Energy Emergency Consumer Protection Act of 2005 - States that during any presidentially-declared energy emergency it is unlawful to sell crude oil, gasoline, or petroleum distillates in, or for use in, the area involved at a price that: (1) is unconscionably excessive; or (2) indicates the seller is taking unfair advantage of the circumstances to increase prices unreasonably.
Makes it unlawful to: (1) report to the Federal Trade Commission (FTC) false or misleading data and information regarding the wholesale price of crude oil, gasoline, or petroleum distillates; or (2) use or employ, in connection with the purchase or sale of crude oil, gasoline, or petroleum distillates at wholesale, any manipulative or deceptive device or contrivance, in contravention of FTC-prescribed rules and regulations.
Authorizes the President to declare a federal energy emergency if the health, safety, welfare, or economic well-being of American citizens is at risk because there exists either: (1) an actual or imminent shortage of adequate supplies of crude oil, gasoline, or petroleum distillates due to a disruption in the national distribution system; or (2) significant pricing anomalies in national energy markets for such products.
Empowers the FTC and state attorneys general to enforce this Act.
Prescribes maximum civil and criminal penalties for violations of this Act.
Instructs the FTC to: (1) facilitate price transparency in wholesale crude oil and petroleum product markets; and (2) conclude a memorandum of understanding with the Commodity Futures Trading Commission and other appropriate agencies relating to information sharing.
Instructs the Comptroller General to investigate periodically the extent to which major oil companies and automobile manufacturers have invested in alternative fuels production, infrastructure, and technology development.
Directs the National Academy of Sciences to review expenditures and activities by major U.S. companies to protect the energy supply system from terrorist attacks, international supply disruptions, and natural disasters, and ensure a stable and reasonably priced supply of such products to consumers.
[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 1735 Introduced in Senate (IS)]
109th CONGRESS
1st Session
S. 1735
To improve the Federal Trade Commission's ability to protect consumers
from price-gouging during energy emergencies, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
September 20, 2005
Ms. Cantwell (for herself, Mr. Reid, Mr. Durbin, Mr. Inouye, Mrs.
Feinstein, Mr. Kerry, Mr. Feingold, Mrs. Clinton, Mr. Wyden, Mr. Kohl,
Mr. Schumer, Ms. Stabenow, Mr. Dorgan, Mr. Jeffords, Mrs. Boxer, Ms.
Mikulski, Mr. Biden, Mr. Lieberman, Mr. Harkin, Mr. Reed, and Mr.
Salazar) introduced the following bill; which was read twice and
referred to the Committee on Commerce, Science, and Transportation
_______________________________________________________________________
A BILL
To improve the Federal Trade Commission's ability to protect consumers
from price-gouging during energy emergencies, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Energy Emergency
Consumer Protection Act of 2005''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Unfair or deceptive acts or practices in commerce related to
gasoline and petroleum distillates.
Sec. 3. Declaration of energy emergency.
Sec. 4. Enforcement.
Sec. 5. Enforcement by State attorneys general.
Sec. 6. Penalties.
Sec. 7. Effect on other laws.
Sec. 8. Market transparency for crude oil, gasoline, and petroleum
distillates.
Sec. 9. Report on United States energy emergency preparedness.
Sec. 10. Alternative fuels investment by major oil companies and
automobile manufacturers.
Sec. 11. Protective action to prevent future disruptions of supply.
Sec. 12. Authorization of appropriations.
SEC. 2. UNFAIR OR DECEPTIVE ACTS OR PRACTICES IN COMMERCE RELATED TO
GASOLINE AND PETROLEUM DISTILLATES.
(a) Sales to Consumers at Unconscionable Price.--
(1) In general.--During any energy emergency declared by
the President under section 3, it is unlawful for any person to
sell crude oil, gasoline, or petroleum distillates in, or for
use in, the area to which that declaration applies at a price
that--
(A) is unconscionably excessive; or
(B) indicates the seller is taking unfair advantage
of the circumstances to increase prices unreasonably.
