قانون نوبك ... No Oil Producing and Exporting Cartels

No Oil Producing and Exporting Cartels Act

The No Oil Producing and Exporting Cartels Act (NOPEC) was a 

U.S. Congressional bill, never enacted, known as H.R. 2264 (in 2007) 

and then as part of H.R. 6074 (in 2008). NOPEC was designed to 

remove the state immunity shield and to allow the international oil 

cartel, OPEC, and its national oil companies to be sued under U.S. 

antitrust law for anti-competitive attempts to limit the world's supply 

of petroleum and the consequent impact on oil prices. Despite popular 

sentiment against OPEC, legislative proposals to limit the 

organization's sovereign immunity have so far been unsuccessful. 

"Varied forms of a NOPEC bill have been introduced some 16 times 

since 2000, only to be vehemently resisted by the oil industry and its 

allied oil interests like the American Petroleum Institute and their 

legion of “K” Street Lobbyists."[1]

The NOPEC Act was initially sponsored and introduced by Sen. Herb 

Kohl, D-WI, in June 2000 (S. 2778). The bill had 9 bipartisan 

cosponsors, including Sen. Chuck Schumer, D-NY, Patrick Leahy, 

D-VT; Chuck Grassley, R-IA; Arlen Specter, R-PA; and Sen. Joseph 

Lieberman, D-CT. That bill passed the Senate Judiciary Committee 

on September 21, 2000.[2] NOPEC was reintroduced in the Senate by 

Sen. Kohl in every Congress until his retirement in 2013 and passed 

the Senate Judiciary Committee in Congress.

The identical text of the NOPEC bill was also introduced in the House 

of Representatives by Representative John Conyers, D-MI, in May 

2007 and then as H.R. 6074 by Representative Steve Kagan, D-WI. In 

the U.S. House of Representatives, the 2007 bill had 12 bipartisan co-

sponsors in the House, which included Rep. Dennis J. Kucinich, D-

OH .[3][4][5] H.R. 2264 also had strong bipartisan support in the U.S. 

Senate.[6][7] Judiciary Committee Chairman Patrick Leahy, D-VT, 

said: "It is long past time for this to become law."[8] H.R. 2264 was 

passed by the House of Representatives in May 2007 as a stand-alone 

bill by a vote of 345–72.[9] That same month, it also passed the Senate 

by a vote of 70-23 as part of its energy measure.[10] As part of the Gas 

Price Relief Act, NOPEC (H.R. 6074) was then passed in the House of 

Representatives, in May 2008, by a vote of 324–84.[5][11][12] 

President George W. Bush reiterated his previous promise to veto the 

bill.[13] Under a continued veto threat, a team of senators 

reintroduced the bill just a week before President Bush left office.[14] 

However, NOPEC/H.R. 6074 did not then come to a final Senate vote. 

With continued bipartisan support, Rep. Steve Chabot, R-OH, 

sponsored NOPEC in 2011, as H.R. 1346.[15] NOPEC has not gone 

beyond its introduction subsequently.[16]

NOPEC has been the Congressional effort to address the issue that, 

under federal law, foreign governments cannot be sued for predatory 

pricing or failing to comply with federal antitrust laws. Thus, the 

purpose of the bill was to extend similar Sherman Antitrust consumer 

protection, so as to include protection against collusion and predatory 

pricing by foreign governments and international cartels, such as the 

Organization of the Petroleum Exporting Countries (OPEC).[17]

As written and passed, H.R. 2264:

Amends the Sherman Act to declare it to be illegal and a violation of 

the Act for any foreign state or instrumentality thereof to act 

collectively or in combination with any other foreign state or any 

other person, whether by cartel or any other association or form of 

cooperation or joint action, to limit the production or distribution of 

oil, natural gas, or any other petroleum product (petroleum), to set or 

maintain the price of petroleum, or to otherwise take any action in 

restraint of trade for petroleum, when such action has a direct, 

substantial, and reasonably foreseeable effect on the market, supply, 

price, or distribution of petroleum in the United States.

