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Simple English definitions for legal terms
reciprocal dealing
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A quick definition of reciprocal dealing:
Reciprocal dealing is when a big buyer agrees to buy something from a seller only if the seller buys something back. This is usually against the law. Reciprocal exchange is when people join together to insure themselves and each other, but the group is not a company.
A more thorough explanation:
Reciprocal dealing is a business agreement where a buyer who has more economic power than a seller agrees to buy something from the seller only if the seller buys something in return. This type of arrangement is usually illegal under antitrust laws.
A large retail chain agrees to buy products from a small supplier only if the supplier agrees to purchase advertising from the retail chain. This is an example of reciprocal dealing.
Another example could be a software company agreeing to purchase hardware from a supplier only if the supplier agrees to use the software company's products exclusively. This type of arrangement is illegal because it can limit competition and harm smaller businesses.