VERTICAL MERGERS UNDER SECTION SEVEN

Section 7 of the Clayton Act does not expressly define the characteristics of the mergers it prohibits; rather the statute contains a general prohibition against a corporation's acquisition of the stocks or assets of another corporation where "the effect of such acquisition may be substantially to lessen competition, or to tend to create a monopoly."1 The conditions under which these consequences may occur, however, are not spelled out. As with other parts of the antitrust laws, the merger act is understandable only through study of the economic and other meanings attributed to the legal concepts used in the statute and of the cases arising under it.