Citations
- 465 F.2d 542
Full opinion text
TAMM, Circuit Judge:
After nearly a decade of litigation we are called upon to examine the ramifications of the Supreme Court’s decision in Federal Maritime Comm. v. Aktiebolaget Svenska Amerika Linien, 390 U.S. 238, 88 S.Ct. 1005, 19 L.Ed.2d 1071 (1968), and decide whether the Federal Maritime Commission’s instant order is in accordance with relevant law and supported by substantial evidence. Answering these questions in the affirmative, we affirm the order under review.
This is a petition for review of an order of the Commission amending a dual rate contract system to permit ocean shippers and receivers to separately contract for the carriage of goods under preferential rates in each of five trade areas served by petitioner, the Latin America/Pacific Coast Steamship Conference. Petitioners’ existing exclusive patronage dual rate contract requires shippers, in order to obtain lower rates, to give their exclusive patronage to petitioners in all three outbound trades served by petitioners, and similarly requires receivers, in order to obtain lower rates, to do likewise with reference to petitioners’ two inbound trades.
I. History of Proceedings
A. Phase One
The long procedural tangle in the instant case had its beginning in January of 1962 when petitioner, pursuant to section 15 of the Shipping Act (hereinafter the “Act”), filed for approval of Agreement No. 8660 which created the Latin America/Pacific Coast Steamship Conference, superseding ten previously independent conferences serving inbound and outbound trade between the Pacific Coast of the United States and Latin America. Dividing the trade into five areas, the agreement provided that, although all members of the conference had a vote with reference to general matters, only those carriers actively serving a particular trade area could participate in the establishment of rates and related matters affecting that area. While the Commission was considering Agreement No. 8660, petitioners filed proposed dual rate contracts for Commission approval under section 14b of the Act. Under these contracts, shippers of goods in any of the outbound trade areas were committed to exclusive use of conference vessels in all three outbound trade areas, while receivers were obligated to exclusive use of conference vessels in both inbound trade areas.
After consideration of the record, the Commission rendered its decision in The Dual Rate Cases, 8 F.M.C. 16 (1964), which approved petitioners’ Agreement No. 8660 and the dual rate contracts subject to the condition that petitioners offer their dual rate contracts to merchants on a separate basis in each of the five trade areas. The Commission expressed its concern stating that
if the conference is permitted to offer a single dual rate contract which includes all five of the trade areas, merchants will be forced to obligate themselves to exclusive conference patronage in trade areas not desired in order to obtain contract rates in a trade area where they feel the dual rate contract meets their needs. This seems to us neither necessary nor fair.
Id. at 50.
Petitioners and two other conferences filed petitions for review of the Commission’s decision in the Ninth Circuit, which, although remanding for certain procedural infirmities, affirmed the Commission with respect to its section 14b actions. Pacific Coast European Conference v. United States, 350 F.2d 197 (9th Cir.), cert. denied, 382 U.S. 958, 86 S.Ct. 433, 15 L.Ed.2d 362 (1965). On petition for rehearing, however, the Ninth Circuit, in an unpublished per curiam opinion, set aside the five-contract separability condition imposed by the Commission.
B. Phase Two
Following remand, the Commission instituted a rule making proceeding to determine whether the “one trade-one contract” requirement should be reimposed. As a result of petitioners’ challenge to the rule making format, a full evi-dentiary hearing was held, at the conclusion of which, the examiner, in an initial decision, upheld petitioners’ dual rate contracts under section 14b. However, upon exception, the Commission once again imposed the condition that the conference offer its dual rate contract in each of the five trade areas, relying upon the failure of petitioner to meet the “public interest” standard promulgated by the Commission in Investigation of Passenger Travel Agents, 10 F. M.C. 27 (1966), and affirmed by the Supreme Court in Federal Maritime Comm. v. Aktiebolaget Svenska Amerika Linien, supra, 390 U.S. at 243, 88 S.Ct. at 1009 wherein the Court upheld the Commission’s test that
conference restraints which interfere with the policies of antitrust laws will be approved only if the conferences can “bring forth such facts as would demonstrate that the [restraint] was required by a serious transportation need, necessary to secure important public benefits or in furtherance of a valid regulatory purpose of the Shipping Act.”
