The Securities Acts

The Securities Acts of 1933 and 1934 established the SEC and require that all securities

offered to the public must be registered with the government. The registration process

requires a description of the company’s properties and business, a description of the securities,

information about management, and financial statements certified by public

accountants. Passed in 1968, the Williams Act consists of a series of amendments to

the 1934 Securities Exchange Act intended to provide target firm shareholders with sufficient

information and time to adequately assess the value of an acquirer’s offer. Any person

or firm acquiring 5 percent or more of the stock of a public corporation must file a

Schedule 13D disclosing its intentions and business plans with the SEC within 10 days of

reaching that percentage ownership threshold.

Federal antitrust laws exist to prevent individual corporations from assuming too

much market power. Passed in 1890, the Sherman Act makes illegal such practices as

agreements to fix prices and allocate customers among competitors, as well as attempts

to monopolize any part of interstate commerce. In an attempt to strengthen the Sherman

Act, the Clayton Act was passed in 1914 to make illegal the purchase of stock of another

company if their combination results in reduced competition within the industry. Current

antitrust law requires prenotification