What is an Antitrust?
An Antitrust – orAntitrust Law – is terminology that is used within the legal spectrum of business and commercial law. Antitrust Law mandates jurisdiction over business and commercial endeavors existing within the United States in order to regulate fair business practices, upkeep free trade, protect the ethics within the commercial market, and avoid monopolies.
What is a Trust?
With regard to commercial and business law, Antitrust Law strictly prohibits the usage of ‘Trusts’ within a commercial market; a trust is defined as an operational process in which a larger corporation – or commercial entity – maintains agency over smaller commercial factions in order to retain profit and administration of those secondary corporations – this is allows for the primary corporation to maintain control of entities other than the primary corporation.
The primary corporation, which is sometimes called an ‘Umbrella Corporation’, employs the formation of smaller companies; as a result of the formation of a trust, the umbrella corporation can operate in an indirect fashion – although the umbrella corporation maintains ownership of the faction corporations, a direct connection of association is not prevalent.
Antitrust vs. Monopoly
Within the scope of Antitrust Law, there exists a variety of associated terminology that is pertinent with regard to the legal review latent within legal stipulations expressed by Antitrust Laws; perhaps the most prominent term accompanying the term ‘Antitrust’ is the term ‘Monopoly’:
Antitrust Law, which is also classified as competition law, addresses the regulatory statutes and preventative measures that have the potential to exist within commercial and business endeavors. As previously stated, one of the many circumstances in which Antitrust Law can be violated is through the use of a monopoly.
A Monopoly is a circumstance in which a single business entity has disallowed for commercial competition or businesses within a competing market. A monopoly typically takes place in the event that a single business – or a provider of products or services – has maintained exclusive control of commercial activity with regard to the provision of specific products or services; this can be undertaken within a variety of methodologies:
1. Price Gouging: The notion of price gouging is a common violation of Antitrust Law; price gouging takes place in the event that a business has become the sole provider of specific products or services, resulting in the patronizing of that specific business as the only avenue for a consumer to obtain those specific products or services. Once this has taken place, the business may take advantage of the market by implementing higher prices, which is considered to be a form of consumer abuse; due to the lack of competition, consumers are forced to patronize that particular business in order to obtain those products or services.
2. Exclusive Dealings: Within the realm of Antitrust Law, the usage of Exclusive dealings is expressly prohibited. Exclusive dealings are defined as two separate bodies of production – such as retailers and manufacturers – acting in concert in order to remove competing business within the commercial market; in accordance with Antitrust Law, exclusive dealings is illegal due to the fact that is creates a monopoly of the individual products and services provided.