International Law - Research Paper Example

International Law The Sherman Antitrust Act (1890) was introduced to protect the market from being monopolized by companies. Monopolies often preventfree competition in the market. The act states that any company that engages in contracts inside the United States or with foreign nations in order to monopolize trade violates the law. Such contracts are, in effect, illegal. The penalty for such contracts, if found guilty, is over $ 10,000,000 in the case of companies. However, other individuals are expected to pay over $350,000, or face a jail term of not more than three years (Hylton, 2003).

Goliath and Junior are correct because their trade policies cannot be termed as monopolies outside the United States. Cayman Islands (Junior, Ltd.) is a foreign company and is, therefore, not subject to the laws governing trade in the United States. Goliath Inc is also not liable to the law suit being supported by the United States since its contract with Junior Ltd does not affect the American market. Regulations concerning price fixing are normally applied internationally. However, when there are laws that seek to restrict price fixing to national sovereignty, challenges arise in finding out whether Goliath and Junior violated the anti-trust law (Mann and Barry, 2004).

The major controversy arises due to the applicability of the Sherman Anti-Trust Act to foreign businesses. It is true that Goliath was in contract with a company of foreign origin. However, its market is outside the United States. It is, therefore, difficult to enforce the law to the international market (Hylton, 2003).The geographic market is very important in determining whether the two companies engaged in illegal dealings. According to the act, the confines of the market are only within the United States.

The market in which companies sell their products should be national, regional or local but not global. Goliath Inc. and Junior Ltd. have not committed any crime by engaging gin contracts that may affect the international market. The United States government should only be concerned if the operations of the two companies are affecting the national and interstate markets. The market in which an organization, for instance, Goliath Inc. and Junior Ltd. serve is not limited by transportation costs, the kinds of service, or product they sell and the geographic location of their competitors.

Different countries have different laws concerning market monopolies. It is, therefore, difficult to find Junior Ltd with any wrong doing since the company is registered in line with British laws (Posner, 2002).It would be difficult for the united state’s government to prove that sufficient monopoly occurred due to the dealings of Goliath and Junior. The act demands that the government be able to prove that the organizations involved are under contract to enforce monopoly or engaged in unfair conduct.

Different justice systems have different interpretations of what constitutes unfair conduct. The fact that Junior Ltd engaged in a cartel agreement with other companies producing sapphires in other countries apart from the United States makes its case against the government simple since it operated outside the territory governed by the Sherman Anti-Trust Law (Hylton, 2003).ReferencesHylton, K. (2003). Antitrust Law: Economic Theory and Common Law Evolution. New York: Cambridge University Press.Mann. R.

and Barry, S. (2004). Essentials of Business La, 8th ed. Mason. Ohio: Thomson/South-Western West.Posner, R. (2002). Antitrust Law, 2nd ed. Chicago: University.of Chicago Press.