...laws effective? If not, why? There are several laws in place such as the Sherman Antitrust Act, the Clayton Antitrust Act and the Federal Trade Commission Act. Anti-Trust laws limit what businesses can and cannot do to ensure that all competitors have an equal chance of succeeding. (Bovee and Thill p. 39). We will discuss each of these laws throughout the paper and hopefully answer the question that was originally asked. The United States laws that are in place currently are typical effective as control measures to ensure fair business practices are followed. Determining the success or failure of specific legislation or regulations can be relative to what angle you are looking from. With anti-trust laws we are insured safeness from unreasonable trade, price discrimination and unfair and anti-competitive business practices. The Sherman Anti-Trust Act In 1890, Congress enacted the Sherman Anti-Trust Act, which is a law designed to restore competition and free enterprise by breaking up monopolies. The Act of July 2, 1890 (Sherman Anti-Trust Act) states that: “This Act outlaws all contracts, combinations, and conspiracies that unreasonably restrain interstate and foreign trade. This includes agreements among competitors to fix prices, rig bids, and allocate customers, which are punishable as criminal felonies.” (The Act of July 2, 1890 pg. 1) The original intention of the Sherman Antitrust Act was to protect consumers from big businesses that were using unscrupulous...
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...regulations to govern fair and equitable trade and business practices. However, with competition came regulation for business and trade. A Competitive America As Americans we love to compete. Therefore it is no wonder that the United States economy is based on competition. Promoting competition is accepted as the best way to promote consumer well-being. America’s anti-trust laws have been in place for more than 100 years, since the Industrialization of America protecting the consumer’s rights. However, more countries have passed anti-trust laws in the past 20 years. America’s anti-trust laws were passed to focus on anti-competitive practices. Americans have long loved free market system and the competition that it fosters. Competition among businesses has been regulated by anti-trust acts recently; however they help to maintain a fair and equitable system where the small business is able to compete with the big business. The anti-trust laws enable the consumer to purchase a quality product at an affordable price due to the competitive market that it sets in place between the businesses. Anti-trust laws are needed to continually handle the companies that would be dishonest in business practices if not for regulations and rules....
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...Clayton Anti-trust Law In the late 1800’s there were some big names in the economy. Two of the biggest trusts out there where the Carnegie Steel and John D. Rockefeller’s Standard Oil Company. These two companies and a few others dominated the economy and controlled not only the prices, but the market share for their products. In response, the Sherman Anti-trust Act was passed around 1890 to limit the control. The Sherman Act however, did not cover everything that businesses needed it to cover. In 1914, Woodrow Wilson instructed Congress to pass a new set of antitrust laws called the Clayton Act. (Swenson, 2) The Sherman Act was first passed to ensure that no company “shall monopolize, attempt to monopolize or conspire with another to monopolize interstate or foreign trade or commerce, regardless of the type of business entity” (Abernathy, 4). If a company did violate this act they could face up to three years in jail and up to $350,000 per violation and corporations could be fined up to $10 million per violation (6). Although the Sherman Act provided much advancement in fighting monopolies, there needed to be another act that more specifically and clearly prohibited certain anti-competitive practices. Since the Sherman act needed more clarification, the Clayton Act of 1914 was soon drafted by Henry De Lamar Clayton Jr. Clayton along with many other people though the Sherman Act needed to be strengthened and clarified to work better. When Woodrow Wilson became president...
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...Anti-trust Policy in the Modern Economy Microsoft's Anti-trust Case Mark Hinman UCCS Baud 5590 Anti-trust Policy in the Modern Economy Microsoft's Anti-trust Case This paper's intention is to discuss the role of anti-trust legislation in the modern economy. To accomplish this, we will be reviewing the United States Government's anti-trust case against Microsoft that began nearly twenty-two years ago. To begin we will look at the history leading up to the filing, the government's argument, Microsoft's argument, and the outcome of the case. We will also look at the intent of the Sherman Anti-Trust Act. Specifically, how does the Sherman Anti-Trust Act protect consumers? Finally, we will discuss whether the anti-trust legislation actually accomplishes what it is intended to do, with respect to the technology industry. Microsoft has been under constant scrutiny since June 1990 when the Federal Trade Commission (FTC) launched a probe into the possible collusion between Microsoft and IBM. Three years later, the FTC handed over their investigation to the U.S. Department of Justice. After years of accusations for monopolizing and engaging in anti-competitive acts, Microsoft finally, on May 18, 1998, received a suit for violation of federal anti-trust laws.[i] The suit alleges that Microsoft is in violation of Sections 1 and 2 of the Sherman Anti-Trust Act, and seeks to prohibit Microsoft from selling certain products and engaging in certain sales...
