BTF1010 Study Guide - Final Guide: Exclusive Dealing, S47 (Berlin), Product Bundling
6 Jun 2018
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EXCLUSIVE DEALINGS
S47(1) of the Competition and Consumer Act prohibits a firm from engaging in exclusive
dealing. Exclusive dealing is concerned with vertical relations between firms at different
levels of an industry.
METHODS OF DISTRIBUTION
• Vertical Integration: From product to customer
• Agents: Acting on behalf of another is not a reseller
• Independent dealer buys goods and sells them as their own.
• Franchising: Means the right to use someone’s system, product or process of
manufacture – Code of Conduct Part IVB of the Competition and Consumer Act.
TYPES OF VERTICAL CONSTRAINTS
• Restrictions on competing products
• Tying – Product bundling. E.G. “If you buy my photocopier you must use the paper I
produce, or restricted type of paper from one purchaser”
• Geographical restrictions
• Time restrictions
• Quantity restrictions
S47 EXCLUSIVE DEALINGS
It prohibits corporations engaging in exclusive dealings that substantially lessen competition
between suppliers of goods and services or buyers of goods and services. Taking from both
perspectives as supplier or buyer.
Third line forcing: Tying one person’s product to your product.
Document Summary
S47(1) of the competition and consumer act prohibits a firm from engaging in exclusive dealing. Exclusive dealing is concerned with vertical relations between firms at different levels of an industry. Methods of distribution: vertical integration: from product to customer, agents: acting on behalf of another is not a reseller. Independent dealer buys goods and sells them as their own: franchising: means the right to use someone"s system, product or process of manufacture code of conduct part ivb of the competition and consumer act. Types of vertical constraints: restrictions on competing products, tying product bundling. If you buy my photocopier you must use the paper i produce, or restricted type of paper from one purchaser : geographical restrictions, time restrictions, quantity restrictions. It prohibits corporations engaging in exclusive dealings that substantially lessen competition between suppliers of goods and services or buyers of goods and services. Taking from both perspectives as supplier or buyer.
