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What is the Clayton Act

5. What is the “Clayton Act of 1914”?

The Clayton Act is an antitrust law passed to protect consumers by providing a means of preventing early-stage anticompetitive practices. It has a specific focus on the sale of commodities. The Clayton Act is more specific in identifying anticompetitive conduct than is the Sherman Act. It also creates exemptions for certain industries or businesses and establishes an enforcement mechanism to remedy violations of the Act. A notable aspect of the Clayton Act is that it prohibits conduct that does not presently amount to an injury to consumers but has the tendency to lead to consumer injury. In this way, the Act focused on regulating conduct to prevent harm from occurring.

•    Note: The specific types of conduct prohibited under The Clayton Act is discussed below.

•    Discussion: How do you feel about the purpose of the Clayton Act? Should the Federal Government be able to prohibit certain business practices that are not presently anticompetitive based upon their tendency to by anticompetitive?

•    Practice Question: What is the regulatory function of the Clayton Act and how is it distinct from the Sherman Act?

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