C. Phase Three
The Conference, again protesting the decision moved the Commission to reopen the proceeding to afford it an opportunity to meet the new burden of proof imposed by Svenska. The Commission, acquiescing in a reopening, nevertheless, reaffirmed its previous “one trade-one contract” decision rejecting the examiner’s initial decision once again. The Commission, noting that “the exclusive patronage tying arrangement embodied in a dual rate contract would clearly run counter to the antitrust laws,” (J.A. 177-78) concluded, that, under Svenska, this fact standing alone rendered petitioners’ dual rate contracts “contrary to the public interest,” and shifted the burden to petitioners of introducing “other evidence in the record [which] fairly detracts from the weight of this factor [antitrust conflict]” by demonstrating “the necessity for this restraint in terms of legitimate commercial objectives.” Federal Maritime Comm. v. Aktiebolaget Svenska Amerika Linien, supra, 390 U.S. at 244, 246, 88 5. Ct. at 1009. Examining petitioners’ evidence, the Commission “remain[ed] unconvinced . . . that the present so-called single-contract system is required by some serious transportation need, necessary to secure important public benefits or in furtherance of any valid regulatory purpose of the Shipping Act.” (J.A. 178). The Commission concluded that much of petitioners’ evidence confused advantages attributable to the conference format with those resulting from the dual rate contracts and accordingly ruled against petitioners.
Before turning to the specific arguments advanced and issues raised on appeal, it will, in our view, facilitate matters to briefly examine the nature of the antitrust-regulatory conflict and cursorily survey the vagaries of the ocean shipping industry.
II. Accommodation of Regulatory and Antitrust Policies
Forced to steer a course between a regulatory Scylla and an antitrust Charybdis, we pause for a moment to reflect upon the rhyme and reason of our voyage.
Although the policies underlying the antitrust laws and the regulatory agency statutes are conflicting, their purposes — -service to the public — are complementary. As we indicated in Northern Natural Gas Co. v. Federal Power Comm., 130 U.S.App.D.C. 220, 226, 399 F.2d 953, 959 (1968), they both attempt to “achieve the most efficient allocation of resources possible” and to “establish an atmosphere which will stimulate innovations for better service at a lower cost.” See also Symposium on ‘Regulated’ Industries and Antitrust, 32 A.B.A. Antitrust L.J. 239-41 (1966).
It is all too clear that “[t]he general objective of the antitrust laws is promotion of competition in open markets.” As Justice Black has eloquently observed, “[the antitrust laws were] designed to be a comprehensive charter of economic liberty aimed at preserving free and unfettered competition as the rule of trade. [They rest] on the premise that the unrestrained interaction of competitive forces will yield the best allocation of our .economic resources, the lowest prices, the highest quality and the greatest material progress, while at the same time providing an environment conducive to the preservation of our democratic political and social institutions.” Northern Pacific Railway Co. v. United States, 356 U.S. 1, 4, 78 S.Ct. 514, 517, 2 L.Ed.2d 545 (1958). The Supreme Court has “long recognized that the antitrust laws represent a fundamental national economic policy . . .,” Carnation Co. v. Pacific West-bound Conference, 383 U.S. 213, 218, 86 S.Ct. 781, 784, 15 L.Ed.2d 709 (1966), and often commented upon the “indispensable role of antitrust policy in the maintenance of a free economy.” United States v. Philadelphia National Bank, 374 U.S. 321, 348, 83 S.Ct. 1715, 1733, 10 L.Ed.2d 915 (1963). See Marine Space Enclosures, Inc. v. Federal Maritime Comm., 137 U.S.App.D.C. 9, 420 F.2d 577 (1969); Pacific Seafarers, Inc. v. Pacific Far East Line Inc., 131 U.S.App.D.C. 226, 237, 404 F.2d 804, 815 (1969). Indeed, they have been deemed important enough to be denominated the “Magna Charta of free enterprise.” United States v. Topco Associates, Inc., 405 U.S. 596, 610, 92 S.Ct. 1126, 1135, 31 L.Ed.2d 515 (1972).
