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(1) To require every registered holding company and every subsidiary company thereof to dispose of any security of capital assets held in violation of any provision of this Act or any rule or regulation thereunder;

(2) Immediately after January 1, 1938, to require every registered holding company and every subsidiary company thereof to dispose of any securities or capital assets whenever it appears to the Commission that the continued own. ership or control thereof by any such company is not necessary or appropriate to the operations of a geographically and economically integrated public-utility system;

(3) Immediately after January 1, 1938, to require every registered holding company and every subsidiary company of a registered holding company to be reorganized or dissolved whenever it appears to the Commission that the corporate structure or continued existence of any such company unduly or unnecessarily complicates the structure of the public-utility system of which it is à part or is detrimental to the subsidiary companies thereof or to investors or consumers: Provided, however, That if the Commission is of the opinion in any case that action by it under paragraph (2) or (3) of this subsection could cause unnecessary injury to investors or consumers, the Commission, upon such terms and conditions as it may deem necessary or appropriate in the public interest or for the protection of investors or consumers, may defer action in such case for a period not extending beyond January 1, 1940; and

(4) Immediately after January 1, 1940, to require every registered holding company to dispose of securities or to be reorganized or dissolved insofar as may be necessary to make every such company cease to be a holding company: Provided, however, That the Commission, upon such terms and conditions as it may deem necessary or appropriate in the public interest or for the protection of investors or consumers, may permit a registered holding company to continue to be a holding company (A) if such registered holding company shall have obtained from the Federal Power Commission a certificate that the continuance of the holding company relation is necessary for the operation of a geographically and economically integrated public-utility system serving an economic district extending into two or more contiguous States or into a contiguous foreign country and the merger or consolidation of such registered holding company with its subsidiary company or companies is impossible under the applicable State or foreign law, or (B) if neither such registered holding company nor any such subsidiary company thereof is a public-utility company organized or doing business within the United States.

(c) The Commission may apply to a court, in accordance with the provi. sions of subsection (f) of section 18, to enforce compliance with any order under this section. Upon any such application, the court shall take possession and exclusive jurisdiction for the purposes of this Act of such assets of the company, wherever located, as may be held in contravention of such order, or, in the case of any order for reorganization or dissolution, possession, and exclusive jurisdiction for the purposes of this Act of the company and all of its assets, wherever located; and the court shall have jurisdiction, and it shall be the duty of the court, to constitute and appoint the Commission as sole trustee to administer the assets so possessed and the proceeds thereof as a trust estate for the benefit of the persons interested therein as their interests may appear. In any proceedings for the enforcement of an order of the Commission under this section, the Commission with the approval of the court shall have power to dispose of any or all of such assets and, subject to such terms and conditions as the court may prescribe, may make such disposition in accordance with a reorganization plan which shall have been approved by the Commission after opportunity for hearing. Such reorganization plan may be prepared in the first instance by the Commission, or, subject to such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors, by any person having a bona fide interest (as defined by the rules and regula. tions of the Commission) in the reorganization.

(d) If, in the judgment of the Commission, any registered holding company or any subsidiary company thereof is insolvent or unable to pay its debts as they mature, the Commission shall have power to institute proceedings for the reorganization of such company under section 77B of the Act of July 1, 1898, entitled "An Act to establish a uniform system of bankruptcy throughout the United States ", as amended. In any such proceedings or in any other proceedings in a court of the United States, whether under said section 77B or otherwise, by whomsoever instituted, for the reorganization or liquidation of any registered holding company or subsidiary company thereof or in which a receiver or trustee of any such company or any assets thereof is appointed, the court, at the request of the Commission, shall have jurisdiction, and it shall be the duty of the court, to constitute and appoint the Commission as sole trustee or receiver, whether or not a trustee or receiver shall theretofore have been appointed. In any such proceedings a reorganization plan for a registered holding company or any subsidiary company thereof shall not become effective unless such plan shall have been approved by the Commission after opportunity for hearing prior to its submission to the court. Notwithstanding any other provision of law, any such reorganization plan may be prepared in the first instance by the Commission or, subject to such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors, by any person having a bona fide interest (as defined by the rules and regulations of the Commission) in the reorganization. All fees, expenses, and remuneration paid in connection with any reorganization or liquidation of a registered holding company or subsidiary company thereof, whether under said section 77B or otherwise, shall be subject to the approval of the Commission. The Commission shall be entitled to such reasonable compensation for its services as trustee or receiver in any proceedings as the court may allow.