(2) Factors considered.--In determining whether a violation
of paragraph (1) has occured, there shall be taken into
account, among other factors, whether--
(A) the amount charged represents a gross disparity
between the price of the crude oil, gasoline, or
petroleum distillate sold and the price at which it was
offered for sale in the usual course of the seller's
business immediately prior to the energy emergency; or
(B) the amount charged grossly exceeds the price at
which the same or similar crude oil, gasoline, or
petroleum distillate was readily obtainable by other
purchasers in the area to which the declaration
applies.
(3) Mitigating factors.--In determining whether a violation
of paragraph (1) has occurred, there also shall be taken into
account, among other factors, the price that would reasonably
equate supply and demand in a competitive and freely
functioning market and whether the price at which the crude
oil, gasoline, or petroleum distillate was sold reasonably
reflects additional costs, not within the control of the
seller, that were paid or incurred by the seller.
(b) False Pricing Information.--It is unlawful for any person to
report information related to the wholesale price of crude oil,
gasoline, or petroleum distillates to the Federal Trade Commission if--
(1) that person knew, or reasonably should have known, the
information to be false or misleading;
(2) the information was required by law to be reported; and
(3) the person intended the false or misleading data to
affect data compiled by that department or agency for
statistical or analytical purposes with respect to the market
for crude oil, gasoline, or petroleum distillates.
(c) Market Manipulation.--It is unlawful for any person, directly
or indirectly, to use or employ, in connection with the purchase or
sale of crude oil, gasoline, or petroleum distillates at wholesale, any
manipulative or deceptive device or contrivance, in contravention of
such rules and regulations as the Commission may prescribe as necessary
or appropriate in the public interest or for the protection of United
States citizens.
SEC. 3. DECLARATION OF ENERGY EMERGENCY.
(a) In General.--If the President finds that the health, safety,
welfare, or economic well-being of the citizens of the United States is
at risk because of a shortage or imminent shortage of adequate supplies
of crude oil, gasoline, or petroleum distillates due to a disruption in
the national distribution system for crude oil, gasoline, or petroleum
distillates (including such a shortage related to a major disaster (as
defined in section 102(2) of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C. 5122))), or significant pricing
anomalies in national energy markets for crude oil, gasoline, or
petroleum distillates, the President may declare that a Federal energy
emergency exists.
(b) Scope and Duration.--The declaration shall apply to the Nation,
a geographical region, or 1 or more States, as determined by the
President, but may not be in effect for a period of more than 45 days.
(c) Extensions.--The President may--
(1) extend a declaration under subsection (a) for a period
of not more than 45 days; and
(2) extend such a declaration more than once.
SEC. 4. ENFORCEMENT UNDER FEDERAL TRADE COMMISSION ACT.
(a) Enforcement by Commission.--This Act shall be enforced by the
Federal Trade Commission. In enforcing section 2(a) of this Act, the
Commission shall give priority to enforcement actions concerning
companies with total United States wholesale or retail sales of crude
oil, gasoline, and petroleum distillates in excess of $500,000,000 per
year but shall not exclude enforcement actions against companies with
total United States wholesale sales of $500,000,000 or less per year.
(b) Violation Is Unfair or Deceptive Act or Practice.--The
violation of any provision of this Act shall be treated as an unfair or
deceptive act or practice proscribed under a rule issued under section
18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C.
57a(a)(1)(B)).
SEC. 5. ENFORCEMENT AT RETAIL LEVEL BY STATE ATTORNEYS GENERAL.
(a) In General.--A State, as parens patriae, may bring a civil
action on behalf of its residents in an appropriate district court of
the United States to enforce the provisions of section 2(a) of this
Act, or to impose the civil penalties authorized by section 6 for
violations of section 2(a), whenever the attorney general of the State
has reason to believe that the interests of the residents of the State
have been or are being threatened or adversely affected by a person
engaged in retail sales of gasoline or petroleum distillates to
consumers for purposes other than resale that violates this Act or a
regulation under this Act.
(b) Notice.--The State shall serve written notice to the Commission
of any civil action under subsection (a) prior to initiating such civil
action. The notice shall include a copy of the complaint to be filed to
initiate such civil action, except that if it is not feasible for the
State to provide such prior notice, the State shall provide such notice
immediately upon instituting such civil action.
