Cartel vs. Trust — What's the Difference?

A cartel is an alliance of businesses that control prices or production to maintain high profits.

A trust consolidates control of several companies under a single management to dominate a market.

It involves competitors agreeing on business terms to avoid undercutting each other.

It legally centralizes decision-making power, affecting competition.

Cartels often operate in secrecy due to legal restrictions.

Trusts can provide operational efficiencies and economies of scale.

They aim to reduce competition and increase market predictability.

Trusts often lead to monopolies, limiting consumer choices.

Cartel agreements can be fragile, as members have incentives to cheat for more market share.

They are subject to antitrust laws designed to prevent market abuse.

A cartel is a group of independent market participants who collude with each other in order to improve their profits and dominate the market. Cartels are usually associations in the same sphere of business, and thus an alliance of rivals.

Firm belief in the integrity, ability, or character of a person or thing; confidence or reliance

A combination of independent business organizations formed to regulate production, pricing, and marketing of goods by the members.

The condition and resulting obligation of having confidence placed in one

An official agreement between governments at war, especially one concerning the exchange of prisoners.

One in which confidence is placed.

A group of parties, factions, or nations united in a common cause; a bloc.

Custody; care

(economics) A group of businesses or nations that collude to limit competition within an industry or market.

Something committed into the care of another; a charge

A combination of political groups (notably parties) for common action.

Reliance on something in the future; hope

(historical) A written letter of defiance or challenge.

Reliance on the intention and ability of a purchaser to pay in the future; credit

An official agreement concerning the exchange of prisoners.

A legal relationship in which one party holds a title to property while another party has the entitlement to the beneficial use of that property.

A ship used to negotiate with an enemy in time of war, and to exchange prisoners.

The confidence reposed in a trustee when giving the trustee legal title to property to administer for another, together with the trustee's obligation regarding that property and the beneficiary.

An agreement between belligerents for the exchange of prisoners.

The property so held.

A letter of defiance or challenge; a challenge to single combat.

An institution or organization directed by trustees

To defy or challenge.

A combination of firms or corporations for the purpose of reducing competition and controlling prices throughout a business or industry.

A consortium of independent organizations formed to limit competition by controlling the production and distribution of a product or service;

To have or place confidence in; depend on

To have confidence in allowing (someone) to use, know, or look after something

To expect with assurance; assume

To give credence to; believe

To place in the care of another person or in a situation deemed safe; entrust

To extend credit to.

To have or place reliance; depend

To be confident; hope.

Confidence in or reliance on some person or quality.

Dependence upon something in the future; hope.

Confidence in the future payment for goods or services supplied; credit.

That which is committed or entrusted; something received in confidence; a charge.

That upon which confidence is reposed; ground of reliance; hope.

(rare) Trustworthiness, reliability.

The condition or obligation of one to whom anything is confided; responsible charge or office.

(legal) The confidence vested in a person who has legal ownership of a property to manage for the benefit of another.

(legal) An arrangement whereby property or money is given to be held by a third party (a trustee), on the basis that it will be managed for the benefit of, or eventually transferred to, a stated beneficiary; for example, money to be given to a child when he or she reaches adulthood.

A group of businessmen or traders organised for mutual benefit to produce and distribute specific commodities or services, and managed by a central body of trustees.

(computing) Affirmation of the access rights of a user of a computer system.

(transitive) To place confidence in, to rely on, to confide in.

To have faith in; to rely on for continuing support or aid.

(transitive) To give credence to; to believe; to credit.

(transitive) To hope confidently; to believe (usually with a phrase or infinitive clause as the object)

(transitive) to show confidence in a person by entrusting them with something.

(transitive) To commit, as to one's care; to entrust.

(transitive) To give credit to; to sell to upon credit, or in confidence of future payment.

To rely on (something), as though having trust (on it).

To risk; to venture confidently.

(intransitive) To have trust; to be credulous; to be won to confidence; to confide.

To sell or deliver anything in reliance upon a promise of payment; to give credit.

(obsolete) Secure, safe.

(obsolete) Faithful, dependable.

(legal) of or relating to a trust.

Assured resting of the mind on the integrity, veracity, justice, friendship, or other sound principle, of another person; confidence; reliance; reliance.

Credit given; especially, delivery of property or merchandise in reliance upon future payment; exchange without immediate receipt of an equivalent; as, to sell or buy goods on trust.

