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Simple English definitions for legal terms
active supervision
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A quick definition of active supervision:
Active supervision is a rule that says when a private company is doing something that might hurt competition, the government has to make sure it's okay. This is because the private company might be doing it just to help themselves, not because it's good for everyone. The government has to make sure that the private company is doing it for the right reasons. This is called active supervision.A more thorough explanation:
Active supervision is a term used in antitrust law to refer to the right of the state to review and disapprove anticompetitive acts of private entities that do not promote state policy. This is important because private parties may act in their own interests rather than the interests of the state, and the state wants to ensure that only anticompetitive acts that further state regulatory policies are allowed.
For example, if a group of private hospitals in a state decide to collude and fix prices for medical services, the state may review their actions and disapprove of them if they do not promote state policy. The state may require the hospitals to stop their anticompetitive behavior and impose penalties if they do not comply.
Another example is if a group of private schools in a state decide to form a cartel and agree to charge the same tuition fees, the state may review their actions and disapprove of them if they do not promote state policy. The state may require the schools to stop their anticompetitive behavior and impose penalties if they do not comply.
In both examples, the state is exercising active supervision over the anticompetitive behavior of private entities to ensure that they are not acting in their own interests but in the interests of the state and its regulatory policies.