Antitrust Law Daily Wrap Up, ANTITRUST NEWS: FTC Reopens, Extends Comment Period for Advertising Allowances Guides, (Feb 12, 2013)

By Jeffrey May, J.D.

The FTC announced today that it has reopened and extended the deadline for submitting public comments on guidance for manufacturers and wholesalers on how they can provide advertising allowances and other promotional payments and services to retailers without running afoul of the Robinson-Patman Act. At the request of stakeholders, the deadline to submit comments will be extended until March 4, 2013. The FTC published its request for public comments on December 4, 2012. The comment period originally ended on January 29, 2013.

The Guides for Advertising Allowances and Other Merchandising Payments and Services (16 CFR Part 240) are sometimes referred to as the “Fred Meyer Guides,” because the U.S. Supreme Court, in FTC v. Fred Meyer, Inc., 390 US 341, 1968 Trade Cases ¶72,383, suggested that the FTC provide the guidance. They were last revised in August 1990.

The guides are advisory in nature and are intended to provide the public with the Commission’s views concerning the requirements of Sections 2(d) and 2(e) of the Clayton Act, as amended by the Robinson-Patman Act. Sections 2(d) and 2(e) of the Robinson-Patman Act address allowances or services sellers give their customers to facilitate the resale of their goods by the customers. The sections require that such allowances or services be offered on proportionally equal terms to competing customers, except in instances in which a seller in good faith attempts to meet another seller’s lower priced offer.

According to the FTC, the current version of the guides contains 15 sections covering such topics as the definition of “competing sellers,” some acceptable ways of calculating the proportionality of allowances and services, and the circumstances in which different types of retailers might need to be given access to different types of promotional media.

The FTC said that it was seeking input on a number of specific issues including:

(1) the continuing need for the guides;

(2) changes in the case law that should now be reflected in the guides;

(3) accounting for new developments in commercial practices since 1990, such as the growth of the Internet as a means of promoting products;

(4) the costs and benefits the guides provide to business; and

(5) the costs and benefits the guides have for consumers.

Public comments can be submitted in paper form or online. Instructions for submitting comments in paper form can be found in the Federal Register notice. Comments can be submitted electronically at: https://ftcpublic.commentworks.com/ftc/fredmeyerguides.

News: Antitrust Advertising FederalTradeCommissionNews