(c) Authority To Intervene.--Upon receiving the notice required by
subsection (b), the Commission may intervene in such civil action and
upon intervening--
(1) be heard on all matters arising in such civil action;
and
(2) file petitions for appeal of a decision in such civil
action.
(d) Construction.--For purposes of bringing any civil action under
subsection (a), nothing in this section shall prevent the attorney
general of a State from exercising the powers conferred on the attorney
general by the laws of such State to conduct investigations or to
administer oaths or affirmations or to compel the attendance of
witnesses or the production of documentary and other evidence.
(e) Venue; Service of Process.--In a civil action brought under
subsection (a)--
(1) the venue shall be a judicial district in which--
(A) the defendant operates;
(B) the defendant was authorized to do business; or
(C) where the defendant in the civil action is
found;
(2) process may be served without regard to the territorial
limits of the district or of the State in which the civil
action is instituted; and
(3) a person who participated with the defendant in an
alleged violation that is being litigated in the civil action
may be joined in the civil action without regard to the
residence of the person.
(f) Limitation on State Action While Federal Action Is Pending.--If
the Commission has instituted a civil action or an administrative
action for violation of this Act, no State attorney general, or
official or agency of a State, may bring an action under this
subsection during the pendency of that action against any defendant
named in the complaint of the Commission or the other agency for any
violation of this Act alleged in the complaint.
(f) Enforcement of State Law.--Nothing contained in this section
shall prohibit an authorized State official from proceeding in State
court to enforce a civil or criminal statute of such State.
SEC. 6. PENALTIES.
(a) Civil Penalty.--
(1) In general.--In addition to any penalty applicable
under the Federal Trade Commission Act--
(A) any person who violates section 2(b) or 2(c) of
this Act is punishable by a civil penalty of not more
than $1,000,000; and
(B) any person who violates section 2(a) of this
Act is punishable by a civil penalty of not more than
$3,000,000.
(2) Method of assessment.--The penalties provided by
paragraph (1) shall be assessed in the same manner as civil
penalties imposed under section 5 of the Federal Trade
Commission Act (15 U.S.C. 45).
(3) Multiple offenses; mitigating factors.--In assessing
the penalty provided by subsection (a)--
(A) each day of a continuing violation shall be
considered a separate violation; and
(B) the Commission shall take into consideration
the seriousness of the violation and the efforts of the
person committing the violation to remedy the harm
caused by the violation in a timely manner.
(b) Criminal Penalty.--Violation of section 2(a) of this Act is
punishable by a fine of not more than $1,000,000, imprisonment for not
more than 5 years, or both.
SEC. 7. EFFECT ON OTHER LAWS.
(a) Other Authority of Commission.--Nothing in this Act shall be
construed to limit or affect in any way the Commission's authority to
bring enforcement actions or take any other measure under the Federal
Trade Commission Act (15 U.S.C. 41 et seq.) or any other provision of
law.
(b) State Law.--Nothing in this Act preempts any State law.
SEC. 8. MARKET TRANSPARENCY FOR CRUDE OIL, GASOLINE, AND PETROLEUM
DISTILLATES.
(a) In General.--The Federal Trade Commission shall facilitate
price transparency in markets for the sale of crude oil and essential
petroleum products at wholesale, having due regard for the public
interest, the integrity of those markets, fair competition, and the
protection of consumers.
(b) Marketplace Transparency.--
(1) Dissemination of information.--In carrying out this
section the Commission shall provide by rule for the
dissemination, on a timely basis, of information about the
availability and prices of wholesale crude oil, gasoline, and
petroleum distillates to the Commission, States, wholesale
buyers and sellers, and the public.
(2) Protection of public from anticompetitive activity.--In
determining the information to be made available under this
section and time to make the information available, the
Commission shall seek to ensure that consumers and competitive
markets are protected from the adverse effects of potential
collusion or other anticompetitive behaviors that can be
facilitated by untimely public disclosure of transaction-
specific information.
(3) Protection of market mechanisms.--The Commission shall
withhold from public disclosure under this section any
information the Commission determines would, if disclosed, be
detrimental to the operation of an effective market or
jeopardize security.
