I 

110TH CONGRESS 

1ST SESSION H. R. 2460 

To protect the welfare of consumers by prohibiting price gouging by merchants with respect to gasoline and other fuels during certain abnormal 

market disruptions. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 23, 2007 

Mr. FOSSELLA (for himself, Mr. HAYES, Mr. MORAN of Kansas, and Mr. 

ISSA) introduced the following bill; which was referred to the Committee 

on Energy and Commerce, and in addition to the Committee on Education and Labor, 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 protect the welfare of consumers by prohibiting price 

gouging by merchants with respect to gasoline and other 

fuels during certain abnormal market disruptions. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Federal Energy Price 

5 Protection Act’’. 


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1 SEC. 2. PROTECTION OF CONSUMERS AGAINST PRICE 

2 GOUGING. 

3 It shall be unlawful for any supplier to increase the 

4 price at which that supplier sells, or offers to sell, crude 

5 oil, gasoline, or petroleum distillates in an area covered 

6 by a Presidential proclamation issued under section 

7 4(a)(1) by an unconscionable amount during the period 

8 beginning on the date the proclamation is issued and end9 ing on the date specified in the proclamation. 

10 SEC. 3. JUSTIFIABLE PRICE INCREASES. 

11 (a) IN GENERAL.—The prohibition in section 2 does 

12 not apply to the extent that the increase in the price of 

13 the crude oil, gasoline, or petroleum distillate is substan14 tially attributable to— 

15 (1) an increase in the wholesale cost of crude 

16 oil, gasoline, or petroleum distillates to a supplier; 

17 (2) an increase in the replacement costs for 

18 crude oil, gasoline, or petroleum distillate sold; 

19 (3) an increase in operational costs; or 

20 (4) local, regional, national, or international 

21 market conditions. 

22 (b) OTHER MITIGATING FACTORS.—In determining 

23 whether a violation of section 2 has occurred, there also 

24 shall be taken into account, among other factors, the price 

25 that would reasonably equate supply and demand in a 

26 competitive and freely functioning market and whether the 


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1 price at which the crude oil, gasoline, or petroleum dis2 tillate was sold reasonably reflects other additional costs 

3 or risks, not within the control of the seller, that were 

4 paid or incurred by the seller. 

5 SEC. 4. EMERGENCY PROCLAMATIONS AND ORDERS. 

6 (a) PRESIDENTIAL EMERGENCY PROCLAMATIONS.— 

7 The President may issue an emergency proclamation when 

8 an abnormal market disruption has occurred or is reason9 ably expected to occur. 

10 (b) SCOPE AND DURATION.— 

11 (1) IN GENERAL.—The emergency proclamation 

12 or order shall specify with particularity— 

13 (A) the period for which the proclamation 

14 or order applies; 

15 (B) the event, circumstance, or condition 

16 that is the reason such a proclamation or order 

17 is determined to be necessary; and 

18 (C) the geographic area or region to which 

19 it applies. 

20 (2) LIMITATIONS.—An emergency proclamation 

21 or an order under subsection (a)— 

22 (A) may not apply for a period of more 

23 than 30 consecutive days (renewable for a con24 secutive period of not more than 30 days); and 


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1 (B) may apply to a period of not more 

2 than 7 days preceding the occurrence of an 

3 event, circumstance, or condition that is the 

4 reason such a proclamation or order is nec5 essary. 

6 SEC. 5. ENFORCEMENT BY FEDERAL TRADE COMMISSION. 

7 (a) UNFAIR OR DECEPTIVE ACT OR PRACTICE.—Sec8 tion 2 of this Act shall be treated as a violation of a rule 

9 defining an unfair or deceptive act or practice prescribed 

10 under section 18(a)(1)(B) of the Federal Trade Commis11 sion Act (15 U.S.C. 57a(a)(1)(B)). 

12 (b) ACTIONS BY THE COMMISSION.—The Commis13 sion shall prevent any supplier from violating this Act in 

14 the same manner, by the same means, and with the same 

15 jurisdiction, powers, and duties as though all applicable 

16 terms and provisions of the Federal Trade Commission 

17 Act (15 U.S.C. 41 et seq.) were incorporated into and 

18 made a part of this Act. Any entity that violates any provi19 sion of this Act is subject to the penalties and entitled 

20 to the privileges and immunities provided in the Federal 

21 Trade Commission Act in the same manner, by the same 

22 means, and with the same jurisdiction, power, and duties 

23 as though all applicable terms and provisions of the Fed24 eral Trade Commission Act were incorporated into and 

25 made a part of this Act. 


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1 (c) REGULATIONS.—Not later than 180 days after 

2 the date of enactment of this Act, the Federal Trade Com3 mission shall prescribe such regulations as may be nec4 essary or appropriate to implement this Act. 

5 SEC. 6. PENALTIES. 

6 (a) CIVIL PENALTY.— 

7 (1) IN GENERAL.—In addition to any penalty 

8 applicable under the Federal Trade Commission Act 

9 any supplier who violates this Act is punishable by 

10 a civil penalty of— 

11 (A) not more than $500,000, in the case of 

12 an independent small business marketer of gas13 oline (within the meaning of section 324(c) of 

14 the Clean Air Act (42 U.S.C. 7625(c)); and 

15 (B) not more than $5,000,000 in the case 

16 of any other supplier. 