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...HCS/430 - Legal Issues in Health Care: Regulation and Compliance February 28, 2011 William Bross Article/Case Law Search The main function of the anti trust law in health care is to help keep the industry competitive and open so that any means of delivery service that are new or any new financing of health care services are able to compete for the acceptance by any purchasers. By developing these arrangements helps the competition such as providers, insurers, and any others and this is important to help prevent the fixing of prices, and any other agreements that may be allocated among the competitors. By enforcing the anti trust laws federally has helped to facilitate the delivery of health care systems that is efficient and has helped to challenge any efforts of any anticompetitive providers in health care delivery. Anti trust laws are a body of laws that help to prohibit any anti competitive behavior and any business practices that are unfair. These laws are made to help encourage competition in the workplace. These anti trust laws make many practices illegal and they may hurt consumers and businesses and can violate ethical behavior standards. In order to prevent failure within the market there are regulators along with candidates that are private which helps to apply the anti trust laws. These anti trust laws are supposed to help produce prices that are low and also make services and good better. These laws continue to be a concern for hospitals, organizations...
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...competitors to either sell to Standard Oil or close their business. They purchased the equipment needed to make oil barrels so that their competitors could not get their oil to their customers. They used thugs and threats of violence against those that refused to bend to their demands. And finally, their attitude and lack of cooperation towards the government intervention alongside the widespread disgust and revulsion by the public led Standard Oil to be charged under the Sherman Anti-Trust Act (Kopel & Bast., 2001). Some of the pecuniary and nonpecuniary costs included closing of businesses, monopoly pricing of oil and the refined products, higher unemployment, and lower competition. Standard Oil could control the output of oil and thereby affecting businesses that were not even directly involved in the oil business. And by using thugs and physical violence, the loss of physical items and/or hospitalization of people increased (“The Sherman,” 2008) This Act authorized the Federal Government to eliminate trusts. In1911, after years of legal...
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...followed in business organizations. These laws are very important and should be strictly adhered to so that the organization's integrity stays intact while at the same time they continue increasing their customers and profits. The United States as well as many other countries has many antitrust laws that forbids acts or understandings that can get rid of or deter fair competition, these laws also forbids the maltreatment of a dominant industry position, restraint or misrepresent commerce, hold prices by artificial means, or bring forward a monopoly. I will be writing about antitrust laws and the famous Microsoft case to demonstrate how business ethics and fair practices are important in business, it’s not only right thing to do but can also be beneficial to the company, clients and employees....
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...Antitrust Claims Antitrust laws were put in place to preserve competition as the rule of trade. Microsoft was accused of violating antitrust laws, and engaging in anti-competitive behavior by illegally using its Windows operating system monopoly. Netscape contended that Microsoft’s anticompetitive practices caused anti-trust injury by violating the Sherman Act. The Sherman Act The Sherman ACT of 1890 prohibits every contract, combination, or conspiracy that restrains trade, or any attempted or actual monopolization or conspiracy or combination to monopolize. While the Sherman Act does not ban all forms of trade, it does stop those that are considered unreasonable. Fixing prices, rigging bids, and dividing markets are all considered violations of the Sherman Act (Anonymous, 2012). It is not illegal for a company to have a monopoly in their industry. However, if the organization attempts to hold their monopoly status through ventures that exclude other companies from having a hold in the market, then the Sherman Act comes into play. Microsoft As most of the world is aware, Microsoft is a monopoly. AOL Time Warner accused Microsoft of engaging in illegal practices to maintain this monopoly (Well & McMillan, 2003). The alleged anticompetitive practices pertained to their Windows operating system. The suit claimed Microsoft held its position as a monopoly in the personal computer operating trade by unlawful exclusionary conduct (Ohlhausen, 2008). In layman’s terms...
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...charging higher prices, (2) providing inferior goods and services and (3) suppressing innovation, as compared with a competitive situation (i.e., the existence of numerous, competing suppliers of the good or service).[1] In theory, the Government or State could collect the excess profits that the company obtained through taxes and then redistribute it among the buyers of the product. However, this redistribution is usually not feasible. It is difficult to ascertain what proportion of the profits of an enterprise is attributable to monopoly power and it is even more difficult to locate all buyers and reimburse them an amount proportional to their purchases. How can society, then, limit the market power and prevent the anti-competitively use of it? In the case of a natural monopoly, i.e. an electricity/power company, the solution is a direct regulation of the price. But more generally, the solution is to prevent companies from acquiring excessive market power and limit the use of that power if they already have it. In the United States, the regulation is made by the antitrust laws: a set of laws and regulations to promote competition in the economy by banning everything that...
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...ICANN’s functions is to authorize an entity to serve as a registrar for certain “Top Level Domains” (TLDs). ICANN and VeriSign entered into an agreement that authorized VeriSign to provide registry services in accordance with ICANN’s specifications. VeriSign complained that ICANN was restricting the services that it could make available as a registrar and was blocking new services, imposing unnecessary conditions on those services, and setting the prices at which the services were offered. VeriSign claimed that ICANN’s control of the registry services for domain names violated Section 1 of the Sherman Act. Answer the following questions, using the information presented in the chapter. 1. Should ICANN’s actions be judged under the rule of reason or deemed per se violations of Section 1 of the Sherman Act? In a straight forward analysis, ICANN operates in violation of the Sherman Act and thus scrutiny of ICANN’s control registry services precede under the “Rule of Reason”. In the case at hand, however; VeriSign charges that ICANN’s prohibition upon Verisign’s SMARTBROWSER correcting a searcher’s misspelled search request overreached ICANN’s authority. VeriSign complains that ICANN’s action resulted via a conspiracy of competing actors intertwined in ICANN processes. Since VeriSign alleges a conspiracy, this team proposes the VeriSign allegations present a pro se violation. There can be no “reason” in justifying conspiracy, accordingly; the opportunity to present evidence...
