Posted by Dave Nerz

The information that follows is based on US law, but most countries have a similar requirement by a differing set of laws.

Bottom line for all anti competitive previsions in the law, in the US or internationally, the law expects competitors to act as competitors.  When there is an agreement to restrict competition, the law frowns upon the act and the actors involved. 

While it would be rare for such a situation to surface between NPAworldwide members, where a single client is severed by multiple members, such issues are possible.  Please be aware of the client's wishes for a "partnered" approach to solving their issues or the expectation of competition. When in doubt, act independently.

Some laws that cover anti competitive behavior...

Sherman Antitrust Act

A Section 1 violation has three elements:

  1. An agreement
  2. which unreasonably restrains competition
  3. and which affects interstate commerce.

Section 2 violation are not likely by NPAworldwide or members.


Violations of the Sherman Act section 1 can be called "per se" violations.  These are violations that meet the strict characterization of Section 1 ("agreements, conspiracies or trusts in restraint of trade"). A per se violation requires no further inquiry into the practice's actual effect on the market or the intentions of those individuals who engaged in the practice. Conduct characterized as per se unlawful is that which has been found to have a "pernicious effect on competition' or 'lack[s] . . . any redeeming virtue." Such conduct "would always or almost always tend to restrict competition and decrease output." A civil violation of the act is proved merely by proving that the conduct occurred.    


The Clayton Antitrust Act

The Clayton Act seeks to capture anti competitive practices by prohibiting particular types of conduct, not deemed in the best interest of a competitive market. It supplements the Sherman Antitrust Act of 1890. In those sections, the Act thoroughly discusses the following four principles of economic trade and business:

  • price discrimination 
  • exclusive dealings - sales on the condition that the buyer or lessee not deal with the competitors or the buyer also purchase another different product
  • mergers and acquisitions where the effect may substantially lessen competition
  • any person from being a director of two or more competing corporations

Robinson- Patman Act

In general, the Act prohibits sales that discriminate in price on the sale of goods to equally-situated distributors when the effect of such sales is to reduce competition.