Editing Price fixing

{{Short description|Anticompetitive agreement to control prices}}
{{Distinguish|fixed price|price controls}}
{{Competition law}}
'''Price fixing''' is an [[Anti-competitive practices|anticompetitive]] agreement between participants on the same side in a market to buy or sell a [[product (business)|product]], service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given level by controlling [[supply and demand]].

The intent of price fixing may be to push the price of a product as high as possible, generally leading to [[profit (economics)|profits]] for all sellers but may also have the goal to fix, peg, discount, or stabilize prices. The defining characteristic of price fixing is any agreement regarding price, whether expressed or implied.

Price fixing requires a conspiracy between sellers or buyers. The purpose is to coordinate pricing for mutual benefit of the traders. For example, manufacturers and retailers may conspire to sell at a common "retail" price; set a common minimum sales price, where sellers agree not to discount the sales price below the agreed-to minimum price; buy the product from a supplier at a specified maximum price; adhere to a [[price book]] or [[list price]]; engage in cooperative price [[advertising]]; standardize [[credit (finance)|financial credit]] terms offered to purchasers; use uniform [[discounts and allowances|trade-in allowances]]; limit [[discounts and allowances|discounts]]; discontinue a free service or fix the price of one component of an overall service; adhere uniformly to previously announced prices and terms of sale; establish uniform costs and [[markup (business)|markups]]; impose mandatory [[fee|surcharges]]; purposefully reduce output or sales in order to charge higher prices; or purposefully share or pool markets, territories, or customers.

Price fixing is [[competition law|permitted in some markets but not others]]; where allowed, it is often known as ''[[resale price maintenance]]'' or ''retail price maintenance''.

Not all similar prices or price changes at the same time are price fixing. These situations are often normal market phenomena. For example, the price of [[Agriculture|agricultural]] products such as wheat basically do not differ too much, because such agricultural products have no characteristics and are essentially the same, and their price will only change slightly at the same time. If a natural disaster occurs, the price of all affected wheat will rise at the same time. And the increase in consumer demand may also cause the prices of products with limited supply to rise at the same time.<ref>{{Cite web|title=Price Fixing|url=https://www.ftc.gov/advice-guidance/competition-guidance/guide-antitrust-laws/dealings-competitors/price-fixing|access-date=January 20, 2023|website=ftc.gov|publisher=[[Federal Trade Commission]]}}</ref>

In [[neo-classical economics]], price fixing is inefficient. The anti-competitive agreement by producers to fix prices above the market price transfers some of the [[consumer surplus]] to those producers and also results in a [[deadweight loss]].

International price fixing by private entities can be prosecuted under the antitrust laws of many countries. Examples of prosecuted international cartels are those that controlled the prices and output of [[Lysine price-fixing conspiracy|lysine]], [[citric acid]], [[graphite electrodes]], and bulk [[Hoffmann-La Roche#Price-fixing conspiracy|vitamins]].<ref name="AAEA">{{cite report|url=https://ageconsearch.umn.edu/record/19499|title=Extraterritoriality of the Sherman Act and Deterrence of Private International Cartels|publisher=[[American Agricultural Economics Association]]|date=April 2004|access-date=September 30, 2014|last=Connor|first=John M.}}</ref>

==Legal status==
===United States===
In the United States, price fixing can be prosecuted as a criminal [[federal offense]] under Section 1 of the [[Sherman Antitrust Act]].<ref>{{cite web|url=https://www.law.cornell.edu/uscode/text/15/1|title=15 U.S. Code § 1 - Trusts, etc., in restraint of trade illegal; penalty|website=law.cornell.edu|publisher=[[Legal Information Institute]]|access-date=January 20, 2023}}</ref>

Criminal prosecutions must be handled by the [[U.S. Department of Justice]], but the [[Federal Trade Commission]] also has jurisdiction for civil antitrust violations. Many [[state attorney general|state attorneys general]] also bring [[antitrust]] cases and have antitrust offices, such as [[Virginia]], [[New York (state)|New York]], and [[California]]. Further, where price fixing is used as an artifice to defraud a U.S. government agency into paying more than market value, the U.S. attorney may proceed under the [[False Claims Act]].