There are, on the other hand, particular economic or social objectives sought by Congress which are unattainable through the free forces of competition. In seeking these goals Congress has therefore established regulatory agencies to supervise certain industries. “Regulation of a specific industry . ‘evidences congressional recognition that competition can assure protection of the public interest only in an industrial setting which is conducive to a free market and can have no place in industries which are monopolies because of public grant, the exigencies of nature, or legislative preference for a particular way of doing business.’ ” S. S. W., Inc. v. Air Transport Ass’n of America, 89 U.S.App.D.C. 273, 276, 191 F.2d 658, 661 (1951). “Of course, the fact that there is substantial regulation does not preclude the regulatory agency from drawing on competition for complementary or auxiliary support. Satisfactory accommodation of the peculiarities of individual industries to the demands of the public interest necessarily requires in each case a blend of private forces and public intervention.” Federal Communications Comm. v. RCA Communications, Inc., 346 U.S. 86, 93-94, 73 S.Ct. 998, 1003, 97 L.Ed. 1470 (1953).
In those areas in which Congress has felt that competition is less appropriate, it has exempted the industries from the operation of the antitrust laws. See C. Kaysen & D. Turner, Antitrust Policy 41-43 (1959). The reasons generally advanced for these exemptions are: 1) disparity of economic power; 2) assistance for American businessmen against foreign competition; 3) incentives for research and development; 4) national defense needs; 5) maintenance of favorable federal-state relations; 6) the inherent nature of the activity; and 7) tradition.
Various tests have been proposed for determining when antitrust exemptions should be granted. The better school of thought is that no exemptions should be permitted unless necessary to carry out the purpose of the statute. Thill Securities Corp. v. New York Stock Exchange, 433 F.2d 264, 268 (7th Cir. 1970), cert. denied, 401 U.S. 994, 91 S.Ct. 1232, 28 L.Ed.2d 532 (1971) quoting Silver v. New York Stock Exchange, 373 U.S. 341, 357, 83 S.Ct. 1246, 10 L.Ed.2d 389 (1963). See also, Comment, Accommodations of Antitrust Law and Ocean Shipping Regulation, 4 Texas Int’l L. Forum 393, 409-12 (1968). An opposing school of thought is that once a regulatory agency has intervened in an industry, the antitrust laws should not apply unless the agency cannot effectively regulate the industry. Hale & Hale, Competition or Control VI: Application of Antitrust Laws to Regulated Industries, 111 U.Pa.L.Rev. 46, 58-59 (1962).
Some of the antitrust exemptions have been explicitly set forth in regulatory statutes. E. g., Shipping Act, 46 U.S.C. § 814; Federal Communications Act, 47 U.S.C. §§ 221(a), 222(c) (1); Federal Aviation Act, 49 U.S.C. § 1384; Interstate Commerce Act, 49 U.S.C. §§ 5(11), 5b, 9; Webb-Pomerene Act, 15 U.S.C. § 62. These exemptions must in any event be narrowly construed. Maryland & Virginia Milk Producers Association, Inc. v. United States, 362 U.S. 458, 80 S.Ct. 847, 4 L.Ed.2d 880 (1960); United States v. McKesson & Robbins, Inc., 351 U.S. 305, 316, 76 S.Ct. 937, 100 L.Ed. 1209 (1956).
Where the exemptions are not express, they must of course be inferentially gleaned, if at all, from the statute. However, we cannot overemphasize that “immunity from antitrust laws ‘is not lightly implied.’ ” United States v. First City National Bank of Houston, 386 U.S. 361, 368, 87 S.Ct. 1088, 1093, 18 L.Ed.2d 151 (1967) quoting California v. Federal Power Comm., 369 U.S. 482, 485, 82 S.Ct. 901, 8 L.Ed.2d 54 (1962). See Georgia v. Pennsylvania R. R. Co., 324 U.S. 439, 456, 65 S.Ct. 716, 89 L.Ed. 1051 (1945). This cardinal rule of construction disfavoring lacunae in the application of antitrust laws has been applied to a myriad of industries faithfully catalogued in the following cases. Northern Natural Gas Co. v. Federal Power Comm., supra, ISO U.S.App.D.C. at 226-227, 399 F.2d at 959-960; Alabama Power Co. v. Alabama Electric Cooperative, Inc., 394 F.2d 672, 682-683 (5th Cir. 1968) (Godbold, J., dissenting). Indeed, there is a presumption that antitrust principles apply unless a contrary intent appears expressly or by necessary implication. Cities of Statesville v. Atomic