Effective Date: August 13, 2009
Competition Price Maintenance

Section 61(1) of the Competition Act in Canada
Broadly worded prohibition

In the United States, Blackline GPS, Inc. and ESCORT, Inc. strictly enforce our MAP pricing policy. Price maintenance is currently illegal in Canada, however, Blackline GPS, Inc. and ESCORT, Inc. will stand provisions that reflect some pro-competitive rationales for price maintenance.

The basic offence of price maintenance is found at section 61(1) of the Competition Act, which stipulates two branches of the price maintenance:

61(1) No person who is engaged in the business of producing or supplying a product shall, directly or indirectly,

(a) by agreement, threat, promise or any like means, attempt to influence upward, or to discourage the reduction of the price at which any other person engaged in business in Canada supplies or offers to supply or advertises a product within Canada; or
 
(b) refuse to supply a product to or otherwise discriminate against any other person engaged in business in Canada because of the low pricing policy of that other person.

Blackline GPS, Inc. and ESCORT inc., would like all retailers to support our suggested retail pricing of $399.95 for the ESCORT Entourage CIS powered by Blackline GPS and $349.95 for the ESCORT Entourage PS powered by Blackline GPS, and $399.95 for Blackline GPS’s Harpoon GPS. Resellers in Canada are not obligated to adhere to our suggested price and in no way would the reseller suffer in its business relationship with Blackline GPS or ESCORT Inc. if the supplier/reseller advertises or sells below the suggested price.

However, Blackline GPS, Inc. and ESCORT Inc., will refuse to supply a reseller that has a low-pricing policy if we can show that we reasonably believe that:

(a) the reseller is making a practice of using products supplied by Blackline GPS, Inc. or ESCORT, Inc. as loss leaders, namely for purposes of advertising, rather than to make a profit;
  
(b) the reseller is making a practice of using products supplied by Blackline GPS, Inc. or ESCORT, Inc. for the purpose of attracting customers in the hope of selling them other products (“bait and switch”), rather than to sell the products at a profit;
 
(c) the reseller is making a practice of engaging in misleading advertising in respect of Blackline GPS, Inc. or ESCORT, Inc.’s products; or
 
(d) the reseller is making a practice of no providing the level of service that purchasers of the product might reasonably expect from the reseller.

Blackline GPS, Inc. and ESCORT, Inc. will stand behind these provisions that reflect some pro-competitive rationales for price maintenance.

All resellers selling product below our suggested retail pricing will be closely monitored and will not exclude archiving the resellers website, monitor website traffic, monitoring blogs, monitoring newsletters, monitoring advertising, monitoring customer service, and other methods of providing visibility to Blackline GPS, Inc. and ESCORT, Inc., to determine if these provisions are being violated to make a determination if Blackline GPS, Inc. and ESCORT, Inc. will continue to distribute product to the reseller.