By Jody Godoy
Oct 2 (Reuters) – Southern Glazer’s, the largest US liquor distributor, agreed on Friday to a US Federal Trade Commission settlement under which the supplier of brands such as Bacardi and Smirnoff won’t charge small retailers significantly more than nearby chain stores.
The FTC has ramped up its focus on affordability issues this year as the midterm elections approach. The agency is considering a new rule to bar misleading grocery and food delivery fees and probing personalized pricing practices.
The Southern Glazer’s settlement is aimed at leveling the playing field between independent stores and bigger chains such as Walmart, Costco and Kroger, which the FTC alleged had received better prices.
“Small businesses are an invaluable part of the American economy and way of life,” FTC Bureau of Competition Director Daniel Guarnera said.
For six years, Southern Glazer’s will be subject to penalties if it gives its biggest customers in 26 states significantly better prices than independent stores nearby, the FTC said. A monitor will oversee the settlement.
Southern Glazer’s Chief Legal Officer Alan Greenspan said the company did not violate the law and has not admitted wrongdoing in the settlement.
“The proposed order does not outright prohibit Southern Glazer’s from engaging in any particular business activity, and we do not anticipate material changes to our business or pricing practices,” Greenspan said.
The FTC sued Southern Glazer’s in 2024, accusing it of violating the Robinson-Patman Act, a law aimed at protecting small retailers from bigger competitors.
The case marked the first time in decades the FTC had enforced the RPA, which was a priority for former FTC Chair Lina Khan.
Current FTC Chairman Andrew Ferguson had voted against suing Southern Glazer’s, saying that while the agency should enforce the RPA, the case was weak.
Passed in 1936 during the Great Depression, the Robinson-Patman Act prohibits a seller from offering different prices for the same goods to different buyers. The law has a few exceptions, such as when shipping costs are higher for one customer than another.
(Reporting by Jody Godoy in New York; Editing by Chizu Nomiyama, Rod Nickel and Cynthia Osterman)
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