Energy Comm., 142 U.S.App.D.C. 272, 297, 441 F.2d 962, 987 (1969) (en banc) (Leventhal, J., concurring). See also Sabre Shipping Corp. v. American President Lines, Ltd., 285 F.Supp. 949, 953 (S.D.N.Y.1968), cert. denied sub nom., Japan Line Ltd. v. Sabre Shipping Corp., 395 U.S. 922, 89 S.Ct. 1774, 23 L.Ed.2d 239 (1969). As the Supreme Court has emphasized, “[r]epeals of the antitrust laws by implication from a regulatory statute are strongly disfavored, and have only been found in cases of plain repugnancy between the antitrust and regulatory provisions.” United States v. Philadelphia National Bank, supra, 374 U.S. at 350-351, 83 S.Ct. at 1734 (footnotes omitted) and authorities cited therein. See S. S. W., Inc. v. Air Transport Ass’n. of America, supra, 89 U.S.App.D.C. at 276, 191 F.2d at 661 (1951). Even where the agency’s particular statutory standard requires that it override antitrust principles, this “does not compel unawareness of antitrust policies, and the agency may well be able to harmonize diverse and even competing policies.” Cities of Statesville v. Atomic Energy Comm., supra, 142 U.S.App.D.C. at 297, 441 F.2d at 987 (Leventhal, J., concurring). See McLean Trucking Co. v. United States, 321 U.S. 67, 79, 64 S.Ct. 370, 88 L.Ed. 544 (1944). In essence then, the duty of the agencies and courts is to accommodate or harmonize antitrust and regulatory principles. See Seaboard Airlines R. R. v. United States, 382 U.S. 154, 156, 86 S.Ct. 277, 15 L.Ed. 2d 223 (1965) quoting Minneapolis & St. L. Ry. v. United States, 361 U.S. 173, 80 S.Ct. 229, 4 L.Ed.2d 223 (1959). Indeed, regulatory agencies have long used the antitrust laws to give “understandable content to the broad statutory concept of ‘the public interest’ ” often found in their statutory charters. Federal Maritime Comm. v. Aktiebolaget Svenska Amerika Linien, supra,, 390 U.S. at 244, 88 S.Ct. 1005. See Volkswagenwerk Aktiengesellschaft v. Federal Maritime Comm., 390 U.S. 261, 274 n. 20, 88 S.Ct. 929, 19 L.Ed.2d 1090 (1968); Denver & Rio Grande Western R. R. Co. v. United States, 387 U.S. 485, 492-494, 87 S.Ct. 1754, 18 L.Ed.2d 905 (1967); California v. Federal Power Comm., supra, 369 U.S. at 484-485, 82 S.Ct. 901; United States v. Radio Corporation of America, 358 U.S. 334, 351, 79 S.Ct. 457, 3 L.Ed. 2d 354 (1959); McLean Trucking Co. v. United States, supra, 321 U.S. at 79-80, 64 S.Ct. 370; and City of Pittsburgh v. Federal Power Comm., 99 U.S.App.D.C. 113, 237 F.2d 741 (1956).
With this background we now proceed to an examination of the ocean shipping industry in light of the relevant criteria including “the specific language of the congressional statute involved, any legislative history which would throw light on the congressional intent, the relative importance of the governmental action which is asserted to override antitrust policy, whether the governmental agency is required to take into consideration the possible anticompetitive effect of its actions, whether the agency is required to adhere to a clearly defined and restricted statutory directive, and to what extent the agency’s actions are subject to judicial review.” Hecht v. Pro-Football Inc., 144 U.S.App.D.C. 56, 60, 444 F.2d 931, 935 (1971).
III. The Ocean Shipping Industry— Statutory Framework and Svenska
A. The Shipping Act of 1916 — Rationale and Content
Shipping conferences, organizations of steamship lines whose members regularly transport cargo, were organized to limit the competition which would otherwise exist between its members and to insulate member carriers from non-member carrier competition. Conferences were found necessary to combat the cutthroat competition and resulting business failures among shipping lines which often depressed the rates charged by the carriers to the cost of the voyage itself. Once established, the conference members agreed among themselves upon matters such as rates, market quotas and sailing dates.
The six economic factors most frequently cited to justify the existence of the conference system are: 1) ease of market entry; 2) the industry’s rigid fixed and operating cost structure; 3) the absence of any governmental control over the level of ocean freight rates; 4) the difference in operating costs of similar vessels flying different flags; 5) the almost invariable imbalance between inbound and outbound cargo; and 6) over-tonnaging.
