Can I offer discounts or promotions without violating pricing laws in Kentucky? What are the requirements?

Here are the requirements for offering discounts or promotions without violating pricing laws in Kentucky:

Sale at Less Than Cost Prohibited

Kentucky law prohibits the sale of any product at less than cost for the purpose of destroying competition or substantially lessening competition ^[2.2]. Sale of cigarettes at less than cost is also prohibited ^[2.2]. Violation of this law can result in a fine of up to $1,000 per sale or purchase ^[2.2].

Advertising

A licensee may advertise or cause to be advertised in any manner any product that the licensee is licensed to manufacture or sell unless prohibited by administrative regulations promulgated by the board ^[1.8]. The board shall not prohibit certain forms of advertising, including advertising in newspapers, magazines, or periodicals having a general circulation, promotional advertising on radio or television limited to no more than the name of the licensee and the products the licensee is permitted to manufacture or sell, promotional advertising containing the names of establishments or products displayed on uniforms or equipment of sporting teams, promotional advertising mailed or delivered to a consumer’s residence, and providing visitors who are twenty-one (21) years of age or older, in conjunction with a distillery tour or an event conducted by a bona fide church or charitable organization, free consumer-branded nonalcoholic novelty items whose actual retail cost does not exceed seventy-five dollars ($75) per item and production by-products ^[1.8].

Loyalty Cards

Loyalty cards issued by retailers that reward customers with product discounts for buying goods or services are not prohibited by Kentucky law ^[1.1].

Discounts in the Usual Course of Business

It is permissible to offer discounts in the usual course of business if the same discounts are offered to all licensees holding the same license type buying similar quantities ^[1.2].

Based on the above information, it is possible to offer discounts or promotions without violating pricing laws in Kentucky as long as the sale is not below cost, the advertising is not prohibited by administrative regulations promulgated by the board, and the discounts are offered in the usual course of business. Additionally, loyalty cards issued by retailers that reward customers with product discounts for buying goods or services are allowed.

Source(s):

• [1.1] Use of rebate coupons – Redemption – Retailers’ loyalty cards.
• [1.2] Distiller, rectifier, winery, or wholesaler not to be interested in retail premises – Transactions prohibited – Discounts in the usual course of business – Retailer not to demand violation of this section – Permitted activities.
• [2.2] Sale at less than cost prohibited – Fine.
• [1.8] Advertising to comply with regulations of board – Types of advertising not prohibited.

Jurisdiction

Kentucky

• General