Antitrust laws are designed to ensure that businesses compete fairly and lawfully. Both federal and state antitrust laws prohibit collusion between business competitors and ban companies from engaging in false, deceptive, and corrupt trade practices. The Federal Trade Commission and the United States Department of Justice Antitrust Division enforce federal antitrust laws. While the authority of each agency overlaps in certain areas, each group tends to focus its efforts in the oversight of particular industries or markets. Below is an overview of the three primary federal antitrust laws.
- The Sherman Antitrust Act – The Sherman Antitrust Act prohibits both monopolization and any behavior that unreasonably restrains trade. Unreasonable restraints on trade include arrangements between competing businesses to divide markets, fix prices, or rig the bidding process. While most Sherman Antitrust Act penalties are civil in nature, violators may also be subject to criminal prosecution and penalties. Penalties include fines of up to $100 million for corporations, $1 million for individuals, and up to 10 years in prison.
- The Federal Trade Commission Act – The Federal Trade Commission Act prohibits unfair or deceptive practices and unfair methods of competition. The Federal Trade Commission Act is intertwined with the Sherman Act, as the Supreme Court has found that all violations of the Sherman Act also violate the Federal Trade Commission Act. Violators of the Federal Trade Commission Act are also subject to the penalties discussed above. The Federal Trade Commission Act affords additional protection to businesses, as it bans some practices that harm competition but aren’t formally prohibited by the Sherman Act.
- The Clayton Antitrust Act – The Clayton Antitrust Act prohibits mergers and acquisitions where the effect substantially lessens competition or results in the creation of a monopoly. It also prohibits a number of discriminatory services, prices, and allowances in transactions between merchants and requires companies planning large mergers or acquisitions to alert the government of their plans prior to execution.
Houston Antitrust Attorneys
It’s important that organizations comply with both federal and state antitrust laws, as the failure to do so can have dire consequences. Without the assistance of experienced legal counsel, it can be difficult to determine whether a particular course of action is within the bounds of the law. At Ajamie LLP, we advise corporations, trade associations, and individuals on compliance with state and federal antitrust, competition, and trade laws. We have represented clients in many industries and professions on antitrust and competition matters. Our vast experience in these areas gives us a unique perspective into the myriad of antitrust issues that can arise in the course of doing business, allowing us to create solutions that minimize risk. Please contact us for a consultation.