[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 3044 Placed on Calendar Senate (PCS)]
Calendar No. 743
110th CONGRESS
2d Session
S. 3044
To provide energy price relief and hold oil companies and other
entities accountable for their actions with regard to high energy
prices, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 20, 2008
Mr. Reid (for himself, Mrs. Boxer, Mr. Brown, Mr. Cardin, Mr. Conrad,
Mr. Dodd, Mr. Durbin, Mr. Johnson, Mr. Kennedy, Ms. Klobuchar, Mr.
Kohl, Mr. Lautenberg, Mr. Leahy, Mr. Levin, Mrs. McCaskill, Ms.
Mikulski, Mrs. Murray, Mr. Reed, Mr. Schumer, Ms. Stabenow, and Mr.
Whitehouse) introduced the following bill; which was read the first
time
May 21, 2008
Read the second time and placed on the calendar
_______________________________________________________________________
A BILL
To provide energy price relief and hold oil companies and other
entities accountable for their actions with regard to high energy
prices, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Consumer-First
Energy Act of 2008''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
TITLE I--TAX PROVISIONS RELATED TO OIL AND GAS
Sec. 101. Denial of deduction for major integrated oil companies for
income attributable to domestic production
of oil, gas, or primary products thereof.
Sec. 102. Elimination of the different treatment of foreign oil and gas
extraction income and foreign oil related
income for purposes of the foreign tax
credit.
Sec. 103. Windfall profits tax.
Sec. 104. Energy Independence and Security Trust Fund.
TITLE II--PRICE GOUGING
Sec. 201. Short title.
Sec. 202. Definitions.
Sec. 203. Energy emergency and additional price gouging enforcement.
Sec. 204. Presidential declaration of energy emergency.
Sec. 205. Enforcement by the Federal Trade Commission.
Sec. 206. Enforcement by State attorneys general.
Sec. 207. Penalties.
Sec. 208. Effect on other laws.
TITLE III--STRATEGIC PETROLEUM RESERVE
Sec. 301. Suspension of petroleum acquisition for Strategic Petroleum
Reserve.
TITLE IV--NO OIL PRODUCING AND EXPORTING CARTELS
Sec. 401. No Oil Producing and Exporting Cartels Act of 2008.
TITLE V--MARKET SPECULATION
Sec. 501. Speculative limits and transparency for off-shore oil
trading.
Sec. 502. Margin level for crude oil.
SEC. 2. FINDINGS.
Congress finds that--
(1) excessive prices for petroleum products have created,
or imminently threaten to create, severe economic dislocations
and hardships, including the loss of jobs, business failures,
disruption of economic activity, curtailment of vital public
services, and price increases throughout the economy;
(2) those hardships and dislocations jeopardize the normal
flow of commerce and constitute a national energy and economic
crisis that is a threat to the public health, safety, and
welfare of the United States;
(3) consumers, workers, small businesses, and large
businesses of the United States are particularly vulnerable to
those price increase due to the failure of the President to
aggressively develop alternatives to petroleum and petroleum
products and to promote efficiency and conservation;
(4) reliable and affordable supplies of crude oil and
products refined from crude oil (including gasoline, diesel
fuel, heating oil, and jet fuel) are vital to the economic and
national security of the United States given current energy
infrastructure and technology;
(5) the price of crude oil and products refined from crude
oil (including gasoline, diesel fuel, heating oil, and jet
fuel) have skyrocketed to record levels and are continuing to
rise;
(6) since 2001, oil prices have increased from $29 per
barrel to levels near $120 per barrel and gasoline prices have
more than doubled from $1.47 per gallon to more than $3.50 per
gallon;
(7) the record prices for crude oil and products refined
from crude oil (including gasoline, diesel fuel, heating oil,
and jet fuel)--
(A) are hurting millions of consumers, workers,
small businesses, and large businesses of the United
States, and threaten long-term damage to the economy
and security of the United States;
(B) are partially due to--
(i) the declining value of the dollar and a
widespread lack of confidence in the management
of economic and foreign policy by the
President;
(ii) the accumulation of national debt and
growing budget deficits under the failed
economic policies of the President; and
(iii) high levels of military expenditures
under the failed policies of the President in
Iraq; and
(C) are no longer justified by traditional forces
of supply and demand;
(8) rampant speculation in the markets for crude oil and
products refined from crude oil has magnified the price
increases and market volatility resulting from those underlying
causes of price increases; and
(9) Congress must take urgent action to protect consumers,
workers, and businesses of the United States from rampant
speculation in the energy markets and the price increases
resulting from the failed domestic and foreign policies of the
President.
