What is exclusive dealing?

Question

What is exclusive dealing? What is a real life example of exclusive dealing?

Answer 1

Exclusive dealing broadly involves one trader imposing restrictions on another trader’s freedom to choose with whom, or in what, or where they deal. Exclusive dealing is prohibited by section 47 of the Trade Practices Act.

Some forms of exclusive dealing will only raise concerns under the Trade Practices Act if they substantially lessen competition.

One form of exclusive dealing – known as third line forcing – is prohibited per se, meaning that it is prohibited no matter what its effect on competition.

Third line forcing involves the supply of goods or services on condition that the purchaser acquires goods or services from a particular third party, or a refusal to supply because the purchaser will not agree to that condition.