17 (2) METHOD OF ASSESSMENT.—The penalty 

18 provided by paragraph (1) shall be assessed in the 

19 same manner as civil penalties imposed under sec20 tion 5 of the Federal Trade Commission Act (15 

21 U.S.C. 45). 

22 (3) MULTIPLE OFFENSES; MITIGATING FAC23 TORS.—In assessing the penalty provided by sub24 section (a)— 


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1 (A) the Commission shall take into consid2 eration the seriousness of the violation and the 

3 efforts of the supplier committing the violation 

4 to remedy the harm caused by the violation in 

5 a timely manner; and 

6 (B) each determination that the price at 

7 which crude oil, gasoline, or other petroleum 

8 distillate has been sold or offered for sale in an 

9 area and during a period covered by a procla10 mation or order issued under section 4 was in11 creased by an unconscionable amount shall be 

12 treated as a single violation. 

13 (b) CRIMINAL PENALTY.— 

14 (1) IN GENERAL.—In addition to any penalty 

15 applicable under the Federal Trade Commission Act, 

16 the violation of this Act is punishable by a fine of 

17 not more than $1,000,000, imprisonment for not 

18 more than 2 years, or both. 

19 (2) ENFORCEMENT.—The criminal penalty pro20 vided by paragraph (1) may be imposed only pursu21 ant to a criminal action brought by the Attorney 

22 General or other officer of the Department of Jus23 tice. 


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1 SEC. 7. LOW INCOME ENERGY ASSISTANCE. 

2 Amounts collected in fines and penalties under sec3 tion 6 of this Act shall be deposited in a separate fund 

4 in the treasury to be known as the Consumer Relief Trust 

5 Fund. To the extent provided for in advance in appropria6 tions Acts fund shall be used to provide assistance under 

7 the Low Income Home Energy Assistance Program ad8 ministered by the Secretary of Health and Human Serv9 ices. 

10 SEC. 8. DEFINITIONS. 

11 In this Act: 

12 (1) ABNORMAL MARKET DISRUPTION.—The 

13 term ‘‘abnormal market disruption’’ means there is 

14 a reasonable likelihood that, in the absence of a 

15 proclamation under section 4(a), there will be an in16 crease in the average price of crude oil, gasoline, or 

17 petroleum distillates as a result of a change in the 

18 market, whether actual or imminently threatened, 

19 resulting from extreme weather, a natural disaster, 

20 strike, civil disorder, war, military action, a national 

21 or local emergency, or other similar cause, that ad22 versely affects the availability or delivery of crude 

23 oil, gasoline, or petroleum distillates. 

24 (2) SUPPLIER.—The term ‘‘supplier’’ means 

25 any person engaged in the trade or business of sellVerDate Aug 31 2005 01:35 May 28, 2007 Jkt 059200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H2460.IH H2460

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1 ing, reselling, at retail or wholesale, or distributing 

2 crude oil, gasoline, or petroleum distillates. 

3 (3) REPLACEMENT COSTS.—The term ‘‘replace4 ment costs’’ means, with respect to a supplier to 

5 whom sections 2 and 3 apply, costs to that supplier 

6 determined by referencing either— 

7 (A) the actual or reasonably anticipated re8 placement cost as evidenced by bills of sale, in9 voices, or other appropriate documentation; or 

10 (B) the cost for crude oil, gasoline, or 

11 other petroleum distillates in the relevant mar12 ket at the time of the sale or offer for sale that 

13 is the subject of a violation of section 2, plus 

14 actual storage, transportation, and delivery 

15 costs. 

16 (4) UNCONSCIONABLE AMOUNT.—The term 

17 ‘‘unconscionable amount’’ means, with respect to 

18 any supplier to whom section 2 applies, a significant 

19 increase in the price at which crude oil, gasoline, or 

20 petroleum distillates are sold or offered for sale by 

21 that supplier that increases the price, for the same 

22 grade of crude oil, gasoline, or petroleum distillate, 

23 to an amount that— 

24 (A) substantially exceeds the average price 

25 at which crude oil, gasoline, or petroleum disVerDate Aug 31 2005 01:35 May 28, 2007 Jkt 059200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H2460.IH H2460

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1 tillates were sold or offered for sale by that sup2 plier during the 30-day period immediately pre3 ceding the sale or offer; 

4 (B) substantially exceeds the average price 

5 at which crude oil, gasoline, or petroleum dis6 tillates were sold or offered for sale by that per7 son’s competitors in the area and during the pe8 riod for which the emergency proclamation ap9 plies; and 

10 (C) cannot be justified by taking into ac11 count the factors described in section 3. 

12 SEC. 9. EFFECTIVE DATE. 

13 This Act shall take effect on the date on which a final 

14 rule issued by the Federal Trade Commission under sec15 tion 5(c) is published in the Federal Register. 

Æ 


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