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There was only one small downside: It was illegal in its largest markets. Almost every single aspect of De Beers violated U. S. Antitrust Laws, from its lion-sized market share to its price-fixing scheme.
2.1 History and Motivation
2.1.1 The Sherman Act
The original legislation regulating the establishment of commercial monopolies was passed at the end of the 19th century, when the power of big business seemed to threaten American ideals of free enterprise and the small stakeholder.
In 1890 The Sherman Act laid out fundamental principles that would underpin Antitrust Law through the next century.
Later the
2.1.2 The Clayton Act
Strengthened the Antitrust Laws even further, broadening the definition of unacceptable behaviour that is able to create a monopoly in any line of commerce.
2.2 Extraterritoriality
De Beers retained no U. S. Presence. It was completely run by South Africans. Nevertheless, the U. S. Antitrust Laws reached the De Beers. It is a tricky element of the U. S. Law that they are apply to foreign conducts as soon as a foreign conduct produce some substantial effect in the United States. So De Beers stopped selling Diamonds in the U. S.
Instead, it sold all of its diamonds in London and then let its sightholders export them, perfectly legally, in the U.S.
Although, by the time De Beers´s Diamonds reached U.S. Market they were no longer de Beers Diamonds.
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