Forestalling

Engrossing, forestalling and regrating were marketing offences in English common law. The terms were used to describe unacceptable methods of influencing the market, sometimes by creating a local monopoly for a certain good, usually food. The terms were often used together, and with overlapping meanings. They are obsolete.

Blackstone’s Commentaries described them as offences against public trade:

forestalling - the buying or contracting for any merchandise or victual coming in the way of the market; or dissuading persons from bringing their goods or provisions there; or persuading them to enhance the price, when there; any of which practices make the market dearer to the fair trader.

regrating - the buying of corn or other dead victual, in any market, and selling it again at the same market, or within four miles of the place. For this also enhances the prices of the provisions, as every successive seller must have a successive profit.

engrossing - the getting into one’s possession, or buying up, large quantities of corn, or other dead victuals, with intent to sell them again. This must of course be injurious to the public, by putting it in the power of one or two rich men to raise the price of provisions at their own discretion.

Blackstone described a monopoly as “the same offence in other branches of trade”, i.e., not food.

Blackstone says that this was a common law offence. The derivation does not come from setting up a stall in front of another but buying before the goods got to a stall in open market. Typically, forestalling referred to the practice of intercepting sellers on their way to a market, buying up their stock, then taking it to the market and marking it up, which appears to be a type of arbitrage. It could also mean the creation of partnerships or agreements under which goods would not be brought to market. Forestalling is often used and understood as a catch all clause for marketing offences.

The Domesday Book recorded that "foresteel" (i.e. forestalling, the practice of buying up goods before they reach market and then inflating the prices) was one of three forfeitures that King Edward the Confessor could carry out through England. As early as 1321 the practice of forestalling was recognized as a specific offence and was regulated in London in the early twelfth century, and in other cities and towns, including goods coming by land or sea. However, originally the word itself was not used. In the laws of Henry I of England forestalling was the crime of assault on the highway, an offence against the King's Peace. It acquired the meaning of the marketing offence through the distribution of the regulations of the Marshalsea whose officers were empowered by Edward I of England to regulate trade in the shires. In time these regulations became known as the Statute of Forestallers, though probably never passed by any formal process. The laws provided for heavy penalties against forestalling. In practice the normal penalty was a fine, or, for repeated cases, exposure in the pillory.

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