H.R. 831 – Reading Mode

111th CONGRESS

1st Session

H. R. 831

IN THE HOUSE OF REPRESENTATIVES

February 3, 2009

Mr. Oberstar introduced the following bill; which was referred to the Committee on Transportation and Infrastructure, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To direct the Comptroller General to conduct a study of the legal requirements and policies followed by the Department of Transportation in deciding whether to approve international alliances between air carriers and foreign air carriers and grant exemptions from the antitrust laws in connection with such international alliances, and for other purposes.

Antitrust exemptions

(a)

Study

The Comptroller General shall conduct a study of the legal requirements and policies followed by the Department in deciding whether to approve international alliances under section 41309 of title 49, United States Code, and grant exemptions from the antitrust laws under section 41308 of such title in connection with such international alliances.

(b)

Issues To be considered

In conducting the study under subsection (a), the Comptroller General, at a minimum, shall examine the following:

(1)

Whether granting exemptions from the antitrust laws in connection with international alliances has resulted in public benefits, including an analysis of whether such benefits could have been achieved by international alliances not receiving exemptions from the antitrust laws.

(2)

Whether granting exemptions from the antitrust laws in connection with international alliances has resulted in reduced competition, increased prices in markets, or other adverse effects.

(3)

Whether international alliances that have been granted exemptions from the antitrust laws have implemented pricing or other practices with respect to the hub airports at which the alliances operate that have resulted in increased costs for consumers or foreclosed competition by rival (nonalliance) air carriers at such airports.

(4)

Whether increased network size resulting from additional international alliance members will adversely affect competition between international alliances.

(5)

The areas in which immunized international alliances compete and whether there is sufficient competition among immunized international alliances to ensure that consumers will receive benefits of at least the same magnitude as those that consumers would receive if there were no immunized international alliances.

(6)

The minimum number of international alliances that is necessary to ensure robust competition and benefits to consumers on major international routes.

(7)

Whether the different regulatory and antitrust responsibilities of the Secretary and the Attorney General with respect to international alliances have created any significant conflicting agency recommendations, such as the conditions imposed in granting exemptions from the antitrust laws.

(8)

Whether, from an antitrust standpoint, requests for exemptions from the antitrust laws in connection with international alliances should be treated as mergers, and therefore be exclusively subject to a traditional merger analysis by the Attorney General and be subject to advance notification requirements and a confidential review process similar to those required under section 7A of the Clayton Act (15 U.S.C. 18a).

(9)

Whether the Secretary should amend, modify, or revoke any exemption from the antitrust laws granted by the Secretary in connection with an international alliance.

(c)

Report

Not later than one year after the date of enactment of this Act, the Comptroller General shall submit to the Secretary of Transportation, the Committee on Transportation and Infrastructure of the House of Representatives, and the Committee on Commerce, Science, and Transportation of the Senate a report on the results of the study under subsection (a), including any recommendations of the Comptroller General as to whether there should be changes in the authority of the Secretary under title 49, United States Code, or policy changes that the Secretary can implement administratively, with respect to approving international alliances and granting exemptions from the antitrust laws in connection with such international alliances.

(d)

Adoption of recommended policy changes

Not later than one year after the date of receipt of the report under subsection (c), and after providing notice and an opportunity for public comment, the Secretary shall issue a written determination as to whether the Secretary will adopt the policy changes, if any, recommended by the Comptroller General in the report or make any other policy changes with respect to approving international alliances and granting exemptions from the antitrust laws in connection with such international alliances.

(e)

Sunset provision

(1)

In general

An exemption from the antitrust laws granted by the Secretary on or before the last day of the 3-year period beginning on the date of enactment of this Act in connection with an international alliance, including an exemption granted before the date of enactment of this Act, shall cease to be effective after such last day unless the exemption is renewed by the Secretary.

(2)

Timing for renewals

The Secretary may not renew an exemption under paragraph (1) before the date on which the Secretary issues a written determination under subsection (d).

(3)

Standards for renewals

The Secretary shall make a decision on whether to renew an exemption under paragraph (1) based on the policies of the Department in effect after the Secretary issues a written determination under subsection (d).

(f)

Definitions

In this section, the following definitions apply:

(1)

Exemption from the antitrust laws

The term exemption from the antitrust laws means an exemption from the antitrust laws granted by the Secretary under section 41308 of title 49, United States Code.

(2)

Immunized international alliance

The term immunized international alliance means an international alliance for which the Secretary has granted an exemption from the antitrust laws.

(3)

International alliance

The term international alliance means a cooperative agreement between an air carrier and a foreign air carrier to provide foreign air transportation subject to approval or disapproval by the Secretary under section 41309 of title 49, United States Code.

(4)

Department

The term Department means the Department of Transportation.

(5)

Secretary

The term Secretary means the Secretary of Transportation.