Promotional allowances and services-sections 2(d) and 2(e)

• Pages: 14-18

Robinson-Patman Primer

14

forming the same function. Alter natively, the cost

justication or meeting competition defenses might

be used to justify such a discount.

IV. PROMOTIONAL ALLOWANCES AND

SERVICES—SEC TIONS 2(d) AND 2(e)

Promotional allowances or services are pay-

ments or services that facilitate the product’s resale

by the customer and are distinct from concessions

that affect the price paid by the customer. Promo-

tional allowances and services are subject to some-

what stricter rules than pr ice concessions under

Section 2(a). Examples include cooperative advertis-

ing, catalogues, displays, demonstrators, and on-line

advertising.

A. Proportional Equality

If a seller either offers to pay a customer for

promotional services (e.g., display or advertising)

or provides the customer promotional services or

materials, the Act requires that t he offer be made

available on proportionally equal terms to al l com-

peting customers. Unlike discrimi nation in price, a

discrimination involving promotional allowances or

services violates the Act regardles s of whether there

has been injury to competition, although recover-

ing damages requires proof of actual injur y. More-

over, when a seller provides promotional allowances

or services to direct-buying retailers, it must offer

PrmrFedPriceDiscr4e.indd 14 9/15/15 1:01 PM