Postwar Control of Restrictive Trade Practices in Great Britain

Abstract

E ACH country has its own individualized approach to the treatment of monopoly and restrictive economic practices. Likewise, the attitude toward and enthusiasm for competition vary among countries. Federal antitrust legislation was initiated in the United States as far back as 1890 in an effort to restrain monopoly more effectively and to eliminate restrictive trade practices. Great Britain, on the other hand, depended solely on common law protection against unreasonable restraints of trade until after World War II. In fact, the protection of the public interest in that country had, through the process of court interpretation, gradually become less important, and the safeguarding of the freedom of contract for business interests had gained paramount significance. Restrictive agreements, in themselves, had not been illegal and they came to be accepted as a part of customary business practice. Under the unstable economic conditions prevailing between the two world wars, restraints on competition were crystallized, and procedures for collective action and control were extended further. Subsequently, many of the trade organizations developed during these years for this purpose were utilized by the British government to carry out the World War II rationalization of production and distribution. In this setting a strong reaction began to develop in Britain against the whole institutional organization of restraints. Affirmative action was cautious, however, and emphasized a conservative approach of inquiry. To accomplish this goal, a Monopolies and Restrictive Practices Commission was established in 1948. Largely as an outgrowth of the findings of this commission, Parliament enacted a more vigorous statute in 1956, the Restrictive Trade Practices Act. It is the major purpose of this paper to show the character of this postwar legislation and to discuss the efforts made within its framework to eliminate those restraints that are viewed as being opposed to the public interest. As an introduction to the analysis of this new legal position of restrictive practices, the evolutionary development of the common law doctrine and the reaction against it are traced briefly.