For a particular niche in demand but broad in utility industry, I am both a consumer and producer that participates internationally. Within segments of the participants, there are public informal concerns that the elimination of a price floor policy would lead to market failure through the unregulated undercutting of competition that would lead to lower quality products for consumers and an unprecedented drop in the number of competitors. For more sophisticated alternatives, as citizens of a country where free speech is protected, it seems like the people involved should have the right to publicly discuss how a policy would impact their lives and what could be proposed in place of it. However, such discussions would also inevitably include other independent business owners. Because of that, one should keep in mind that it is also strictly illegal for people who own or manage businesses in the same industry to decide or discuss what prices to set for the industry, which makes sense for the purposes of preventing a monopoly or oligopoly.

But, considering that such discussions wouldn't be solely to the benefit of the parties who would discuss such matters, but rather to the health of the entire market for any and all current and future participants, it seems unreasonable that participants who happen to be competitors wouldn't have any way to publicly voice the effects and alternatives of policies without it being considered collusion.

Are there any laws detailing what the limits are in this context? Are there referable precedents for what is allowed and not allowed within the context of maintaining market competition? From what I gather, there is a form of tacit collusion if it would be called that which seems permissible, but I have never had any particular desire for this kind of discussion until recently, so I don't have much experience in knowing how I establish what is legal and what isn't. I am looking for laws that can illustrate details and limits to these discussions to make there are no infringements before proceeding with a quantitative analysis.


1 Answer 1


Under US law, referring to the rather broad range of anti-trust legislation, regulation and case law, the most important issue is whether there is a conspiracy. A public discussion of some policy question is clearly not a conspiracy (even if only certain individuals are allowed to speak at the forum). So it is actually not illegal for executives to discuss their product. It would be illegal to engage in a a conspiracy to fix, raise, maintain or stabilize prices. To quote from the instructions from an antitrust case in the 9th Circuit, the case of Best Buy v. Toshiba, HannStar:

Under the federal Sherman Act, it is illegal for competitors, regardless of their size or amount of sales, to agree on the prices to be charged for their competing products. An agreement between competing firms can violate this rule even if there is not an agreement on the exact price to be charged. For example, it is illegal for competing companies to agree on maximum or minimum prices, a range within which prices will fall, a formula to set prices, or a component of prices, such as a shipping charge or an interest rate. It is also illegal for competitors to agree on a plan or scheme that will tend to stabilize prices.

Interestingly, there was no instruction as to what constitutes a conspiracy: but, ordinarily, it means that means to agree in secret to do an illegal thing.

  • Okay, so it seems like the most important aspect is secrecy. What if, however, someone, possibly a producer or possibly not, determines a specific optimization for the quantity supplied and price of a product, but then also openly admit they will conform to that supply and price, and a bandwagon effect causes more to adhere to that quantity and price. That seems it would constitute stabilizing prices. What is also bothersome is that the price cannot be doesn't need to be exact, which seems to rule out price floors and ceilings for discussion, but is it only for conspiracy?
    – John Joe
    Feb 10, 2018 at 21:10
  • 1
    @JohnJoe "and a bandwagon effect causes more to adhere to that quantity and price" How?
    – JAB
    Feb 12, 2018 at 21:05
  • Because having a price floor reduces predatory pricing, so inevitably more smaller businesses will support it in a public discussion. I definitely see a problem with the kind of situation where a lot of businesses are coming together and all agreeing on pricing because that could easily be abused, but I also definitely see a problem with a lack of regulation that can also be equally abused. I assume there has to be a middle ground because the problem is: if these people can't discuss the issues, then how does anyone know what policy to support? How does anyone discover any proof of anything?
    – John Joe
    Feb 13, 2018 at 1:28
  • I do not see either "conspiracy" or "secretly" in the excerpt. May 18, 2020 at 5:11

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