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S. 382 in Section 3 requires agencies taking action with certain listed effects on competition in the economy 1/ to choose "the least anticompetitive alternative legally and practically available to achieve statutory goals" and to include appropriate fundings in any opinion accompanying an agency order under Section 3(a). The bill thus recognizes the presence of other statutory objectives but still imposes an additional
requirement on agencies.
Section 4 of the bill continues to provide for intervention as a party of right by the Attorney General and the Federal Trade Commission "in any administrative or judicial proceeding subject to Section 3." However, the requirements for a special hearing on competitive effects and for special standards of judicial review have been dropped. Section 6 of the bill requires federal agencies to modify and conform their rules and practices to the requirements of the bill.
1/ ANTITRUST STANDARD FOR FEDERAL AGENCIES
Sec. 3(a) Notwithstanding any other provision of law, no Federal agency shall take any action that
regulates or licenses entry under a scheme in which the level of entry is subject to limitation;
sets or reviews with authority to accept, reject, or modify the monetary price charged for goods or services;
sets, limits, or allocates the production or distribution of goods or services; or
reviews, approves, rejects, or regulates the terms and
conditions of agreements among providers or purchasers of goods or services unless it has considered the competitive effects of such action and concluded that such action is the least anticompetitive alternative legally and practicably available to achieve statutory goals.
(b) The findings, if required by section 3(a), shall be included in any opinion accompanying an agency order and shall be included in the statement of basis and purpose incorporated in any rule or regulation.
The bill, as amended, is from the Commission's point of view, an
improvement over the original bill. However, even as amended, the bill should not apply to the Commission because of the Commission's independent status and preexisting Congressional mandate to analyze conditions in the U.S. economy. We think that it will place our comments in context to provide some background on the role of the Commission under the statutes that might be affected by this bill.
The Commission has a role under several statutes of providing findings on whether there is or is likely to be injury to a domestic industry caused by various types of international trading practices which we describe below. In addition, the Commission provides information to the President and in some cases recommendations on matters relating to trade negotiation and on imports of articles that are causing or are likely to cause serious injury within the United States economy. Finally, the Commission is in effect a competition enforcement agency under the provisions of Section 337 of the Tariff Act of 1930 (19 U.S.C. 1337; hereafter, Section 337), which is also described below.
It appears that since most of these activities, excepting particularly those under Section 337, do not result in final agency action, they are not within the scope of Section 3 "action," as that term is defined in the bill. (The Commission does not issue final "orders" under any head of authority except Section 337.) However, this is not entirely clear, and, moreover, these non-action functions apparently fall within the requirements
of Section 6 of the bill. Therefore, in these comments we will discuss all
aspects of our
authority, with an emphasis on Section 337.
Pursuant to Section 337 of the Tariff Act of 1930 (19 U.S.C. 1337), the Commission may order persons to cease and desist unfair methods of competition and unfair acts in the importation and sale of articles in the United States which have specified effects or tendencies in the domestic economy, such as substantially injuring an efficiently and economically operated domestic industry, or restraining or monopolizing trade and commerce within the United States. This emphasis on efficiencies in the domestic industry; the determination (in some cases) of whether a restraint of trade exists; and the very limitation of any restriction of trade upon a finding that there is an unfair method of competition or unfair act involved, demonstrate the Congressional interest in restricting relief under Section 337 to situations in which free competition is being destroyed by unfair practices. Under Section 337, the Commission may exclude from entry articles tainted with the unfairness where a cease and desist order is not appropriate, but even in these cases, the Commission must, as a result of the Trade Act of 1974, consider certain factors relating to the public interest in competition. These factors are "competitive conditions in the United States economy" and "the production of like or directly competitive articles in the United States" and "United States consumers." Moreover, Section 337 requires the Commission to consult with, among others, the Department of Justice and the Federal Trade Commission in the course of its investigations under that law.
The Antidumping Act, 1921, as amended (19 U.S.C. 160 et seq.) provides for the imposition of special duties on imported goods sold in the United States at less than fair value if an industry in the United States is being or is likely to be injured, or is prevented from being established as a result of such importation. The responsibility for determining whether merchandise is being or is likely to be sold at less than fair value is vested in the Department of the Treasury. If the Treasury Department makes an affirmative determination, an investigation is referred to the Commission for a determination as to whether an industry in the United States has been or is likely to be injured or is prevented from being established by reason of the less than fair value sales.
Should the Commission make an affirmative determination under the Antidumping Act, 1921, the Treasury Department will issue a dumping finding and the matter is transmitted to the U.S. Customs Service to determine which entries are subject to the special duties. 1/ The imposition of special dumping duties is ministerial, that is, they will be assessed by the Treasury Department once the margin of unfair pricing is determined.
This procedure would appear to involve "action," as that term is defined in section 8(b) of the bill at some point, because the special dumping duty is a type of "relief." However, it concerns the Commission that it might
17 The Commission's activities pursuant to the countervailing duty law, which is Section 303 of the Tariff Act of 1930 (19 U.S.C. 1303), are similar to its action under the Antidumping Act, 1921, except that only one class of Treasury Department determinations of the existence of bounty or grant, those as to articles which are otherwise entered duty free, are referred to the Commission.
be subjected to the bill without the Department of Treasury being subject to
the same requirements. It is conceivable that neither of the Department of the Treasury's determinations--either as to less than fair value sales or as to the amount of any necessary special dumping duty--would be subject to section 3 of the bill, because neither would be "action" within the meaning of Section 8(b) of the bill. In fact, the Commission believes, for reasons presented below, that it would be undesirable to make any phase of proceedings under the Antidumping Act, 1921, subject to the bill.
Under Sections 201 and 406 of the Trade Act of 1974, the Commission only makes findings and recommendations and thus would not be subject to section 3 of the bill.
THE IMPACT OF THE LEGISLATION UPON COMMISSION PROGRAMS
In general, the Commission supports the objectives of this
legislation. However, we have serious reservations whether the Commission ought to be subject to any provision of the bill both from a policy standpoint and in light of procedures in the areas under our jurisdiction.
For one thing, we think it will be difficult in administering statutes that already take into account economic factors directly related to competitiveness, to consider the competitive impact in terms of this bill. Indeed, under Section 337 (arguably the only Commission proceeding subject to Sections 3 and 4 of the bill), the Commission is engaged in a process of protecting competition. It seems to us unnecessary to require the Commission to make determinations pursuant to Section 3 of the bill, when the very agency