Competition Act
The Competition Act at large focuses on forbidding, respective, agreements between undertakings or concerted practices which may restrict the competition within the market. It forbids all practices, which amount to the abuse of a dominant position in the Market by an undertaking where the practice could potentially, affect trade between its members. The rules of the Act set out the basic framework, providing for the maintenance of effective competition in the market.
The Competition Act based on Articles 85 and 86 of the Treaty of Rome provides control to business practices within our market.
"The following shall be prohibited as incompatible with the common market: all agreements between undertakings , decisions by associations of undertakings, and concentrated practices which may effect trade between member states and which have as their object or effect the prevention, restriction or distortion of competition within the common market "
Therefor any agreement, decision, and practice caught by Section 5(1) must have the following conditions
1. There must be some form of collusion between the undertakings
2. Trade must be affected
3. There must be must some adverse effect on competition.
This Section covers such agreements, decisions, practices which:
a. Directly or indirectly fix the purchase or selling price or other trading conditions
b. Limit or control production , markets, technical development or investment
c. Share markets or sources of supply
d. Impose the application of dissimilar conditions to equivalent transactions which
other parties outside such agreement, thereby placing them at a competitive
disadvantage
e. Make the conclusion of contrast subject to the acceptance by the other parties of
supplementary obligations, which by their nature or according to commercial usage,
have no connections, which the subject of such contracts.
The competition act analyzes various aspects so as to promote a healthy business environment. It gives a clear picture in respect to positioning in the market. Clearly, the narrower the definition of the relevant market, the greater the importance of an undertakings share of that market. Once one has defined the relevant market, one must determine whether the questioned undertaking has a dominant position in that market.
In general, an undertaking has a dominant position if it can act on the market independently from its competitors. Thus, if a seller can ask any price for a product, even though its competitors are selling a similar product for much less, it is likely that the seller in question has a dominant position.
United States has several laws that ensure that competition among businesses flow rely and new competitors get free access to the market. These laws intend to ensure fair and balanced competitive business practices. However, there are times when some businesses will do anything to gain competitive edge. USA has strong antitrust laws that prohibit fixing market price, price discrimination, conspiring boycott, monopolizing, and adopting unfair business practices. The history of Antitrust laws goes back to 1890 when Congress passed Sherman Act. In 1914, Congress passed two more acts: Federal Trade Commission Act, and Clayton Act. With some revisions, these three acts are still core antitrust acts.
This essay will examine key aspects of the recent implementation of the Australian Consumer Law (ACL) 2011, which is the largest overhaul in Consumer Law in Australia in the past twenty five years. The ACL replaces 20 existing State and Territory laws into one national law , the legislation was enacted in two main parts as Schedule 2 of the renamed Trade Practices Act 1974 (Cth) (TPA) - Competition and Consumer Act 2010 (Cth) (CCA) . Aforementioned this essay it will outline the key benefits of the implementation of the act. Furthermore it will critique the Act, whilst exploring the objectives of the legislation.
Economic integration is the joining of economic policies between different states/regions. This eliminates tariff and non-tariff barriers to the flow of goods, services and factors of production between the regions. Economic integration has varying levels referred to as trading blocs; these are a form economic integration. A trading bloc is a group of nations that have been made a bilateral or multilateral agreement. There are four types of trading blocs. The least advanced level is the Free Trade Area. The features of this level is that reduced tariff barriers between signatories, which at times are abandoned altogether and there is free movement of labour and capital and the non-member countries have an independent set of tariffs against member countries. The second level of economic integration is the Customs Union. This is a Free Trade Agreement plus a common external tariff. Member countries agree to reduce tariff barriers among themselves and they have in common, this is referred to as tax harmonisation. The Common Market is the third level of trade blocs. This has features of the Customs Union plus free movement of capital and labour and some policy harmonisation such as similar trade policies to prevent certain member countries having an unfair advantage. The European Union is an example of a Common Market and is an economic and political partnership that involves 28 European countries. It allows goods and people to be moved around and has its own currency, the euro, which is used by nineteen of the member countries (The UK excluded). It also has its own parliament and sets rules in a wide range of areas such as transport,...
