Opinion ID: 106659
Heading Depth: 2
Heading Rank: 2

Heading: The Effect of the Bank Merger Act of 1960.

Text: Appellees contended below that the Bank Merger Act, by directing the banking agencies to consider competitive factors before approving mergers, 12 U. S. C. (1958 ed., Supp. IV) § 1828 (c), note 8, supra, immunizes approved mergers from challenge under the federal antitrust laws. [26] We think the District Court was correct in rejecting this contention. No express immunity is conferred by the Act. [27] Repeals of the antitrust laws by implication from a regulatory statute are strongly disfavored, [28] and have only been found in cases of plain repugnancy between the antitrust and regulatory provisions. [29] Two recent cases, Pan American World Airways v. United States, 371 U. S. 296, and California v. Federal Power Comm'n, 369 U. S. 482, illustrate this principle. In Pan American, the Court held that because the Civil Aeronautics Board had been given broad powers to enforce the competitive standard clearly delineated by the Civil Aeronautics Act, and to immunize a variety of transactions from the operation of the antitrust laws, the Sherman Act could not be applied to facts composing the precise ingredients of a case subject to the Board's broad regulatory and remedial powers; in contrast, the banking agencies have authority neither to enforce the antitrust laws against mergers, cf. note 22, supra, nor to grant immunity from those laws. In the California case, on the other hand, the Court held that the FPC's approval of a merger did not confer immunity from § 7 of the Clayton Act, even though, as in the instant case, the agency had taken the competitive factor into account in passing upon the merger application. See 369 U. S., at 484-485, 487-488. We think California is controlling here. Although the Comptroller was required to consider effect upon competition in passing upon appellees' merger application, he was not required to give this factor any particular weight; he was not even required to (and did not) hold a hearing before approving the application; and there is no specific provision for judicial review of his decision. [30] Plainly, the range and scope of administrative powers under the Bank Merger Act bear little resemblance to those involved in Pan American. Nor did Congress, in passing the Bank Merger Act, embrace the view that federal regulation of banking is so comprehensive that enforcement of the antitrust laws would be either unnecessary, in light of the completeness of the regulatory structure, or disruptive of that structure. On the contrary, the legislative history of the Act seems clearly to refute any suggestion that applicability of the antitrust laws was to be affected. Both the House and Senate Committee Reports stated that the Act would not affect in any way the applicability of the antitrust laws to bank acquisitions. H. R. Rep. No. 1416, 86th Cong., 2d Sess. 9; S. Rep. No. 196, 86th Cong., 1st Sess. 3. See also, e. g., 105 Cong. Rec. 8131 (remarks of Senator Robertson, the Act's sponsor). Moreover, bank regulation is in most respects less complete than public utility regulation, to which interstate rail and air carriers, among others, are subject. Rate regulation in the banking industry is limited and largely indirect, see p. 328, supra; banks are under no duty not to discriminate in their services; and though the location of bank offices is regulated, banks may do businessplace loans and solicit depositswhere they please. The fact that the banking agencies maintain a close surveillance of the industry with a view toward preventing unsound practices that might impair liquidity or lead to insolvency does not make federal banking regulation all-pervasive, although it does minimize the hazards of intense competition. Indeed, that there are so many direct public controls over unsound competitive practices in the industry refutes the argument that private controls of competition are necessary in the public interest and ought therefore to be immune from scrutiny under the antitrust laws. Cf. Kaysen and Turner, Antitrust Policy (1959), 206. We note, finally, that the doctrine of primary jurisdiction is not applicable here. That doctrine requires judicial abstention in cases where protection of the integrity of a regulatory scheme dictates preliminary resort to the agency which administers