The impact of private labels on welfare and competition – how retailers take advantage of the prohibition of resale price maintenance in European competition law.

Contracts stipulating consumer prices between retailers and suppliers are illegal under European competition law. Without control of prices, the branded goods industry cannot communicate coherent marketing strategies. Retailers, though, control prices, promotions and presentations for industry's brands and private labels. These unequal conditions help to explain the recent surge of private labels that has regionally reached more than 40% of food turnover and for new ways in which private labels are used against brands. Issues of competition and welfare are discussed in the context of private labels to support the argument against the prohibition of retail price maintenance....