The Sherman Antitrust Act: Review

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The purpose of the Sherman Antitrust Act is to restrict business entities from forming cartels and monopolies that could hinder fair market completion. Monopolies and cartels harm competition by manipulating trade, supply and in extension, controlling market prices. Competition in the market is encouraged, but there are factors in the market that could affect businesses as well as the public. This Act is supposed to protect these market players and not the competition. The law generally regulates conduct that has the potential to destroy market competition. This Act gives the government of the United States the authority to inquire, investigate and follow organizations or businesses that violate the antitrust laws.

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In this case, Goliath U.S.A is a major player in the United States market and is subject to the jurisdiction of the countries laws. On the other hand, Goliath Junior of Caymans Islands has violated the terms of Sherman Act. It has signed cartel agreements that manipulates the markets and controls the prices of Sapphire. However, Junior of Caymans is not a player in the United States market. Both Goliath U.S.A and Goliath Junior Caymans were right in their answers to the government of United States; Goliath U.S.A agreement with Goliath Junior Caymans does not influence the United States Sapphire market. Goliath Junior is not under the jurisdiction of the United States government laws.

The violation of the Sherman Antitrust Act involves agreements made between businesses that are aimed at unreasonably restricting competition and in turn influencing interstate commerce within the United States and this is not the case with Goliath U.S.A or Goliath Junior of Caymans. In addition, Goliath U.S.A does not possess monopolistic power in the United States sapphire market neither has it signed agreements with other businesses in the United States that unreasonably restrain Sapphire trade in the country. However, it is linked to a firm that does exactly that but not in the United States. Violation of the act only occurs when the action is intended to influence the relevant market.

In case of “Standard Oil Company of New Jersey verses United States of America in 1911” (Standard Oil Co. of New Jersey v. United States, 1911), the company was accused of manipulating the petroleum industry by causing a chain of abusive and anticompetitive manoeuvres. The Oil company bought most refinery firms in the United States. First, the financial growth was influenced by the high quality refinery technology in kerosene products. This growth led the Standard Oil to use profits in acquisition of neighbouring refining capacity. This resulted to major increase of refined oil and in 1870, ten percent of refined oil in the United States was produced by Standard Oil Company. Eventually it compelled competitors to sell out owing to control of the industry by Standard Oil.

In the case of Goliath, the company has only set up a subsidiary company in the Caymans that has nothing to do with the control or manipulation of the United States market. The Goliath Junior deals with none US subsidiaries and therefore not subject to the United States Sapphire market.

The court, in the Standard Oil Company case concluded that an agreement violated the Sherman Act only if it manipulated trade “ unduly” which it termed as monopoly. Goliath U.S.A unlike Standard Oil, dose not use Goliath Junior to control United States market neither is Junior a market player in the United States.

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Reference

Standard Oil Co. of New Jersey v. United States, 221 U.S. 1 U.S. (1911).

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DemoEssays. (2022, April 10). The Sherman Antitrust Act: Review. Retrieved from https://demoessays.com/the-sherman-antitrust-act-review/

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DemoEssays. (2022) 'The Sherman Antitrust Act: Review'. 10 April.

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DemoEssays. 2022. "The Sherman Antitrust Act: Review." April 10, 2022. https://demoessays.com/the-sherman-antitrust-act-review/.

1. DemoEssays. "The Sherman Antitrust Act: Review." April 10, 2022. https://demoessays.com/the-sherman-antitrust-act-review/.


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DemoEssays. "The Sherman Antitrust Act: Review." April 10, 2022. https://demoessays.com/the-sherman-antitrust-act-review/.