Imagini ale paginilor
PDF
ePub

analytically in his treatise.60 He indicates that a naked economic restraint isolating the United States should not be treated any differently than a naked territorial restraint within the country. The principal area in which a different rule applies is where a restraint which is imposed on export sales neither has nor is intended to have direct impact on the American market. For example, an agreement between an American firm and a British firm that the American firm will sell only in South Africa and the British firm will sell only in Australia may restrain American exports to the latter and hence, is arguably within the jurisdiction of the Sherman Act; beyond that, competition within Australia or within South Africa is a matter for their respective governments rather than our own. On the other hand, an agreement between the British firm and the American firm that the British firm will not sell in the United States and the American firm will not sell abroad raises an immediate and direct United States interest, which we should protect by strict antitrust enforcement.

VI

THE AWKWARD PRESENCE OF GOVERNMENTS

National governments are especially important in the international business realm. They are conspicuously active in organizing producer cartels for primary products; they sometimes impose anticompetitive restrictions on foreign firms and products; and in communist countries, they operate state trading monopolies for internal distribution of goods and services.

Government activity can create special antitrust problems. For example, long-term exclusive arrangements between an American firm and a state trading monopoly may necessarily exclude all other American firms from that market. The antitrust answer to these problems turns on the factual realities of the situation. Where the foreign government, as sovereign, requires an American firm to engage in some activity which would otherwise be offensive to our antitrust laws, that is the end of the antitrust inquiry. The same is not true where the American firm has been the moving force in getting the anticompetitive contractual restrictions adopted-or has discretion in how they are administered.

The law in this area can be traced to the Supreme Court's 1943

60. K. BREWSTER, supra note 57, at 79-96.

decision in Parker v. Brown.61 There, the Supreme Court held that a California state scheme for regulating raisin marketing was on its facts exempt from the antitrust laws.

but as

The state in adopting and enforcing the prorata program made no contract or agreement and entered into no conspiracy in restraint of trade sovereign, imposed the restraint as an act of government which the Sherman Act did not undertake to prohibit.62

This policy is broadly applicable in the international field.

The other side of the coin is illustrated by the Supreme Court's 1962 decision in Continental Ore v. Union Carbide. 63 A defendant subsidiary of an American company had been appointed during the war to act for the Canadian Metals Controller as the sole buyer for Canada of a particular metal, and it had used its position to favor its own interests and to squeeze the plaintiff (another American firm) out of the Canadian market. The Supreme Court held that this was actionable as part of an alleged attempt to monopolize U.S. foreign commerce. The Court noted that the defendant's control ". . . was aided by discriminatory legislation of the foreign country . . ." but that the action was "taken within the area of its discretionary powers granted by the Metals Comptroller. . . ."64

To summarize, that which is required by a foreign government is exempt from antitrust liability; but that which the foreign government simply affords one the opportunity to do, may or may not be illegal, depending upon its effect on American commerce.

CONCLUSION: THE NEED FOR REASON AND FLEXIBILITY

The world of international trade is competitive and complex. It is also changing. Such circumstances offer a constant temptation to unwise policies--including antitrust repeals and protectionist devices. We should resist that temptation, because those policies are expensive to us as a nation of consumers, and because they fail to come to grips with the hard issues of skill and efficiency.

We must face up to the complexities of the real world. In fact, the antitrust laws are conducive to such pragmatism.

The draftsmen of the Sherman Act created a statute of great breadth and flexibility (the same is true of the amended Clayton Act § 7). The

61. 317 U.S. 341 (1943).

62. Id. at 352 (emphasis added).

63. 370 U.S. 690 (1962).

64. Id. at 706 (emphasis added).

Sherman Act has worked well because generations of prosecutors and judges have given it specificity in dealing with particular types of conduct in the ever-changing world of business. Some kinds of conduct have been found to be so generally harmful as to be deemed per se illegal, without actual proof of anticompetitive impact or other public harm. Other kinds of conduct have been subjected to full factual inquiry in both section 1 and section 2 cases.

