History and Overview of Section 8

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CHAPTER I

HISTORY AND OVERVIEW OF SECTION 8

The passage of Section 8 of the Clayton Act1was the result of

concerns about business “bigness” and monopoly in a period of broad

public mistrust of business. While many of these concerns, such as

conflict of interest, are not normally considered antitrust issues, the

statute was enacted to provide limited regulation of corporate interlocks.

The main impact of the law was the prohibition of simultaneous service

by a “person” as a director of two competing corporations.2Section 8

has been amended eight times3and over its history has repeatedly faced

arguments supporting its substantial modification or repeal.4The most

important of the relatively recent efforts to alter Section 8 produced the

1990 amendments, which resulted in the substantially reworked statutory

framework currently in place.5

The primary purposes of the 1990 amendments to Section 8 were to

provide exceptions to per se condemnation if the competitive overlap

between the firms is de minimis and to increase the jurisdictional

1. Antitrust Act, 1914, ch. 323, § 8, 38 Stat. 730, 732-33 (codified as

amended at 15 U.S.C. § 19).

2. Other provisions prohibited personnel interlocks between banks meetin g

certain requirements and regulated interlocks between common carriers

and their suppliers and customers. The provision regulating vertical

interlocks with common carriers, § 10, was repealed in 1990, and the

provision concerning bank interlocks, though not rep ealed, has been

superseded by other legislation. See part C of this chapter, as well as

Chapter IV.H.

3. An excellent treatment of the post-enactment a mendments to § 8 prior to

the 1990 amendments is contained in ABA SECTION OF ANTITRUST LAW,

MONOGRAPH NO. 10, INTERLOCKING DIRECTORATES UNDER SECTION 8OF

THE CLAYTON ACT 15-16 (1984) [hereinafter ABA MONOGRAPH NO. 10].

4. See, e.g., H.R. 4406, 94th Cong. (1975); H.R. 14997, 93d Cong. (1974);

H.R. 13581, 93d Cong. (1974); H.R. 2346, 91st Cong. (1971). For

additional information about these unsuccessful attempts to a mend § 8

and expand the types of interlocks covered by the statute, see J. Randolph

Wilson, Unlocking Interlocks: The On-Again Off-Again Saga of Section 8

of the Clayton Act, 45 ANTITRUST L.J. 317, 318 (1976).

5. 15 U.S.C. § 19.