TITLE I--TAX PROVISIONS RELATED TO OIL AND GAS
SEC. 101. DENIAL OF DEDUCTION FOR MAJOR INTEGRATED OIL COMPANIES FOR
INCOME ATTRIBUTABLE TO DOMESTIC PRODUCTION OF OIL, GAS,
OR PRIMARY PRODUCTS THEREOF.
(a) In General.--Subparagraph (B) of section 199(c)(4) (relating to
exceptions) is amended by striking ``or'' at the end of clause (ii), by
striking the period at the end of clause (iii) and inserting ``, or'',
and by inserting after clause (iii) the following new clause:
``(iv) in the case of any major integrated
oil company (as defined in section
167(h)(5)(B)), the production, refining,
processing, transportation, or distribution of
oil, gas, or any primary product thereof during
any taxable year described in section
167(h)(5)(B).''.
(b) Primary Product.--Section 199(c)(4)(B) is amended by adding at
the end the following flush sentence:
``For purposes of clause (iv), the term `primary
product' has the same meaning as when used in section
927(a)(2)(C), as in effect before its repeal.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2008.
SEC. 102. ELIMINATION OF THE DIFFERENT TREATMENT OF FOREIGN OIL AND GAS
EXTRACTION INCOME AND FOREIGN OIL RELATED INCOME FOR
PURPOSES OF THE FOREIGN TAX CREDIT.
(a) In General.--Subsections (a) and (b) of section 907 of the
Internal Revenue Code of 1986 (relating to special rules in case of
foreign oil and gas income) are amended to read as follows:
``(a) Reduction in Amount Allowed as Foreign Tax Under Section
901.--In applying section 901, the amount of any foreign oil and gas
taxes paid or accrued (or deemed to have been paid) during the taxable
year which would (but for this subsection) be taken into account for
purposes of section 901 shall be reduced by the amount (if any) by
which the amount of such taxes exceeds the product of--
``(1) the amount of the combined foreign oil and gas income
for the taxable year,
``(2) multiplied by--
``(A) in the case of a corporation, the percentage
which is equal to the highest rate of tax specified
under section 11(b), or
``(B) in the case of an individual, a fraction the
numerator of which is the tax against which the credit
under section 901(a) is taken and the denominator of
which is the taxpayer's entire taxable income.
``(b) Combined Foreign Oil and Gas Income; Foreign Oil and Gas
Taxes.--For purposes of this section--
``(1) Combined foreign oil and gas income.--The term
`combined foreign oil and gas income' means, with respect to
any taxable year, the sum of--
``(A) foreign oil and gas extraction income, and
``(B) foreign oil related income.
``(2) Foreign oil and gas taxes.--The term `foreign oil and
gas taxes' means, with respect to any taxable year, the sum
of--
``(A) oil and gas extraction taxes, and
``(B) any income, war profits, and excess profits
taxes paid or accrued (or deemed to have been paid or
accrued under section 902 or 960) during the taxable
year with respect to foreign oil related income
(determined without regard to subsection (c)(4)) or
loss which would be taken into account for purposes of
section 901 without regard to this section.''.
(b) Recapture of Foreign Oil and Gas Losses.--Paragraph (4) of
section 907(c) of the Internal Revenue Code of 1986 (relating to
recapture of foreign oil and gas extraction losses by recharacterizing
later extraction income) is amended to read as follows:
``(4) Recapture of foreign oil and gas losses by
recharacterizing later combined foreign oil and gas income.--
``(A) In general.--The combined foreign oil and gas
income of a taxpayer for a taxable year (determined
without regard to this paragraph) shall be reduced--
``(i) first by the amount determined under
subparagraph (B), and
``(ii) then by the amount determined under
subparagraph (C).
The aggregate amount of such reductions shall be
treated as income (from sources without the United
States) which is not combined foreign oil and gas
income.
``(B) Reduction for pre-2008 foreign oil extraction
losses.--The reduction under this paragraph shall be
equal to the lesser of--
``(i) the foreign oil and gas extraction
income of the taxpayer for the taxable year
(determined without regard to this paragraph),
or
``(ii) the excess of--
``(I) the aggregate amount of
foreign oil extraction losses for
preceding taxable years beginning after
December 31, 1982, and before January
1, 2008, over
``(II) so much of such aggregate
amount as was recharacterized under
this paragraph (as in effect before and
after the date of the enactment of the
Consumer-First Energy Act of 2008) for
preceding taxable years beginning after
December 31, 1982.
