1. A limitation on business dealings or professional or gainful occupations.
2. Antitrust. An agreement between or combination of businesses intended to eliminate competition, create a monopoly, artificially raise prices, or otherwise adversely affect the free market. • Restraints of trade are usu. illegal, but may be declared reasonable if they are in the best interests of both the parties and the public. — Often shortened to restraint.
— Also termed conspiracy in restraint of trade. See PER SE RULE; RULE OF REASON. [Cases: Monopolies 12. C.J.S. Monopolies §§ 19, 26–27, 62–63.]
horizontal restraint. A restraint of trade imposed by agreement between competitors at the same level of distribution. • The restraint is horizontal not because it has horizontal effects, but because it is the product of a horizontal agreement.
— Also termed horizontal agreement.
unreasonable restraint of trade. A restraint of trade that produces a significant anticompetitive effect and thus violates antitrust law.
vertical restraint. A restraint of trade imposed by agreement between firms at different levels of distribution (as between manufacturer and retailer).
