English Competition Law Before 1900

AuthorBarry E. Hawk
DOI10.1177/0003603X18781397
Published date01 September 2018
Date01 September 2018
Article
English Competition
Law Before 1900
Barry E. Hawk*
Abstract
English competition law before 1900 developed over many centuries and reflected changes in political
conditions, economic theories and social values. It mirrored the historical movements in England, from
the medieval ideal of fair prices and just wages to 16th and 17th century nation-state mercantilism to
the 18th and 19th century Industrial Revolution and notions of laissez faire capitalism and freedom of
contract. English competition law at varying times articulated three fundamental principles: mono-
polies were disfavored; freedom to trade was emphasized; and fair or reasonable prices were sought.
The Sherman Act truly was a watershed that significantly took a different path from English law as it had
evolved. In England, legal challenges to monopolization were limited to the royal creation of mono-
polies and were concentrated in the 17th and early 18th centuries. A prominent element of English
competition law—bans on forestalling—was repealed in the first half of the 19th century. Enforcement
of English law against cartels was largely emasculated by the end of the 19th century with the
ascendancy of freedom of contract and laissez faire political theory.
Keywords
Cartels, common law, forestalling, monopolies and restraints of trade
I. Introduction
English competition law before 1900 developed over the course of many centuries beginning in the
medieval period.
1
That development reflected changes in political conditions, economic theories and
broader social values. English competition law mirrored the historical movements in England, from the
medieval ideal of fair prices and just wages to sixteenth- and seventeenth-century nation-state mer-
cantilism to the eighteenth- and nineteenth-century Industrial Revolution and notions of laissez faire
capitalism and freedom of contract. The development of English competition law is rich in insights for
modern antitrust issues, including, for example, the adaptability of case law and legislation to changing
*Fordham Law School, New York, NY, USA
Corresponding Author:
Barry E. Hawk, Fordham Law School, 150 W 62nd St., New York, NY 10023, USA.
Email: bhawk1@law.fordham.edu
1. English law is used here in the broadest sense—i.e., case law, royal edicts and decrees, parliamentary acts, as well as local
laws and regulations.
The Antitrust Bulletin
2018, Vol. 63(3) 350-374
ªThe Author(s) 2018
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DOI: 10.1177/0003603X18781397
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economic conditions, the role of economic theories in the formulation of legal rules, and the role of
political and social values in competition policy.
English commonlaw had an immediate and practical importance in the UnitedStates during the nine-
teenth century. Federal and state courts distinguished between English “common law” decisions, which
remainedpotentiallyvalid precedent,and English statutesthat were no longereffective in the UnitedStates.
Englishlaw was cited byboth proponents andopponents of theSherman Act. SenatorHoar declared,
2
“The
great thing that t his bill does ...is to extend the commonlaw principles,which protected faircompetition in
trade in old times in England, to international and interstate commerce in the Unite d States.”
Senator Platt found a different version of common law, citing a common law “right to trade” that
included a right to combine for the purpose of price fixing:
3
I believe that every man in business—I do not care whether he is a farmer, a laborer, a miner, a sailor, a
manufacturer, a merchant—has a right, a legal and moral right, to obtain a fair profit upon his business and
his work; and if he is driven by fierce competition to a spot where his business is unremunerative, I believe
it is his right to combine for the purpose of raising prices until they shall be fair and remunerative.
Although heresy today, Senator Platt’s view of the common law would have been shared by many
English judges of the nineteenth century.
English competition law developed over the course of almost a millennium. Search for a consistent
coda of specific legal rules and principles can be difficult.
4
And while inconsistencies can be found
even within short periods of time,
5
general principles and rules can be discerned and their evolution
assessed in light of changing economic and political conditions and theories.
English competition law does not neatly break down into the categories of modernantitrust law such
as concerted restraints (Section 1 of the Sherman Act and Article 101 of the Treaty on the Functioning
of the European Union [TFEU]) and actual monopolization or abuse of a dominant position(Section 2
and Article 102). Instead, we discuss English competition law along the following parameters:
—forestalling, engrossing, and regrating (Section II);
—restraints of trade and freedom to trade (Section III);
—conspiracies to raise prices, agreements between competitors and combinations (Section IV);
and
—monopolies (Section V)
II. Interference with the Market: Forestalling, Engrossing and Regrating
In medieval and early modern England, numerous local and national laws prohibited practices that
interfered with markets, notably the allied practices of forestalling (buying goods from the farmer/
producer for resale before the goods came to the market),
6
engrossing (buying goods from farmer/
2. 21 CONG.REC. 3152 (1890) (statement of Sen. Hoar).
3. 21 CONG.REC. 2730 (1890) (statement of Sen. Platt).
4. Milton Handler noted in frustration: “To speak of a common law in light of [the] divergencies of ruling is to court confusion.”
MILTON HANDLER,ASTUDYOF THE CONSTRUCTION AND ENFORCEMENT OF THE FEDERAL ANTITRUST LAWS 5 (1941).
5. For example, English courts in the two decades after 1798 (1) upheld the validity of a contract limiting competition between
two competitors, (2) refused to enforce a bid rigging agreement between competitors, and (3) fined a merchant for engrossing
despite recent legislation that repealed bans on engrossing.
6. A statute in 1266 defined forestallers as those “that buy anything afore the due and accustomed hour ...or that pass out of the
town to meet such things as come to the market being out of the town to the intent that they may sell the same in the Town
more dear unto Regrators, that utter it more dear than they would that brought it, in case they had come to the town or
market.” Judicium Pillorie, 51 Hen. 3 Stat. 6 (1266), reprinted in 1S
TAT. 50 (Danby Pickering ed., 1762).
Hawk 351

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