Vertical Restraints

Vertical Restraints and International Trade Economy

In relation to international trade economy, Christopher Mark (1993) provided the following definition of Vertical Restraints: Anticompetitive restraint of trade arrangements imposed by a firm at one stage in a chain of transactions –usually the seller –on firms at another stage, such as the seller's customers. Such restrictions include prescribing minimum prices at which the customer can resell a purchased product (resale price maintenance); limiting the geographic territory in which the buyer may resell what it has purchased (territorial restrictions); inducing the buyer to deal only in the seller's products (exclusive dealing); and making the availability of one product contingent upon the purchase of other goods or services (tying contracts or bundling). See antitrust and competition policy.