Murphy Introduces Bill To Protect Small Businesses From Corporate Gouging, Lower Prices For American Families

WASHINGTON-U.S. Senator Chris Murphy (D-Conn.) on Thursday introduced the Fair Prices for Local Businesses Act, a bill that would bring down prices for American families and support small businesses by cracking down on corporate price discrimination. The bill is co-sponsored by U.S. Senators Richard Blumenthal (D-Conn.), John Fetterman (D-Pa.), Ruben Gallego (D-Ariz.), and Peter Welch (D-Vt.).

Small businesses nationwide - from small town grocers to big city restaurants - are forced by mega-corporations to pay higher prices for identical products and pass those higher prices on to customers. Existing laws are supposed to stop big corporations from using their size to force suppliers into charging smaller businesses more, so they can undercut those competitors and clear the market for themselves. But over the last four decades, the Executive Branch and the courts have mostly looked the other way and refused to enforce these laws. Communities paid the price as huge corporations used price discrimination to crush small businesses, with more than 100,000 small retailers shutting their doors in the last few decades, hollowing out local economies and creating food deserts in poor and rural areas.

Under the leadership of Lina Khan, the FTC exposed how the world's biggest corporations illegally conspire to drive up costs on mom-and-pop businesses. In one case, the FTC uncovered how Pepsi and Walmart allegedly colluded to drive up the price of Pepsi products at grocery stores that compete with Walmart. These mega-corporations still benefit from a wide range of legal loopholes that stall enforcement and disincentivize small businesses from fighting back. The Fair Prices for Local Businesses Act would strengthen and modernize our price discrimination laws to level the playing field for small businesses and ensure mega-corporations can be held accountable.

"For decades, corporations have been allowed to break the law and rig the system to make small businesses pay higher prices for the exact same products," said Murphy. "Their goal was to crush the competition so they could hoard even more profit and power, even if that meant decimating local economies and raising prices on families. Small businesses are the lifeblood of a community and they should be able to compete with these soulless mega-corporations on equal footing. This bill would end the disastrous, price rigging lawlessness by providing both small businesses and federal regulators with a larger set of legal tools to punish corporations that run these schemes."

"Small businesses are the backbone of our economy, yet for far too long they've been forced to compete with massive corporations who use their power to squeeze out local competitors. The Fair Prices for Local Businesses Act will ensure accountability by giving local retailers a chance, strengthening competition, and ultimately delivering better prices for consumers. I'm proud to support this legislation to level the playing field for our local businesses," said Blumenthal.

"High costs are crushing working families and small businesses," said Fetterman. "The Fair Prices for Local Businesses Act would level the playing field and make sure small businesses can buy products on the same terms as big corporations."

"When suppliers can charge small businesses more than big corporations for the exact same products, local shops shut down, a handful of companies run the market, and families end up paying more at the checkout line," said Gallego. "This bill gives regulators the tools they need to hold big retailers accountable and make sure local businesses have a fair shot to compete. By leveling the playing field, we can bring prices down for American families."

"Vermont's small businesses are the backbone of our economy, but they can't compete when they're forced to pay more than big retailers for the same goods and services. That kind of price discrimination squeezes local businesses and raises costs for consumers," said Welch. "The Fair Prices for Local Businesses Act helps level the playing field and holds bad actors accountable."

The Fair Prices for Local Businesses Act would:

• Repeal the "meeting competition" defense: Under current law, price discrimination is legal if the supplier is meeting a competitor's price to the retailer. Massive retailers would no longer be able to squeeze all their competing suppliers for special deals, creating competition that brings down prices at retailers large and small alike.
• Hold power buyers accountable: Big retailers are rarely held accountable for receiving illegal price discrimination because plaintiffs must prove they did so knowingly. The bill would eliminate the "knowingly" requirement for retailers with more than $100 billion in annual sales, because these huge corporations should know how suppliers price their products.
• Expand the law to cover services, not just goods: Local shops and restaurants would no longer pay higher costs for services like delivery apps, point of sale systems, and credit card swipe fees.
• Set minimum damages to equal the cost of price discrimination: The bill would simplify damage awards for victims of price discrimination to at least match the higher prices they had to pay.

The Fair Prices for Local Businesses Act is endorsed by: Open Markets Institute, Small Business Majority, Farm Action Fund, American Booksellers Association, Independent Restaurant Coalition, Institute for Local Self-Reliance, American Economic Liberties Project, Demand Progress, National Supermarket Association, Main Street Competition Coalition, Small Business Rising, and RAFI.

"Senator Murphy's Fair Prices for Local Businesses Act is an essential effort to fight the extraordinary buyer power of large corporations. Giants like Amazon and Walmart use their market muscle to squeeze suppliers and their workers, extract discriminatory discounts and other concessions, and thereby gain an unfair and illegitimate advantage over rivals, whether regional chains or mom-and-pop stores. This bill strengthens the existing Robinson-Patman Act by extending its coverage to services and undoing Supreme Court misinterpretations of the law and empowers the federal government and private parties to end the widespread abuse of buyer power in today's economy," said Sandeep Vaheesan, Legal Director at Open Markets Institute.