the scheme. See Far East Conference v. United States, 342 U. S. 570; Great Northern R. Co. v. Merchants Elevator Co., 259 U. S. 285; Schwartz, Legal Restriction of Competition in the Regulated Industries: An Abdication of Judicial Responsibility, 67 Harv. L. Rev. 436, 464 (1954). [31] Court jurisdiction is not thereby ousted, but only postponed. See General Am. Tank Car Corp. v. El Dorado Terminal Co., 308 U. S. 422, 433; Federal Maritime Bd. v. Isbrandtsen Co., 356 U. S. 481, 498-499; 3 Davis, Administrative Law (1958), 1-55. Thus, even if we were to assume the applicability of the doctrine to merger-application proceedings before the banking agencies, [32] the present action would not be barred, for the agency proceeding was completed before the antitrust action was commenced. Cf. United States v. Western Pac. R. Co., 352 U. S. 59, 69; Retail Clerks Int'l Assn. v. Schermerhorn, 373 U. S. 746, 756. We recognize that the practical effect of applying the doctrine of primary jurisdiction has sometimes been to channel judicial enforcement of antitrust policy into appellate review of the agency's decision, see Federal Maritime Bd. v. Isbrandtsen Co., supra ; cf. D. L. Piazza Co. v. West Coast Line, Inc., 210 F. 2d 947 (C. A. 2d Cir. 1954), or even to preclude such enforcement entirely if the agency has the power to approve the challenged activities, see United States Nav. Co. v. Cunard S. S. Co., 284 U. S. 474; cf. United States v. Railway Express Agency, 101 F. Supp. 1008 (D. C. D. Del. 1951); but see Federal Maritime Bd. v. Isbrandtsen Co., supra . But here there may be no power of judicial review of the administrative decision approving the merger, and such approval does not in any event confer immunity from the antitrust laws, see pp. 350-352, supra. Furthermore, the considerations that militate against finding a repeal of the antitrust laws by implication from the existence of a regulatory scheme also argue persuasively against attenuating, by postponing, the courts' jurisdiction to enforce those laws. It should be unnecessary to add that in holding as we do that the Bank Merger Act of 1960 does not preclude application of § 7 of the Clayton Act to bank mergers, we deprive the later statute of none of its intended force. Congress plainly did not intend the 1960 Act to extinguish other sources of federal restraint of bank acquisitions having anticompetitive effects. For example, Congress certainly knew that bank mergers would continue subject to the Sherman Act, see p. 352, supra, as well as that pure stock acquisitions by banks would continue subject to § 7 of the Clayton Act. If, in addition, bank mergers are subject to § 7, we do not see how the objectives of the 1960 Act are thereby thwarted. It is not as if the Clayton and Sherman Acts embodied approaches to antitrust policy inconsistent with or unrelated to each other. The Sherman Act, of course, forbids mergers effecting an unreasonable restraint of trade. See, e. g., Northern Securities Co. v. United States, 193 U. S. 197; United States v. Union Pac. R. Co., 226 U. S. 61; indeed, there is presently pending before this Court a challenge to a bank merger predicated solely on the Sherman Act. United States v. First Nat. Bank & Trust Co. of Lexington, prob. juris. noted, post, p. 824. And the tests of illegality under the Sherman and Clayton Acts are complementary. [T]he public policy announced by § 7 of the Clayton Act is to be taken into consideration in determining whether acquisition of assets . . . violates the prohibitions of the Sherman Act against unreasonable restraints. United States v. Columbia Steel Co., 334 U. S. 495, 507, n. 7; see Note, 52 Col. L. Rev. 766, 768, n. 10 (1952). To be sure, not every violation of § 7, as amended, would necessarily be a violation of the Sherman Act; our point is simply that since Congress passed the 1960 Act with no intention of displacing the enforcement of the Sherman Act against bank mergersor even of § 7 against pure stock acquisitions by bankscontinued application of § 7 to bank mergers cannot be repugnant to the design of the 1960 Act. It would be anomalous to conclude that Congress, while intending the Sherman Act to remain fully applicable to bank mergers, and § 7 of the Clayton Act to remain fully applicable to pure stock acquisitions by banks, nevertheless intended § 7 to be completely inapplicable to bank mergers.