DISCOUNTS

The offering of discounts to customers is generally a form of price competition that is encouraged. Under certain circumstances, however, discounts can be anti-competitive, for example, if they lead to prices being set at predatory levels; are conditional on customers buying all or a large proportion of their goods from the dominant enterprise (commonly known as “fidelity” or “loyalty” discounts); or where they are conditional upon the purchase of tied products (tying or bundling). If these conditions apply, the discount may be a breach of Section 17 or Section 20 of the Act.