It also summarizes enforcement parameters as follows:

Denies a foreign state engaged in such conduct sovereign immunity 

from the jurisdiction or judgments of U.S. courts in any action 

brought to enforce this Act. States that no U.S. court shall decline, 

based on the act of state doctrine, to make a determination on the 

merits in an action brought under this Act. Authorizes the Attorney 

General to bring an action in U.S. district court to enforce this Act. 

Makes an exception to the jurisdictional immunity of a foreign state 

in an action brought under this Act.[18]

Controversy surrounding passage under veto threat

At the time of passage, U.S. motorists were paying $3.21/gallon for 

gasoline. The London-based Center for Global Energy Studies cited 

OPEC restrictions on output as the driving force in pushing oil prices 

in 2008 to above $60/barrel. The study proposed that this OPEC-

driven price increase was the central cause of the consumer gas price 

increase at the pump.[19]

The many bipartisan supporters of the bill, in Congress and 

elsewhere, felt disavowed by President Bush's staunch veto threats. 

Representative Conyers stated: "The Bush administration's threat to 

veto this bill is just further proof that the administration favors the 

international oil cartel over the American consumer."[17] Then-

senators Barack Obama and Hillary Clinton both voted "yes" on 

NOPEC. Commodities trader and author Raymond J. Learsy put it 

this way: "In defiance of oil interests Congress voted overwhelmingly 

for the Bill (70 votes to 23 in the Senate and 345 to 72 in the House). 

This was an act of refreshing and courageous leadership by our 

Congress only to be abandoned after President George W. Bush, that 

great stalwart of oil interests and friend of Saudi Arabia, made it 

clear that he would veto the bill should it land on his desk."[20]

Supporters of the Bush veto included the U.S. Chamber of Commerce 

(USCC). In its 2007 letter to House members, the USCC stated 

opposition to the bill: "Although H.R. 2264 limits itself to restraint of 

trade in oil, natural gas, or petroleum products, it would create a 

dangerous precedent. There would be a domino effect: once sovereign 

immunity has been eliminated for one action of a state or its agents, it 

can be eliminated for all state actions and the actions of agents of the 

state."[21] Energy analyst Kevin Book noted that increased 

regulatory fears, as a result of NOPEC, could prompt a flight of 

capital. Others, including some officials in the oil-producing 

countries, also expressed concerns that "a nation caught up in the 

throes of a populist movement" might look to seize energy-relatrd 

plants and even non-energy assets in the United States that are owned 

by these foreign governments or their affiliated companies. Some 

officials in the Bush Administration agreed that OPEC countries' 

United States assets could be targeted, if a court were to award 

damages in a resulting antitrust lawsuit. They further feared that this 

"would likely spur retaliatory action against American interests in 

those countries and lead to a reduction in oil available to U.S. 

refiners."[22]

Economist Dambisa Moyo wrote: "It is beyond question that if OPEC 

member nations were private companies, they would have been fined 

heavily and/or had their executives put in jail in the United States or 

the United Kingdom." Beyond energy alone, Moyo then cited the 

Bush veto of NOPEC, "for reasons of public policy" and in order to 

support market-based economies, as an indication to China that it too 

could also expect continued "lack of any forceful international law" 

regarding China's potential future international monopolistic policies 

for "influencing prices, and violating antitrust rules."[23][24]

Litigation

In 2011 a U.S. District Court case involving two class actions was 

brought by private gasoline retailers against oil production 

companies most of which were owned in whole or in part by OPEC 

member nations (Citgo and the Venezuelan State Oil Company 

(PDVSA)), alleging antitrust violations. As has been the case since 

first introduced, public discord on the issues was widely disparate. 

With an apparent policy reversal of his position as senator, the 

Obama administration favored dismissal in an amicus brief 

supporting the "sovereign immunity" defense for international 

commodity producers.[25][26]

The United States Court of Appeals, Fifth Circuit held that if a case 

presents a political question, they lacked subject matter jurisdiction, 

agreeing with the district court that adjudication of the case is barred 

by application of the political question doctrine. Given that the OPEC 

member nations included Algeria, Angola, Ecuador, Iran, Iraq, 

Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab 

Emirates, and Venezuela, the Fifth Circuit's opinion sited much case 

precedence and stated: “Such matters are so exclusively entrusted to 

the political branches of government as to be largely immune from 

judicial inquiry or interference.”