Assured anticipation; dependence upon something future or contingent, as if present or actual; hope; belief.

That which is committed or intrusted to one; something received in confidence; charge; deposit.

The condition or obligation of one to whom anything is confided; responsible charge or office.

That upon which confidence is reposed; ground of reliance; hope.

An estate devised or granted in confidence that the devisee or grantee shall convey it, or dispose of the profits, at the will, or for the benefit, of another; an estate held for the use of another; a confidence respecting property reposed in one person, who is termed the trustee, for the benefit of another, who is called the cestui que trust.

An equitable right or interest in property distinct from the legal ownership thereof; a use (as it existed before the Statute of Uses); also, a property interest held by one person for the benefit of another. Trusts are active, or special, express, implied, constructive, etc. In a passive trust the trustee simply has title to the trust property, while its control and management are in the beneficiary.

A business organization or combination consisting of a number of firms or corporations operating, and often united, under an agreement creating a trust (in sense 1), esp. one formed mainly for the purpose of regulating the supply and price of commodities, etc.; often, opprobriously, a combination formed for the purpose of controlling or monopolizing a trade, industry, or business, by doing acts in restraint or trade; as, a sugar trust. A trust may take the form of a corporation or of a body of persons or corporations acting together by mutual arrangement, as under a contract or a so-called gentlemen's agreement. When it consists of corporations it may be effected by putting a majority of their stock either in the hands of a board of trustees (whence the name trust for the combination) or by transferring a majority to a holding company. The advantages of a trust are partly due to the economies made possible in carrying on a large business, as well as the doing away with competition. In the United States severe statutes against trusts have been passed by the Federal government and in many States, with elaborate statutory definitions.

Held in trust; as, trust property; trustmoney.

To place confidence in; to rely on, to confide, or repose faith, in; as, we can not trust those who have deceived us.

To give credence to; to believe; to credit.

To hope confidently; to believe; - usually with a phrase or infinitive clause as the object.

To show confidence in a person by intrusting (him) with something.

To commit, as to one's care; to intrust.

To give credit to; to sell to upon credit, or in confidence of future payment; as, merchants and manufacturers trust their customers annually with goods.

To risk; to venture confidently.

To have trust; to be credulous; to be won to confidence; to confide.

To be confident, as of something future; to hope.

To sell or deliver anything in reliance upon a promise of payment; to give credit.

Something (as property) held by one party (the trustee) for the benefit of another (the beneficiary);

Certainty based on past experience;

The trait of trusting; of believing in the honesty and reliability of others;

A consortium of independent organizations formed to limit competition by controlling the production and distribution of a product or service;

Complete confidence in a person or plan etc;

A trustful relationship;

Have confidence or faith in;

Allow without fear

Be confident about something;

Expect and wish;

Confer a trust upon;

Extend credit to

In business, a trust refers to a consolidation of companies under a single management, often to monopolize a market.

Both are often illegal when they reduce competition, but cartels directly involve price-fixing or output agreements, while trusts involve the management of companies through a legal entity.

The incentive for individual members to cheat for extra profits makes cartel agreements unstable.

They reduce competition, leading to higher prices, lower quality, and fewer choices for consumers.

Yes, trusts are commonly used for estate planning, managing assets for beneficiaries, and other legal purposes unrelated to market competition.

In some industries, like oil, governmental or international agreements can resemble cartels but are legal due to specific exemptions or regulatory frameworks.

While they are different mechanisms for controlling markets, a cartel could theoretically lead to a trust if the companies decide to merge under a single management structure.

Companies in a trust are managed by a central body of trustees, limiting their individual decision-making powers.

A cartel is an agreement among competing firms to control prices or production to reduce competition and increase profits.

Governments use antitrust laws to investigate and dismantle such arrangements to protect consumer interests and promote competition.

Trusts can limit choices by monopolizing a market and controlling the variety and pricing of products or services.

Cartels typically aim to keep market prices high by controlling production or fixing prices among competitors.

Trusts consolidate companies by transferring their stocks to a set of trustees, who then control the companies as a single entity.

Cartels can quickly renegotiate terms among members to adapt to changes in demand, production costs, or competitive pressures.

Antitrust laws aim to prevent anti-competitive practices by breaking up or regulating cartels and trusts.