Senator MUSKIE. Senator Javits?

Senator JAVITS. No questions as far as these witnesses are concerned. Mr. Chairman, as soon as the Chair could reach it, I would like to get to the Department of Justice witnesses.

Senator MUSKIE. We have several witnesses here from Defense and Commerce, but Senator Javits must leave and he wanted to put some questions to the Justice Department.

Thank you very much, gentlemen.

From the Justice Department we have James Coyle and William Lamont.

I might say these two gentlemen were invited yesterday and have not had the opportunity they might have liked to prepare for this appearance, but we appreciate your coming.

Would you give your names and your addresses, your titles?

STATEMENTS OF JAMES J. COYLE, EXECUTIVE ASSISTANT, AND WILLIAM LAMONT, ATTORNEY, ANTITRUST DIVISION, DEPARTMENT OF JUSTICE

Mr. COYLE. I am James J. Coyle. I am executive assistant in the Antitrust Division, and this is William Lamont, who is an attorney in the Antitrust Division.

Senator MUSKIE. I will turn you over to Senator Javits, who has a line of questioning to follow.

Senator JAVITS. Thank you, Mr. Chairman.

First, let me thank you gentlemen and Attorney General Kennedy for producing you so quickly.

Then let me state that if you are unprepared to testify now, either for fact or policy reasons—and the latter may easily be the caseplease feel free to tell me. I will do my utmost to get from our chairman the necessary time to allow you to prepare.

So that I do not want to make you feel there is any surprise in this at all. Just let me know if there is surprise, as we lawyers call it, and we will arrange it to suit you. Because there is nothing adverse about my interest. It is really an honest desire to get the facts. May I tell you gentlemen what concerns me. There is a very serious inhibition in section 708(b) of the law we are asked to extend, with regard to the antitrust laws and the extent to which even the Attorney General may allow action to be taken which will relieve people of the restraints of the antitrust laws where it is in the national interest of the United States.

This is particularly pertinent to the problem of the Soviet shipment of oil into Europe, which is a new situation as to which there is a deep feeling by people like myself and others who have spoken to the subject that something must be done by the countries of Europe and the United States and Canada in association with the private enterprise which is involved in order to meet the new situation. And my concern-and I ask you this question-is this:

Are you satisfied that, with the restraints upon the right of the Attorney General to give exemptions from the antitrust laws, we may nonetheless be in a position to meet a new situation such as I have described? Or should we make some other provision with respect

to section 708(b) except its straight extension so that we may be able to meet eventualities?

Section 708(b), as I read it, and you gentlemen may read it differently, today deprives, because of the 1955 amendments, the Attorney General of the opportunity he had for giving an antitrust exemption where the national interest required it in order for us to get private enterprise cooperation which the national interest required, which he had before 1955, and confines him now only to situations in which military equipment is involved, to wit, these integration committees which are referred to in the departmental quarterly reports.

In short, my question is: Should we free the hands of the Attorney General in order to meet a situation which we see marching up over the horizon, or should we not?

Because if we pass the extension statute as it is, then we are continuing to put the same restraints on him which we have in the 1955 amendments that deprive him even of the opportunity to act if the President should think it in the national interest that the Attorney General should act.

That is my question.

Mr. COYLE. Senator Javits, the Department has considered the extension of the Defense Production Act as it is now drafted, and we have not opposed the extension of the Defense Production Act. We have not considered any amendment which would amend this section which inhibits new arrangements not involving defense procurement. I think that if an amendment should be presented to the Department that the Department would consider an amendment. I am just not prepared to say what position we would take on an amendment. But it is an important question, and I am sure we would properly consider an amendment or if an amendment is necessary— and submit our opinion on it.

But right now we just could not take any position on it.
Senator JAVITS. That is very kind.

Now may I ask you this question: Will you also give us your opinion as to whether action contemplated by an amendment which I will submit promptly could be taken under the existing agreements which are already covered by law, and do those agreements give the same exemptions under the antitrust laws which were given before the 1955 amendments?

There are two questions involved. I may ask for an amendment which you will feel is fully within the power of the entities which exist now, the committees which exist now. That is point No. 1.

Point No. 2: As to the entities which exist now, do they continue to have the same exemption from the antitrust laws so long as the Attorney General does not revoke that exemption which they had before the 1955 amendments?

There seems to be some concern on that score in industry circles. Mr. LAMONT. I think we could answer the second question now. They have exactly the same degree of exemption covering the actions. that they can carry out under the agreement.

Senator JAVITS. So that the question would be: Is there enough ambit under the preexisting committee arrangements to allow cooperative action which may have to be taken in the future?

Mr. LAMONT. This would, of course, be to a considerable degree conditioned on the kind of cooperative action, the form which it is to take, and that kind of more specific detail.

I mean this is a question which would be most difficult to answer in general.

Senator JAVITS. Mr. Lamont, you understand my desire is not to deprive the Attorney General of one whit of power or authority or supervision. It is only to see that he has it.

Mr. LAMONT. Yes; I understand that.

Senator JAVITS. I am very concerned about the fact we have deprived him of it. Now we run into a situation where it may be extremely desirable he should have it so that we may be renewing an existing statute without any regard to a new state of facts. This is what troubles me very deeply, and I wanted to get your situation before us.

I will submit an amendment, Mr. Chairman, to the Department, to which I hope we will have a very speedy reaction, so that we may act providently and with the full understanding of the factual situation.

I am right about the fact and I think we should have this in the record that the Attorney General now does not have the power to approve any new arrangement of the kind which is incorporated in the Foreign Petroleum Supply Committee or its Defense Study Subcommittee or in respect of the work of the National Petroleum Council.

Mr. COYLE. I think that is correct, Senator.

Senator JAVITS. That is correct?

Mr. COYLE. Yes.

Senator JAVITS. One other thing and then I shall be through, Mr. Chairman.

There is some concern that the Presidential executive order with respect to conflicts of interest, and so forth, may also be an inhibiting factor in again leaving the hands of the President free to act in this situation if he deems action necessary in the national interest.

However, this does not concern me, because if the President can make an Executive order, he can unmake an Executive order. I am only stating that for the record as a fact.

What does concern me is statute law, and it is that to which I would hope to get the Department's expeditious attention.

Mr. COYLE. I am sure you will.

Mr. LAMONT. May I just clarify one point. There is no National Petroleum Council problem now, that I know of, that relates to the Defense Production Act or to agreements under it. The National Petroleum Council is an entity entirely separate.

Senator JAVITS. So we can leave that out of our consideration?
Mr. LAMONT. Yes.

Senator JAVITS. I would also hope, Mr. Coyle, if you would think it proper, that we could also have the Department's independent advice in this situation. After all, it is in touch with all other Government agencies, with Interior, with State-or if it is not, it should beon this very serious problem. And I assure you it is a problem of the first magnitude.