Private individuals or organizations may file lawsuits for triple damages for antitrust violations and, depending on the law, recover attorneys fees and costs expended on prosecution of a case.<ref>{{cite web|url=http://www.oag.state.ny.us/business/antitrust.html|title=About Antitrust Bureau|website=oag.state.ny.us|publisher=[[Attorney General of New York|New York State Attorney General]]|access-date=June 15, 2016|archive-url=https://web.archive.org/web/20080929184231/http://www.oag.state.ny.us/business/antitrust.html|archive-date=September 29, 2008|url-status=dead}}</ref><ref name="be-careful">{{cite web|url=http://apa.pmai.org/readall/antitrustlaw.html |title=Be Careful About Antitrust Law!|date=February 2000|publisher=Art Publishers Association|access-date=June 15, 2016|url-status=usurped|archive-url=https://web.archive.org/web/20070927185403/http://apa.pmai.org/readall/antitrustlaw.html|archive-date=September 27, 2007}}</ref> If the case at hand also violates the [[False Claims Act of 1863]], in addition to the Sherman Act, private individuals may also bring a civil action in the name of the United States under the ''[[Qui Tam]]'' provision of The False Claims Act.

Under American law, exchanging prices among competitors can also violate the [[antitrust laws]]. That includes exchanging prices with the intent to fix prices or the exchange affecting the prices individual competitors set. Proof that competitors have shared prices can be used as part of the evidence of an illegal price fixing agreement.<ref name="be-careful"/> Experts generally advise that competitors avoid even the appearance of agreeing on price.<ref name="be-careful"/>

Since 1997, US courts have divided price fixing into two categories: vertical and horizontal maximum price fixing.<ref name="tsui">{{cite journal|title=Interstate Comparison – Use of Contribution Margin in Determination of Price Fixing|last=Tsui|first=Tat Chee|journal=Pace International Law Review Online Companion|volume=1|date=April 2011|ssrn=1839223}}</ref> Vertical price fixing includes a manufacturer's attempt to control the price of its product at retail.<ref>{{cite web|last=Sauer|first=Raymond D.|title=VERTICAL PRICE FIXING|url=http://hubcap.clemson.edu/~sauerr/classes/309/vertpfix.htm|access-date=July 9, 2013|url-status=dead|archive-url=https://web.archive.org/web/20130708042032/http://hubcap.clemson.edu/~sauerr/classes/309/vertpfix.htm|archive-date=July 8, 2013}}</ref> In ''[[State Oil Co. v. Khan]]'',<ref>{{ussc|name=State Oil Co. v. Khan|volume=522|page=3|pin=|year=1997}}.</ref> the [[U.S. Supreme Court]] held that vertical price fixing is no longer considered a ''per se'' violation of the Sherman Act, but horizontal price fixing is still considered a breach of the Sherman Act. Also in 2008, the defendants of ''United States v LG Display Co.'', ''United States v. Chunghwa Picture Tubes'', and ''United States v. Sharp Corporation'', heard in the [[United States District Court for the Northern District of California]], agreed to pay a total sum of $585 million to settle their prosecutions for conspiring to fix prices of liquid crystal display panels. That was the second largest amount awarded under the Sherman Act in history.<ref name="tsui"/>

===Canada===
In Canada, it is an indictable criminal offence under Section 45 of the [[Competition Act]]. [[Bid rigging]] is considered a form of price fixing and is illegal in Canada (s.47 Competition Act).

