ARE SLOTTING ALLOWANCES LEGAL UNDER THE ANTITRUST-LAWS

Retail grocers are currently requiring many packaged goods manufacturers to make up-front cash payments, called slotting allowances, before they will put a new product on their shelves. Manufacturers, grocery retailers, and public policymakers have expressed concern that this Practice might be in violation of the antitrust laws. The primary goal of this paper is to assess whether the use of slotting allowances would be likely to be found illegal under current antitrust laws. The potential cases of small manufacturers, small retailers, and the Federal Trade Commission are examined, and the arguments that night be used on both sides are scrutinized The analysis concludes that although private suits attacking slotting allowances could be won, the Commission is the party best-suited to bring a case aimed at the practice.