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CLAYTON
ANTI-TRUST ACT
The Clayton Anti-Trust Act was a
body of legislation sponsored by Alabama
congressman Henry De Lamar Clayton. It was
passed in 1914 as an amendment to the
Sherman Anti-Trust Act. The purpose of the
Act was to prohibit monopolistic practices
by businesses and aimed to do so by
regulating business practices within three
realms.
Corporate activities - By formalizing
regulations that made negotiated
price-cutting, unfair freezing of
competition, and exclusive buying and
selling contracts illegal, smaller
corporations were given a more equal chance
to become successful in a free enterprise
economy.
Remedies for reform
- Prior stipulations on the control
of a company did not inhibit an executive to
direct more than one corporation.
Inter-locking directorates led to
inter-corporate shareholding by a single
board and this led to biased leadership and
insider trading of the company stock. The
Clayton Anti-Trust Act called on the
directors themselves to be held responsible
for the actions of their companies.
Policies on labor disputes - Helped affirm the rights
of unions to strike, boycott, and picket
without fear of repercussions. The Federal
Trade Commission was created to enforce this
privilege and prevent unfair business
practices in the future.
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