exclusive dealing


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exclusive dealing

a business practice whereby a supplier contracts distributors/ retailers to sell his products on an exclusive basis (i.e. to refrain from handling the products of rival suppliers). Retailers are rewarded for sole representation in a variety of ways including preferential discounts, back-up services and loans. The practice of exclusive dealing may help the supplier boost his sales and protect market share because distributors have an undivided commitment to the product. However, if undertaken by a DOMINANT FIRM, the practice may serve to limit competition in a market by depriving rival suppliers of distribution outlets. See ANTICOMPETITIVE PRACTICE, COMPETITION ACT, 1980, OFFICE OF FAIR TRADING.

exclusive dealing

a type of ANTICOMPETITIVE PRACTICE/RESTRICTIVE TRADE PRACTICE whereby a supplier contracts distributors to deal only in his products to the exclusion of competitors’ products. Exclusive dealing may be beneficial in some cases by allowing distribution costs to be lowered but, if exclusive dealing is pursued by several large firms in a market, the access of smaller suppliers and potential entrants to established distributive outlets may be severely restricted. Under the COMPETITION ACT 1980, exclusive dealing can be investigated by the OFFICE OF FAIR TRADING and (if necessary) by the COMPETITION COMMISSION, and prohibited if found to unduly restrict competition.
References in periodicals archive ?
The ACCC alleges that Pfizer misused its substantial market power and engaged in exclusive dealing conduct for an anti-competitive purpose in breach of the Competition and Consumer Act 2010 (CCA).
In recent years, there has been renewed research interest in the economics of exclusive dealing. While Howard Marvel's free riding explanation of exclusive dealing retains its prominence, other related free riding explanations have recently been offered, along with other efficiency based explanations.
Chapters also cover customer and territorial restraints, trying arrangements, exclusive dealing and incentives to induce exclusive dealing, and price discrimination and the Robinson-Patman Act.
8m investment is still on track - despite the 14-day extension for exclusive dealing granted at the club's AGM having passed.
Supreme Court has left standing an appellate court's decision that under the antitrust laws, a sales representative can challenge the exclusive dealing requirements and territorial restrictions imposed by two furniture companies (Bassett Furniture Inc.
The Commission found that FEG "was operating a collective exclusive dealing arrangement involving the FEG, the association of importers of such products in the Netherlands (NAVEG) and a large number of individual suppliers of such products".
The European Commission has stung the Dutch association of electrotechnical equipment wholesalers, FEG (the Nederlandse Federatieve Vereniging voor de Groothandel op Elektrotechnisch Gebied), as well as its biggest member, Technische Unie (TU), with fines for collective exclusive dealing and price-fixing.
The broker contends that it entered into an "exclusive dealing" contract with the tenants, which entitles the broker to a commission upon the signing of the renewal lease even if that lease was procured entirely through the efforts of the tenants.
These items include payment for goodwill, payment for value of the ongoing business unit, payment for covenants not to compete, payment for exclusive dealing agreements, payment for patient lists, and payment for patient records.
Topics covered in this year's review include: the Supreme Court's decision in Reeder-Simco; the Sixth Circuit's Northwest Airlines decision remanding a predatory pricing case for trial; court decisions upholding and condemning 'reverse payments' patent litigation settlements; FTC adjudicatory opinions on price fixing and consummated mergers; FTC and DOJ appellate victories in joint venture, partial acquisition, and exclusive dealing cases; and, the court decision on Wal-Mart v.
(5) Like "unilateral" exclusive dealing, such agreements deprive rivals of inputs--including distribution services--they might otherwise employ to enhance moment-to-moment rivalry.
One popular way to frame the antitrust analysis of a vertical practice such as exclusive dealing is to assess the probability that it serves efficiency.