How Do Non-Profits Engage in Unfair Competition Measures?
Provided by HG.org
Any type of redirecting consumer traffic and sales away from a business is part of unfair competition practices and activity, and even certain non-profit organizations engage in these situations sometimes. It is important to know when this occurs and how it affects the company so that the owner is able to pursue legal action when the offense is serious enough.
There are various tactics that businesses and non-profits both engage in that could harm another company. These methods usually include a misleading campaign against another entity or misdirection of product and service sales. If the non-profit organization starts with the purpose of taking business from a company, this could become harmful enough that revenue affected may decrease significantly. When enough of these actions occurs, the company needs to take legal action or risk losing future business transactions and sales. While consumers may only make up a small percentage of these sales, losing the clients that purchase the products or services could devastate the entity for years or permanently.
The Online Reviews
Many organizations started engaging in online interactions and exchanges of information in the electronic age. This permits a company, entity or group to post various pieces of data and illustrations about something specific. When using reviews, the organization has the capability of either providing truthful information or falsifications. Targeting a company in particular could have disastrous consequences when the owner has the power to shut these groups down. However, if the owner or management only has so many resources, it is better to purge online reviews that target the company. Redirecting and removing the information online may provide a remedy to this situation.
Taxation for Non-Profits
When applied correctly, the non-profit organization has the added bonus of no taxation. This provides a greater capacity of garnering funds without the worries that taxes will crush the entity. Unfortunately, this does not apply for the business. Because of this, the non-profit is able to complete various tasks and campaigns without the same negative impact. Other opportunities arise when the organization has the ability to attract companies and business owners to donate and receive tax deductions. The same is not usually possible when donating to a company. This could detract from revenue and attention to a business when compared to a non-profit.
Some of the most profitable interactions occur through product and service sales. While smaller businesses may cater to the customer, other big entities seek business to business sales. A non-profit may provide products similarly, but the organization is not generally permitted to sell the products. These may exchange through donations, however. By attracting companies in this manner, the unfair competition regulations could take effect and lead to complications for the non-profit involved. It is important to ensure that a specific company or market impact is not severe enough that legal action may transpire. Then, a lawyer may become part of the proceedings and contact the non-profit about the activity.
Some company owners are becoming aware of tactics by non-profits in competing with business through commercial activities. Sales of products and services occur with greater frequency through bypassing some of the same methods companies take. Without paying taxes, the non-profit is able to increase payments and revenue. When there is lower quality of data recorded through Congress and taxation, these organizations may get away with various processes that should not occur. Without utilizing the unfair and unreasonable competition methods, many non-profit entities could not continue. Even if these procedures include detracting business from a single or entire market of companies, some organizations may continue until an owner sues for these measures.
Commercial activities increase revenue through donations by private individuals and the richer company owners. Television and radio advertisements increase awareness of the non-profit organization. However, some of the commercials may redirect consumer traffic away from competing businesses to the non-profit. A company that supplies similar products may lose revenue when this occurs. Increasing social awareness of certain matters such as smoking or excessive drinking may also create unfair competition measures. Certain procedures occur unintentionally that harm businesses, and these could lead to litigation.
Legal Services in Unfair Competition
Unfair competition is a blow against a company, and these measures could harm the market. It is important for a business to seek a legal remedy when this occurs. Hiring a lawyer could increase the chances of a successful conclusion to these practices and possible compensation for the affected business.
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.