===Australia===
Price fixing is illegal in Australia under the [[Competition and Consumer Act 2010]], with considerably similar prohibitions to the US and Canadian prohibitions. The Act is administered and enforced by the [[Australian Competition & Consumer Commission]]. Section 48 of the Competition and Consumer Act 2010 (Cth) explicitly states, "A corporation shall not engage in the practise of resale price maintenance." A broader understanding of the statutory provision is in Section 96(3)of the Competition and Consumer Act 2010 (Cth), which broadly defines what can be resale price maintenance.

===New Zealand===
New Zealand law prohibits price fixing, among most other anti-competitive behaviours under the [[Commerce Act 1986]]. The act covers practices similar to that of US and Canadian law, and it is enforced by the [[Commerce Commission]].<ref>{{cite press release|url=http://www.comcom.govt.nz/MediaCentre/MediaReleases/2004/commissionwarnsgpsaboutpricefixing.aspx|title=Commission warns GP's about price fixing|url-status=dead|archive-url=https://web.archive.org/web/20090416054240/http://www.comcom.govt.nz/MediaCentre/MediaReleases/2004/commissionwarnsgpsaboutpricefixing.aspx|archive-date=April 16, 2009|date=May 18, 2005|work=Release No 133|publisher=[[Commerce Commission]]}}</ref><ref>{{cite web|url=https://www.legislation.govt.nz/act/public/1986/0005/latest/DLM87623.html|title=Commerce Act 1986|publisher=Parliamentary Counsel Office|date=October 5, 2022|orig-date=Originally published April 28, 1986|access-date=January 20, 2023}}</ref>

===European Union===
Under the [[EU commission's leniency programme]], [[whistleblowing]] firms that co-operate with the antitrust authority see their prospective penalties either wiped out or reduced.<ref>{{cite news|first= David|last=Gow|title=Heineken and Grolsch fined for price-fixing|date=April 18, 2007|url=http://business.guardian.co.uk/story/0,,2059542,00.html|work=[[The Guardian]]|access-date=January 20, 2023|location=Brussels}}</ref>

===United Kingdom===
British competition law prohibits almost any attempt to fix prices.<ref>{{cite web|url=https://www.gov.uk/cartels-price-fixing|title=Avoid and report anti-competitive activity|publisher=[[Government of the United Kingdom]]|website=gov.uk|access-date=January 20, 2023}}</ref>

The [[Net Book Agreement]] was a public agreement between UK booksellers from 1900 to 1991 to sell new books only at the recommended retail price to protect the revenues of smaller bookshops. The agreement collapsed in 1991, when the large book chain [[Dillons Booksellers|Dillons]] began discounting books, followed by rival [[Waterstones]].<ref>{{cite book|title=The Organisation of Knowledge in Victorian Britain|publisher=[[Oxford University Press]]/[[British Academy]]|year=2005|page=275|isbn=978-0197263266|doi=10.5871/bacad/9780197263266.001.0001|editor1-last=Daunton|editor1-first=Martin|editor1-link=Martin Daunton}}</ref><ref>{{cite news|url=https://www.nytimes.com/1991/10/07/business/the-media-business-british-book-shops-in-price-skirmishes.html|work=[[The New York Times]]|first=Suzanne|last=Cassidy|title=THE MEDIA BUSINESS; British Book Shops in Price Skirmishes|date=October 7, 1991|access-date=January 20, 2023|url-access=limited}}</ref>

However, price-fixing is still legal in the magazine and newspaper distribution industry, and sometimes in the motion picture industry.<ref>{{Cite journal|last=Stevens|first=John Paul|date=April 2020|title=Price-Fixing in the Motion Picture Industry|url=https://scholarlycommons.law.northwestern.edu/cgi/viewcontent.cgi?article=1422&context=nulr|format=PDF|journal=[[Northwestern University Law Review]]|volume=114|issue=7|pages=1787–1804|access-date=January 20, 2023|issn=0029-3571}}</ref> Retailers who sell at below cover price are subject to withdrawal of supply. The [[Office of Fair Trading]] has given its approval to the ''status quo''.{{Citation needed|date=October 2015}}

==Exemptions==
When the agreement to control price is sanctioned by a multilateral [[treaty]] or is entered by sovereign nations as opposed to individual firms, the [[cartel]] may be protected from lawsuits and criminal [[antitrust]] prosecution. That is why [[OPEC]], the global [[petroleum]] cartel, has not been prosecuted or successfully sued under [[US antitrust law]].

