Legal Definitions - Robinson–Patman Act

The Robinson–Patman Act is a federal law that prohibits price discrimination that can harm competition or lead to a monopoly. It is an amendment to the Clayton Act and is aimed at promoting fair competition in the marketplace.

Price discrimination occurs when a seller charges different prices to different buyers for the same product or service. This can be harmful to smaller businesses that cannot afford to pay higher prices and can lead to a monopoly by larger companies.

For example, if a grocery store charges different prices for the same brand of cereal to different customers based on their race or gender, this would be a violation of the Robinson-Patman Act. Another example would be if a manufacturer charges different prices to different retailers for the same product, with the intention of driving smaller retailers out of business.

The Robinson-Patman Act helps to ensure that businesses compete fairly and that consumers have access to a variety of products at reasonable prices.