Overview
The U.S. antitrust laws embody a commitment to preserving free markets unfettered by unreasonable restraints of trade. Free markets are the most effective means for allocating resources to their highest valued uses and maximizing consumer welfare. Competition sharpens firms’ incentives to cut costs and improve productivity and stimulates product and process innovation. Competition necessarily results in some firms losing while others succeed. That risk creates a vibrant and dynamic rivalry that maximizes economic growth.
The antitrust laws are intended to protect this competitive process. The U.S. has several statutes directed at antitrust violations.
Sherman Antitrust Act
The Sherman Antitrust Act, enacted in 1890 provides that:
- §1 Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is hereby declared to be illegal.
- §2 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, or with foreign nations, shall be deemed guilty of a misdemeanor.
Clayton Antitrust Act
The Clayton Antitrust Act of 1914 prohibits price discrimination between purchasers if "such discrimination substantially lessens competition or tends to create a monopoly in any line of commerce; prohibits sales that are contingent upon exclusive dealing or tying agreements; prohibits mergers and acquisitions that may "substantially lessen competition" and prohibits any person from being a director of two or more competing corporations.
Robinson-Patman Act
The Robinson-Patman Act of 1936 prohibits price discrimination.