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I have a listings site that lists cars. The cars are those of several auto dealers in my area. Many of them signed up with me, to list their cars and then I direct traffic to their business. However, the day after listing with me, my competition sent them an e-mail saying that if they list with me, their content will be removed from the competition's website. They followed by emailing me, telling me to remove all their listings off my site.

  1. Isn't this illegal? I mean, he's basically forcing a monopoly and killing anyone that enters the market?
  2. Can he legally deny people being listed on their site on these grounds?
  3. Do people not have the right to advertise everywhere?
  4. How do I proceed to deal with such a matter, or is it a lost cause?
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2 Answers 2

Depends on terms of contract and contracts can be changed at any time.... so yes its legal.

Q. Isn't this illegal? I mean, he's basically forcing a monopoly and killing anyone that enters the market?

A: Depends on the scale and laws in your country. A local advertising contract that prohibits certain actions is hardly a monopoly and your have a hard time getting a small claims court to hear your case and that's even if both parties agree to it.. (UK).

Q. Can he legally deny people being listed on their site on these grounds? Do people not have the right to advertise everywhere?

A: Yes, its called a terms of contract.... and contracts can always be rewritten. If the customers doesn't like their terms then they are welcome to go elsewhere - your customers are not being forced to use their service.

Q: How do I proceed to deal with such a matter, or is it a lost cause?

A: Your competitor is obviously doing something better, or has better exposure otherwise your customers would tell your competitor to stick it. (not that I agree with their terms but if they are getting a percentage of sale then obviously they don't want other advertisers having the same chance and I understand their reasoning).

Back to the drawing board

It sounds like your website is not offering anything that the customer can't get else where and one of the reasons they are flocking to the other site, in order to beat the other site you need to out smart them. Time to rethink your strat, reduce fees, revert to a different pricing model etc.

The first approach should be getting more traffic than your competitor and not focusing on how much money you can make or how many cars you list. The more traffic you get the better proof your have to why customers should choose you, 'Because your site gains more exposure, more hits, and faster sales'. But this isn't my niche but a little common sense says this ;)

I understand your frustration but sounds like typical business ;)

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The behavior of your competitor is certainly anti-competitive. Laws that regulate anti-competitive practices are called Anti-trust laws. That Wikipedia article shows how complicated the issue is, as there are many different laws that apply in each jurisdiction.

To determine if your competitor is actually breaking any laws, you would need to seek the advice of a Lawyer in your jurisdiction. There are certainly laws against "attempting to monopolize" in many countries.

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