Propriety of publishing marketing area price lists The Federal Trade Commission recently advised a…

No. 122. Propriety of publishing marketing area price lists

The Federal Trade Commission recently advised a manufacturer who had requested an advisory opinion that there is nothing inherently ilegal about area price lists which make only due al10wancc for differences in the cost of shipment and delivery. The Commission advised the manufacturer further that price discriminations in sales to customers located in different areas who in fact compete with each other could amount to conduct in violation of Section 2 (a) of the Clayton Act, unless cost justified or unless the lower price is a good faith meeting of a competitor equal1y low price.

The Commission also pointed out that it could be unlawful area price lists permitted sales producing monopoly profits in one area to subsidize sales at much lower prices in another area or to a particular customer or group of customers to the competitive injury of a competitor of the sel1er. (File No. 67: 7081 , released Apr. 22, 1967.

1'0. 123. Sel1ing merchandise by lottery methods condemned by Commission The Commission issued an advisOl'Y opinion in which it ruled that a proposed plan calling for the sale of merchandise by means of a lottery would be contrary to the provisions of Section 5 of the Federal Trade Commission Act.

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Moreover " the Commission said the fact that the purchaser receives something of value for his consideration does not negate the existence of a lottery.

Under the terms of the proposed plan which was the subject of the advisory opinion, the promobon would consist of a store display carton containing 36 1 plastic scale model kits, with a different number to be marked on the end of each kit box. The display header would announce to prospective purchasers they could win a $2 chrome plated model if the number on the end of the box corresponds with the number to be posted by the store manager in 4 weeks. (File :\0. 673 7085, released May 5, 1967.

No, 124. Agricultural cooperatives may market their products through a common sales agent In an advisory opinion made public today, the Federal Trade Commission stated that agricultural cooperatives fOl'led under pertinent provisions of the Capper-Volstead Act may establish and market their members ' products through a common sales agent. Counsel for the requesting parties described his clients as cooperative associations of milk producers representing some 361 farmers and dairymen who produce about 2 miJJion pounds of milk per month in excess of that consumed in their trading area. Counsel said that formation of the sales agency by his clients wiJJ enable them to dispose of this excess through bidding on Government contracts to supply milk to military bases in competition with milk now imported from other milk marketing areas for that purpose. The Capper-Volstead Act (7 U. C. 291 , 292) permits persons engaged in agricultural pursuits to associate in the collective marketing of their products. Under its provisions cooperative associations formed thereunder may make contracts or agreements as will effect such purpose, and they may have lnal'keting agents in common. The Act has been construed as a grant of immunity from the antitrust laws insofar as collaboration among members of cooperative associations are concerned. This immunity ends hmvever, at the point where they act, either by themselves or 'with other persons or entities not in this category, to restrain trade or otherwise eliminate competition at successive stages in the marketing process.

In approving the formation of a common sales agency by cooperative 3ssociations of milk producers to market the products of their members the Commission advised Counsel for the requcsting: parties that its action His not to be construed as approval for any practice which may be predatory in nature, may result in unlawful ADVISORY OPINION DIGESTS 1733 monopolization, may restrain commerce to the extent that milk prices are unduly enhanced thereby, nor to conspiracies or combinations between your " clients "and persons or entities not in this category. " (File No. 673 7082, released May 5, 1967.