Sherman Anti-Trust – 1890

As a result of large trust companies forming in the late 1800’s by companies such as Standard Oil Trust to monopolize the oil industry, Congress passed the Sherman Antitrust on July 2, 1890.  The act was an attempt to prevent large companies from controlling one major industry such as oil, steel, and banking by forming trust companies with only a few trustees having ownership of the entire business.  The act was passed to avoid major industries from dominating and thereby destroying competition.  The Sherman Act provided the authority of the Federal government to interject and dissolve trusts if they found them to be anti competition and would form an industry monopoly in the states and foreign.  However, with the act being the first of its kind, the wording of “trust”, “combination”, and “monopoly” were vague at times for the government to prove  a violation had occurred and in the case of United States vs E.C. Knight Co., the company was ruled not in violation of the act despite having 98% of all sugar refining control in the U.S. (Source: Act of July 2, 1890(Sherman Anti-Trust Act), July 2, 1890; Enrolled Acts and Resolutions of Congress, 1789-1992; General Records of the United States Government; Record Group 11; National Archives).   Although the act was much more relevant during the late 1800’s to early 1900’s, the act was scarcely used by the federal government for most of the 20th century until late 1990’s when the federal government used it against Microsoft. I believe one of the major reason the Sherman Act has less relevance in the 21st century is due to the extensive global economy and competition around the world that the U.S. is confronting, therefore the act should be applied to companies in a much more world macroeconomic standards and not just in the U.S.


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