Minnesota Joins the Fight Against Monopoly Power

Date: 8 Feb 2023 | posted in: Retail | 0 Facebooktwitterredditmail

Lawmakers in Minnesota will have the opportunity this legislative session to put the state at the forefront of a growing national movement to improve and strengthen laws to constrain monopoly abuses against workers, independent businesses, and communities.

Last year, senior Minnesota lawmakers introduced three bills that, together, would revamp the state’s laws against monopoly power and give law enforcers in the state additional powers to go after dominant corporations that abuse their outsized power. The bills, introduced by Minnesota Representatives Zach Stephenson and Steve Elkins (DFL), would help level the playing field for small independent businesses and workers by banning unfair monopoly abuses and ensuring that the state’s antitrust laws apply fairly to everyone who lives, works, and owns a business in Minnesota.

The bills have been, or will soon be reintroduced this legislative session, where they will continue to have the support of Minnesota Attorney General Keith Ellison. A coalition of local and national groups, including The Institute for Local Self-Reliance, are supporting the bills and encouraging lawmakers to pass them into law. Ron Knox, a senior researcher at ILSR, spoke as a subject matter expert during a briefing to lawmakers, where he discussed the need for a bill that helps ensure fairness for independent businesses.

State antitrust laws in some cases predate federal law, and states have a rich history of using their own laws, and their ability to enforce federal law, to ensure markets within their borders remain fair and open. The bills will amend Minnesota’s state antitrust laws in several ways:

  1. Abuse of Dominance: One of the bills would ban companies that dominate their industries from using that power to constrain or eliminate a rival, or prevent new companies from entering the industry to compete with them. The bill makes clear that a company’s behavior — such as its ability to unilaterally set prices or contractual terms in its dealings with trading partners— can be used as evidence that a company is dominant, exposing them to enforcement under the law. Compared to federal law, this bill would make clear that a company need not have a monopoly in an industry in order to abuse its power. Read the Abuse of Dominance bill here. 
  2. Price Discrimination: This bill would ensure that law enforcers in Minnesota can punish powerful retailers that use their size to bully their suppliers into offering them discounts and benefits they don’t offer to smaller stores in the state. This practice, called “price discrimination,” is illegal under federal law, but federal agencies haven’t enforced that law — the Robinson Patman Act of 1936 — in more than two decades. This bill would give Minnesota law enforcers the power to go after this abusive conduct and ensure small retailers can compete on fair terms with their biggest rivals.
  3. Worker Protections: Dominant companies today use their power as major employers to underpay workers and force them into unsafe working conditions. A third bill would amend the state’s existing antitrust law to make clear that it applies to dominant companies that abuse their power as buyers of goods and services — including labor. While antitrust laws have always theoretically applied to abuses of both buyer and seller power, this bill makes clear that in Minnesota, monopoly abuses by dominant employers or buyers of goods can be antitrust violations.

Read the Abuse of Dominance bill here.

Read the monopsony and price discrimination bills here and here. The bills were introduced by Senator Bonnie Westlin, and co-authored by Senators Lindsey Port, Robert Kupec, and Assistant Majority Leader Erin Murphy.

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Ron Knox is the Senior Researcher and Writer for ILSR's Independent Business Initiative.