This short article might help you understand what is going on.
Antitrust laws are intended to maintain competition among business firms. A trust consists of two or more companies that combine in order to control the supply and price of a product or service. Such an arrangement eliminates competition among the companies and generally results in higher prices for consumers. Other companies in the same field as a trust may find themselves forced out of business.
The first antitrust legislation in the United States was the Sherman Antitrust Act of 1890. This law forbids any business combination or practice that interferes with free competition or promotes monopoly. The Federal Trade Commission (FTC), established in 1914, and the Antitrust Division of the Department of Justice have the authority to break up price-fixing agreements among companies. These agencies also can prevent any merger (joining of two or more companies) that would reduce competition. Most states have additional laws that prevent the creation of trusts.
Contributor: Richard M. Hodgetts, Ph.D., Prof., Florida International Univ.