Textually, the 111th Congress NOPEC Act of 2009 would also 

expressly exclude a private right of action, and "leaves the decision to 

prosecute OPEC members in the hands of the executive branch by 

giving the Justice Department sole authority to prosecute." 

(statement of Sen. Arlen Specter). This view reinforces the court's 

conclusion that there is an unusual need for unquestioning adherence 

to the political decision made by the branches of government that are 

accountable to the electorate: “Relations with OPEC nations 

regarding U.S. oil supplies are not to be conducted through private 

litigation.” In their amicus brief the Obama Administration agreed 

that the appropriate means for achieving United States objectives, 

involving international energy markets, lies in diplomatic efforts, 

encompassing the executive branch and the justice department, with 

the countries involved rather than private lawsuits by each individual 

company, against sovereign nations in U.S. courts. Convinced that 

these matters deeply implicate concerns of foreign and defense policy, 

concerns that constitutionally belong in the executive and legislative 

departments, the Fifth Circuit concluded that they lacked jurisdiction 

to adjudicate the claims presented.[27]

Ongoing debate and future possibilities

As with all cartels, compliance from cartel members is a central 

factor in any price-fixing effectiveness.[28] More significant may be 

the developments relating to antitrust/cartel enforcement efforts 

outside the United States. Brazil and the United Kingdom have 

strengthened their existing laws and their enforcement capabilities; 

the European Union and other nations may do likewise.[29] At the 

start of 2015 and continuing to this day, efforts have resumed toward 

achieving additional recourse against multinational price-fixing and 

future possibilities for more rigorous, international antitrust 

protection for US consumers.[30][31] In 2016, Saudi Arabia and 

Russia, the world's two largest producers, formed a "working group" 

pact "to monitor" the oil market at regular intervals.[32] In 2018, a 

NOPEC bill, sponsored by Steve Chabot, R-OH and six additional 

bipartisan cosponsors, was reintroduced by the 115th Congress, but 

again failed to be enacted into law.[33] Since facing rising oil and gas 

prices in 2021 and 2022, the Biden administration has sought support 

in Congress, attempting once again to hold foreign entities, such as 

OPEC, accountable. This has not fully assumed a multi-prong 

approach, through a combined enactment of NOPEC's Sherman 

Antitrust protection, along with more strenuous enforcement of 

already existing legislation within the Foreign Corrupt Practices Act 

(FCPA).[34][35] On November 15, 2021, enactment of the Energy 

Policy And Conservation Act grants limited, discretionary executive 

regulatory powers to address international antitrust conduct that 

may occur subsequent to that act’s enactment date.[36] On March 8, 

2022, President Joe Biden signed an executive order banning the 

import of Russian oil and gas, in response to the Russian invasion of 

Ukraine, with almost unanimous bipartisan Congressional support.

[37] The ongoing Russian invasion of Ukraine, with its accompanying 

devastation, human toll, and sustained manipulaton of both world oil 

prices and multi-national inflation, are well documented.[38][39][40] 

If bipartisan congressional support for Ukraine continues,[41] this 

could prompt a greater application of currently existing international 

antitrust regulatory powers for addressing future US/Saudi relations, 

under the influence of any ongoing Russo-Saudi production pact.[42]

[43] NOPEC-2022 was reintroduced in the 117th Congress, S.977 by 

Sen. Chuck Grassley, R-IA and cosponsored by Sen. Patrick Leahy, 

D-VT, Sen. Mike Lee, R-UT, and Sen. Amy Klobuchar, D-MN.[44] An 

identical bill was again sponsored in the House of Representatives by 

Rep. Steve Chabot, R-OH and cosponsored by Rep. Jerold Nadler, 

D-NY, and Rep. David Celine, D-RI.[45] The current Saudi oil 

production cutbacks have specifically targeted US oil and gasoline 

price increases, and public perception. It now remains to be seen if 

the Biden administration's efforts may yet prompt a renewed, more 

candid and fully bipartisan response, with the reevaluation of NOPEC 

legislation as a whole.[46][47][48]