Antitrust deals with the area of law concerned with maintaining competition in private markets. The American antitrust and fair trade laws protect and promote competition in the free enterprise system. These laws provide remedies for businesses and consumers from the effects of monopolization and conspiracy, fixed prices, boycotts, refusals to deal, divided markets, etc.
The historic goal of the antitrust laws is to protect economic freedom and opportunity by promoting competition in the marketplace. Free competition benefits consumers through lower prices, better quality, and greater choice. Competition provides businesses the opportunity to compete on price and quality, in an open market and on a level playing field, unhampered by anticompetitive restraints.
To prevent trusts from creating restraints on trade or commerce and reducing competition, Congress passed the Sherman Antitrust Act in 1890. The Sherman Act was designed to maintain economic liberty, and to eliminate restraints on trade and competition. The Sherman Act is the main source of Antitrust law.
The Sherman Act is a Federal statute and as such has a scope limited by Constitutional constraints on the Federal government. The commerce clause, however, allows for a very wide interpretation and application of this act. The Act applies to all transactions and business involved in interstate commerce. If the activities are local, the act applies to transactions affecting interstate commerce. The latter phrase has been interpreted to allow broad application of the Sherman Act.
The Clayton Act, which supplements the Sherman Act, prohibits mergers and acquisitions where the effect is to substantially lessen competition or create a monopoly.
Each state has its own antitrust laws, but most are similar to federal versions. Antitrust lawyers represent companies on matters concerning government regulation of business including price fixing and restraint of free trade.
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