Economic writing of the potential anti-competitive issues Term Paper (Term Paper Sample)

Salary Caps Authorization by New Zealand Rugby Union
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Salary Caps Authorization by New Zealand Rugby Union
The New Zealand Rugby Union has been able to promote competition amongst the teams playing in the domestic league through establishing the salary gaps for the players. The competition has enabled the increase in television audience and local fun base. The strategy applied by NZRU is seen to be unlawful as it restrains the competition within the commercial market. Therefore, the study will scrutinize the connection between the authorization of the salary caps by the NZRU and the implementation of an anti-competitive conduct.
New Zealand Rugby union was following suit of transforming the sport into a professional standard as rugby had gone professional since 1995. The changes are based on the nature in which the structure of the game is set where it becomes a business entity. Therefore, it is essential to note that the organizational structure of the rugby union has changed particularly in New Zealand where it is not all about playing for fun but instead it is a form of entertainment and business for the players and the union. After 1995, the International Rugby Board indicated that all the players should be paid if they participated in any of the rugby union events which made the players that participate in the sport to have a professional approach to the competition (Basnier, 2014). The perception meant that the players transformed from being armature players to be since as the nation’s pride. The focus of the players was to ensure that they participate in international platforms but not for the country’s satisfaction but as professional workers for the country.
The anti-competitive conduct is enacted under the Commerce Act, which is associated with the prohibition of some aspects within the mergers and agreements. The perception works to establish an anti-competitive outcome, which includes lack of choice for the customers and an increase in prices (Lambaskis, et al., 2015). Consequently, there are cases where the application of the process would allow the commission authorizes implementation of the anti-competitive agreement and mergers where the benefits of the public would outweigh the competitive harm in the market. The same case applied in the New Zealand Rugby team where they realized that the strategy that was to be involved in during the merger would be beneficial to the public, in this case, the fans.