(e) It shall be unlawful for any person to solicit or to permit the use of his or its name to solicit, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, any proxy, consent, authorization, power of attorney, deposit, or dissent in respect of any reorganization plan for any registered holding company or any subsidiary company thereof unless (1) such plan shall have been prepared by the Commişsion or such plan and such information regarding it and its sponsors as the Commission may deem necessary or appropriate in the public interest or for the protection of investors or consumers shall have been submitted to the Commission by a person having a bona fide interest (as defined by the rules and regulations of the Commission) in such reorganization ; (2) a copy of a report which shall be made by the Commission after an opportunity for a hearing on such plan and other plans submitted to it, or an abstract of such report made or approved by the Commission, shall accompany each such solicitation; and (3) in accordance with such rules and regulations or orders as the Commission may prescribe or issue as necessary or appropriate in the public interest or for the protection of investors or consumers. Nothing in this subsection or the rules and regulations thereunder shall prevent any person from appearing before the Commission or any court through an attorney or proxy.

INTERCOMPANY LOANS; DIVIDENDS ; FEES; SALE OF SECURITIES AND CAPITAL ASSETS ;

PROXIES AND OTHER TRANSACTIONS

SBC. 12. (a) It shall be unlawful for any registered holding company, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, directly or indirectly, to borrow or to receive any extension of credit or indemnity from any public-utility company in the same holdingcompany system or from any subsidiary company of such holding company.

(b) It shall be unlawful for any registered holding company or subsidiary company thereof, by use of the mails or any means or instrumentality of Interstate commerce, or otherwise, directly or indirectly, to lend or in any manner extend its credit to or indemnify any company in the same holdingcompany system in contravention of such rules and regulations or orders as the Commission may prescribe or issue as necessary or appropriate in the public interest or for the protection of investors or consumers or to prevent the drcumvention of the provisions of this Act or the rules and regulations thereunder.

(c) It shall be unlawful for any registered holding company or any subsidiary company thereof, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to declare or pay any dividend on any seurity of such company or to acquire, retire, or redeem any security of such company, in contravention of such rules and regulations or orders as the Commission may prescribe or issue as necessary or appropriate to protect the financial integrity of public-utility systems, to safeguard the working capital of public-utility companies, or to prevent the payment of dividends out of capital or unearned surplus.

(d) It shall be unlawful for any registered holding company or any subsidiary company thereof, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to receive, directly or indirectly, any fee or commission in connection with the negotiation, effecting, or performing of any security or other transaction for or by any company in the same holding-company system unless and to the extent authorized by the rules and regulations of the Commission as necessary or appropriate in the public interest or for the protection of investors or consumers.

(e) It shall be unlawful for any registered holding company, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to sell any security or capital assets in contravention of such rules and regulations or orders regarding the consideration to be received for such sale, competitive bidding, fees, and commissions, accounts, disclosure of interest, and similar matters as the Commission may prescribe or issue as necessary or appropriate in the public interest or for the protection of investors or consumers or to prevent the circumvention of the provisions of this Act or the rules and regulations thereunder.

(f) It shall be unlawful for any person to solicit or to permit the use of his or its name to solicit, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, any proxy, power of attorney, consent, or authorization regarding any security of a registered holding company or a subsidiary company thereof in contravention of such rules and regulations or orders as the Commission may prescribe or issue as necessary or appropriate in the public interest or for the protection of investors or consumers or to prevent the circumvention of the provisions of this Act or the rules and regulations thereunder.

