manufacturers also see the positive side of the regulation,” he wrote. “After all, the ordinance also secures jobs here in the region, and creates a legal basis to prevent legal disputes.”
Watches have been made in Glashütte since 1845, when Ferdinand Adolph Lange started creating pocket watches, a business that later would become A. Lange & Söhne, now owned by the Swiss luxury group Richemont.
By the early 20th century, according to online histories of the town, other brands had set up shop and Glashütte was known outside Germany for its high-end timepieces.
After World War II, the socialist regime of East Germany merged all the watchmaking businesses into a state-run collective devoted to the production of cheap quartz models for export to the West. But after the Berlin Wall fell in 1989 and reunification began, some of the watchmakers resumed operations and began restoring Glashütte’s reputation.
Returning the industry to its former glory was “no easy task” for the watchmakers, who invested ample time and money in the process, wrote Mr. Nyikos of Nomos. “The bottom line is that this period motivated all manufacturers to deliver top performance and invest heavily in quality and vertical integration locally.”
As the watchmakers continued to expand their operations, there were disputes about the question: How much of a watch must be produced in Glashütte to bear its name? The regulation answers the question.
“We felt that a legal regulation was better than a rule agreed upon by all the manufacturers because such a regulation applies equally to everyone and it protects the consumer,” Mr. Nyikos wrote, “and because it protects and distinguishes Glashütte in the same way the ‘Swiss Made’ label protects Swiss watches.”
While Wilhelm Schmid, chief executive of A. Lange & Söhne, likened the regulation to “a shield” or an “insurance policy” that will take pressure off manufacturers to defend the Glashütte name in lawsuits, it is the art of watchmaking, he wrote in an email, that is the primary concern among manufacturers in the town.
“Glashütte’s prestige and reputation will continue to grow if all the companies operating in Glashütte do their job properly,” he wrote. “A shield is not enough to achieve this.”