"Independent supermarkets are not asking for special treatment, we are demanding fair treatment. When national suppliers offer better pricing and services to large chains while charging neighborhood grocers more for the exact same products, it puts community stores and the families we serve at a disadvantage. Enforcing price discrimination protections is about leveling the playing field, protecting local jobs, and keeping groceries affordable in working-class and immigrant neighborhoods," said Anthony Peña, National President of the National Supermarket Association.

"The Robinson-Patman Act is a strong law, but decades of judicial narrowing have left independent businesses without the tools they need to fight back against discriminatory pricing by dominant firms. The Fair Prices for Local Businesses Act closes critical loopholes and gives antitrust enforcers and Main Street businesses the strong tools they need to restore competitive fairness in the modern marketplace," said Chris Jones, Executive Director of the Main Street Competition Coalition.

"Having seen the ways in which price fixing and similar anti-competitive practices can put small businesses at a severe disadvantage, we're pleased that Congress is taking action to strengthen existing antitrust law to give regulators greater power to stop repeat offenders who are committing violations of the Robinson-Patman Act. More robust enforcement of laws intended to level the playing field for small firms would go a long way toward helping small businesses compete with larger companies when accessing goods and services for their business," said Alexis D'Amato Falvey, Senior Director of Federal Government Affairs for Small Business Majority.

Joe Maxwell, President of Farm Action Fund, said, "For decades, powerful corporations have used price discrimination to squeeze independent farmers, small businesses, and local communities. This legislation takes direct aim at this rigged pricing system, restoring the promise of the Robinson-Patman Act by making clear that no corporation is too big to play by the same rules-and that fair competition still matters in America. As a farmer, I thank Senator Murphy for filing this important legislation."

"The American Booksellers Association is grateful for Senator Murphy's leadership in introducing the "Fair Prices for Local Businesses Act." For far too long, independent bookstores have had to compete with online megacorporations who often sell bestselling titles at prices below what bookstores pay to suppliers. They are rarely held accountable, even though it is illegal for dominant retailers to use their power over suppliers to secure lower prices and other benefits. Senator Murphy's bill will make them play fair by strengthening and clarifying antitrust regulations, which ABA believes will help level the playing field for Main Street businesses like indie bookstores," said David Grogan, Director of Advocacy & Public Policy, American Booksellers Association.

"RAFI is proud to endorse the Fair Prices for Local Businesses Act. As can be seen in RAFI's Grocery Gap Atlas, the accelerating consolidation of the grocery industry has allowed for entities like Walmart and Dollar General to drive the local grocery stores that feed rural places out of business through their predatory practices. This isn't just a food access and consumer choice issue. Farmers all across the country feel the squeeze of a dominated grocery sector, with fewer pathways to market than ever before. A retail environment that functions fairly and allows for more robust competition will directly benefit our dwindling population of farmers who seek to feed the country domestically," said Melanie Canales, Challenging Corporate Power Project Manager, RAFI.

"Independent restaurants are being crushed by a rigged system where massive corporations and platforms use their market power to secure sweetheart deals that local businesses can never access," said Erika Polmar, Executive Director of the Independent Restaurant Coalition. "Whether it's delivery platforms offering preferential terms to chains, or suppliers giving volume discounts that independent operators could never dream of, price discrimination is crushing neighborhood restaurants while corporate giants proper. This isn't just unfair-it's destroying the restaurants that anchor our communities and support local jobs. We're grateful to Senator Murphy for his leadership on this critical issue. The Fair Prices for Local Businesses Act will level the playing field so independent restaurants can compete on quality, not backroom deals."

"When the government stopped enforcing price discrimination laws, corporate consolidation exploded and so did prices for groceries and prescriptions," said Katherine Van Dyck, Senior Legal Fellow at American Economic Liberties Project. "This legislation modernizes the Robinson-Patman Act for today's economy by expanding protections to services like delivery apps and credit card fees, eliminating a loophole that lets dominant buyers escape accountability, and making it easier for independent businesses to prove damages. The Senate should act quickly on this essential reform to protect small businesses and deliver lower prices to American families."

Carter Dougherty, Senior Fellow for Antimonopoly and Finance at Demand Progress, said, "The penalty imposed by the giants for being a small player in your home state or town is a problem long-recognized by the authors of the Robinson-Patman Act, and it's up to us today to carry on their work. This legislation, with its focus on preventing unfair pricing in services -- especially finance -- is a vital step in the right direction."

"For decades, powerful chain stores, like Walmart, Amazon, and Kroger, have used their economic muscle to extract sweetheart deals from suppliers - deals that squeeze out independent competitors and drive up prices for everyone else. Senator Murphy's legislation would give enforcers the tools they need to finally call that what it is: illegal. ILSR applauds this effort to restore fairness in US markets, allow local businesses to compete, and make groceries and goods more affordable for the communities that need it most," said Ron Knox, Senior Researcher and Policy Advocate, Institute for Local Self-Reliance.

Bill text is available here. A one-pager is available here.