``(C) Reduction for post-2008 foreign oil and gas
losses.--The reduction under this paragraph shall be
equal to the lesser of--
``(i) the combined foreign oil and gas
income of the taxpayer for the taxable year
(determined without regard to this paragraph),
reduced by an amount equal to the reduction
under subparagraph (A) for the taxable year, or
``(ii) the excess of--
``(I) the aggregate amount of
foreign oil and gas losses for
preceding taxable years beginning after
December 31, 2008, over
``(II) so much of such aggregate
amount as was recharacterized under
this paragraph for preceding taxable
years beginning after December 31,
2008.
``(D) Foreign oil and gas loss defined.--
``(i) In general.--For purposes of this
paragraph, the term `foreign oil and gas loss'
means the amount by which--
``(I) the gross income for the
taxable year from sources without the
United States and its possessions
(whether or not the taxpayer chooses
the benefits of this subpart for such
taxable year) taken into account in
determining the combined foreign oil
and gas income for such year, is
exceeded by
``(II) the sum of the deductions
properly apportioned or allocated
thereto.
``(ii) Net operating loss deduction not
taken into account.--For purposes of clause
(i), the net operating loss deduction allowable
for the taxable year under section 172(a) shall
not be taken into account.
``(iii) Expropriation and casualty losses
not taken into account.--For purposes of clause
(i), there shall not be taken into account--
``(I) any foreign expropriation
loss (as defined in section 172(h) (as
in effect on the day before the date of
the enactment of the Revenue
Reconciliation Act of 1990)) for the
taxable year, or
``(II) any loss for the taxable
year which arises from fire, storm,
shipwreck, or other casualty, or from
theft,
to the extent such loss is not compensated for
by insurance or otherwise.
``(iv) Foreign oil extraction loss.--For
purposes of subparagraph (B)(ii)(I), foreign
oil extraction losses shall be determined under
this paragraph as in effect on the day before
the date of the enactment of the Consumer-First
Energy Act of 2008.''.
(c) Carryback and Carryover of Disallowed Credits.--Section 907(f)
of the Internal Revenue Code of 1986 (relating to carryback and
carryover of disallowed credits) is amended--
(1) by striking ``oil and gas extraction taxes'' each place
it appears and inserting ``foreign oil and gas taxes'', and
(2) by adding at the end the following new paragraph:
``(4) Transition rules for pre-2009 and 2009 disallowed
credits.--
``(A) Pre-2009 credits.--In the case of any unused
credit year beginning before January 1, 2009, this
subsection shall be applied to any unused oil and gas
extraction taxes carried from such unused credit year
to a year beginning after December 31, 2008--
``(i) by substituting `oil and gas
extraction taxes' for `foreign oil and gas
taxes' each place it appears in paragraphs (1),
(2), and (3), and
``(ii) by computing, for purposes of
paragraph (2)(A), the limitation under
subparagraph (A) for the year to which such
taxes are carried by substituting `foreign oil
and gas extraction income' for `foreign oil and
gas income' in subsection (a).
``(B) 2009 credits.--In the case of any unused
credit year beginning in 2009, the amendments made to
this subsection by the Consumer-First Energy Act of
2008 shall be treated as being in effect for any
preceding year beginning before January 1, 2009, solely
for purposes of determining how much of the unused
foreign oil and gas taxes for such unused credit year
may be deemed paid or accrued in such preceding
year.''.
(d) Conforming Amendment.--Section 6501(i) of the Internal Revenue
Code of 1986 is amended by striking ``oil and gas extraction taxes''
and inserting ``foreign oil and gas taxes''.
(e) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2008.
SEC. 103. WINDFALL PROFITS TAX.
(a) In General.--Subtitle E of the Internal Revenue Code of 1986
(relating to alcohol, tobacco, and certain other excise taxes) is
amended by adding at the end thereof the following new chapter:
``CHAPTER 56--WINDFALL PROFITS ON CRUDE OIL
``Sec. 5896. Imposition of tax.
``Sec. 5897. Windfall profit; qualified investment.
``Sec. 5898. Special rules and definitions.
``SEC. 5896. IMPOSITION OF TAX.
