Resale price maintenance systems have long been used by manufacturers who wished to exercise control over the retail sale of their products. There have been some legal problems with such pricing systems. While the courts have maintained that a manufacturer is free to set the price of its product, they have not been clear as to how far a manufacturer can go to assure that its desired price is charged. This article describes manufacturers’ rationales for using resale price maintenance, discusses the current and probable future legal status of RPM, and suggests steps manufacturers can take in establishing RPM programs in order to avoid legal problems.
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