and interstate common carriers by rail, or water, engaged in whole or in part in commerce, any one of which corporations has capital surplus and undivided profits of more than $1,000,000, if such two or more corporations then are, or theretofore shall have been, competitors, so that the elimination of competition by agreement between them would violate any provision of any of the antitrust laws.19.

§ 5. Advisory power:20 The Commission has authority (1) upon the direction of the President, or either House of Congress, to report the facts relating to the alleged violation of the antitrust laws by any corporation; (2) upon the request of the Attorney General, to make recommendations for the readjustment of the business of any corporation alleged to be violating the antitrust laws, in order that the corporation may thereafter conduct its affairs in accordance with law; (3) to report to the Attorney General, upon his request or upon the Commission's own initiative, the manner in which a final decree entered against a defendant corporation in any suit brought by the United States under the antitrust laws has been, or is being, carried out; (4) upon the request of the court, to ascertain and report an appropriate form of decree for complainant in any suit in equity brought by the Attorney General under the antitrust laws; (5) to make reports to Congress, with such recommendations as the Commission may deem advisable, in respect of foreign trade conditions which may affect the foreign trade of the United States; (6) to make annual and special reports to Congress, with rec

19 For meaning of "antitrust laws", see Sec. 1 of Clayton Law, and Sec. 4 of Trade Law; and, for the provisions of the "anti

trust laws", see appendix.

20Trade Law, Sec. 6, (c), (d), (e), (f), (h), Sec. 7. See Chapter III, infra.

ommendations for additional legislation; and (7) to report to the public such information as the Commission may obtain and may deem it expedient in the public interest to publish, except trade secrets and names of customers, and to provide for the publication of its reports and decisions.

§ 6. Investigative power:21 The Commission has authority (1) to prosecute any inquiry necessary to its duties in any part of the United States; (2) to continue all investigations and proceedings pending in the Bureau of Corporations at the time when that Bureau automatically ceased to exist by the organization of the Trade Commission and the election of its chairman; (3) to investigate the organization, business, conduct, practices, and management of any corporation engaged in commerce, except banks and common carriers, and the relation of such corporation to other corporations and to individuals, associations, and partnerships; (4) to conduct its investigations by (a) requiring reports from corporations, (b) examining and copying the documentary evidence of corporations, (c) subpoenaing and examining witnesses and documents and (d) obtaining information from other departments and bureaus of the government; and (5) to enforce its investigative power by requesting the proper governmental authorities to institute (a) criminal prosecutions, (b) actions for penalties, (c) contempt proceedings and (d) proceedings in mandamus, in case the exercise of its investigative power shall be obstructed or resisted.

§ 7. Commission an administrative body: The Commission thus appears, from the preceding sections, to be an administrative body, created in part to fur

21 Trade Law, Secs. 3, 6, 8, 9, 10.

See Chapter IV, infra.

nish information to the legislative and executive branches of the government in furtherance of the enactment of new and the enforcement of existing laws, in part to inform and mould public opinion, in part to regulate trade, and in part to assist the courts. The Commission is not a court, and does not possess judicial power.22 Its investigative power is perhaps the most formidable of any it possesses. Its regulative power is not great. The subjects intended principally to be affected by the Commission's powers would seem to be the antitrust laws, unfair competitive practices, and foreign trade. While under its regulative authority the Commission may institute and conduct proceedings against natural persons, its powers in the main pertain to corporations and, with exceptions which will be noted, 23 cannot affect banks subject to the jurisdiction of the Federal Reserve Board, or common carriers subject to the jurisdiction of the Interstate Commerce Commission.

22 Sec. 30, infra.

28 Secs. 11, 12, 35, 36, 45, infra.

CHAPTER II.

REGULATIVE POWER.

§ 8. Scope of power: The matters as to which the regulative power of the Commission may be exercised are discriminations in price between different purchasers of commodities, exclusive purchase and sale ✓ arrangements, intercorporate shareholding, and interlocking directorates, declared unlawful by the Clayton Law,24 and unfair methods of competition in commerce, declared unlawful by the Trade Law.25 As to those matters, the Commission's authority is preventive only. It can only restrain, and cannot even restrain effectively except in so far as its preventive orders may be sanctioned and enforced by the courts.26 The Commission cannot punish violations of the law. It is without power to command affirmatively, or even to give protective permission for, the adoption of any course of conduct in interstate trade. The Trade Law is explicit that nothing therein contained shall be construed to prevent or interfere with the enforcement of the antitrust laws, or the acts to regulate commerce,27 and that neither the restraining order of the Commission, nor the decree of a court in enforcement of such order, shall in any manner absolve or relieve any person or corporation from liability under the antitrust laws.28

24 Clayton Law, Secs. 2, 3, 7 and 8; Sec. 4 supra, Secs. 9 to 12, infra.

25Trade Law, Sec. 5; Secs. 14 to 27, infra.

26 Sec. 29 (6), (7), infra.

27 Trade Law, Sec. 11.

28 Trade Law, Sec. 5; Clayton Law, Sec. 11.

The Commission may institute and conduct restraining proceedings under its regulative power against natural persons as well as against all corporations engaged in interstate or foreign commerce, except banks subject to the authority of the Federal Reserve Board and common carriers subject to the authority of the Interstate Commerce Commission.

Although the question is not by any means free from doubt, perhaps it might not have been an unconstitutional delegation of power for Congress, had it seen fit, to confer upon the Commission power authoritatively to inform a person engaged in interstate trade, in advance of action by such person, whether any given proposed course of conduct in interstate trade, if pursued, would so restrain trade by lessening competition, or so tend to create monopoly, or constitute such an unfair method of competition, as to offend against the Trade Law, the Clayton Law, and the other antitrust laws.29 And, since Congress failed to confer that power, it has been widely suggested30 that, with the co-operation or acquiescence of the Attorney General, the Commission can, and should, assume it, by permitting any proposed commercial plan to be submitted informally for consideration in advance of being acted upon by the proponent, and then expressing and publishing an extralegal opinion as to whether or not such plan is repugnant to law.

It is probably not to be anticipated that the Commission will assume ungranted power in the manner sug

29 Mutual Film Corp. v. Ohio Ind. Comm. (1915) 236 U. S. 230, 245-246; Buttfield v. Stranahan (1904) 192 U. S. 470, 496; Union Bridge Co. v. United States (1907) 204 U. S. 364, 378-386; Coopers

ville Co-operative Creamery Co. v. Lemon (1908) 163 Fed. 145, 147152.

304 Federal Trade Rep. (Decem. 1, 1915) 665, 667.