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...As monopolies ravaged the American economy, the American public demanded a response from the federal government. Starting with President Roosevelt, the regulation of trusts and monopolies increased and continued with later presidents. This new stance was adequate in dealing with monopolies. Muckrackers such as Ida Tarbell exposed countless trusts, one of them being the Standard Oil Company. In “The History of the Standard Oil Company”, Tarbell quotes Mr. Rockefeller as saying “This scheme is bound to work. It means an absolute control by us of the oil business. There is no chance for anyone outside.” By completely controlling the oil business, the core principle of American democracy was being violated, which didn't take the government long...
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...States has various laws in place, which are anticipated to foster fair, balanced, and competitive business practices. These laws are placed as control measures to help safeguard fair business practices. With anti-trust laws in place we are then warranted a since of security from unfair and anti-competitive business practices, unreasonable trade, and price discrimination. As though anything new that is introduced, laws and or regulations when newly introduced can become the product of skepticism. Typically the judgmental ears question the new laws purpose and what influence it will have, even though these new laws may be intended to foster fair and or competitive business practices. Although most of us do not recognize their value, anti-trust laws affect our daily lives in a multiplicity of ways. In 1890 Congress ordained the Sherman Antitrust Act, a law designed to restore competition and free enterprise by breaking up monopolies. This Act July 2. 1890 states the following: “This Act outlaws all contracts, combinations, and conspiracies that unreasonably restrain interstate and foreign trade. This includes agreements among competitors to fix prices, rig bids, and allocate customers, which are punishable as criminal felonies.” The novel purpose for Sherman’s Act was to protect consumers from big business that was exercising immoral means to raise the prices of their product falsely, for example producing too few goods to help meet the consumers needs thereby driving up...
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... and what services are allowed for consumers. The importance of regulating monopolies is to keep the market alive, to allow freedom for other smaller businesses. This keeps up competition in the market, and also keeps the monopolies from doing anything unreasonable. This has led to numerous trials on major companies, one of the biggest cases would be the trial against Microsoft INC. Acts for Regulating Monopolies: In 1890 the Sherman Antitrust act was put into effect, named after the Senator of Ohio, John Sherman and was the first component for congress to prohibit trust.(General Records of the United States Government, Record number 11) The Sherman Act intended by congress to help keep up competition in markets. Unfortunately the act was written to vague there were loopholes to the act and in only five short years the Congress picked apart the act. The act was used again later down the road to successfully help the economy. In 1904 the Sherman act was used to resolve the Northern Securities Company in State of Minnesota v. Northern Securities Company and by 1911, President Taft used the act against the Standard Oil Company and the American Tobacco...
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... I found that I am evaluating my way of thinking more. By researching a little, the discovery I made was that in 1890 our Congress enacts an antitrust act. It is a law that was designed to give competition and free enterprise. I broke up the monopolies to give everyone a fair shake. The Act of July 2, 1890 also known as the Sherman Anti-Trust Act states that “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 declared to be illegal” (“Sherman Antitrust Act,” 2014). The Act also provides: "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 felony” (“Sherman Antitrust Act,” 2014). This act keeps consumers of big businesses from using dishonest means to raise prices falsely, such as deliberately producing too few goods to meet consumer demand and thereby driving up the product's value and price. The aims of competition 1(anti-trust) laws are to ensure that consumers pay the lowest possible price (the most efficient price) coupled with the highest quality of the goods and services which they consume. That act has put the United States on the right track. On February 7, 2015 CNN released our latest employment numbers "The US economy added...
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...Anti-Trust Law and Monopoly; Restraint of Trade Anti-trust laws encourage competition by “leveling the playing field”. These laws are intended to prevent large companies who have already established themselves from using their size and leverage to prevent competitors from entering their markets. The Sherman Act addresses unfair strategies in two different ways: Section 1 forbids restraint of trade and Section 2 forbids the misuse of monopoly power. Section 1 requires two or more persons conspiring together for a violation, so the essence of the illegal activity is “the act of joining together”. Section 2 refers to “every person”, so the conduct of a single person can result in a violation of Section 2. Any agreement between firms that results in reduced competition in the marketplace is restraint of trade. When there are very few firms in a market and a firm with an extreme amount of market power can affect the market price of its own product that firm has monopoly power. The Sherman Act applies only to restraints that have a significant impact on interstate commerce; it also extends to U.S. nationals abroad. The Clayton Act deals with specific practices not covered by the Sherman Act that reduce competition or lead to monopoly power. However, they only violate the Act if they are found to substantially lessen competition or create monopoly power. The price discrimination section 2 of the Clayton Act makes it illegal to injure buyers through unfair pricing and services...
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