A company trying to sell its products in a competitive market might be tempted to pursue strategies aimed at shielding it from the forces of competition with which it would otherwise have to contend. The desired effect could be achieved by, for example, reaching some form of accommodation with its competitors or, if the circumstances allow, exploiting its own dominance in the market to reduce or eliminate competition. In many countries the law seeks to ensure, so far as possible, that free competition is maintained in the market place. Any collaboration between competing businesses which seeks to prevent, restrict or distort competition between them is likely to be illegal. So, for example, agreements to fix prices, share markets or restrict production would clearly come within this category.

Most countries have strict rules governing anti-competitive behaviour, their enforcement being the responsibility of the national competition authority. Very often, criminal sanctions are imposed which can be severe. In addition to risking heavy fines and the possible imprisonment of its managers, a company acting in breach of the law could face a civil claim for compensation from another business suffering damage as a result of the illegal activity.

In the majority of cases, national competition law will extend only to conduct affecting competition in the country concerned, and not to activities whose effects are felt beyond its borders. However, in some contexts competition laws exist which extend beyond national frontiers, bringing international business activity within their scope. Notable examples of such...