Leegin Case: Resale Price Maintenance vs. Consumer Welfare

Abstract

A new approach to vertical price fixing, brought up in Leegin by U.S. Supreme Court had triggered various debate and it is still not clear whether resale price maintenance (RPM) can have severe anticompetitive potential or can also be beneficial to competition. Main problem of assessing pro-competitive or anti-competitive effects of RPM is that there is a substantive lack of empirical evidence. Furthermore, there is a room for manipulation where contradictory economic theories are brought. Albeit EU Competition Law is always influenced by U.S. Antitrust policy, however, it can be argued that EU should not follow a liberal approach to RPM made in Leegin.

Keywords: Leegin case, resale price maintenance, vertical price fixing agreements, pro-competitive, anti competitive effects, EU competition, U.S. antitrust law

JEL Classification: K21