International airline tickets have their prices fixed by agreement with the [[IATA]], a practice for which there is a specific exemption in [[antitrust law]].<ref>{{Cite web|date=October 7, 2012|title=Australia: IATA enters price fixing saga|url=https://www.competitionpolicyinternational.com/australia-iata-enters-price-fixing-saga/|access-date=January 20, 2023|website=Competition Policy International}}</ref>{{better source needed|date=May 2017}}

==Examples==

=== Compact discs ===
{{main article|CD price fixing}}

Between 1995 and 2000, music companies were found to have used illegal marketing agreements such as [[resale price maintenance|minimum advertised pricing]] to artificially inflate prices of [[compact disc]]s in order to end price wars by discounters such as [[Best Buy]] and [[Target Corporation|Target]] in the early 1990s. It is estimated customers were overcharged by nearly $500 million and up to $5 per album. A settlement in 2002 included the music publishers and distributors; [[Sony Music Entertainment|Sony Music]], [[Warner Music Group|Warner Music]], [[Bertelsmann Music Group]], [[EMI|EMI Music]], [[Universal Music Group|Universal Music]] as well as retailers [[Musicland]], [[Trans World Entertainment]] and [[Tower Records (music retailer)|Tower Records]]. In restitution for price fixing they agreed to pay a $67.4 million fine distribute $75.7 million in CDs to public and non-profit groups.

=== Dynamic random access memory (DRAM) ===
{{main article|DRAM price fixing}}
In October 2005, the [[Korea]]n company [[Samsung]] pleaded guilty to conspiring with other companies, including [[Infineon]] and [[Hynix Semiconductor]], to fix the price of dynamic random access memory ([[DRAM]]) chips. Samsung was the third company to be charged in connection with the international cartel and was fined $300 million, the second largest antitrust penalty in US history.

In October 2004, four executives from Infineon, a German chip maker, received reduced sentences of 4 to 6 months in federal prison and $250,000 in fines after agreeing to aid the [[U.S. Department of Justice]] with their ongoing investigation of the conspiracy.

=== Capacitors ===
In March 2018, the [[European Commission]] fined eight firms, mostly Japanese companies, €254 million for operating an illegal price cartel for [[capacitors]].<ref name=jpcapactiros>{{cite news|last1=JiJi|title=EU fines Japanese firms over price-fixing cartel for capacitors|url=https://www.japantimes.co.jp/news/2018/03/22/business/eu-fines-japanese-firms-price-fixing-cartel-capacitors|access-date=22 March 2018|work=[[The Japan Times]]|date=March 22, 2018|archive-url=https://web.archive.org/web/20180322124609/https://www.japantimes.co.jp/news/2018/03/22/business/eu-fines-japanese-firms-price-fixing-cartel-capacitors/#.WrOlqnbP1PY|archive-date=March 22, 2018|location=Brussels}}</ref> The two largest players were [[Nippon Chemi-Con]] which was fined €98 million and [[Hitachi]] Chemical which was fined €18 million.<ref name=jpcapactiros />

=== Perfume ===
In 2006, the [[Cabinet of France|government of France]] fined 13 [[perfume]] brands and three vendors for price collusion between 1997 and 2000. The brands include [[L'Oréal]] (€4.1 million), [[Chanel]] (€3.0 million), [[LVMH]]'s [[Sephora]] (€9.4 million), and [[Hutchison Whampoa]]'s ''Marionnaud'' (€12.8 million).<ref>{{cite news|url=https://www.wsj.com/articles/SB114238994783198532|title=France Fines Perfume Makers And Vendors in Price-Fixing Case|last=Passariello|first=Christina|date=March 15, 2006|work=[[The Wall Street Journal]]|access-date=January 20, 2023|location=Paris}}</ref>

