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Can I charge different prices to different customers without violating discrimination laws in Michigan? What are the requirements?

Charging Different Prices to Different Customers in Michigan

Michigan law does not have a specific statute that prohibits price discrimination. However, businesses must comply with federal laws that prohibit price discrimination, such as the Robinson-Patman Act and the Sherman Antitrust Act [1.1].

Under the Robinson-Patman Act, it is illegal for a seller to charge different prices to different customers if the effect of such discrimination may be to substantially lessen competition or tend to create a monopoly in any line of commerce [1.1]. The Sherman Antitrust Act prohibits any agreement or conspiracy in restraint of trade, including price-fixing [1.1].

Requirements

To avoid violating federal laws, businesses must ensure that any price differences are based on legitimate factors such as quantity discounts, differences in the cost of production, or differences in the cost of doing business with different customers [1.1].

It is important to note that price discrimination may also violate Michigan’s Consumer Protection Act if it is found to be unfair, unconscionable, or deceptive [1.1].

Additional Information

Michigan law has a specific statute that regulates the proposed rate, fare, charge, or tariff of any carrier by water that primarily transports vehicles directly between 2 state highways [2.1]. The department of state police shall compare the proposed rate, fare, charge, or tariff of any carrier by water that primarily transports vehicles directly between 2 state highways to the rates, fares, charges, or tariffs charged by comparable carriers by water. The department of state police shall automatically approve any proposed rate, fare, charge, or tariff of any carrier by water that primarily transports vehicles directly between 2 state highways that is less than the rates, fares, charges, or tariffs charged by comparable carriers by water. The department of state police may approve a proposed rate, fare, charge, or tariff of any carrier by water that primarily transports vehicles directly between 2 state highways that is more than the rates, fares, charges, or tariffs charged by comparable carriers by water if, based on justification submitted by the carrier by water, the department of state police finds the rate, fare, charge, or tariff is reasonable [2.1].

Conclusion

While Michigan law does not specifically prohibit price discrimination, businesses must comply with federal laws such as the Robinson-Patman Act and the Sherman Antitrust Act. To avoid violating these laws, businesses must ensure that any price differences are based on legitimate factors and do not substantially lessen competition or tend to create a monopoly. Additionally, price discrimination may also violate Michigan’s Consumer Protection Act if it is found to be unfair, unconscionable, or deceptive. Michigan law has a specific statute that regulates the proposed rate, fare, charge, or tariff of any carrier by water that primarily transports vehicles directly between 2 state highways [2.1].

Source(s):
Jurisdiction

Michigan