In the early part of the twentieth century these conferences came under close scrutiny by the British Royal Commission on Shipping Rings which published a report in 1909. After extended study the Commission concluded that conferences should be permitted to continue since they encouraged regular dependable service at relatively stable rates. Several years after the report of the Royal Commission the House Committee on the Merchant Marine and Fisheries, of which Representative J. W. Alexander was chairman, undertook an exhaustive inquiry into the practices of shipping conferences. The Committee’s findings, contained in what has become known as the Alexander Report, resulted in the conclusion that while certain conference practices needed correcting, the conference system as a whole was a worthwhile device. Among the advantages listed were those such as “greater regularity and frequency of service, stability and uniformity of rates, economy in the cost of service, better distribution of sailings, maintenance of American and European rates to foreign markets on a parity, and" equal treatment of shippers through the elimination of secret arrangements and underhanded methods of discrimination.” The Report concluded that these advantages could only be preserved “by permitting the several lines in any given trade to cooperate through some form of rate and pooling arrangement under Government supervision and control.”
The basic recommendations of the Alexander Report were enacted into law by Congress in the Shipping Act of 1916. Section 15 of the Act required certain conference agreements to be filed with an appropriate governmental body for approval. Approved agreements were exempted from the antitrust laws. Other sections of the act prohibited certain prevalent anticompetitive and discriminatory practices. The Act did not, however, speak to another anticompetitive device — dual rates — subsequently adopted by many conferences.
The dual rate system was successfully employed by conferences until the Supreme Court’s decision in Federal Maritime Board v. Isbrandtsen Co., 356 U.S. 481, 78 S.Ct. 851, 2 L.Ed.2d 926 (1958), where the Court held that such agreements were illegal “where they [were] employed as predatory devices.” Id. at 499, 78 S.Ct. at 862. The Court’s decision, casting a pall over dual rate contracts, prompted the Congress to enact interim legislation to neutralize the Court’s holding by preserving the legality of dual rate contracts in effect at the time of the Isbrandtsen decision. Following an extensive three year investigation, the Congress enacted permanent legislation, the 1961 amendments to the Shipping Act.
B. The 1961 Amendments to the Shipping Act
Three subcommittees of Congress — the Antitrust Subcommittee of the House Judiciary Committee, the Subcommittee on Steamship Conferences of the House Merchant Marine and Fisheries Committee, and the Merchant Marine and Fisheries Subcommittee of the Senate Commerce Committee — conducted exhaustive investigations into the operations of shipping conferences in international trade. The House Merchant Marine and Fisheries Committee concluded that dual rate contracts were necessary to ensure strong conferences, which, although not flawless, did offer certainty of rates and scheduling redounding to the benefit of all. The Antitrust Subcommittee of the House Committee on the Judiciary, naturally more antitrust oriented, placed greater emphasis upon the predatory anticompetitive devices of the conferences. “The Bill which was finally passed in the House reflected the fundamental conflict in approach to the regulation of the industry pursued and adopted by the two committees.” American Export Isbrandtsen Lines v. Federal Maritime Comm., 127 U.S.App.D.C. 62, 70, 380 F.2d 609, 617 (1967).
The Senate hearings were primarily concerned with reconciling some of the contradictory provisions in the House bill. The bill as reported out by the Senate was more antitrust exemption oriented than that which passed the House. The bill as finally reported out by the House-Senate Conference and enacted into law adopted essentially the Senate approach. As we have said it was “largely a triumph for the conference interests in that most of the antitrust aspects of the legislation were deleted and dual rate contracts were legalized.” American Export Isbrandtsen Lines v. Federal Maritime Comm., supra, 127 U.S.App.D.C. at 70, 380 F.2d at 617.
The 1961 amendments made for our purposes several relevant changes in the law. Section 15 was amended to provide considerably broader Commission authority by permitting disapproval of-any conference agreement found to be-“contrary to the public interest.’’ Section 14b, the heart of the 1961 amendments, was added to provide that"
the . . . Commission shall . . . permit [dual rate agreements] . . . unless the Commission finds that the contract . will be detrimental to the commerce of the United States or contrary to the public interest, or unjustly discriminatory or unfair as between shippers, exporters, importers, or ports, or between exporters from the United States and their foreign competitors.
