Nancy Williams Paper 2 Cartel
A cartel is a group of businesses in a certain industry that agree to band together and regulate their
productivity to fix sales prices and control and regulate their businesses. They voluntarily form with the
objective to eliminate any force again them and to secure a monopoly of their market. They use various
restrictive measures to achieve the goal. In a cartel, the manufacturers and dealers fix prices, restrict
output, pool the output and establish a common group through which the product is sold.
There are a few different types of cartels which include Quota fixing, Price firing, Term fixing, Customer
assigning cartels, Zonal, Super and Syndicate. Cartels usually occur when there is a small group of sellers
and the product is rare to that region or to a certain geographical area. Cartels normally are economically
unstable and there normally cheating within their groups to ignore the quota’s and price set by the group,
this leads to them to be unsuccessful.
Price fixing is often practiced internationally by cartels. When the agreement to control price is sanctioned
by a multilateral treaty or protected by national sovereignty, no antitrust actions may be initiated so there
is nothing that can be done since they are beyond the law. However, some of the cartels can be
prosecuted under the antitrust laws, if they are within the scope of the law in certain countries. When
most people think of cartels they think of drugs which we always hear about in the news, but OPEC is one
of the best examples of the cartels we are speaking of in this paper. The principal aim of the OPEC,
according to its Statute, is “the coordination and unification of the petroleum policies of its member
countries and the determination of the best means for safeguarding their interests, individually and