FTC against new power to stop gasoline gouging

By Tom Doggett

WASHINGTON (Reuters) - The head of the U.S. Federal Trade Commission's competition bureau said on Thursday the agency does not need any new authority from the Democratic-controlled Congress to prevent gasoline price gouging.

Democrats plan to consider legislation that will make it easier for the FTC to go after oil companies that unfairly charge consumers at the pump.

"We don't think it's necessary to have price-gouging legislation," the FTC's Jeffrey Schmidt said at the Reuters Regulation Summit in Washington. "We think the current statutory and regulatory regime that's in place is the one that's best for consumers."

Oil companies came under scrutiny following the sharp rise in gasoline prices after Hurricanes Katrina and Rita disrupted supplies in late 2005. The industry claimed high pump prices reflected market conditions at the time.

Schmidt's comments against price gouging legislation mirrors the position expressed by the agency's chairman.

Schmidt said it would be "very difficult" to determine what exactly is price gouging, but he said the agency would nonetheless enforce such a statute if Congress passed it.

Schmidt said the FTC does not expect to help shape any price-gouging bill.

When asked if it would be better for the agency to offer lawmakers advice in defining price gouging instead of leaving it up to the 535 members of Congress, Schmidt said: "That's really their decision, not ours. We don't lobby Congress. We respond to Congress."

Schmidt said the FTC would of course provide assistance on the matter if asked by lawmakers.

Still, he emphasized there was no new authority the Congress could give the FTC that would help the agency better protect consumers against gasoline price gouging.

"Leave everything as it is, understanding that means continued close scrutiny of this (oil) industry by the antitrust enforcers who are trying their best to protect American consumers," Schmidt said.