``(a) In General.--In addition to any other tax imposed under this
title, there is hereby imposed on any applicable taxpayer an excise tax
in an amount equal to 25 percent of the excess of--
``(1) the windfall profit of such taxpayer, over
``(2) the excess of--
``(A) the amount of the qualified investments of
such applicable taxpayer for such taxable year, over
``(B) the average of the qualified investment of
such applicable taxpayer for taxable years beginning
during the 2002-2006 taxable year period.
``(b) Applicable Taxpayer.--For purposes of this chapter, the term
`applicable taxpayer' means any major integrated oil company (as
defined in section 167(h)(5)(B)).
``SEC. 5897. WINDFALL PROFIT; QUALIFIED INVESTMENT.
``(a) General Rule.--For purposes of this chapter, the term
`windfall profit' means the excess of the adjusted taxable income of
the applicable taxpayer for the taxable year over the reasonably
inflated average profit for such taxable year.
``(b) Adjusted Taxable Income.--For purposes of this chapter, with
respect to any applicable taxpayer, the adjusted taxable income for any
taxable year is equal to the taxable income for such taxable year
(within the meaning of section 63 and determined without regard to this
subsection)--
``(1) increased by any interest expense deduction,
charitable contribution deduction, and any net operating loss
deduction carried forward from any prior taxable year, and
``(2) reduced by any interest income, dividend income, and
net operating losses to the extent such losses exceed taxable
income for the taxable year.
In the case of any applicable taxpayer which is a foreign corporation,
the adjusted taxable income shall be determined with respect to such
income which is effectively connected with the conduct of a trade or
business in the United States.
``(c) Reasonably Inflated Average Profit.--For purposes of this
chapter, with respect to any applicable taxpayer, the reasonably
inflated average profit for any taxable year is an amount equal to the
average of the adjusted taxable income of such taxpayer for taxable
years beginning during the 2002-2006 taxable year period (determined
without regard to the taxable year with the highest adjusted taxable
income in such period) plus 10 percent of such average.
``(d) Qualified Investment.--For purposes of this chapter, the term
`qualified investment' means, with respect to any applicable taxpayer,
means any amount paid or incurred with respect to--
``(1) any qualified facility described in paragraph (1),
(2), (3), (4), (5), (6), (7), or (9) of section 45(d)
(determined without regard to any placed in service date), or
``(2) any facility for the production renewable fuel or
advanced biofuel (as defined in section 211(o) of the Clean Air
Act 942 U.S.C. 7545).
``SEC. 5898. SPECIAL RULES AND DEFINITIONS.
``(a) Withholding and Deposit of Tax.--The Secretary shall provide
such rules as are necessary for the withholding and deposit of the tax
imposed under section 5896.
``(b) Records and Information.--Each taxpayer liable for tax under
section 5896 shall keep such records, make such returns, and furnish
such information as the Secretary may by regulations prescribe.
``(c) Return of Windfall Profit Tax.--The Secretary shall provide
for the filing and the time of such filing of the return of the tax
imposed under section 5896.
``(d) Crude Oil.--The term `crude oil' includes crude oil
condensates and natural gasoline.
``(e) Businesses Under Common Control.--For purposes of this
chapter, all members of the same controlled group of corporations
(within the meaning of section 267(f)) and all persons under common
control (within the meaning of section 52(b) but determined by treating
an interest of more than 50 percent as a controlling interest) shall be
treated as 1 person.
``(f) Regulations.--The Secretary shall prescribe such regulations
as may be necessary or appropriate to carry out the purposes of this
chapter.''.
(b) Clerical Amendment.--The table of chapters for subtitle E of
the Internal Revenue Code of 1986 is amended by adding at the end the
following new item:
``Chapter 56. Windfall Profit on Crude Oil.''.
(c) Deductibility of Windfall Profit Tax.--The first sentence of
section 164(a) of the Internal Revenue Code of 1986 (relating to
deduction for taxes) is amended by inserting after paragraph (5) the
following new paragraph:
``(6) The windfall profit tax imposed by section 5896.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2007.
SEC. 104. ENERGY INDEPENDENCE AND SECURITY TRUST FUND.
(a) Establishment.--Subchapter A of chapter 98 of the Internal
Revenue Code of 1986 (relating to trust fund code) is amended by adding
at the end the following new section:
``SEC. 9511. ENERGY INDEPENDENCE AND SECURITY TRUST FUND.
