FOR YOUR INFORMATION . . . . . . . . June 5, 1989




     The Federal Trade Commission staff has said that proposed
legislation before the Louisiana legislature concerning gasoline
pricing is "likely to be anticompetitive" and "could cause
gasoline prices in Louisiana to increase."  The legislation would
prohibit below cost pricing, as defined by the legislation, and
prohibit price discrimination in gasoline sales.

     The FTC staff comments were submitted at the request of
State Representative Francis C. Heitmeier, a member of the House
Commerce Committee, which is considering the legislation.

      According to a letter signed by Tom Carter, Director of
the FTC's Dallas Regional Office, the legislation "would deny
firms the flexibility to adjust their prices in response to
changing conditions of demand and supply.  Such legislation is
likely to add costs to the distribution of gasoline in Louisiana
that do not exist in other states, costs that would be borne by
Louisiana consumers and visitors." 

     The FTC staff further stated that if this legislation
passes, "Short term price discounts designed to attract new
customers would be deterred."  Also, the staff said, "Refiners
may be prevented from realizing the efficiencies of vertical
integration, which can often reduce transaction and search costs
and lower prices to consumers."

     The comments are the views of the FTC's Dallas Regional
Office and Bureau of Competition.  They are not necessarily the
views of the Commission or any individual Commissioner.

     Copies of the comments are available from the FTC's Public
Reference Branch, Room 130, 6th St. and Pennsylvania Ave., N.W.,
Washington, D.C. 20580; 202-326-2222; TTY 202-326-2502.  

                              # # #

MEDIA CONTACT:      Nancy Sachs, Office of Public Affairs,
                    202-326-2181

STAFF CONTACT:      Tom Carter, Dallas Regional Office,
                    214-767-5503

(LouisGas)