=== Liquid crystal displays ===
In 2008 in the US, [[LG Display Co.]], Chunghwa Picture Tubes and [[Sharp Corp.]], agreed to plead guilty and pay $585 million in criminal fines<ref>{{cite news|url=https://money.cnn.com/2008/11/12/news/international/pricefixing/index.htm|work=[[CNN]]|last=Frieden|first=Terry|title=$585 million LCD price-fixing fine|date=November 12, 2008|access-date=January 20, 2023|location=Washington, D.C.}}</ref><ref>{{cite web|url=https://www.justice.gov/archive/opa/pr/2008/November/08-at-1002.html|title=LG, Sharp, Chunghwa Agree to Plead Guilty, Pay Total of $585 Million in Fines for Participating in LCD Price-fixing Conspiracies|website=justice.gov|publisher=[[United States Department of Justice]]|access-date=January 20, 2023|location=Washington, D.C.}}</ref> for conspiring to fix prices of [[liquid crystal display]] panels.

South Korea–based [[LG Display]] would pay $400 million, the second-highest criminal fine that the [[United States Department of Justice Antitrust Division|US Justice Department antitrust division]] has ever imposed. Chunghwa would pay $65 million for conspiring with LG Display and other unnamed companies and Sharp would pay $120 million, according to the department.<ref>{{cite news|url=https://www.bloomberg.com/apps/news?pid=20601080&sid=aP1P0CBFZssE&refer=asia|work=[[Bloomberg News]]|last=Bliss|first=Jeff|title=LCD Makers Will Plead Guilty in Price-Fixing Scheme (Update2)|archive-url=https://web.archive.org/web/20121023082042/http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aP1P0CBFZssE&refer=asia|archive-date=October 23, 2012|date=November 12, 2008|url-access=subscription}}</ref><ref>{{cite news|url=https://www.reuters.com/article/lcd-doj-idUKN1246651020081112|title=UPDATE 2-LG Display, Sharp, Chunghwa say guilty in LCD case|work=[[Reuters]]|date=November 12, 2023|access-date=January 20, 2023}}</ref>

In 2010, the [[EU]] fined LG Display €215 million for its part in the [[LCD]] price fixing scheme.<ref>{{cite web|url=https://www.bloomberg.com/news/2010-12-08/six-lcd-panel-makers-fined-649-million-by-european-union-for-price-fixing.html|title=LCD-Panel Makers Fined $649 Million by European Union for Price Fixing|last=White|first=Aoife|publisher=[[Bloomberg News]]|date=December 8, 2010|access-date=January 20, 2023|url-access=subscription}}</ref> Other companies were fined for a combined total of €648.9 million, including [[Chimei Innolux Corporation|Chimei Innolux]], [[AU Optronics]], Chunghwa Picture Tubes Ltd., and [[HannStar Display Corporation|HannStar Display Corp.]]<ref>{{cite press release|url=https://ec.europa.eu/commission/presscorner/detail/en/SPEECH_10_736|title=Joaquín Almunia Vice President of the European Commission responsible for Competition Policy Press conference on LCD cartel, Visa and French chemists' association decisions Press conference Brussels, 8 December 2010|date=December 8, 2010|website=europa.eu|publisher=[[European Commission]]|access-date=January 20, 2023}}</ref> LG Display said it is considering appealing the fine.<ref>{{cite news|url=https://www.koreatimes.co.kr/www/news/tech/2010/12/133_77753.html|title=2 LCD giants face contrasting fates|newspaper=[[The Korea Times]]|last=Kim|first=Yoo-chul|date=December 9, 2010|access-date=January 20, 2023}}</ref>{{update needed|date=February 2025}}

