|
Unilateral Policy
Under a unilateral policy (or "colgate policy" or "unilateral minimum retail price policy") a manufacturer, without any agreement with the reseller, announces a minimum resale price and refuses to make further sales to any reseller that sells below the announced price. Unilateral policy is a form of resale price maintenance that enables a manufacturer to influence the price at which its distributors and dealers resell its products without a formal contract regarding the resale price. The policy was first identified in ''United States v. Colgate & Co.'', . Development Beginning with the Sherman Act in 1890 which banned, "every contract, combination …, or conspiracy, in restraint of trade" price fixing by the manufacturer was held to be illegal. In ''Dr. Miles Medical Co. v. John D. Park and Sons'', , the United States Supreme Court affirmed a lower court's holding that a massive minimum resale price maintenance scheme was unreasonable and thus offended Section 1 of the Sherman Antit ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Resale Price Maintenance
Resale price maintenance (RPM) or, occasionally, retail price maintenance is the practice whereby a manufacturer and its distributors agree that the distributors will sell the manufacturer's product at certain prices (resale price maintenance), at or above a price floor (minimum resale price maintenance) or at or below a price ceiling (maximum resale price maintenance). If a reseller refuses to maintain prices, either openly or covertly (see grey market), the manufacturer may stop doing business with it. Resale price maintenance is illegal in many jurisdictions. Resale price maintenance prevents resellers from competing too fiercely on price, especially with regard to fungible goods. Otherwise, resellers worry it could drive down profits for themselves as well as for the manufacturer. Some argue that the manufacturer may do this because it wishes to keep resellers profitable, thus keeping the manufacturer profitable. Others contend that minimum resale price maintenance, for inst ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |