Market Division Agreement

A Market Division Agreement is a contract between competing businesses that outlines how they will divide a market among themselves. Instead of competing directly for the same customers, each company agrees to focus on a specific area, customer base, or product type. This can reduce competition and enhance profits for each participant. While it may seem beneficial for the businesses involved, such agreements can be illegal in many jurisdictions because they can lead to higher prices and less choice for consumers, violating antitrust laws that promote fair competition.