Global Competition Law and Economics by Einer Elhauge;Damien Geradin;

Author:Einer Elhauge;Damien Geradin;
Language: eng
Format: epub
ISBN: 9781847317674
Publisher: Bloomsbury UK (Major Textbooks)
Published: 2019-11-25T00:00:00+00:00

Questions on FTC v. Brown Shoe

The Court here holds that the FTC can condemn exclusive dealing or loyalty discounts without proof that a substantial share of the market was foreclosed if those agreements would violate Clayton Act § 3 and Sherman Act § 1 if substantial market foreclosure were shown.

1. Does it make sense to allow the FTC to condemn exclusive dealing or loyalty discount agreements without proof of substantial market foreclosure or direct proof of anticompetitive effect? What anticompetitive effect could such agreements have without such substantial foreclosure?

2. Should antitrust law condemn loyalty agreements like this when the buyer can terminate the loyalty condition at any time if it is willing to forgo benefits the seller provides to loyal buyers?

a. In a market with many buyers, does any individual buyer have any incentive to forgo such benefits in order to try to prevent marketwide foreclosure?

b. Doesn’t Clayton Act § 3 specifically cover loyalty discounts?

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