Question

In theory, there are three key legal issues related to distribution. If a seller requires an intermediary to purchase a supplementary product to qualify to purchase the primary product the intermediary wishes to buy, a _______ is in place. Exclusive dealing Exclusive territory Tying contract Slotting fee None of these

Answer 1

Tying contract

Step-by-step explanation:

In theory, there are three key legal issues related to distribution, these are exclusive dealing, tying contract and exclusive territory.

If a seller requires an intermediary to purchase a supplementary product to qualify to purchase the primary product the intermediary wishes to buy, a tying contract is in place.

Simply stated, a tying contract is an agreement which conditions an intermediary such as retailer or wholesaler, to purchase other products (the "tied" products) from the supplier, in order to get the product (the "tying product) which is actually required.

For instance, XYZ company (intermediary) can purchase computers at 15% discount from a certain supplier, but is also mandated to agree to purchase computer desk and printer from the same supplier.