=== Air cargo market ===
In late 2005/early 2006, [[Lufthansa]] and [[Virgin Atlantic]] came forward about their involvement in large price-fixing schemes for cargo and passenger surcharges in which 21 airlines were involved since 2000 (amongst which were [[British Airways]], [[Korean Air]], and [[Air France-KLM]]). [[U.S. Department of Justice]] fined the airlines a total of $1.7 billion, charged 19 executives with wrongdoing and four received prison terms.<ref>{{cite news|last=Caldwell|first=Alicia A.|url=http://www.nbcnews.com/id/41926712 |title=21 airlines fined in price-fixing scheme|publisher=[[NBC News]]|date=March 5, 2011|access-date=January 20, 2023}}{{dead link|date=August 2024|bot=medic}}{{cbignore|bot=medic}}</ref>

In December 2008, the [[Commerce Commission|New Zealand Commerce Commission]] filed legal proceedings against 13 airlines in the [[New Zealand High Court]]. According to the Commission, the carriers "colluded to raise the price of [freight] by imposing fuel charges for more than seven years".<ref name="Commerce Commission">{{cite press release|url=http://www.comcom.govt.nz/BusinessCompetition/Anti-competitivePractices/commercecommissionprocedureinaccor.aspx|title=Commerce Commission procedure in accordance with standard best practice|date=March 20, 2009|work=Release no 113|publisher=[[Commerce Commission]]|access-date=June 23, 2014|archive-url=https://web.archive.org/web/20090906183007/http://www.comcom.govt.nz/BusinessCompetition/Anti-competitivePractices/commercecommissionprocedureinaccor.aspx|archive-date=September 6, 2009}}</ref> In 2013 [[Air New Zealand]] was the final airline of the 13 to settle.<ref>{{cite press release|url=http://www.comcom.govt.nz/the-commission/media-centre/media-releases/detail/2013/air-new-zealand-final-airline-to-settle-with-commerce-commission-in-air-cargo-case|title=Air New Zealand final airline to settle with Commerce Commission in air cargo case|publisher=[[Commerce Commission]]|date=June 13, 2013|access-date=June 23, 2014|archive-url=https://web.archive.org/web/20141003141705/http://www.comcom.govt.nz/the-commission/media-centre/media-releases/detail/2013/air-new-zealand-final-airline-to-settle-with-commerce-commission-in-air-cargo-case|archive-date=October 3, 2014|url-status=dead}}</ref>

The Commission noted that it might involve up to 60 airlines.<ref name="CC Dec 08">{{cite press release|url=https://comcom.govt.nz/case-register/case-register-entries/cargolux-airlines-international-sa/media-releases/international-air-cargo-cartel-to-be-prosecuted|title=International air cargo cartel to be prosecuted|date=December 15, 2008|publisher=[[Commerce Commission]]|access-date=June 23, 2014}}</ref> In 2009 the Commission said overseas competition authorities were also investigating the [[air cargo]] market, including the US and Australia where fines had been imposed.<ref name="Commerce Commission"/>

=== Tuna ===
An attempt to fix the price of tuna resulted in a $25 million fine for [[Bumble Bee Foods]] in 2017 and a $100 million fine for [[StarKist]] in 2020. Christopher Lischewski, the former CEO of Bumble Bee, was sentenced to 40 months in jail and fined $100,000 for his 2010–2013 involvement.<ref>{{Cite news|last=Garcia|first=Sandra E.|date=June 16, 2020|title=Former Bumble Bee C.E.O. Is Sentenced in Tuna Price-Fixing Scheme|work=[[The New York Times]]|url=https://www.nytimes.com/2020/06/16/business/bumble-bee-tuna-price-fixing.html|access-date=January 20, 2023|issn=0362-4331|url-access=limited}}</ref>

