Effects of international trade are controlled by global competition law in the respective countries. In the United States, competition law is known as the anti-trust laws and anti-monopoly laws in China. Cartels have funded the campaigns of political candidates to ensure that they will not be affected by the anti-trust laws.
Anti-trust laws also require that abusive firms in the country be banned. Competition law used to control monopolization of industries but today due to the political affiliation of business owners, antitrust laws do not control monopolies but instead support privatization of state-owned corporations that operate as monopolies. The continued modifications on competition law increase exploitation of consumers for political gain.
Global competition law is considered political instead of thinking of it as an economic expression
Public enforcement of competition law is inherently political because it involves the use of the power of a country to control or redistribute market power. It is important to understand the political nature of the competition policy because selective enforcement id did to promote and protect a competitive environment for economic activities.
It is unfortunate that governments have been the source of grants of legal privilege to companies of special interest to the company. Competition law has therefore changed from controlling monopoly to supporting the monopoly of some companies that have a political affiliation to the government.
Types of anti-competitive behaviours that are essential to national sovereignty
Anticompetitive behaviours are business practices that limit or prevent competition which is against the law. There are some important anti-competitive behaviours to the sovereignty of a nation. Anti-competitive behaviours can be classified into several categories. One of the categories is collusion. This is where competitors act together through explicit or implicit business agreements to exploit customers by fixing prices.
This is not an important behaviour as a country would be exploiting citizens by fixing the price. Vertical restraints are anti-competitive behaviour used to lessen competition. This is a behaviour that involves imposing constraints in the supply chain such as resale price with the aim of reducing intra-brand competition.
Anticompetitive Mergers is another form of anti-competitive laws to increase market power and reduce competition altogether. Some good anti-competitive behaviours to the sovereignty of a country include dumping. Dumping is where the government may offer subsidies to a certain group to produce a certain commodity.
Offering grant to produce certain commodities especially offering subsidies to farmers may be anti-competitive behaviour that prevents an increase in food prices in the country. Dumping may also be done in the case where export prices are below reasonable cost thus causing bankruptcies of certain groups of the economy.
The government may also use dumping to reduce competition of international companies. Offering subsidies and grants to local companies will bring economic growth to a country thereby stimulating economic growth in a country.
Another important anti-competitive behaviour is a refusal to deal with. This will ensure that the country provides telephone services in the country thereby providing the necessary infrastructure in the country. A country does this by setting proprietary standards that are tough for foreign companies to comply. Setting these standards protects domestic industries in a country and also protects national interests thereby maintaining the country’s sovereignty.
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