``(a) Creation of Trust Fund.--There is established in the Treasury
of the United States a trust fund to be known as `Energy Independence
and Security Trust Fund' (referred to in this section as the `Trust
Fund'), consisting of such amounts as may be appropriated or credited
to the Trust Fund as provided in this section or section 9602(b).
``(b) Transfers to Trust Fund.--There is hereby appropriated to the
Trust Fund an amount equivalent to the increase in the revenues
received in the Treasury as the result of the amendments made by
sections 101, 102, and 103 of the Consumer-First Energy Act of 2008.
``(c) Distribution of Amounts in Trust Fund.--Amounts in the Trust
Fund shall be available, as provided by appropriation Acts, for the
purposes of reducing the dependence of the United States on foreign and
unsustainable energy sources and reducing the risks of global warming
through programs and measures that--
``(1) reduce the burdens on consumers of rising energy
prices;
``(2) diversify and expand the use of secure, efficient,
and environmentally-friendly energy supplies and technologies;
``(3) result in net reductions in emissions of greenhouse
gases; and
``(4) prevent energy price gouging, profiteering, and
market manipulation.''.
(b) Clerical Amendment.--The table of sections for subchapter A of
chapter 98 of such Code is amended by adding at the end the following
new item:
``Sec. 9511. Energy Independence and Security Trust Fund.''.
(c) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act.
TITLE II--PRICE GOUGING
SEC. 201. SHORT TITLE.
This title may be cited as the ``Petroleum Consumer Price Gouging
Protection Act''.
SEC. 202. DEFINITIONS.
In this title:
(1) Affected area.--The term ``affected area'' means an
area covered by a Presidential declaration of energy emergency.
(2) Supplier.--The term ``supplier'' means any person
engaged in the trade or business of selling or reselling, at
retail or wholesale, or distributing crude oil, gasoline,
petroleum distillates, or biofuel.
(3) Price gouging.--The term ``price gouging'' means the
charging of an unconscionably excessive price by a supplier in
an affected area.
(4) Unconscionably excessive price.--The term
``unconscionably excessive price'' means an average price
charged during an energy emergency declared by the President in
an area and for a product subject to the declaration, that--
(A)(i)(I) constitutes a gross disparity from the
average price at which it was offered for sale in the
usual course of the supplier's business during the 30
days prior to the President's declaration of an energy
emergency; and
(II) grossly exceeds the prices at which the same
or similar crude oil, gasoline, petroleum distillates,
or biofuel was readily obtainable by purchasers from
other suppliers in the same relevant geographic market
within the affected area; or
(ii) represents an exercise of unfair leverage or
unconscionable means on the part of the supplier,
during a period of declared energy emergency; and
(B) is not attributable to increased wholesale or
operational costs, including replacement costs, outside
the control of the supplier, incurred in connection
with the sale of crude oil, gasoline, petroleum
distillates, or biofuel, and is not attributable to
local, regional, national, or international market
conditions.
(5) Commission.--The term ``Commission'' means the Federal
Trade Commission.
SEC. 203. ENERGY EMERGENCY AND ADDITIONAL PRICE GOUGING ENFORCEMENT.
(a) In General.--During any energy emergency declared by the
President under section 204 of this title, it is unlawful for any
supplier to sell, or offer to sell crude oil, gasoline, petroleum
distillates, or biofuel subject to that declaration in, or for use in,
the area to which that declaration applies at an unconscionably
excessive price.
(b) Factors Considered.--In determining whether a violation of
subsection (a) has occurred, there shall be taken into account, among
other factors, whether--
(1) the price charged was a price that would reasonably
exist in a competitive and freely functioning market; and
(2) the amount of gasoline, other petroleum distillates, or
biofuel the seller produced, distributed, or sold during the
period the Proclamation was in effect increased over the
average amount during the preceding 30 days.
SEC. 204. PRESIDENTIAL DECLARATION OF ENERGY EMERGENCY.
(a) In General.--If the President finds that the health, safety,
welfare, or economic well-being of the citizens of the United States is
at risk because of a shortage or imminent shortage of adequate supplies
of crude oil, gasoline, petroleum distillates, or biofuel due to a
disruption in the national distribution system for crude oil, gasoline,
petroleum distillates, or biofuel (including such a shortage related to
a major disaster (as defined in section 102(2) of the Robert T.
Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C.
5122(2)))), or significant pricing anomalies in national energy markets
for crude oil, gasoline, petroleum distillates, or biofuel the
President may declare that a Federal energy emergency exists.
