Celler-Kefauver Act
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The Cellar-Kefauver Act is a United States federal law passed in 1950 that reformed and strengthened the Clayton Antitrust Act of 1914 which had amended the Sherman Antitrust Act of 1890. The Cellar-Kefauver Act was passed to close a loophole regarding certain asset acquisitions and acquisitions involving firms that were not direct competitors. While the Clayton Act prohibited stock purchase mergers that resulted in reduced competiton, shrewd businessmen were able to find ways around the Clayton Act by simply buying up a competitor's assets. The Cellar Kefauver Act prohibited this practice if competition would be reduced as a result of the asset acquisition.
Sometimes referred to as the Anti-Merger Act, the Cellar-Kefauver Act gave the government the ability to prevent vertical mergers and conglomerate mergers which could limit competition.