The Sherman Antitrust Act of 1890 and the Clayton Antitrust Act of 1914 are two things that work together to help explain and prohibit things that people believe are wrong in the world and definitely hurts peoples and the governments wallets.
Anti-trust laws are laws which prohibit anti-competitive behavior and unfair business practices. Their purpose is to make sure that businesses and consumers cannot be abused by powerful firms that hold or wish to hold a monopoly in the market. They also take into account certain ethical standards, and therefore can be considered quite subjective. Many specific strategies are outlawed by anti-trust laws, including price fixing (agreement on prices of uniform goods or services), predatory pricing (setting a low price in order to knock off competitors), and vendor lock-in (virtually forcing a consumer to buy from a certain supplier).
Market structure is classified according to the degree of competition firms encounter in their industry (Baker College, 2016). There are four main market structures: pure competition, monopolistic competition, oligopoly and a pure monopoly. Pure competition is where fir...
[7] Section 25 voluntary of the C (S) A 1995 to section 73 (4) of the
Oligopolists are drawn in two different directions, either to compete with each other or to collude with each other. If they collude, they end up acting as monopoly and thereby maximising the industry's profits. However they are often tempted to compete with each other inorder to gain a bigger share of the profit of the industry.
The Lex mercatoria was an international law of commerce governing the trades and disputes based on the customs and practices of merchants. By the nineteen century, the law of merchant was fully incorporated in the Common law, but the development of commercial law led to a conflicting mass of case law . Following the commercial community recommendations, European countries started to rationalized the commercial law by building codes . English law didn’t follow this path, but instead adopted a series of Act of Parliament focusing on specific area, such as Bills of Exchange Act 1882 and the Sale of Good Act 1893 . Finally, the rise of the consumerism forced the Parliament to recognize the separateness of certain commercial transaction and to adopted an interventionist approach that aimed to create a body of laws protecting consumers, such as the Unfair Contract Terms ACT 1977 and Consumer Protection Act 1987
Competition law in the European Union has developed from being an uncertain preoccupation of a few economists, lawyers and officials to one of the leading competition law system in the globe. Nonetheless, in agreement with most commentators, there are inherent flaws within the EU Commission’s procedures. This paper aims to provide an account of concerns in the current system, drawing comments from scholars and EU officials in order to demonstrate both benefits and shortcomings of the system. An overview of the legal and policy debate of the current EU Competition enforcement will be presented as the introduction. Policy concerns such as prosecutorial bias and self-incrimination in enforcement powers will be the main subjects for the purpose of this paper, followed by analysis of the EU commission structure, in particular checks and balances and the hearing process, both of which have been claimed being incompatible with the ECHR. A comparison with the US Antitrust system will also be paralleled through out this essay in order to demonstrate a clearer examination. This essay will conclude with the Commission’s flaws that have effected on the upcoming UK competition law reforms.
The competition and consumer act aims to discourage price discrimination in the business environment if the discrimination could substantially reduce competition. An example of price discrimination would be Apple with the distribution of IPhone 5c around the world, the prices vary from $500-$1,500(local currency). The IPhone 5c is less-profitable for Apple but still the price range has a big gap e.g., in Singapore the iPhone costs $948, but in the UK it costs $529 . There are three types of price discrimination (first degree, second degree and third degree) and they all discriminate differently. The price discrimination in business will increase revenue, they will attract more consumers and will enable companies to stay in business. The consequences for price discrimination is that the manufacture/business will get sued by consumers for price discrimination especially when paying higher prices, decline in consumer surplus, there may be administrative costs of separating the markets etc. However, Price discrimination has a lot of impacts on consumers and business owner 's around the world but most importantly it affects people that have been discriminated over the price for the same
Few conditions are necessary for the existence of perfect competition. Firstly, there must be large number of buyers and sellers in the market. Then the condition is that the sellers must be selling an identical product in all sense such that it has same characteristics, quality, condition and formula etc. The entry and exist from the market must be free such that any firm or individual
...the potential interference of the market into the legal trade circle may be shaped up to match the interest of the involved traders.
...ur; in such cases, competition authorities must act to fight unlawful practices that are detrimental for the economic welfare.
Weiler, Joseph H.H.: «Community, Member States and European Integration: Is the Law Relevant?», Journal of Common Market Studies 21 (1982), pp. 39-56.