Clayton Act


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Clayton Act

A federal law enacted in 1914 as an amendment to the Sherman Anti-Trust Act (15 U.S.C.A. § 1 et seq. [1890]), prohibiting undue restriction of trade and commerce by designated methods.The Clayton Act (15 U.S.C.A. § 12 et seq. [1914]) was originally enacted to exempt unions from the scope of antitrust laws by refusing to treat human labor as a commodity or an article of commerce. Today, it is used primarily to prohibit the suppression of free competition by making illegal four business practices: price discrimination, which is the sale of the same product to comparably situated buyers at different prices; tying and exclusive dealing contracts, which are the sale of products on condition that the buyer stop dealing with the seller's competitors; corporate mergers, the acquisition of competing companies by one company; and interlocking directorates, the members of which are common members on the boards of directors of competing companies.

These practices are illegal when they might substantially lessen competition or tend to create a Monopoly in any line of commerce. By making the suppression of free competition unlawful the Clayton Act supplements the provisions of the Sherman Act, which outlaws monopolies.

Clayton Act

a US statute that prohibited certain practices like price discrimination and exclusive dealing where goods are sold for use, consumption or resale in the USA. Mergers are restricted under the Act. It has been developed over the years and provides a robust competition law.
References in periodicals archive ?
think tank, weighs in its call to Congress to repeal the Clayton Act (1914) and the Sherman Act (1890).
When Congress passed the Clayton Act in 1914, it included a provision (Section 6) that specifically exempted the creation of farmer cooperatives and labor unions and collective activities by farmers and workers from the general operation of the antitrust laws.
The Clayton Act was enacted in 1914 as an amendment to clarify and supplement the Sherman Act.
Clayton Act (5) (whose Section 2 covers "price discrimination" as defined by the statute; (6) whose Section 3 covers single-brand exclusive dealerships, full-requirements contracts, and total-output-supply contracts; and whose Section 7 covers mergers and acquisitions) prohibits the behavior it covers if that conduct is requisitely likely to or did lessen competition.
49) The Clayton Act generally applies to "commerce.
To give more meaning to the Sherman Act, the Clayton Act was subsequently enacted.
Changing Section 8 of the Clayton Act to Allow for Benefits of
His Clayton Act claim also failed because it applies solely to commodities.
But in response to concerns that investment bankers were abusing their positions for their own benefit, Section 10 of the Clayton Act, which went into effect in 1921, prohibited investment bankers from serving on the boards of railroads for which they underwrote securities.
The groups sent a co-signed letter to William Baer, the assistant attorney general of the Antitrust Division, saying that the merger would "substantially lessen competition, or tend to create a monopoly," which is forbidden by Section 7 of the Clayton Act.
Mergers and acquisitions may substantially lessen competition with the tendency to create a monopoly, and they are subject to Section 7 of the Clayton Act.
Section 6 of the Clayton Act, (1) the Capper-Volstead Act, (2) and the Cooperative Marketing Act (3) are the results of that "solicitude" for farmers.