1. Prohibition of Monopolies: The Sherman Act declared that combinations, trusts, conspiracies, or monopolies that restrain trade or commerce among the states or with foreign nations are illegal. Companies that engaged in such activities could be subject to legal action by the federal government.
2. Restraint of Trade: The act prohibits any contract, combination, or conspiracy in the form of trust or otherwise, that unreasonably restrains trade or commerce. This includes practices such as price fixing, boycotts, and market allocation schemes that limit competition.
3. Protection of Consumers and Competition: The Sherman Act sought to protect consumers and ensure that various markets remain open and competitive. By preventing monopolies and unfair business practices, the law aimed to maintain healthy competition and provide a level playing field for businesses to operate.
4. Enforcement: The Sherman Act was one of the first federal laws to directly address anticompetitive behavior in the economy. It empowered the U.S. Department of Justice to investigate and prosecute violations of the law.
5. Landmark Cases: The Sherman Act has been used in several prominent antitrust cases throughout history. Notable examples include the Standard Oil case in 1911, which resulted in the breakup of the Standard Oil Company into smaller entities, and the Microsoft case in the late 1990s, where the company was found to have engaged in illegal practices to maintain its dominant position in the software market.
6. Amendments and Subsequent Legislation: Over the years, the Sherman Act has been amended and complemented by other antitrust laws, such as the Clayton Antitrust Act of 1914 and the Federal Trade Commission Act of 1914. These subsequent pieces of legislation further refined and strengthened antitrust enforcement in the U.S.
In summary, the Sherman Antitrust Act of 1890 was a landmark legislation that aimed to prevent the formation of monopolies and safeguard fair competition in the American economy. Enacted in 1890, the act has had a significant impact on the U.S. legal and economic landscape.