Anticompetitive behavior refers to a set of activities or business practices carried out systematically by a firm or group of firms or government institutions to restrict competition in the market. Some of the anticompetitive behaviors are described below.
- Dumping – this is a process in which a company sells its products in a competitive market at a loss. This forces competitors out of the market and benefits the company in the long run
- Exclusive deals – involves providing a retailer or wholesaler with exclusive rights to purchase from only one supplier, for example a food retailer may buy food from only one farmer.
- Fixing of prices – the free market is dismantled by price collusions
- Refusal of deals – Companies may agree to refuse dealing with a certain vendor, for example two retailers may refuse to deal with a certain supplier.
- Territorial divisions – companies may agree to keep off each other’s territories. For example, a company in UK may agree with a company in US to avoid crossing each other’s borders
- Tying – products that are not related in any natural way are purchased together. For example, a soap and a knife may be purchased together to resist competition