Development of competition law
Competition law is a law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies. Competition law is known as antitrust law in the United States and as anti-monopoly law in China and Russia. In previous years it has been known as trade practices law in the United Kingdom and Australia. According to Fali S Nariman, competition law is all about economics and economic behaviour.
The primary purpose of competition law is to remedy some of the situations in which the free market system breaks down. Competition law is a law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies. Competition law provides the framework for competitive activity. It protects the process of competition.
The history of competition law reaches back to the Roman Empire. The business practices of market traders, guilds and governments have always been subject to scrutiny, and sometimes severe sanctions. Since the 20th century, competition law has become global. The two largest and most influential systems of competition regulation are United States antitrust law and European Union competition law. National and regional competition authorities across the world have formed international support and enforcement networks.
Modern competition law has historically evolved on a country level to promote and maintain fair competition in markets principally within the territorial boundaries of nation-states. National competition law usually does not cover activity beyond territorial borders unless it has significant effects at nation-state level. Countries may allow for extraterritorial jurisdiction in competition cases based on so-called effects doctrine.
The protection of international competition is governed by international competition agreements. In 1945, during the negotiations preceding the adoption of the General Agreement on Tariffs and Trade (GATT) in 1947, limited international competition obligations were proposed within the Charter for an International Trade Organisation. These obligations were not included in GATT, but in 1994, with the conclusion of the Uruguay Round of GATT Multilateral Negotiations, the World Trade Organization (WTO) was created.
The Agreement Establishing the WTO included a range of limited provisions on various cross-border competition issues on a sector specific basis. Competition or antitrust law, as it is known in the United States, was invented neither by technicians of commercial law (although they became its first specialist) nor by the economists themselves (although they supplied its most soli cultural background).
It was rather desire by the politicians (in the United States) and scholars (in the EU) attentive to the pillar of the democratic system who saw it as an answer (if not indeed ‘the’ answer) to a crucial problem of democracy, that is private power vis-à-vis public power. Concentration and co-operation are conditions imperatively essential for industrial advance; but if we allow concentration and co-operation there must be control in order to protect the people, and adequate control is only possible through the administrative commission.
Hence concentration, co-operation, and control are the key words for a scientific solution of the mighty industrial problem which now confronts this nation.