Research Paper On Robinson Patman Act Of 1936

ROBINSON-PATMAN ACT 1936USA LAW
BUS 5110 MANAGERIAL ACCOUNTING
PROJECT GROUP G5
INSTRUCTOR: - DR PROSPER TURKO
BY
BUKASA KABONGO SERAPHIN
HOSSAM SIYAM
MOHAMED SALEH
PAUL LEMI
HISTORY AND DEFINITION
The Robinson-Patman Act of 1936, also referred to as the “Anti-Price Discrimination Act,” is a part of United States federal law that prohibits producers of products from participating in anticompetitive practices. The act specifically limits price discrimination and it is an amendment to the Clayton Antitrust Act, which was the first law of its kinds to prevent unfair price discrimination.
ORIGIN: - Adopted into Federal Law in 1936.
In 1936, Congress passed additional antitrust legislation in the Robinson-Patman Act (“the Act”), which banned any individual or business engaged in interstate commerce to sell the same products to different consumer groups, with the goal or effect of lessening competition, or creating a monopoly. (LEGAL DICTIONERY,NA)
GOALS OF ROBINSON-PATMAN ACT
A primary goal of the Act was to protect independent retailers from unfair competition by large chain stores.
Sometimes referred to as “Anti Chain Store Act”.
It prevents retailers purchasing products in large volumes from gaining too large an advantage over small buyers of the same products.
SECTIONS IN THE ROBINSON-PATMAN ACT
(a) Prohibits price discrimination to avoid causing injury to competition on the market
(b) Provides affirmative defense to this discrimination meaning that sellers have a defense to the discrimination if they offer products at a lower price to meet an equally low price offered by another seller
(c) Limits or prohibits certain brokerage fees
(d) Prohibits sellers from offering different prices to competing customers
(e) Prohibits sellers from promoting the resale based on discriminatory prices
(f) Prohibits sellers from encouraging buyers to violate the
Act
(LEGAL DICTIONERY,NA)

CASE STUDY
Apply this law to a situation where your firm has discovered some essential cost information from a competitor in a specific geographic market. From this valuable commercial intelligence, you believe you can accurately estimate the break-even, pricing point of your competitor. Management of your firm also believes it can temporarily lower its prices (in just that specific geographic area) to a point just below your competitor’s break-even price point and effectively eliminate it as a meaningful competitor.
LEGAL ISSUES
The firm will be in violation of section 2 (a) of the act that. This is because they will be temporarily lowering prices in just that specific geographic area to eliminate competition which is clearly prohibited by the act. The competitor will need to prove there is a reasonable possibility that price discrimination may substantially lessen competition or tend to create a monopoly. Given this scenario, indeed the discrimination can lead to intention to create a monopoly by driving competition out of business

ETHICAL IMPLICATION
“Ethics are a set of moral principles or values about that constitutes ‘right’ and ‘wrong’ behaviour” (Wright, 2008).
It is not ethical to have such confidential information about a competitor without their permission
Using such information against the competitor becomes unfair competition.
ECONOMIC-SOCIAL IMPLICATION
The actions will lead to our business controlling the geographic area and being a monopoly in the run hence customers will have to adapt to all prices adjustments as dictated by our business given that there is no competition in business for the same customers

REFERENCES
Dictionary, L. (NA, NA NA). ROBINSON-PATMAN ACT. Retrieved NA NA, NA, from Legal Dictionary: https://legaldictionary.net/robinson-patman-act/
Wright C. (2008) Stakeholder Marketing, BPP learning media, London, 1st edition