A well-known practice, taught in any business school course dealing with distribution channel management.

One of the best-known practitioners are the rack manufacturers Yakima and Thule, and they illustrate that certain prerequisites exist for such strong channel management to work - the product cannot be a commodity, and must be of high quality (or at least perceived as premium by the market) so that premium pricing can succeed against lower-priced and inferior products filling the same need.

For the manufacturer, it allows them to maintain high quality standards and promotes loyalty amongst distributors as the manufacturer (if they are smart at implementing this distribution strategy) does not engage in "dumping" product on the grey market, and doesn't undercut their distributors by allowing more influential distributors to engage in price-based warfare, eroding distributor's profit margins and eventually leading to downward price-pressure on the manufacturer, leading eventually to compromises in quality leaving the manufacturer open to competition from other less quality-oriented product.

For the distributor, they can concentrate on doing a proper job of selling and servicing the customer in this product line, knowing that their efforts aren't wasted by customers "showrooming" at the local brick & mortar store, then buying at the big-box or online outlet to get a better price.

For the consumer, they reap the benefits of having a superior product, don't have to waste time comparison shopping for the best price, and can select a distributor based on the quality of their service.

The only downside to this distribution model is when it is used by manufacturers that also enjoy near-monopoly market dominance (think of a manufactured-good manufacturer with the market dominance of Ticketmaster).

If you're really looking for an example of a European manufacturer that also follows this distribution model, Festool is a good one. They also prove the underlying principles - their tools are ungodly expensive, but have no equal anywhere in the market. To give up that iron-fisted control over their selected distributors would only serve to eventually erode the extraordinary quality and unique features of their products.