MSCC Letter Supporting Fair Prices for Local Business Act
Dear Senators:
On behalf of thousands of Main Street businesses and agriculture producers across the United States, the Main Street Competition Coalition writes to express our strong support for the Fair Prices for Local Businesses Act. This legislation makes critical improvements to the Robinson-Patman Act that will strengthen the ability of federal enforcers, state attorneys general, and private parties to combat the discriminatory pricing practices of dominant firms that harm independent businesses and raise costs for consumers.
The Main Street Competition Coalition believes the Robinson-Patman Act is a strong law that should be enforced vigorously by federal antitrust enforcers. We are encouraged by the renewed commitment to Robinson-Patman enforcement at the Federal Trade Commission, and we urge continued action. At the same time, we welcome statutory improvements that strengthen the law’s effectiveness. Due to the Act’s statutory construction and textual ambiguities, courts have rendered its application significantly weaker than what Congress originally intended, making enforcement far more difficult.
The Fair Prices for Local Businesses Act addresses these shortcomings directly. The legislation makes several key improvements to the Robinson-Patman Act:
• Expands coverage to services, not just commodities. The current law is limited to the sale of commodities, leaving a significant loophole that dominant platforms, including card networks, pharmacy benefit managers, and digital intermediaries, have exploited to impose discriminatory terms on Main Street businesses. This provision closes that gap.
• Repeals the meeting competition defense. In practice, this defense has created a complicated and problematic relationship between the Robinson-Patman Act and Section 1 of the Sherman Act’s prohibition on competitors sharing pricing information. Its repeal removes a significant barrier to effective enforcement.
• Establishes a reasonable threshold for power buyer inducement. The bill makes it easier to hold dominant buyers accountable when they use their market leverage to induce suppliers to offer discriminatory prices, addressing a key enforcement gap against dominant power buyers.
• Extends power buyer liability to promotional allowances and services. The legislation ensures that buyer liability applies not only to discriminatory pricing but also to discrimination in the extension of promotional allowances and services, closing loopholes that have allowed dominant buyers to avoid accountability.
• Clarifies the calculation of damages. Rather than requiring plaintiffs to perform complicated economic analyses of consumer diversion and price elasticity, the bill establishes a more straightforward damages framework. The framers of the Robinson-Patman Act never intended for an independent business facing discrimination to need a PhD economist whose service often costs in the millions in order to vindicate its rights under the law. A growing body of economic research, from the Federal Reserve Bank of Atlanta, the American Economic Journal, and leading antitrust scholars, demonstrates that dominant retailer market power suppresses competition and drives up consumer prices.
The Fair Prices for Local Businesses Act equips enforcers with the tools needed to address these harms and restore competitive fairness in the marketplace. We respectfully urge members of the Senate to co-sponsor and support the Fair Prices for Local Businesses Act. Agriculture producers, independent businesses, and the consumers they serve cannot afford further delay in enforcing and modernizing antitrust laws to meet the competitive challenges of today’s marketplace.
Thank you for standing with Main Street.
Sincerely,
The Main Street Competition Coalition