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Description of Cartel. Explanation.


Definition Cartel. Description.

A Cartel is a group of legally independent producers who act together to fix prices, to limit supply or to limit competition. Cartels are prohibited by antitrust laws in most countries; however informal and even some formal cartels continue to exist nationally and internationally.

A single legal entity that holds a monopoly position by this definition cannot be said to be a cartel, though it may be guilty of abusing said monopoly.

Examples of well-known formal cartels are the De Beers Diamond cartel, and by some accounts, the Organization of Petroleum Exporting Countries (OPEC).

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Compare with: Horizontal Agreement  |  Horizontal Merger  |  Horizontal Integration  |  Oligopoly  |  Vertical Agreement  |  Competitive Environment

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