Horizontal scheme is a term used to describe illegal activities between competitors in a market, violating antitrust law. These activities include price fixing, bid rigging, and market allocation.
- Price fixing is when two or more competitors agree to set, raise, or maintain the prices of their goods or services at a certain level. This can happen at the wholesale or retail level.
- Bid rigging is when companies agree in advance to determine the successful bidder for a project at a set price.
- Market allocation is when competitors agree to divide up a market between them, rather than compete in an open market.
These activities are considered illegal and can result in criminal prosecution. The most effective way to detect these activities is through careful examination of records and evidence of meetings or communication between competitors.
See the Department of Justice page on Horizontal Schemes.
[Last updated in January of 2023 by the Wex Definitions Team]