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.

In 1955, the Monopolies and Mergers Commission's report Collective Discrimination: A Report on Exclusive Dealing, Aggregated Rebates and Other Discriminatory Trade Practices recommended that resale price maintenance, when collectively enforced by manufacturers, should be made illegal, but individual manufacturers should be allowed to continue the practice.

The report was the basis for the Restrictive Trade Practices Act 1956, specifically prohibiting collective enforcement of resale price maintenance in the UK.

In 2010, the Office of Fair Trading (OFT) opened a formal investigation into allegations by an Online Travel Agent (OTA), Skoosh, of resale price maintenance in the hotel industry.

Subsequent decisions characterized Dr Miles as holding that minimum resale price maintenance is unlawful per se (automatically).

On June 28, 2007, in the landmark decision of Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877 (2007), the Supreme Court overruled Dr.

During the Great Depression in the 1930s, a large number of U.S. states began passing fair trade laws that authorized resale price maintenance.

They were seen as allowing retailers and manufacturers to maintain artificially high prices at a time when economic relief was desperately needed.

Miles decision, scholars began to question the assumption that minimum resale price maintenance, a vertical restraint, was the economic equivalent of a naked horizontal cartel.

In so doing, the Court embraced the logic of Bork and Telser as applied to such restraints, opining that, in a "purely competitive situation", dealers might free ride on each other's promotional efforts.

In 1980, the U.S. Supreme Court held that the repeal of Miller–Tydings implied that the Sherman Act's complete ban of vertical price fixing was again effective, and that even the 21st Amendment could not shield California's liquor resale price maintenance regime from the reach of the Sherman Act.

[8] One legal practice that is used by some Australian distributors to maintain a fixed retail price is a "chartered agency" structure.