When planning a wedding, party, or corporate event, one of the first steps is often securing the perfect venue. However, many venues have a clause in their contracts requiring clients to use only their “approved suppliers” for services such as catering, entertainment, photography, and more. While this practice is relatively common, it raises important questions about legality, fairness, and competition.
At Gig Heaven, we believe in empowering event planners to choose the best suppliers for their unique needs. In this article, we’ll examine the legality of such practices across different countries, discuss the potential downsides for customers, and offer practical tips to help you assert your right to book suppliers from platforms like ours.
Why Do Venues Insist on Approved Suppliers?
Venues often justify their “approved supplier” policies by claiming they ensure quality and reliability. They argue that their pre-approved suppliers are familiar with the venue’s layout, rules, and equipment, which can make event execution smoother. While this may be true in some cases, it’s also worth noting that these arrangements often come with financial incentives for the venue, such as commission deals or exclusive partnerships.
While some clients accept this policy without question, others feel that it limits their ability to customize their event and can lead to inflated costs. For instance, if a venue’s approved caterer charges significantly more than an independent caterer you found on a platform like Gig Heaven, you’re essentially being forced to pay more without getting better value.
Is It Legal? A Global Perspective
The legality of requiring clients to use only approved suppliers varies by country and region. Let’s explore how this practice is treated under different legal frameworks:
United States
In the U.S., requiring the use of approved suppliers can potentially violate antitrust laws if it is deemed anti-competitive. The Sherman Antitrust Act and the Federal Trade Commission Act prohibit businesses from engaging in practices that restrict competition or create monopolies. If a venue’s policy prevents clients from accessing cheaper or better-quality suppliers, it could be challenged as an illegal tying arrangement.
However, enforcement can vary, and the burden of proof falls on the client. Many venues use vague language in their contracts to avoid legal scrutiny, making it difficult to challenge these clauses.
United Kingdom
Under UK law, restrictive practices like mandatory supplier lists could fall foul of the Competition Act 1998, which prohibits agreements or practices that prevent, restrict, or distort competition. If a venue insists on using their suppliers without reasonable justification, it could be seen as anti-competitive.
The Consumer Rights Act 2015 also protects individuals from unfair contract terms. If a venue’s approved supplier policy is deemed unfair—for example, if it forces you into paying inflated prices—it could be challenged in court.
European Union
EU competition law, particularly Article 101 of the Treaty on the Functioning of the European Union (TFEU), prohibits agreements that restrict competition. If a venue’s policy amounts to an exclusive dealing arrangement, it could violate EU law. Additionally, Article 102 TFEU prohibits abuse of a dominant market position, which could apply if a venue’s policy unfairly exploits its market power.
Australia
In Australia, the Competition and Consumer Act 2010 prohibits anti-competitive conduct, including tying arrangements. If a venue forces clients to use specific suppliers, it could be considered a breach of Australian Consumer Law, particularly if it significantly limits consumer choice or leads to price inflation.
Other Regions
In countries like Canada, India, and South Africa, competition laws generally prohibit anti-competitive practices, including those that limit consumer choice. However, enforcement and legal remedies vary, and clients may need to consult local legal experts to challenge such policies.
Why This Practice is Problematic for Consumers
1. Higher Costs
Approved suppliers often charge a premium because they have exclusive access to the venue’s clients. This lack of competition means you could end up paying significantly more than if you were able to choose your own supplier.
2. Limited Customization
Your event is unique, and you should have the freedom to choose suppliers that align with your vision. Approved supplier lists can stifle creativity and force you into using generic services that don’t suit your style or preferences.
3. Reduced Quality
Just because a supplier is on a venue’s approved list doesn’t necessarily mean they’re the best option. In some cases, these suppliers are chosen based on their financial arrangement with the venue rather than their quality or reliability.
4. Legal Ambiguity
As discussed earlier, these practices often operate in a grey area of the law. While challenging them is possible, it can be time-consuming and costly for clients.
How to Insist on Your Right to Choose Suppliers
If you find yourself facing a venue with a strict approved supplier policy, there are steps you can take to assert your right:
1. Read the Contract Carefully
Before signing any venue agreement, review the contract thoroughly. Look for clauses that require the use of approved suppliers and ask for clarification if anything is unclear. If possible, negotiate to have this clause removed or amended.
2. Ask for Exceptions
Many venues are willing to make exceptions, especially if you can demonstrate that your chosen supplier is reputable, insured, and familiar with similar venues. Platforms like Gig Heaven make it easy to find highly rated suppliers with verified reviews.
3. Highlight Legal Concerns
Politely remind the venue that restrictive supplier policies could be seen as anti-competitive or unfair under local laws. While you don’t want to come across as confrontational, mentioning this could encourage the venue to reconsider their stance.
4. Offer to Cover Additional Costs
Venues sometimes argue that outside suppliers create additional costs, such as insurance or setup fees. If you’re willing to cover these costs, the venue may be more inclined to allow your preferred supplier.
5. Use a Platform Like Gig Heaven
Gig Heaven makes it easy to find suppliers who are experienced, reliable, and competitively priced. By presenting the venue with a list of high-quality options from our platform, you can make a strong case for why your chosen supplier is the best fit.
6. Consider Alternative Venues
If the venue refuses to budge, it may be worth looking for an alternative location that offers more flexibility. Many venues are happy to accommodate outside suppliers, especially if it means securing your business.
Conclusion
While venues often justify approved supplier policies as a way to ensure quality and consistency, these practices can be unfair, costly, and even illegal in some cases. As a consumer, you have the right to choose suppliers that align with your vision and budget.
At Gig Heaven, we’re committed to helping you find the best event suppliers, whether you’re planning a wedding, party, or corporate gathering. By understanding the laws in your region, negotiating with venues, and using platforms like ours to find trusted suppliers, you can take control of your event planning process and create an unforgettable experience.
Remember, your event is your own—don’t let restrictive policies limit your ability to make it truly special. Start your search on Gig Heaven today and discover a world of possibilities!
