Sunday, February 5, 2012

LAD#27: Clayton Anti-Trust Act

Summarize.
The Act finally did what the Sherman Antitrust Act could and did not. The Act outlaws price discrimination that lessens competition or tends to create a monopoly, sales if it may lessen competition, mergers and acquisitions that may lessen competition. It also prevents any person from being the director of more than one competing corporation that would violate the act by merging.

Section 7 of the Act defines a holding company as one whose primary purpose is to hold stocks of other companies and outlaws it. It also requires a company to notify the government should it be thinking about a merger or acquisition of another company.

The difference between the Clayton and the Sherman antitrust acts is that the Clayton act made sure that it could not be used against union activities. Section 6 exempts labor unions and agricultural organizations from the provisions in the act.

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