The Federal Trade Commission, countering the latest business attack on the agency's antitrust and consumer protection powers, has notified Congress that it vigorously opposes any attempt to bar the agency from regulating doctors, lawyers and other professional groups.
FTC Chairman James C. Miller III, in a letter to Senate Commerce Committee Chairman Bob Packwood (R-Ore.), warned that to prohibit his agency from dealing with the advertising, pricing and trade practices of professional groups would suggest simply "that certain persons are beyond the rules by which other members of our society are governed."
The letter was sent just two weeks before the Commerce Committee is scheduled to open hearings on the legislative reauthorization of the FTC. The current authorization expires this fall.
The business community, which successfully managed to curb much of the FTC's authority when the agency's authorization expired three years ago, now is seeking further limits on the agency to make it harder to bring suits against unfair trade practices.
Additionally, the American Bar Association, American Medical Association and other professional groups are urging Congress to reconsider a proposal that would limit one of the FTC's most active crackdowns: pricing and advertising restrictions of doctors, lawyers and other professions. A similar proposal was made three years ago and failed to pass the Senate by only two votes.
With the unanimous support of his fellow commissioners, Miller defended the FTC's investigations into the professions, saying the commission is concerned that some of the restrictions "increase consumer costs without producing countervailing benefits."
A special exemption from the FTC's antitrust laws for professionals therefore "would be particularly unwise," Miller said.
The commission's position is supported strongly by key Commerce Committee members, including Packwood and Sen. Robert Kasten (R-Wis.), the chairman of the Commerce consumer subcommittee, who recently issued statements denouncing attempts to curb the FTC's antitrust authority.
Miller, however, did indicate that the commission would not be adverse to new legislation that would define more clearly the agency's ability to bring lawsuits and issue rules against unfair trade practices.
He said the legislation should make clear that, before the commission acts, it should be sure that the unfair trade practice presented a substantial harm and was not outweighed by its benefits.
"In reaching its decision, the commission should take into account costs related to a prospective remedy, including . . . direct cost to the parties, increased paperwork and regulatory burdens, reduced incentives for innovation and capital formation and like matters," Miller wrote.
Yet, Miller acknowledged, in some cases, weighing costs and benefits could "unnecessarily complicate and delay an investigation" or ligitation, making it necessary that the commission not be required to conduct such an analysis in every case.
Commissioner Michael Pertschuk argued that no changes should be made to the FTC's unfair jurisdiction. Although the changes suggested by Miller only reflect current FTC policy, Pertschuk indicated he was concerned that once Congress tried to write that policy into law, tighter restrictions could be imposed, making it very difficult for the commission to bring unfair trade cases.