(b) Scope and Duration.--The emergency declaration shall specify--
(1) the period, not to exceed 30 days, for which the
declaration applies;
(2) the circumstance or condition necessitating the
declaration;
(3) the area or region to which it applies which may not be
limited to a single State; and
(4) the product or products to which it applies.
(c) Extensions.--The President may--
(1) extend a declaration under subsection (a) for a period
of not more than 30 days;
(2) extend such a declaration more than once; and
(3) discontinue such a declaration before its expiration.
SEC. 205. ENFORCEMENT BY THE FEDERAL TRADE COMMISSION.
(a) Enforcement.--This title shall be enforced by the Federal Trade
Commission in the same manner, by the same means, and with the same
jurisdiction as though all applicable terms of the Federal Trade
Commission Act were incorporated into and made a part of this title. In
enforcing section 203 of this title, the Commission shall give priority
to enforcement actions concerning companies with total United States
wholesale or retail sales of crude oil, gasoline, petroleum
distillates, and biofuel in excess of $500,000,000 per year but shall
not exclude enforcement actions against companies with total United
States wholesale sales of $500,000,000 or less per year.
(b) Violation Is Treated as Unfair or Deceptive Act or Practice.--
The violation of any provision of this title shall be treated as an
unfair or deceptive act or practice proscribed under a rule issued
under section 18(a)(1)(B) of the Federal Trade Commission Act (15
U.S.C. 57a(a)(1)(B)).
(c) Commission Actions.--Following the declaration of an energy
emergency by the President under section 204 of this title, the
Commission shall--
(1) maintain within the Commission--
(A) a toll-free hotline that a consumer may call to
report an incident of price gouging in the affected
area; and
(B) a program to develop and distribute to the
public informational materials to assist residents of
the affected area in detecting, avoiding, and reporting
price gouging;
(2) consult with the Attorney General, the United States
Attorney for the districts in which a disaster occurred (if the
declaration is related to a major disaster), and State and
local law enforcement officials to determine whether any
supplier in the affected area is charging or has charged an
unconscionably excessive price for crude oil, gasoline,
petroleum distillates, or biofuel in the affected area; and
(3) conduct investigations as appropriate to determine
whether any supplier in the affected area has violated section
203 of this title, and upon such finding, take any action the
Commission determines to be appropriate to remedy the
violation.
SEC. 206. ENFORCEMENT BY STATE ATTORNEYS GENERAL.
(a) In General.--A State, as parens patriae, may bring a civil
action on behalf of its residents in an appropriate district court of
the United States to enforce the provisions of section 203 of this
title, or to impose the civil penalties authorized by section 207 for
violations of section 203, whenever the attorney general of the State
has reason to believe that the interests of the residents of the State
have been or are being threatened or adversely affected by a supplier
engaged in the sale or resale, at retail or wholesale, or distribution
of crude oil, gasoline, petroleum distillates, or biofuel in violation
of section 203 of this title.
(b) Notice.--The State shall serve written notice to the Commission
of any civil action under subsection (a) prior to initiating the
action. The notice shall include a copy of the complaint to be filed to
initiate the civil action, except that if it is not feasible for the
State to provide such prior notice, the State shall provide such notice
immediately upon instituting the civil action.
(c) Authority To Intervene.--Upon receiving the notice required by
subsection (b), the Commission may intervene in the civil action and,
upon intervening--
(1) may be heard on all matters arising in such civil
action; and
(2) may file petitions for appeal of a decision in such
civil action.
(d) Construction.--For purposes of bringing any civil action under
subsection (a), nothing in this section shall prevent the attorney
general of a State from exercising the powers conferred on the Attorney
General by the laws of such State to conduct investigations or to
administer oaths or affirmations or to compel the attendance of
witnesses or the production of documentary and other evidence.
(e) Venue; Service of Process.--In a civil action brought under
subsection (a)--
(1) the venue shall be a judicial district in which--
(A) the defendant operates;
(B) the defendant was authorized to do business; or
(C) where the defendant in the civil action is
found;
(2) process may be served without regard to the territorial
limits of the district or of the State in which the civil
action is instituted; and
(3) a person who participated with the defendant in an
alleged violation that is being litigated in the civil action
may be joined in the civil action without regard to the
residence of the person.