(g) It shall be unlawful for any registered holding company or subsidiary company thereof, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to negotiate, enter into, or take any step in the performance of any transaction not otherwise specifically covered by this Act, with any company in the same holding-company system or with any affiliate of a company in such holding-company system in contravention of such rules and regulations or orders regarding reports, accounts, costs, competitive bidding, disclosure of interest, duration of contracts, and similar matters as the Commission may prescribe or issue as necessary or appropriate in the public interest or for the protection of investors or consumers or to prevent the circumvention of the provisions of this Act or the rules and regulations thereunder.

(h) It shall be unlawful for any affiliate of any public-utility company, by use of the mails or any means or instrumentality of interstate commerce, or for any affiliate of any registered holding company or of any subsidiary company thereof or of any public-utility company engaged in interstate commerce, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to negotiate, enter into, or take any step in the performance of any sales or construction contract or any other transaction or arrangement with any such company of which it is an affiliate or with a mutual-service company of which any such company is a member company in contravention of such rules and regulations or orders regarding reports, accounts, costs, competitive bidding, disclosure of interest, duration of contracts, and similar matters as the Commission may prescribe or issue as necessary or appropriate in the public interest or for the protection of investors or consumers or to prevent the circumvention of the provisions of this Act or the rules and regulations thereunder.

SERVICE, SALES, AND CONSTRUCTION CONTRACTS

SEC. 13. (a) After Jauary 1, 1936, it shall be unlawful for any registered holding company or subsidiary company thereof, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to enter into or take any step in the performance of any service, sales, or construction contract with any company in the same holding company system or with any affiliate of a company in such holding company system or with any public-utility company.

(b) After January 1, 1936, it shall be unlawful for any affiliate of a publicutility company, by use of the mails or any means or instrumentality of interstate commerce, or for any affiliate of any registered holding company or of any subsidiary company thereof or of any public-utility company engaged in interstate commerce, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to negotiate, enter into, or take any step in the performance of any service contract with any such company of which it is an affiliate unless such affiliate is approved as a mutual company under this section.

(c) The provisions of subsections (a) and (b) of this section shall not apply to the making or performance of any service, sales, or construction contract by and between any public-utility company, in its capacity as a member company, and any mutual service company of which it is a member company.

(d) It shall be unlawful for any person engaged in the business of performing service, sales, or construction contracts, by use of the mails or any means or instrumentality of interstate commerce, to enter into or take any step in the performance of any service, sales, or construction contract with any publicutility company, or for any such person, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to enter into or take any step in the performance of any service, sales, or construction contract with any registered holding company or any subsidiary company thereof or any publicutility company engaged in interstate commerce, in contravention of such rules and regulations or orders regarding reports, accounts, costs, competitive bidding, disclosure of interest, duration of contracts, and similar matters as the Federal Power Commission shall prescribe or issue as necessary or appropriate in the public interest or for the protection of investors or consumers or to prevent the circumvention of the provisions of this Act or the rules and regulations thereunder. Such rules and regulations shall require any person engaged in the business of performing service, sales, or construction contracts on a cooperative or mutual basis to be approved under this section as a mutual service company.

(e) A person may apply to be approved as a mutual service company, upon the terms and conditions hereinafter provided in this section, for the purpose of making and performing service, sales, and/or construction contracts by filing with the Federal Power Commission an application in such form as the Federal Power Commission may by rules and regulations prescribe as necessary or appropriate in the public interest or for the protection of investors or consumers. Such application shall include

(1) Copies of the articles of incorporation, agreement, association, or cooperation under which the applicant will do business and copies of its bylaws or rules or instruments, whatever the name, corresponding thereto;

(2) A statement of the ownership of the applicant, whether by ownership of securities or otherwise, and the relations and agreements between the applicant and its owner or owners;

(3) Copies of the agreement or agreements under which the member companies of the applicant are to share in its expenses and revenues and a detailed explanation of the method by which such shares are determined and to be maintained and/or adjusted ;

(4) A statement of the kinds of service, sales, and/or constri on contracts to be performed by the applicant classified and in such detail as the Federal Power Commission may, by rules and regulations, require as necessary or appro priate in the public interest or for the protection of investors or consumers, and a statement of the member companies of the applicant and the contracts with each;

(5) A detailed statement of the business, if any, other than the performance of service, sales, and/or construction contracts with member companies, in which the applicant purposes to engage.