===Coronavirus vaccine===
During the [[COVID-19 pandemic]], companies such as [[Pfizer]] and [[Moderna]] announced rates for their coronavirus vaccines that would differ based on deals established with various governments. Executive orders were enacted in the United States to lower prescription drug costs which was claimed by Pfizer's CEO to cause "enormous destruction" to the pharmaceutical industry.<ref>{{cite web|url=https://www.cnbc.com/2020/07/28/pfizer-ceo-says-trumps-executive-orders-overhauling-us-drug-pricing-will-cause-enormous-destruction.html|title=Pfizer CEO says Trump's executive orders overhauling U.S. drug pricing will upend the industry|date=July 28, 2020|publisher=[[CNBC]]|last=Lovelace Jr.|first=Berkeley|access-date=January 20, 2023}}</ref>

=== 1990s airlines ===
Airlines in the 1990's were blocked by the [[United States Department of Justice|US Department of Justice]] from continuing to use software to share data on routes and prices before they became public.<ref name=":1">{{Cite web |last1=Vogell |first1=Heather |last2=Coryne |first2=Haru |last3=Little |first3=Ryan |date=2022-10-15 |title=Rent Going Up? One Company's Algorithm Could Be Why. |url=https://www.propublica.org/article/yieldstar-rent-increase-realpage-rent |access-date=2024-08-21 |website=ProPublica |language=en}}</ref>

=== Rent algorithm ===
''[[ProPublica]]'' in 2022 investigated the use of algorithms created by [[RealPage]] by rental companies across the United States to set rents, which critics worry has helped to raise rents by limiting competition.<ref name=":1" /> The US DOJ escalated its investigation into price-fixing in March of 2024,<ref>{{Cite news |last=Sisco |first=Josh |date=March 20, 2024 |title=DOJ escalates price-fixing probe on housing market |url=https://www.politico.com/news/2024/03/20/rental-housing-market-doj-investigation-00147333 |work=Politico}}</ref> and filed an [[United States antitrust law|anti-trust]] lawsuit in August of 2024.<ref>{{Cite web |last=Vogell |first=Heather |date=2024-08-23 |title=DOJ Files Antitrust Suit Against Maker of Rent-Setting Algorithm |url=https://www.propublica.org/article/realpage-lawsuit-doj-antitrustdoj-files-antitrust-suit-against-maker-of-rent-setting-algorithm |access-date=2024-08-24 |website=ProPublica |language=en}}</ref>

== Signs of possible price fixing during bidding ==
It is more common to have price fixing trends during the [[bidding]] process, such as:

* If the bid or quoted price is much higher than expected, the reason may be collusive to set the price or just overpriced, but it is legal in itself.
* If all suppliers choose to increase prices at the same time, it is beyond the scope of input cost changes.
* If the price of a new supplier is lower than the usual corporate bidding price, the reason may be that there is a [[collusion]] of bidding among existing companies.
* If the price of a new supplier drops significantly after bidding, the reason may be that some suppliers have been colluding and the new supplier has forced them to compete.<ref name=":0">{{Cite web|title=Cartels|url=https://www.accc.gov.au/business/competition/cartels|access-date=January 20, 2023|website=accc.gov.au|publisher=[[Australian Competition & Consumer Commission]]}}</ref>

== Impact of price fixing ==
When prices are determined between various companies, it may affect consumers' choices to a certain extent, and affect small businesses that rely on these suppliers.<ref>{{Cite journal|last=Erickson|first=W. Bruce|date=March 1976|title=Price Fixing Conspiracies: Their Long-Term Impact|journal=The Journal of Industrial Economics|volume=24|issue=3|pages=189–202|doi=10.2307/2098269|jstor=2098269}}</ref>

Taking [[freight]] as an example, many products are now transported by freight through various channels. If the freight price is [[Artificiality|artificially]] increased, it will have an impact on the entire supply chain. For example, it will cause the price of goods and services to increase, and it will also affect consumers' choices.<ref name=":0" />

