What are Antitrust Laws?

 

What are Antitrust Laws?

 

Antitrust Laws are laws formed by the government, to regulate and prohibit anticompetitive practices that may be conducted by businesses for unlawful gains at the expense of depriving consumers and society at large of the benefits of competition.

 

Let's understand this in detail.

 

History 

 

·       Around the late 19th century, the industrial might of the United States of America was growing at its fastest pace.

 

·       During that time, several businesses were found to be indulging in anticompetitive practices by forming a cartel, indulging into monopoly, ownership of stake in one another, etc.

 

How has the word Antitrust evolved?

 

·       This grouping of different corporations, with aligned business interests were referred to as corporate trusts then, as the element of mutual cooperation between them was at the base of their conduct of anti competitive practices. 

 

·       These corporate trusts enjoyed significant market power and used the same to make supernormal profits depriving consumers of the benefits of a healthy business environment where there is healthy competition and market forces decide the prices.

 

·       Thus to prohibit these so-called corporate trusts to conduct anticompetitive practice, Antitrust Laws came into existence.

 

So finally once again, 

 

What are Antitrust Laws?

 

Antitrust Laws are laws formed to regulate and prohibit anticompetitive practices that may be conducted by businesses for unlawful gains at the expense of depriving consumers and society at large of the benefits of competition.

 

Antitrust Laws in USA and European Union 

 

·       One of the world's first Antitrust Laws to come into existence was from the USA, called The Sherman Act, 1890.

 

·       Further in 1914, Federal Trade Commission Act as well as The Clayton Act were enacted in the USA.

 

·       The European Union has European Union Competition Law, which is enforced by the European Commission on Competition.

 

Antitrust Laws in India

 

The Competition Act, 2002 was enacted;

 

Ø to prohibit anti-competitive agreements, 

 

Ø abuse of dominant position by enterprises and 

 

Ø to regulate mergers, amalgamations and acquisitions

 

Ø with a view to ensure that there is no adverse effect on competition in India.

#antitrust #antitrustlaw #antitrustlaws #usa #europe #europeanunion #eu #competitionlaw #india #shermanact #europeancommission