Map Policy Basics
What is a MAP Policy?
It is a minimum advertised price policy. MAP Policies are unilateral policies implemented by manufacturers, which set forth the minimum price at which a reseller can advertise your product. MAP Policies are used to ensure that one reseller cannot undercut other resellers, which in turn protects your brand and increases competition among your resellers.
What a MAP Policy isn’t?
A MAP Policy does not establish the price at which resellers can actually sell your product. Resellers are free to sell a product at whatever price they choose. A policy which restricts the sale price risks exposure to price-fixing allegations.
Are MAP Policies Legal?
When implemented and enforced correctly, courts have found that MAP Policies are generally legal and do not constitute illegal price fixing. In Leegin Creative Leather Prods. v. PSKS, Inc., the Supreme Court ruled that vertical price restraints, such as MAP Policies, are not per se illegal, and in United States v. Colgate & Co., the Supreme Court held that a manufacturer may announce certain sales practices and refuse to deal with resellers that do not abide by such practices. Taken together, these cases have helped to establish MAP Policies’ legality.
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