Unfair Competition Law

Articles written by attorneys and experts worldwide discussing legal aspects related to Antitrust and Trade Regulation including: competition law, international trade, trade investment and unfair competition.

This project, which addresses the right to compete, deceptive marketing, the law of trademarks, and related concepts of intangible property and correlative rights, marked the first time the Institute had addressed the subject of unfair competition since publication of the original Restatement of Torts more than half a century earlier. Together these subjects were to have been included in the Second Restatement of Torts, as they were in the first Restatement. See Restatement Second, Torts, Vol. 4, Introduction, vii-viii. It was eventually decided, however, that they should be addressed in a separate project.

Since 1990, commercial torts against business have increased more than personal torts against individuals, and small business bears a disproportionate amount of liability costs. It is the small business — perhaps a family-run business, a tech startup, or a local business employing a handful of people — that bears the biggest burden.

The Federal Trade Commission's Bureau of Competition champions the rights of American consumers by promoting and protecting free and vigorous competition. The Bureau: * reviews mergers and acquisitions, and challenges those that would likely lead to higher prices, fewer choices, or less innovation; * seeks out and challenges anticompetitive conduct in the marketplace, including monopolization and agreements between competitors; * promotes competition in industries where consumer impact is high, such as health care, real estate, oil & gas, technology, and consumer goods; * provides information, and holds conferences and workshops, for consumers, businesses, and policy makers on competition issues and market analysis.

The Federal Trade Commission ("FTC") is an independent agency established by Congress in 1914 to enforce the Federal Trade Commission Act ("FTC Act").(1) Section 5 of the FTC Act prohibits "unfair methods of competition," and was amended in 1938 also to prohibit "unfair or deceptive acts or practices."(2) The Commission enforces a variety of other antitrust and consumer protection laws as well.

The Commission's specific investigative powers are defined in Sections 6, 9, and 20 of the FTC Act, 15 U.S.C. Secs. 46, 49, and 57b-1, which authorize investigations and various forms of compulsory process. In addition, the premerger notification provisions in Section 7A of the Clayton Act, 15 U.S.C. Sec. 18a, prohibit consummation of covered acquisitions until the requested information is provided, thus effectively enabling the Commission to obtain information regarding such acquisitions.

Under the Noerr-Pennington doctrine, private entities are immune from liability under the antitrust laws for attempts to influence the passage or enforcement of laws, even if the laws they advocate for would have anti-competitive effects.

Unfair competition in a general sense means that the competitors compete on unequal terms, because favourable or disadvantageous conditions are applied to some competitors but not to others; or that the actions of some competitors actively harm the position of others with respect to their ability to compete on equal and fair terms.

Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful.

Federal antitrust laws apply to virtually all industries and to every level of business, including manufacturing, transportation, distribution, and marketing. They prohibit a variety of practices that restrain trade, such as price-fixing conspiracies, corporate mergers likely to reduce the competitive vigor of particular markets, and predatory acts designed to achieve or maintain monopoly power.

The American Antitrust Institute is an independent Washington-based non-profit education, research, and advocacy organization. Our mission is to increase the role of competition, assure that competition works in the interests of consumers, and challenge abuses of concentrated economic power in the American and world economy. We have a centrist legal-economic ideology and promote the vigorous use of antitrust as a vital component of national and international competition policy.