Evening star., 1940-02-29

o1Lte7neSS o. Untcn tD1S eQrGte0
only BY that inpoluing the court
reorganization plan, the Holding
Company Act 1DaS passed fpe
years ago in effort to break up
complicated financial structures
1Dhich link the major utilities OF
the country. The Securities and
Exchange Commission is notU
putting the lap into effect.
- the Associated Press.
The Securities and Exchange
Commission has begun a long
awaited move toward bringing major
utility systems within the limitations
Of the 1885 Holding Company Act.
- The commissions first step, in
orders made public last night, was
to ask Electric Bond and Share Co.
the Nations largest utility system
and Engineers Public Service Co.
what each believed needed to be
done to comply with the law.
Replies were called for by April 6,
and public hearings were set tenta-
lively for April 26. S. E. c. officials
pointed out, however, that final ac-
ton in integration proceedings
might be delayed for years.
Electric Bond and Share controls
about $2600,00000O of assets in
dozens of companies operating in 26
States and scattered from coast to
coast. Engineers Public Service
controls about $373, 900 900 Of assets
In q score of companies in Is States.
Seven Others Listed.
The S. E. c. announced that for
the present it was confining it's inte-
grafton proceedings to the major
systems and listed seven others
against which orders are being pre-
pared. The next notice will be sent
to Middle West Corp, once domi-
mated by the late Samuel insult.
A commission member, explaining
the portion of the act under which
the geographic and corporate sim
plicity moves are being made, said
1t amounted to this:
The commission has asked the two
companies whether they control
more than one intergrated utilities
system. If they admit they do, then
the question arises whether the ad-
ditional systems can comply with
the so-called "A B c" standards of
the act. If this cannot be done,
then each company will be asked
what it believes is the appropriate
action to reduce the system to the
limits fixed by Congress.
Must Limit Itself to One.
The section of the act once popu-
iarized as the death sentence
clause" provides that holding COM
pany must limit itself to one inte-
grated public utility system in the
same geographical area, and to such
additional systems as meet certain
standards.
These standards, known as "A
B c." authorize the additional sys-
TENS if they cannot be operated
economically independently. if they
are located in one State or in ad-
joining States, or if the combination
is not unduly large. -. -.
In a statement accompanying its
orders, the commission said the pro-
ceedings were "fact-finding inquir-
hes" designed to determine how each
company could bring itself within
the law, and were sin no sense pun
ltive or prosecutory."
The seven major systems, against
which similar orders are being pre-
pared include the Middle West Corp.
the United Gas Improvement Co.,
Cities Service Power & Light Co.,
the Commonwealth & Southern
Corp, Standard Power & Light
Corp, the North American Co., and
the United Light g. Power Co.
District Has Interest.
The District of Columbia will have
an interest in these proceedings as
the North American holds 46.47 of
the voting control of the Washing
ton Railway g. Electric Co., which in
turn has 100 per cent control of the
Potomac Electric Power Co.
Bond & Share controls directly or
Indirectly electric companies oper-
-Ating in 26 States and gas COM
panies operating in IL States.
The States in which it controls
both electric and gas companies are
Arizona, Arkansas, Florida, Louisi-
ana, Mississippi, Montana, Oregon,
Pennsylvania, Tennessee, Texas,
y Washington and Wisconsin.
It controls electric companies in