Evening star. [volume] (Washington, D.C.) 1854-1972, 1913-01-08
Foreign Control of District
Public Utilities, Forbidden.
NEW BILL BY LA TOILETTE
Not So Drastic as Measure Intro.
duced Last Month.
RAISES LIMIT ON OWNERSHIP
Made Unlawful to Hold 20 Per c ant
or More of Stock of Local
Corporation.

With the avowed object of preventing
the watering and rewatering'' of stock
of public utility corporations by merger
operations. Senator La Toilette today in
troduced a bill Ito make it unlawful for
foreign corporations to own or control the
capital stock. bonds Indebtedness OF
local public utility corporations in the
District of Columbia
The measure, it is declared, would pre-
vent the carrying out of the plans for the
merger of local public utilities as pro-
posed by a group of local financial men
without specific authorization from Con-
gress.
The new bill is redraft of another bill
of similar purpose introduced on the last
day of Congress before the Adjournment
for the holiday recess. But this new
measure is not so drastic in its terms. I'm
der the older bill it would have been UNI
lawful for foreign public utility to own
any stock or bonds in a local public util-
ity corporation In the new bill this has
been changed so that it would make un-
lawful only the ownership of ~ per cent
or more of the capital stock of the local
corporation Senator La Toilette feared
the provision of the earlier bill was SO
stringent that it might enable some per-
sons to harass a corporation.
Senator La Toilette said today that he
would urge prompt action on the bill by
the Senate District committee. to which
it has been referred. The legislation, he
will tell the members of the committee.
is similar to that in force in a number
of the states and follows closely a law
on the statute books Of conservative
Massachusetts.
Features of the Bill.
In it's essential features the bill pro-
vides
That it shall be unlawful for any for
eign public utility corporation. or for any
foreign or local holding corporation, or
for any local street railroad corporation,
gas corporation, electric crporatiOn. tele-
phone corporation, telegraph corporation
or any other local public utility corpora
ton, directly or indirectly, to own, con-
troll or hold or vote stock or bonds of
any public utility corporation organized
under any general incorporation law or
special act of the United States or author
lied under any law Of the United States
to do business in the District of Column
bia, except as hetofore or hereafter ex-
shall be unlawful for any public utility
corporation organized or authorized as
aforesaid to sell or transfer any portion
of it's stock or bonds to any other PUBLIC
utility corporation or holding corporation
whatsoever, unless heretofore here
after expressly authorized by Congress
so to do: and every contract, transfer,
agreement or transfer, or assignment by
any said public utility corporation or
ganized or authorized as aforesaid of
,rtin nf TIC or md urtf
out such authority shall be utterly void
and Of no effect.
Dissolution Proceedings.
THAT the Supreme Court of the Dis
trict of Columbia. on application OF the
District Of Columbia by it's Commission
ers or attorney. or on application of the
United States by it's proper officer, or on
application of any shareholder interested
in any such corporations, shall have juris-
diction in equity to dissolve any public
utility corporation organized under any
general incorporation law or special act
of the United States. or authorized under
any law of the United States to do bust
ness in the District of Columbia, for vio-
latiOn of any of the provisions of this act
or Of their charters; and further, to re-
Qulfe any IOTelS1 pubic utility corpora
ton or foreign or local holding corpora
ton which owns, holds or controls, or
which shall hereafter own. hold or con-
troll any such stock or bonds contrary to
any of the provisions of this act to sell
or dispose of the same and to refrain
from voting such stock or bonds.
Limit of Ownership.
Provided, that in case the allegations
in any bill filed in said court relate to
the ownership of stock bonds of a
local corporation by any foreign corpora
ton, then it must be shown to the salts
faction of the court that such ownership
includes at least - per cent of the cap
ital stock of the local corporation.
That the word foreign when used in
this act shall be construed to mean for
eign to the District of Columbia, and the
word local when used in this act shall
be construed to mean local in the Dis
trict of Columbia.