Simple English definitions for legal terms
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The per se rule is a legal principle that says if a business practice restricts trade, it is automatically considered a violation of the Sherman Antitrust Act, even if it doesn't harm anyone. This is different from the rule of reason, which considers whether the practice has a negative impact on competition.
The per se rule is a legal principle in antitrust law that states that a trade practice violates the Sherman Antitrust Act if it is a restraint of trade, regardless of whether it actually harms anyone. This means that certain practices are considered illegal simply because they restrict competition, without any need to prove that they have a negative impact on the market or consumers.
For example, price-fixing agreements between competitors are considered per se illegal under the Sherman Act, because they eliminate price competition and harm consumers by raising prices. Similarly, market allocation agreements, where competitors agree to divide up territories or customers, are also per se illegal because they reduce competition and limit consumer choice.
The per se rule is different from the rule of reason, which requires a more detailed analysis of the competitive effects of a trade practice. Under the rule of reason, a practice may be legal if it has pro-competitive benefits that outweigh its anti-competitive effects.
Overall, the per se rule is a powerful tool for antitrust enforcement, as it allows authorities to quickly and decisively address certain types of anti-competitive behavior without the need for lengthy and complex economic analysis.