|| Author: Duncan Riley|

Exclusive Sales Agreements

Spain Costas, honors its motto – exclusive real estate – offers a very professional service, with excellent customer service, promotion of the property in the portfolio of international clients and ads studied to achieve maximum impact. When the seller signs an exclusive contract, the real estate agency takes the sale as a favorite subject and not as a second order; First the loyal customers, then the others. Spain Costas, for example, invests more in advertising; Exclusive customers are those who display themselves in the best positions and with a preferred image. Exclusive supply contracts prevent a supplier from selling inputs to another buyer. Where a buyer is in a monopoly situation and obtains exclusive supply contracts, so a newcomer may not be able to receive the inputs necessary to compete with the monopoly, contracts may be considered an exclusionary tactic contrary to Section 2 of the Sherman Act. For example, the FTC prevented a large drug manufacturer from imposing exclusive 10-year contracts for an essential ingredient to produce its drugs, for which suppliers would have received a percentage of the drug`s profits. The FTC found that the drug manufacturer used exclusive supply agreements to prevent other drug manufacturers from moving away from the market by controlling access to the essential ingredient. The drug manufacturer was then able to increase the prices of his drug by more than 3000%. The distributor shall keep accurate records of all its activities, to the extent reasonably necessary to determine compliance with the terms of this Agreement, including accounting records, customer sales records and administrative submissions. The distributor shall keep such recordings for at least three years after their establishment or creation. During the term of this Agreement and for a period of 18 months therefly, the Supplier shall have the right to consult and audit such records. The distributor shall fix the selling price and royalties at which it sells or licenses the supplier products in the territory. The distributor is solely responsible for the costs related to the distribution of the supplier products, including selling costs, import duties, all bank charges, shipping and processing costs, installation or other operating costs, accreditation fees, transfer fees and other payment-related fees, as well as taxes, except for the fact that the merchant is not held responsible for taxes based on the supplier`s income.

Exclusive purchase agreements that require a distributor to sell the products of a single manufacturer may have a similar impact on a new manufacturer and prevent it from placing its products in a sufficient number of outlets to allow consumers to compare its new products with those of the first manufacturer. Exclusive purchase agreements may infringe anti-cartel rules when they prevent new entrants from competing with sales. For example, the FTC found that a tube or pipe fittings producer had unlawfully maintained its monopoly on domestically manufactured ductile tube or pipe fittings by requiring its distributors to purchase domestic tube or pipe fittings exclusively from it and not from its competitors attempting to enter the domestic market. The FTC found that this producer`s policy prevented a competitor from obtaining the sales necessary for effective competition. In another case, the DOJ challenged the exclusive activities of an artificial tooth manufacturer with a market share of at least 75%. These exclusive contracts with key distributors effectively prevented small competitors from selling their teeth to dental laboratories and eventually being used by dental patients. In similar situations, newcomers may face considerable additional costs and time to induce traders to forgo exclusive agreements with the governing company or find another way to preserve its product in front of consumers….

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