Of course, the line has been close in certain cases-particularly joint business ventures-as to whether particular conduct should be subjected to a per se rule or not. Crucial in this determination are the particular circumstances of the case and the attitude of the courts.65 To this extent, there is uncertainty in the law-and there always will be-for, by definition, close cases are uncertain in their effect as precedent. One alternative is to have inflexible rules, to be applied without regard to real facts or consequences (as we have in parts of the Internal Revenue Code and in various forms of absolute tort liability). The other alternative is to have no law at all. The proponents of absolute antitrust exemption for all export activity are clearly asking for the latter. Such a solution does eliminate legal uncertainty, but at an unacceptable price to our consumer and business interests.

In fact, antitrust has been used relatively infrequently against foreign business operations, and most of the actual use has been in "easy" cases involving straight old-fashioned cartels. The Supreme Court has not locked us into inflexible rules in the broad international business area, and it has given no indication that it would do so.

In these circumstances, what is needed is rational argument, not irrational recrimination; facts not footnotes; and a sense of our national public interest as competitive buyers and sellers and international traders. With these, we can in fact protect our consumers at home and allow our producers the fullest capability to compete abroad. That which would be a clearly illegal restraint of trade in the domestic market, can be a rational attempt by a group of American firms to improve their export trade position in the face of stiff foreign competition abroad; it may even promote competition in the foreign market. At the other extreme, the group agreement may purport to improve export competitiveness, yet in reality produce clear adverse effects on

65. E.g., United States v. Topco Associates, 405 U.S. 596 (1972); Worthen Bank & Trust Co. v. National BankAmericard, 485 F.2d 119 (8th Cir. 1973), cert. denied, 415 U.S. 918 (1974).

decision in Parker v. Brown. 61 There, the Sup California state scheme for regulating raisin 1. exempt from the antitrust laws.

The state in adopting and enforcing the prorata pro
agreement and entered into no conspiracy in rest
sovereign, imposed the restraint as an act of governmen
did not undertake to prohibit.62

This policy is broadly applicable in the int
The other side of the coin is illustrated by L
decision in Continental Ore v. Union Carbide. 63
an American company had been appointed
the Canadian Metals Controller as the sol
particular metal, and it had used its position
and to squeeze the plaintiff (another Americ
dian market. The Supreme Court held that
of an alleged attempt to monopolize U.S.
Court noted that the defendant's control “.
tory legislation of the foreign country
"taken within the area of its discretionary power
Comptroller.

"64

[ocr errors]

To summarize, that which is required by a exempt from antitrust liability; but that whic simply affords one the opportunity to do, m. depending upon its effect on American co..

CONCLUSION: THE NEED FOR REASON The world of international trade is com also changing. Such circumstances offer a co wise policies—including antitrust repeals and should resist that temptation, because those po as a nation of consumers, and because they i the hard issues of skill and efficiency.

We must face up to the complexities of t.. antitrust laws are conducive to such pragnie The draftsmen of the Sherman Act created and flexibility (the same is true of the amend

[merged small][ocr errors][ocr errors][merged small][ocr errors][merged small][ocr errors][merged small][ocr errors]

61. 317 U.S. 341 (1943).

62. Id. at 352 (emphasis added). 63. 370 U.S. 690 (1962).

4. Id. at 706 (emphasis added).

[ocr errors][merged small][merged small][merged small][merged small][merged small][merged small]

reply to your letter of July 28th, in which you refer e Washington Star on July 23rd, with respect to to disclosure regarding payments to foreign officials. mony and to a speech by Commissioner Sommer. y such limitation in my testimony before the Suber did refer to this as a possibility in his speech.

t in my testimony particularly my testimony dated ut into the record of the July hearings, our responsiinformation about publicly-held companies, and for nation is defined as information which would be coninvestors in arriving at their investment decisions. This, ion which has been stated by the Supreme Court. Significant question as to how much detail with resp .. material for investment purposes. There is also a serious or not it would be proper for us to compel diseİ VELİ or investment purposes simply because it might be useful or purposes,

final decision as to the extent of disclosure in this area ver the Federal securities laws. In that connection, as I *** testimony, there is a basis for distinguishing Un ween past, at a time whets Comission Lad adressed to this purpose and dwure of d. I believe stuni 4. prescribe more caballe

« ÎnapoiContinuă »