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Business Definition for: Clayton Act

Dictionary of Marketing Terms
Clayton Act

1914 federal consumer protection legislation that prohibits certain monopolistic practices and other impediments to free market competition, including price discrimination, mergers that may lessen competition, tying agreements and exclusive dealings. The Clayton Act also holds corporate officials personally liable for damages resulting from activities in violation of the Act's rulings. The Clayton Act was designed to be more effective in preventing threats or potential threats to competition than the 1890 Sherman Antitrust Act . The Sherman Act does not come into play until after a violation is committed and has impeded competition. The Clayton Act is enforced by the Federal Trade Commission in conjunction with the Department of Justice.

See also antitrust acts , robinson-patman act
Related Terms:
antitrust acts

federal statutes that regulate trade in order to maintain competition and prevent monopolies. Many common business practices are governed by these statutes. The Sherman Anti-Trust Act of 1890 made price-fixing (the setting of prices in cooperation with competitors) illegal. The Clayton Anti-Trust Act of 1914 outlawed price discrimination (charging different prices to different buyers), as did the Robinson-Patman Act of 1936. Under these Acts, advertising and promotional allowances are permitted only if they are offered to all dealers on equal terms.

robinson-patman act

legislation that forbids quoting different prices to competing customers unless such price discrimination is justified by differences in costs of manufacturing, sales, or delivery.

Referring Terms:
consumer protection
dominant firm
Miller-Tydings Fair Trade Act
Wheeler-Lea Act
Copyright c 2000, 1994, 1987 by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
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