DIVESTITURE ORDER Meaning and
Definition
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A divestiture order refers to a legal directive or court-ordered requirement that mandates a company or individual to sell off or dispose of assets, subsidiaries, divisions, or business operations. It is a form of remedy aimed at preventing anti-competitive behavior or restoring market competition when a business entity has been found to have engaged in anti-competitive practices or violated antitrust laws.
A divestiture order typically arises from an investigation or legal action conducted by antitrust authorities or regulatory bodies to deter monopolistic practices, promote fair competition, or reduce market concentration. The order may require the company to sell its subsidiary businesses or divisions to independent entities, thereby reducing its market share and promoting a more level playing field for competitors.
Divestiture orders can take various forms, ranging from the sale of specific assets, separate business lines, intellectual property rights, or even an entire merged corporation. The order may include specific conditions, such as the prohibition of certain contractual agreements or non-competition agreements, to ensure the effectiveness of the divestiture. Compliance with the divestiture order is typically overseen by regulatory bodies or court-appointed trustees to ensure its proper implementation.
Overall, a divestiture order is a legal method used to rectify anti-competitive behavior or restore competition by mandating the sale or disposal of assets, subsidiaries, or business operations of a company implicated in monopolistic practices or antitrust violations.
Common Misspellings for DIVESTITURE ORDER
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Etymology of DIVESTITURE ORDER
The word "divestiture" is derived from the Latin word "divestire" which means "to undress" or "to strip off". In the context of law and business, it refers to the act of selling or disposing of certain assets, businesses, or interests to comply with legal or regulatory requirements.
The term "order" in "divestiture order" refers to a directive or mandate issued by a court or regulatory authority. It instructs a company or individual to divest certain assets, usually as a result of antitrust concerns or to restore competition in the market. Therefore, the etymology of "divestiture order" primarily comes from the Latin root "divestire", meaning to strip off or undress, and the legal terminology of "order" as a formal directive.
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