In addition to the above requirements, Congress provided that in order to obtain Commission approval under § 14b, dual rate agreements must meet eight other specific requirements as well as a ninth requirement that the contract shall contain “such other provisions not inconsistent herewith as the Commission shall require or permit.”
C. Svenska
The 1961 amendments came before the Supreme Court for the first time in Svenska. In that case the Court upheld the Commission’s requirement that conference restraints which interfere with the policies of the antitrust laws be approved only if the conference can bring forth such facts as would “demonstraté that the [restraint is] required by a serious transportation need, [or in order] .to secure important public benefits.” The Court concluded that the 1961 amendments did not confer absolute antitrust immunity on conferences and that the test formulated by the Commission was an appropriate refinement of the “public interest” standard added to § 15 by the 1961 amendments.
IV. The Issues and their Resolution
On appeal petitioners advance several theories for setting aside the Commission’s order. Distilled to the essence, these theories number two. First, petitioners urge that the Commission committed error in relying upon the rationale and standards of Svenska in that the “principles were intended to apply only to § 15 of the Act, not § 14b. Further-more, they urge that the unique factual circumstances in Svenska bar its application to the instant case. Petitioners’ second contention is that even if we should find that the Commission’s simulated Svenska test used in the case sub judice is proper, the Commission misapplied it and improperly evaluated the evidence in arriving at its conclusion.
A. Commission Properly Found that the Rationale and Standards of Svenska Apply
The Commission relied upon Svenska in two ways. First, it used Svenska to find that under § 14b incompatibility with the antitrust laws is a sufficient reason for denying immunity from these laws. Second, it relied upon Svenska to justify placing the burden of proof upon petitioners. Although not without difficulty, we must conclude that these dual applications of Svenska are neither arbitrary nor capricious.
1. Svenska: Antitrust Immunity
Petitioners’ contention that the purpose of the statutory scheme would be defeated if incompatibility with the antitrust laws can be a sufficient reason for denying immunity from these laws is untenable. As the Court recognized in Federal Maritime Comm. v. Aktiebolaget Svenska Amerika Linien, supra, 390 U.S. at 242-243, 88 S.Ct. 1005, the Shipping Act of 1916 conferred only limited antitrust immunity upon the shipping industry. We have recently made mention of this very fact in Seatrain Lines, Inc. v. Federal Maritime Comm., 460 F.2d 932 at 940 (D.C. Cir. March 23, 1972) where we observed
that Congress intended to tolerate only the minimum anticompetitive behavior necessary to preserve an essentially competitive structure in the maritime industry by striving to avoid either the failure or consolidation of independent steamship lines by the method of government supervision of anticompetitive working arrangements. While Congress recognized that in order to accomplish this result a measure of competition might have to be sacrificed, such as permitting agreement on rates or pooling of earnings, it did not intend thereby to remove all effective competition. (Emphasis supplied).
The 1961 amendments were not intended to do away with this limited immunity. As the Senate Report indicated :
The hearings of the committee have made it quite clear that our traditional antitrust concepts cannot be fully applied to this aspect of international commerce. Your committee has concluded that any attempt to effect regulation of this commerce in a measure comparable to that applied to our domestic commerce would be highly detrimental to our essential American-flag merchant marine. (Emphasis supplied).
The House Report similarly commented that “[t]he committee believes that the present bill represents a minimum but necessary deviation from the concepts of the antitrust law.” (Emphasis supplied)
It is noteworthy that the 1961 amendments articulated a “public interest” standard couched in substantially similar language in both sections 15 and 14b. The Court in Svenska indicated that the “public interest” standard embodied in section 15 included antitrust considerations. We see no reason to reach a different conclusion with regard to section 14b in light of the legislative history and rules of construction cited above. We feel that the ambiguities, if any, should be resolved in favor of free competition. McLean Trucking Co. v. United States, supra, 321 U.S. at 94, 64 S.Ct. 370 (Douglas, J., dissenting).