(f) Limitation on State Action While Federal Action Is Pending.--If
the Commission has instituted a civil action or an administrative
action for violation of this title, a State attorney general, or
official or agency of a State, may not bring an action under this
section during the pendency of that action against any defendant named
in the complaint of the Commission or the other agency for any
violation of this title alleged in the Commission's civil or
administrative action.
(g) No Preemption.--Nothing contained in this section shall
prohibit an authorized State official from proceeding in State court to
enforce a civil or criminal statute of that State.
SEC. 207. PENALTIES.
(a) Civil Penalty.--
(1) In general.--In addition to any penalty applicable
under the Federal Trade Commission Act, any supplier--
(A) that violates section 203 of this title is
punishable by a civil penalty of not more than
$1,000,000; and
(B) that violates section 203 of this title is
punishable by a civil penalty of--
(i) not more than $500,000, in the case of
an independent small business marketer of
gasoline (within the meaning of section 324(c)
of the Clean Air Act (42 U.S.C. 7625(c))); and
(ii) not more than $5,000,000 in the case
of any other supplier.
(2) Method.--The penalties provided by paragraph (1) shall
be obtained in the same manner as civil penalties imposed under
section 5 of the Federal Trade Commission Act (15 U.S.C. 45).
(3) Multiple offenses; mitigating factors.--In assessing
the penalty provided by subsection (a)--
(A) each day of a continuing violation shall be
considered a separate violation; and
(B) the court shall take into consideration, among
other factors, the seriousness of the violation and the
efforts of the person committing the violation to
remedy the harm caused by the violation in a timely
manner.
(b) Criminal Penalty.--Violation of section 203 of this title is
punishable by a fine of not more than $5,000,000, imprisonment for not
more than 5 years, or both.
SEC. 208. EFFECT ON OTHER LAWS.
(a) Other Authority of the Commission.--Nothing in this title shall
be construed to limit or affect in any way the Commission's authority
to bring enforcement actions or take any other measure under the
Federal Trade Commission Act (15 U.S.C. 41 et seq.) or any other
provision of law.
(b) State Law.--Nothing in this title preempts any State law.
TITLE III--STRATEGIC PETROLEUM RESERVE
SEC. 301. SUSPENSION OF PETROLEUM ACQUISITION FOR STRATEGIC PETROLEUM
RESERVE.
(a) In General.--Except as provided in subsection (b) and
notwithstanding any other provision of law, during the period beginning
on the date of enactment of this Act and ending on December 31, 2008--
(1) the Secretary of the Interior shall suspend acquisition
of petroleum for the Strategic Petroleum Reserve through the
royalty-in-kind program; and
(2) the Secretary of Energy shall suspend acquisition of
petroleum for the Strategic Petroleum Reserve through any other
acquisition method.
(b) Resumption.--Not earlier than 30 days after the date on which
the President notifies Congress that the President has determined that
the weighted average price of petroleum in the United States for the
most recent 90-day period is $75 or less per barrel--
(1) the Secretary of the Interior may resume acquisition of
petroleum for the Strategic Petroleum Reserve through the
royalty-in-kind program; and
(2) the Secretary of Energy may resume acquisition of
petroleum for the Strategic Petroleum Reserve through any other
acquisition method.
(c) Existing Contracts.--In the case of any oil scheduled to be
delivered to the Strategic Petroleum Reserve pursuant to a contract
entered into by the Secretary of Energy prior to, and in effect on, the
date of enactment of this Act, the Secretary shall, to the maximum
extent practicable, negotiate a deferral of the delivery of the oil for
a period of not less than 1 year, in accordance with procedures of the
Department of Energy in effect on the date of enactment of this Act for
deferrals of oil.
TITLE IV--NO OIL PRODUCING AND EXPORTING CARTELS
SEC. 401. NO OIL PRODUCING AND EXPORTING CARTELS ACT OF 2008.
(a) Short Title.--This section may be cited as the ``No Oil
Producing and Exporting Cartels Act of 2008'' or ``NOPEC''.
(b) Sherman Act.--The Sherman Act (15 U.S.C. 1 et seq.) is amended
by adding after section 7 the following:
``SEC. 7A. OIL PRODUCING CARTELS.
``(a) In General.--It shall be illegal and a violation of this Act
for any foreign state, or any instrumentality or agent of any foreign
state, to act collectively or in combination with any other foreign
state, any instrumentality or agent of any other foreign state, or any
other person, whether by cartel or any other association or form of
cooperation or joint action--
``(1) to limit the production or distribution of oil,
natural gas, or any other petroleum product;
``(2) to set or maintain the price of oil, natural gas, or
any petroleum product; or
``(3) to otherwise take any action in restraint of trade
for oil, natural gas, or any petroleum product;
when such action, combination, or collective action has a direct,
substantial, and reasonably foreseeable effect on the market, supply,
price, or distribution of oil, natural gas, or other petroleum product
in the United States.
