Evening star., 1938-08-04

BACKGROUND
One OF the major battles betueen
the Roosevelt administration and
big business" pas stirred by p1s.
sage Of act to regulate utilities hold
ing companies. Development OF
fight ,ods celebrated lobby INQUIRY
directed by the then Senator Black,
Ey the Associated Press.
The Securities Commission mads
public today letter in which it asked
66 public utility holding companies
to submit integration and simplifi.
cation plans by December 1, 1898.
Chairman William o. Douglas said
formally that the integration and sim
pliflcation provisions of the holding
company act have been in effect since
January l. BY December. he added,
ii months will have passed since that
date and more than three years will
have elapsed since the enactment Of
the statute.
Il expressed the hope in a speech
cSLOiC tAiF dlllludl lHCCIlIR O IIlC
American Bar Association at Cleve-
land on July 26 last" Mr.. Douglas
said, that before the year Is out We
will obtain from the various parts Of
the industry their plans and programs,
so We can chart orr course accord.
ingly.'
Gives Formal Effect.
"The purpose Of our communica-
tions is to give formal effect
to that expression.
Il wish to emphasize again that we
are not departing from our program
for cooperative andeavor, but are
seeking rather to implement the
roundtable technique with a concrete
proposal to those who want to get on
with the job.
Il also repeat what I said before,
that know many leaders of the in
dustry are bent not on notification.
or repeal, but on compliance. To all
them pledge our whole-hearted CO.
operation
Section lib of the Public Utility
Holding Company Act calls Tor ''in.
tegration' of utility holding com.
panies. An integrated system is one
whose utility properties are physically
interconnected. or one whose proper
ties are capable of being strung to-
gether into a single closely-knit sys-
tenn in a single geographic region.
Considered = Test Case.
This concern, now in bankruptcy,
has properties scattered throughout
Northeastern and Midwestern States.
Utility executives consider this hear
ing as a test case.
The commission asked for submis-
; sion Of plans and programs. even
though they were only tentative.
The text of the letter follows:
During recent months representa-
tives of number of public utility
holding company systems have been
discussing with us informally their
plans for compliance with section
integration and section il B (2)
dealing with corporate simplfica-
tom of the public utility holding COM
pany act of 1885. Some of these plans
deal only with parts of the necessary
program for the respective systems;
others are rather complete and full
tledged. although necessarily tentative.
Systems Interconnected.'
''The plan of any one system, in so
far as it calls for acquisition or dis
position of assets or of securities,
usually involves the plans of one or
more other systems. Thus the de-
velopment of section IL programs fire.
quently will necessitate action by two
or more systems. Furthermore, con-
sideration by the commission Of ten
tative proposals by one system should
preferably be given in light Of the
desires and hopes of other systems
which are affected. The commission
has consistently taken the view that
the development Of section IL (B)
Cd program for one system should
be made in light of the requirements
of the various systems which may be
directly or indirectly involved.
Because of these considerations and
because of the desire Of the commits
sion to get on with its task under
section IL, am writing you and the
heads Of other registered holding COM
panies at the direction of the COM
mission to request that the various
systems present to us not later than
December l, 1888, their suggestions.
plans and programs, even though they
may be tentative. looking toward
compliance with sections IL OBJ Q
and IL OBJ (2).
I'VE are sending copy Of this
(See S. E. c., Page A-4D