Resale Price Maintenance Agreement Template for Canada

A Resale Price Maintenance Agreement allows you to establish pricing guidelines with your distributors and retailers while staying compliant with Canadian competition law. Under the Competition Act, you can suggest resale prices to your distribution network, but you must structure these arrangements carefully to avoid triggering regulatory scrutiny from the Competition Bureau.

When do you need this document?

You need this agreement when launching products through multiple distributors and want consistent pricing across your network. Manufacturers of consumer electronics, luxury goods, and branded products commonly use these agreements to protect brand positioning and prevent price wars among retailers. The document is also essential when expanding into new provinces where you need authorized dealers to maintain specific price points. If you're a franchisor wanting franchisees to follow suggested pricing, or a supplier concerned about deep discounting harming your brand image, this agreement provides the legal framework for price coordination while remaining compliant with competition law.

Key legal considerations

Your agreement must clearly distinguish between "suggested" and "mandatory" pricing to comply with Section 76 of the Competition Act. You cannot refuse to supply or terminate agreements solely based on pricing violations, as this could constitute illegal resale price maintenance. Include provisions for regular price reviews and updates, ensuring your suggested prices reflect market conditions and don't artificially inflate consumer costs. The agreement should outline communication methods for price suggestions and specify that distributors retain ultimate pricing autonomy. You must also include compliance monitoring procedures and training requirements to ensure all parties understand their obligations under competition law. Consider including provisions for Quebec-based parties that address Civil Code requirements, and ensure your pricing mechanism accounts for provincial tax variations and consumer protection laws.

Legal requirements in Canada

Under the Competition Act, resale price maintenance is permissible as long as it doesn't adversely affect competition in the relevant market. Your agreement must demonstrate that price suggestions serve legitimate business purposes such as brand protection or service quality maintenance. The Competition Tribunal can review your practices if complaints arise, so maintain detailed records of pricing decisions and their business justifications. Provincial consumer protection acts may impose additional disclosure requirements for retail pricing, particularly for essential goods or services. In Quebec, ensure your agreement complies with Civil Code provisions governing commercial contracts, including specific language requirements and formation rules. Your agreement should also address territorial restrictions carefully, as these can raise additional competition concerns when combined with price maintenance. Consider including dispute resolution mechanisms that account for both federal competition law and provincial commercial law requirements across different Canadian jurisdictions.