==Criticism on legislation==
[[Economic liberals]] believe that price fixing is a voluntary and consensual activity between parties that should be free from government compulsion and government interference. At times price fixing ensures a stable market for both consumers and producers. Any short-term benefit of increased price competition will force some producers out of the market and cause product shortages and prices for consumers to rise. In the end price-fixing legislation forces producers out of a market because it can not compete with the biggest discounter and the market winds up a monopoly anyway.<ref>{{cite magazine|url=https://www.cato.org/sites/cato.org/files/serials/files/regulation/1988/5/reg12n2-debow.html|title=What's Wrong with Price Fixing: Responding to the New Critics of Antitrust|last=DeBow|first=Michael E.|magazine=[[Regulation (magazine)|Regulation]]|publisher=[[American Enterprise Institute]]|volume=12|number=2 (Summer 1988)|date=1988|access-date=January 20, 2023|via=[[Cato Institute]]}}</ref>

==See also==
{{colbegin}}
* [[Antitrust]]
* [[Bid rigging]]
* [[Collusion]]
* [[George Howard Earle Jr.]]
* [[FBI]]
* [[Gold fixing]]
* [[Herfindahl index]]
* [[London Gold Pool]]
* [[Monopoly]]
* [[Oligopoly]]
* [[Price controls]]
* [[Price gouging]]
* [[Resale price maintenance]]
* [[Tacit collusion]]
* [[Trade Practices Act 1974|Trade Practices Act 1974 (Australia)]]
* [[US Department of Justice]]
* [[Variable pricing]]
* [[Fixed price]]
* [[Vendor lock-in]]
* [[Price fixing cases]]
{{colend}}

==References==
{{Reflist|2}}

==External links==
* [https://www.fbi.gov/news/stories/2013/september/guilty-pleas-show-high-cost-of-price-fixing-in-auto-industry Sticker Shock, Guilty Pleas Show High Cost of Price-Fixing in Auto Industry], [[FBI]] 
* [https://www.gov.uk/cartels-price-fixing Avoid and report anti-competitive activity]
* [http://www.usdoj.gov/usao/eousa/foia_reading_room/usam/title7/ant00007.htm US Department of Justice Antitrust Resource Manual]
* [http://www.ftc.gov/speeches/other/confbd4.htm Identifying Horizontal Price Fixing in the Electronic Marketplace]
* [http://www.joystiq.com/entry/1234000990068106/ SONY Accused of Price Fixing in the UK - November 15, 2005]
* [https://web.archive.org/web/20080929184231/http://www.oag.state.ny.us/business/antitrust.html Antitrust Enforcement]
* {{usurped|1=[https://web.archive.org/web/20070927185403/http://apa.pmai.org/readall/antitrustlaw.html Be Careful About Antitrust Law!]}}
* [http://www.usdoj.gov/opa/pr/2005/October/05_at_540.html US Department of Justice Website, Samsung Pleads Guilty to Price Fixing - October 5, 2005]
* [https://web.archive.org/web/20051211072509/http://www.usdoj.gov/atr/public/press_releases/2004/206631.htm US Department of Justice Website, Infineon Pleads Guilty to Price Fixing - October 2004]
* [https://web.archive.org/web/20060305165248/http://ag.state.nv.us/agpress/2002/02_0930b.pdf Antitrust settlement in Nevada price-fixing case]
* [https://web.archive.org/web/20050309083928/http://techcentralstation.com/040803M.html ''In Defense of Price Fixing'' by Sean Gabb]
* [https://web.archive.org/web/20060330071333/http://www.forbes.com/home/feeds/afx/2006/03/14/afx2592193.html "LVMH, L'Oreal, PPR fined for perfume price collusion; LVMH plans appeal"] ''Forbes''
* [http://todoproductosfinancieros.com/fixing/ Concepto de Fixing en Español]

{{Authority control}}

{{DEFAULTSORT:Price Fixing}}
[[Category:Pricing controversies]]
[[Category:Commercial crimes]]
[[Category:Anti-competitive practices]]