Legal Question in Business Law in New Jersey

manufacturer distribution

I was told that as a manufacturer, I

have to offer all of my distributors

the same price if they product is for

the same customer (same

quantity). Is there any truth to

this?


Asked on 4/29/09, 4:09 pm

1 Answer from Attorneys

John Corbett Corbett Law Firm LLC

Re: manufacturer distribution

Not much truth. The anti-trust and unfair trade practice laws are fairly simple to understand in principle but difficult to apply. The theory is that you cannot collaborate with another business to artificially restrain trade such as by agreeing to jointly set prices. You also can't refuse to deal with distributors who resell your products at a discount. Many other practices are potential problems but only a handful are sure triggers.

If you have a business partner who is complaining about some pricing policy, you should have your lawyer look at your particular situation within your industry to see if there is any possibility that your policies would run afoul of the business statutes.

BTW, many companies have very convoluted pricing policies to virtually ensure that they never offer the same deal to any two customers. The reason for that is to avoid triggering certain rebate provisions in what are known as "most favored customer" clauses.

My firm handles matters of this type. If I can be of further help to you, call or email.

See also: http://info.corbettlaw.net/lawguru.htm

Read more
Answered on 4/29/09, 11:19 pm


Related Questions & Answers

More Business Law questions and answers in New Jersey