``(b) Sovereign Immunity.--A foreign state engaged in conduct in
violation of subsection (a) shall not be immune under the doctrine of
sovereign immunity from the jurisdiction or judgments of the courts of
the United States in any action brought to enforce this section.
``(c) Inapplicability of Act of State Doctrine.--No court of the
United States shall decline, based on the act of state doctrine, to
make a determination on the merits in an action brought under this
section.
``(d) Enforcement.--The Attorney General of the United States may
bring an action to enforce this section in any district court of the
United States as provided under the antitrust laws.''.
(c) Sovereign Immunity.--Section 1605(a) of title 28, United States
Code, is amended--
(1) in paragraph (6), by striking ``or'' after the
semicolon;
(2) in paragraph (7), by striking the period and inserting
``; or''; and
(3) by adding at the end the following:
``(8) in which the action is brought under section 7A of
the Sherman Act.''.
TITLE V--MARKET SPECULATION
SEC. 501. SPECULATIVE LIMITS AND TRANSPARENCY FOR OFF-SHORE OIL
TRADING.
Section 4 of the Commodity Exchange Act (7 U.S.C. 6) is amended by
adding at the end the following:
``(e) Foreign Boards of Trade.--
``(1) In general.--In the case of any foreign board of
trade for which the Commission has granted or is considering an
application to grant a board of trade located outside of the
United States relief from the requirement of subsection (a) to
become a designated contract market, derivatives transaction
execution facility, or other registered entity, with respect to
an energy commodity that is physically delivered in the United
States, prior to continuing to or initially granting the
relief, the Commission shall determine that the foreign board
of trade--
``(A) applies comparable principles or requirements
regarding the daily publication of trading information
and position limits or accountability levels for
speculators as apply to a designated contract market,
derivatives transaction execution facility, or other
registered entity trading energy commodities physically
delivered in the United States; and
``(B) provides such information to the Commission
regarding the extent of speculative and nonspeculative
trading in the energy commodity that is comparable to
the information the Commission determines necessary to
publish a Commitment of Traders report for a designated
contract market, derivatives transaction execution
facility, or other registered entity trading energy
commodities physically delivered in the United States.
``(2) Existing foreign boards of trade.--During the period
beginning 1 year after the date of enactment of this subsection
and ending 18 months after the date of enactment of this
subsection, the Commission shall determine whether to continue
to grant relief in accordance with paragraph (1) to any foreign
board of trade for which the Commission granted relief prior to
the date of enactment of this subsection.''.
SEC. 502. MARGIN LEVEL FOR CRUDE OIL.
(a) In General.--Section 2(a)(1) of the Commodity Exchange Act (7
U.S.C. 2(a)(1)) is amended by adding at the end the following:
``(G) Margin level for crude oil.--Not later than
90 days after the date of enactment of this
subparagraph, the Commission shall promulgate
regulations to set a substantial increase in margin
levels for crude oil traded on any trading facility or
as part of any agreement, contract, or transaction
covered by this Act in order to reduce excessive
speculation and protect consumers.''.
(b) Studies.--
(1) Study relating to effect of certain regulations.--Not
later than 1 year after the date of enactment of this Act, the
Commodity Futures Trading Commission shall submit to the
appropriate committees of Congress a report describing the
effect of the amendment made by subsection (a) on any trading
facilities and agreements, contracts, and transactions covered
by the Commodity Exchange Act (7 U.S.C. 1 et seq.).
(2) Study relating to effects of changes in margin
levels.--Not later than 180 days after the date of enactment of
this Act, the Comptroller General of the United States shall
submit to the appropriate committees of Congress a report
describing the effect (including any effect relating to trade
volume or volatility) of any change of a margin level that
occurred during the 10-year period ending on the date of
enactment of this Act.
Calendar No. 743
110th CONGRESS
2d Session
S. 3044
_______________________________________________________________________
A BILL
To provide energy price relief and hold oil companies and other
entities accountable for their actions with regard to high energy
prices, and for other purposes.
_______________________________________________________________________
May 21, 2008
Read the second time and placed on the calendar