(f) Within thirty days after the filing of an application, the Federal Power Commission shall enter an order either approving, or after notice and opportunity for hearing, disapproving the applicant as a mutual service company, unless the applicant shall withdraw its application or shall consent to the Federal Power Commission's deferring action thereon for a stated longer period. The filing with the Federal Power Commission of an application shall be deemed to have taken place upon receipt thereof. Amendments to an application may be made upon such terms and conditions as the Federal Power Commission may prescribe.

(g) The Federal Power Commission shall not approve the applicant as a mutual service company unless, in the judgment of the Federal Power Commission, the applicant is so organized as to ownership, costs, revenues and the sharing thereof as reasonably to insure the efficient and economical performance of service, sales, and/or construction contracts by the applicant for member companies (1) at cost fairly and equitably allocated among such member companies, and (2) at a substantial saving to member companies over the cost to such companies of comparable contracts if performed by independent persons.

(h) Any order of the Federal Power Commission approving a company as a mutual service company may prescribe such terms and conditions regarding the nature and enforcement of the agreements of such mutual service company for the sharing of revenues and expenses among member companies and matters relating to such agreements and the nature, character, and extent of the business to be done by such mutual service company as the Federal Power Commission may deem necessary or appropriate in the public interest or for the protection of investors or consumers or to prevent the circumvention of the provisions of this section or the rules and regulations thereunder.

(i) Every mutual service company shall file with the Federal Power Commission such information and documents in respect of its service, sales, and construction contracts, the composition of its membership, the manner and method of sharing expenses and distributing revenues, and similar matters as the Federal Power Commission may by rules and regulations or order prescribe as necessary or appropriate in the public interest or for the protection of investors or consumers.

(3) It shall be unlawful for any mutual service company, by use of the mails or any means or instrumentality of interstate commerce, or otherwise, to engage in any business or enter into or perform any transaction in contravention of such rules and regulations or orders regarding the nature and types of businesses and transactions in which such companies may engage, the manner of engaging therein, competitive bidding, costs, disclosure of interest, relations with member companies and affiliates, and similar matters as the Federal Power Commission may prescribe or issue as necessary or appropriate in the public interest or for the protection of investors or consumers or to prevent the circumvention of the provisions of this section or the rules and regulations thereunder.

(k) The Federal Power Commission, after notice and opportunity for hearing, may revoke or suspend the approval given any mutual-service company if it finds that such company has violated any provision of this Act or any rule, regulation, or order thereunder, or that such company is not operated efficiently or economically in the interest of its member companies. The Federal Power Commission upon its own motion or at the request of a member company or a State commission, after notice and opportunity for hearing, may require a reallocation or reapportionment of costs among member companies of a mutualservice company if it finds the existing allocation inequitable and may require the elimination of a service or services to a member company which does not bear its fair proportion of costs or which by reason of its size or other circumstances does not require such service or services.

(1) The Federal Power Commission shall from time to time conduct investigations regarding the making, performance, and costs of service, sales, and construction contracts, the economies resulting therefrom, and the desirability thereof. On the basis of such investigations the Federal Power Commission shall classify the different types of such contracts and the work done thereunder, and shall make recommendations from time to time regarding the standards and scope of such contracts in relation to public-utility companies of different kinds and sizes and the costs incurred thereunder and economies resulting therefrom. Such recommendations shall be made available to State commissions and to the public in such-form and at such reasonable charge as the Federal Power Commission may prescribe.

PERIODIC AND OTHER REPORTS

SEC. 14. Every registered holding company shall file with the Commission, and every mutual service company shall file with the Federal Power Commission, such annual, quarterly, and other periodic and special reports, the answers to such specific questions and the minutes of such directors', stockholders', and other meetings as the respective Commission may by rules and regulations or order prescribe as necessary or appropriate in the public interest or for the protection of investors or consumers. Such reports, if required by the rules and regulations of the Commission having jurisdiction thereof, shall be certified by an independent public accountant and shall be made and filed at such time and in such form and detail as such Commission shall prescribe. The Commission shall have power to require that there be included in reports filed with it such information and documents as it may deem necessary or appropriate

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