The Sherman Act
Modern Competition Law begins in 1890 with the Sherman Act: · Section 1: Conspiracies “Every contract, combination in the form of trust or conspiracy in restraint of trade or commerce among the several States, is declared to be illegal.” · Section 2: Monopolisation “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States shall be punished by fine” • Criminal sanctions: imprisonment up to three years
What was a “trust”
Shareholders of all the companies in one industry conveyed their shares to a board of trustees, in exchange for dividend-paying certificates
3. What is Competition Policy and what are the Objectives of Competition Policy
History of US Competition Policy
End of XIX Century in the US: Revolution in transportation and communication, which lead to a single US market Size of firms increases (also through mergers) Incentives to form cartels and trusts due to market instability and macroeconomic crises
The Clayton Act and the Federal Trade Commission (“FTC”) Act
• 1914: Clayton Act: –Merger control –Prohibition of price discrimination and interlocking directorships –Treble damages • 1914: creation of the FTC. It shares antitrust enforcement powers with the DOJ
The board would then manage all the companies in 'trust' for the shareholders and minimize competition Eventually the term was used to refer to monopolies in general
Between the two world wars
• Period of lower antitrust enforcement (also in response to the 1929 Great Depression) • 137 coal producers gather on the Appalachian Mountains and form a company to fix price and output => In Appalachian Coals (1933) the Supreme Court found this agreement a reasonable response to protect the market from destructive practices But in Socony-Vacuum Oil (1940), the Court re-established the per se prohibition of price-fixing
1911: Standard Oil broken into 34 firms
1911: Dr Miles, minimum resale price in vertical agreements per se illegal Standard Oil was one of the greatest companies to be broken up under United States antitrust laws
Principles of Competition Law
Comபைடு நூலகம்etition as a policy
Outline
1. Brief history of Competition Policy 2. EC Competition Law
– a. Article 101 – Prohibition of Agreements – b. Article 102 – Abuse of Dominant Position – c. Merger Control – d. State Aid
First years of Antitrust Enforcement
1897: first Supreme Court decisions against trusts (Trans-Missouri Freight Association): 8 railways fixed rates for transport of goods