(c) Information Sources.--
(1) In general.--In carrying out subsection (b), the
Commission may--
(A) obtain information from any market participant;
and
(B) rely on entities other than the Commission to
receive and make public the information, subject to the
disclosure rules in subsection (b)(3).
(2) Published data.--In carrying out this section, the
Commission shall consider the degree of price transparency
provided by existing price publishers and providers of trade
processing services, and shall rely on such publishers and
services to the maximum extent possible.
(3) Electronic information systems.--The Commission may
establish an electronic information system if it determines
that existing price publications are not adequately providing
price discovery or market transparency. Nothing in this
section, however, shall affect any electronic information
filing requirements in effect under this Act as of the date of
enactment of this section.
(4) De minimus exception.--The Commission may not require
entities who have a de minimus market presence to comply with
the reporting requirements of this section.
(d) Cooperation With Other Federal Agencies.--
(1) Memorandum of understanding.--Within 180 days after the
date of enactment of this Act, the Commission shall conclude a
memorandum of understanding with the Commodity Futures Trading
Commission and other appropriate agencies (if applicable)
relating to information sharing, which shall include
provisions--
(A) ensuring that information requests to markets
within the respective jurisdiction of each agency are
properly coordinated to minimize duplicative
information requests; and
(B) regarding the treatment of proprietary trading
information.
(2) CFTC jurisdiction.--Nothing in this section may be
construed to limit or affect the exclusive jurisdiction of the
Commodity Futures Trading Commission under the Commodity
Exchange Act (7 U.S.C. 1 et seq.).
(e) Rulemaking.--Within 180 days after the date of enactment of
this Act, the Commission shall initiate a rulemaking proceeding to
establish such rules as the Commission determines to be necessary and
appropriate to carry out this section.
SEC. 9. REPORT ON UNITED STATES ENERGY EMERGENCY PREPAREDNESS.
(a) Potential Impacts Report.--Within 30 days after the date of
enactment of this Act, the Federal Trade Commission shall transmit to
the Congress a report describing the potential impact on domestic
prices of crude oil, residual fuel oil, and refined petroleum products
that would result from the disruption for periods of 1 week, 1 year,
and 5 years, respectively, of not less than--
(1) 30 percent of United States oil production;
(2) 20 percent of United States refining capacity; and
(3) 5 percent of global oil supplies.
(b) Projections and Possible Remedies.--The President shall include
in the report--
(1) projections of the impact any such disruptions would be
likely to have on the United States economy; and
(2) detailed and prioritized recommendations for remedies
under each scenario covered by the report.
SEC. 10. ALTERNATIVE FUELS INVESTMENT BY MAJOR OIL COMPANIES AND
AUTOMOBILE MANUFACTURERS.
The Comptroller General shall conduct an investigation within 1
year after the date of enactment of this Act and every 4 years
thereafter of the extent to which companies with total United States
wholesale or retail sales of crude oil, gasoline, and petroleum
distillates in excess of $500,000,000 per year and automobile
manufacturers have invested in alternative fuels production,
infrastructure, and technology development to diversify the motor
vehicle fuel and vehicle options available to consumers in the United
States. At the conclusion of each such investigation, the Comptroller
General shall transmit a report containing the findings and conclusions
to the Congress.
SEC. 11. PROTECTIVE ACTION TO PREVENT FUTURE DISRUPTIONS OF SUPPLY.
The National Academy of Sciences shall review expenditures by, and
activities undertaken by, companies with total United States wholesale
or retail sales of crude oil, gasoline, and petroleum distillates in
excess of $500,000,000 per year to protect the energy supply system
from terrorist attacks, international supply disruptions, and natural
disasters, and ensure a stable and reasonably priced supply of such
products to consumers in the United States, that includes an assessment
of the companies' preparations for the current forecasted period of
more frequent and, due to global warming, more intense hurricane
activity in the Gulf of Mexico and other vulnerable coastal areas.
SEC. 12. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated to the Federal Trade
Commission such sums as may be necessary to carry out the provisions of
this Act.
<all>D23/
Introduced in Senate
Sponsor introductory remarks on measure. (CR S10238-10239)
Read twice and referred to the Committee on Commerce, Science, and Transportation.
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