Definition
Rule of Reason has dual meanings:
In economics, Rule of Reason is a principle for determining the legality of business practices. Illegality is determined by evidence concerning the country, competitors, and consumers.
In legislation, Rule of Reason is a standard applied to the Sherman Antitrust Act that interprets it to prohibit only “unreasonable restraints of trade” rather than every restraint of trade. The courts have not consistently defined the term “unreasonable.”
See Also
References
- American Marketing Association, AMA Dictionary.