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Antitrust law has long existed under the premise that more competition is better for the consumer. But what if a monopoly were to eliminate competition, and then use the increase in efficiency of an empty market strictly to benefit consumers?

The two most important players in antitrust law globally are almost certainly the United States and the EU, so I'm specifically interested in the laws of both, especially in how they contrast given Europe's stronger stance against anticompetitive activities.

Say a company, Supergood Corp., were to intentionally act in such a way as to eliminate competition. Then Supergood hires all workers laid off by the bankrupt competitors, and uses the loss of competition to increase efficiency by cutting advertising (why advertise when you're the only player), consolidating supply chains for faster and cheaper goods, etc.

Supergood Corp. then passes all of the savings resulting from its actions on to consumers, lowering prices to minimize profit, and improving both price and quality over conditions before the anticompetitive activities took place.

Considering the criteria used to establish violation of antitrust law, is there a way that Supergood Corp. can avoid legal culpability under relevant laws for the above actions?

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There is no provision allowing monopolization "for the good of the consumer", regardless of your standards for judging that. The law simply says

Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.

It is not clear what actually counts as a violation is the law: it's not the fact of being the only game in town, per se, it's what you do that might bring that about, it's doing so through improper means. The Dept. of Justice, which may prosecute a case, has guidance on what the law could mean, in particular,

the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident

As you describe it, this is a clear violation of the law. "Noble intentions" is not a valid defense to prosecution. However, prosecution is discretionary, so a favorable government could reach an agreement to not prosecute, as was the case with AT&T (before WWI, not the breakup). Further however, under 15 USC 15c a state attorney general can also bring a civil suit against a monopolizer, so you'd have to get a lot of agreement to not take legal action.

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  • Is there no Miller test dictating what constitutes anticompetitive behavior that includes some requirement of harm done to the consumer? – TheEnvironmentalist May 11 at 4:42
  • Nope. Maybe some future court will discover such a test, but there is no such thing now. – user6726 May 11 at 4:49

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