2 POL 1
The laws regarding regulation of cartels, trusts and monopoly in the market and overall regulation of the market in the USA were laid down in the USA, just as the US Constitution too was shaping up. The genesis of all this was in the Sherman Antitrust act in the year 1890. That act strove to control the market environment by putting a tight leash on trusts, organizations and companies which went against that act. To complement and strengthen this Sherman act, which later on turned out to be the basis of anti trust litigation by Federal government, another Act was passed sometime later, in the year 1914. This was the Clayton Antitrust act, passed by the Congress of the United States, drafted by Henry Clayton which explains the name. Hang in there for more on this act.
Clayton Antitrust Act of 1914
Interestingly, Woodrow Wilson was the president when this act was passed. This Act was mainly a modification and expansion of the already existent federal antitrust law, as a result of the Sherman Act. Clayton Act prescribed changes which were substantive and complementary to the Sherman Antitrust Act. The entire focus of the Clayton Antitrust act was to capture and nip the anti competitive market practices in the bud. This meant that some types of market conducts were to be prohibited. There are primarily 4 sections of this act which suggested major changes in the Sherman act. The following aspects were laid down by the Clayton Act. These are -
The sales were to be carried out on the condition that the buyer will not deal with or have any transaction with the competitors of the seller. Another condition was that the buyer can purchase another product, however that can be done only after the competition is lessened as a result of these acts.
Yet one more point of contention was the price discrimination between various purchasers, only if that discrimination reduces the competition or tends to create a...