2. Svenska: Burden of Proof
Petitioners assert that the mandatory language and legislative history of section 14b preclude imposing the burden of proof upon them. Admittedly, section 14b appears mandatory. The statute provides that the “Commission . . . shall . . . permit [dual rate contracts] . . . unless the Commission finds that the contract . . . will be detrimental to the commerce of the United States or contrary to the public interest, or unjustly discriminatory or unfair . . '. . ” (Emphasis supplied). However, the language of section 15 is no less mandatory. Section 15 provides that the “Commission shall . disapprove . . . any agreement , it finds to be unjustly discriminatory or unfair . . . , or to operate to the detriment of the commerce of the United States, or to be contrary to the public interest . . . , and shall approve all other agreements.” (Emphasis supplied). Despite this mandatory language in section 15, the Supreme Court has permitted imposing the burden of proof upon conferences in section 15 proceedings. We see no reason to differ with respect to section 14b, despite petitioners assertions that the legislative history dictates an opposite result.
Petitioners also rely upon a change in the statutory language of § 14b. As introduced in the House, the bill required the Commission to make an affirmative finding that § 14b contracts would be in the public interest. However, as enacted, the positive finding requirement was deleted from § 14b. Petitioners intimate that this evinces an intent to place the burden of proof upon the Commission. In rejecting such an analysis, we again refer to Svenska where the Court interpreted § 15, which similarly requires no affirmative showing by the-Commission, as susceptible of placing the burden of proof upon petitioners. Furthermore, the excision of the affirmative showing requirement may have been thought useful, as the Senate Report observes, in that it allows easy cases to be disposed of quickly without building an extensive record.
Turning from the language of the statute to the legislative history of § 14b, we candidly admit that our statutory exegesis is not without difficulty, however, in light of the general rules of construction cited herein, we conclude that the Commission’s approach to § 14b and Svenska is not arbitrary, unreasonable or capricious.
Petitioners, asserting that the legislative history of § 14b indicates that Congress did not intend to place the burden of proof upon the proponents of dual rate contracts, place particular reliance upon the following passage in the Senate Report:
Your committee believes that if the [nine] specific requirements set forth in its amendments are met by the proposed contract, it should be entitled to Commission approval unless the Commission finds that the contract would be detrimental to the commerce of the United States, or contrary to the public interest or unjustly discriminatory or unfair. We believe that any contract which contains the [nine] safeguards expressly required by the amended bill makes out a prima facie case that the contract is not detrimental to our commerce, or contrary to our public interest, or unjustly discriminatory or unfair. (Emphasis supplied).
Even assuming this passage is as important as petitioners would have us believe, they have overlooked what the Ninth Circuit has denominated an “all-important proviso,” section 14b(9), which states the Commission shall approve contracts filed provided that the contract expressly “contains such other provisions not inconsistent herewith as the Commission shall require or permit.” Assuming the passage in the Senate Report is as noteworthy as petitioners contend, we conclude, mindful of the maxims of construction herein cited, that the Commission was empowered to include consideration of antitrust principles under § 14b (9) thereby requiring petitioners to surmount antitrust hurdles prior to taking advantage of the “prima facie” language in the Senate Report. We do not find such an interpretation to be inconsistent with the Shipping Act.
Although the legislative history of § 14b(9) is not free of doubt, we believe it supports an expansive reading. Enacted in substantially the same form as introduced, § 14b(9) was intended to confer upon the Commission a “broad rulemaking mandate.” Despite opposition to § 14b(9) from the shipping industry on the ground that it would give the Commission too much discretion, Congress enacted the clause. Its purpose was to provide flexibility in the hands of the Commission. Indeed, it was referred to as a “catchall” during the hearings. Furthermore, the legislative history indicates that the Commission was empowered to “establish minimal standards, for dual rate contracts beyond those set forth in Public Law 87-346.” (Emphasis supplied.)
In our view the imposition of the Svenska burden does not pose an insurmountable obstacle for petitioners. As we have said, “parties alleging anticom-petitive conditions in proceedings before other agencies are frequently afforded the benefit of generous presumptions and shifts in burden of proof once they have demonstrated the existence of non-frivolous antitrust questions.” Hale v. Federal Communications Comm., 138 U.S.App.D.C. 125, 133, 425 F.2d 556, 564 (1970) (Tamm, J., concurring). Many scholars have also approved placing the burden of proof upon those seeking antitrust limitations. As the Supreme Court indicated in Svenska, placing the burden of proof upon the conference does not make the limited antitrust immunity conferred by the Shipping Act illusory because actions which would violate antitrust laws may still be approved if sufficient justification for them exists. Furthermore, the Commission must, of course, adduce substantial evidence to support its finding of a statutory reason —