Government Regulation Of Business

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Sherman Anti-Trust Act of 1890

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First law passed promoting fair competition.

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Clayton Act of 1914

Back 2

prohibits anti-competitive mergers, tying arrangements and exclusive dealing agreements.

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Robinson-Patman Act of 1936

Back 3

bans price discrimination that reduces competition.

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Per-se violation

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blatant breach of anti-trust

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Rule of Reason

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illegal only if there is an anti-competitive impact.

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Horizontal Strategy

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an agreement between competitors (example Levi Strauss and Wrangler)

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Vertical Agreement

Back 7

an agreement between participants in different stages of the production process (Levi-Macys)

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Mergers-Joint Ventures

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companies joining forces to become one or accomplish a business strategy.

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Monopolization

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only illegal if gained in the wrong way. Has to control 70 to 90 percent of the market.

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Predatory Pricing

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when a company lowers its prices below cost to drive competitors out of business.

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Tying Arrangements

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an agreement to sell a product on the condition that the buyer also buy a different or tied product.

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Resale Price Maintenance

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when manufacturers agree that distributors will sell their product at certain prices.

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Price Fixing

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an agreement among participants on the same side in a market to buy or sell a product, service or commodity.

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FTC Federal Trade Commission

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Created to regulate business and be the consumers best friend.

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Consent Order

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party agrees to not violate the law.

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Cease and Desist Order

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a command from the court to stop the violation.

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Voluntary Compliance

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party comes forward to sign this first before a consent order.

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Bait and Switch

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The seller must have the product in stock and not disparage the customer from buying.

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Mail or Telephone Merch

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Must be delivered within 30 days of sale.

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Telemarketing

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the "do not call" list must be obeyed and caller id must be used.

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Unordered Merchandise

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May be kept as a gift; consumer may not be charged.

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Door to Door sales

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right to cancel within 3 days of receipt.

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TILA or Truth in Lending Act

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requires lenders to disclose terms of a loan in an understandable and complete manner.

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TILA applies if

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1. Its a consumer (not business) loan.
2. Will be repaid in more than 4 installments.
3. loan is for less than $25,000 or is secured by a mortgage.

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TILA loans must meet these requirements

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1. Open-ended credit-revolving
2. Closed End Credit-one loan; one amount
3. Home equity loans

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Rescission of Mortgage

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a consumer can rescind a mortgage within 3 business days of signing or within 3 years if the lender violated TILA disclosure terms.

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FCBA Fair Credit Billing Act

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provides additional protection to credit card holders who do not discover errors on their card.

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FCRA Fair Credit Report Act

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regulates consumer reporting agencies; regulates employers use of credit checks when considering an applicant.

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FACTA Fair and Accurate Credit Transactions Act

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goal is reducing identity theft by allowing consumers to put an alert out to financial institutions.

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FDCPA Fair Debt Collections Practices Act

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provides that a debt collector must, within 5 days of contacting a debtor, send a written notice.

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ECOA Equal Credit Opportunity Act

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prevents creditors from discriminating against a borrower for any reason.

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CLA Consumer Leasing Act

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Requires a leasor to disclose all pertinent information pertaining to the lease.

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Magnuson Moss Warranty Act

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does not require that manufacturers or sellers provider a warranty on their products. The act does require that if the party offers a warranty on a product worth more than $15 dollars explain the warranty in simple terms before the sale.

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Clean Air Act 4 major provisions

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1. Primary Standards
2. Secondary Standards
3. State Implementation Plans
4. Citizen Suits

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Clean Water Act

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prohibits any single producer from discharging pollution into the water without a permit from the EPA.

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Safe Drinking Water Act of 1974

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-Prohibits the use of lead pipes where drinking water flows. Requires that levels are reported to the public.

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Ocean Dumping Act of 1972

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Prohibits dumping of wastes in the ocean without a permit from the EPA.

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Oil Pollution Act of 1990

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to prevent defective boats from leaking oil; requires ship owners to pay for any oil leaks.

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RCRA Resource Conservation and Recovery Act

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prevention of illegal waste disposal by regulating the production and disposal of waste.

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CERCLA Comprehensive Environmental Response Compensation and Liability Act

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focuses on cleaning up existing hazardous waste sites using a program called "Superfund"