Legal Updates

A monopoly may set different prices for different parties operating in the market but do not compete with each other

September 6, 2022
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A collector of empty beverage bottles for recycling contended that a collection corporation, which is a monopoly in its field, owed it payment for the difference in bonuses due to it, after discriminating it in comparison to other beverage bottle collectors from among the marketing chains.

The Court held that the collection corporation did not discriminate the collector. Israeli law stipulates that a monopoly owner may not abuse its power as such, in a manner that may reduce competition or harm the public. Such prohibition also bans a monopoly from discriminating competitors in the same market. However, a monopoly may set different terms for factors operating in different market in order to optimize its activities and achieve its goals. Here, the corporation is indeed a monopoly in its field, but it did not discriminate the collector because the collector and the market chains do not compete with each other because they are not in the same market. In addition, the practice the corporation takes is a permissible practice of inequality between different factors in order to encourage the collection of containers in accordance with its requirements. Therefore, the collector was not discriminated against.