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In light of these considerations, the compulsion by a foreign sovereign of private anticompetitive conduct such as that at issue here presents one of the rare instances in which it is proper to read an implied (and thus necessarily limited) defense into the American antitrust laws.

that the theoretical principles justifying a defense based on foreign sovereign compulsion serve very real ends is demonstrated by the practicalities of international commerce. it is, of course, settled law that the sherman act can reach even those anticompetitive restraints that occur wholly overseas but have a direct, substantial and reasonably foreseeable effect on american commerce.
this potentially brings within the reach of the antitrust laws an enormous and growing body of commerce. not surprisingly, the united states' trading partners often manage their domestic economic systems and international affairs in ways that differ from ours. for political or other reasons, foreign nations sometimes cartelize important segments of their economies, and the compelled anticompetitive conduct may well affect our commerce. 25a-26a) -- occasionally compel anticompetitive conduct expressly to accommodate the desires of the united states; to give just one example, australia very recently effectuated a trade agreement with the united states by directing its steel makers to limit their exports to this country. see letter from assistant attorney general j. paul mcgrath to australia charge d'affaires kenneth mcdonald (jan. at 428) were american courts to hold foreign firms liable for engaging in conduct that is compelled by their home nations, a development that would inevitably lead to embarrassment in foreign affairs.
/18/ in a system of international trade where the united states can be found negotiating for certain export restraints, failure to recognize a limited sovereign compulsion exception to the sherman act necessarily would "interfere with delicate foreign relations conducted by the political branches. conversely, the litigation of private antitrust actions could well impede diplomatic efforts to undo foreign compulsion of anticompetitive conduct. in these circumstances, it is evident that the problems posed by compelled anticompetitive activity can, as a general matter, better be addressed through the exercise of executive discretion than by means of the "'(p)iecemeal dispositions' that courts could make" in the course of private litigation.
the considerations that underlie the foreign compulsion defense help to shape its appropriate scope. as this court's treatment of the question in continental ore (see note 15, supra) and the uniform analysis of the lower courts (see cases cited at note 16, supra) suggest, the defense is applicable when the conduct at issue was in fact compelled by a foreign sovereign. in such cases the use of the challenged conduct as a predicate for the imposition of liability by american courts is likely to touch most sharply on foreign concerns and pose the greatest difficulties for the conduct of our foreign relations. these same considerations, moreover, distinguish sovereign compulsion from the state action doctrine, which provides a defense in antitrust challenges to conduct that is authorized and actively supervised by a state.
see southern motor carriers rate conference, inc. the state action defense is grounded on principles of federalism, in particular on the notion that congress should not be presumed to have interfered with state authority to regulate commerce. because the federal structure is designed to secure to the states the greatest possible "range of regulatory alternatives" (southern motor carriers, slip op. 12), the court has held that a requirement of state compulsion is too strict a standard for general use in state action cases -- with the federal government, as a safeguard, always retaining authority under the supremacy clause to void any obnoxious state cartel program that has an effect on interstate commerce. in contrast, the sovereign compulsion defense serves the quite different purpose of forestalling direct clashes with the most significant interests of other sovereigns.
this purpose is advanced most directly by bringing the defense into play only when the foreign government has compelled the challenged activity. in addition, several quite significant practical considerations suggest that the state action standard is not easily transferred to the foreign context. the complexity and novelty of foreign legal systems -- and the concomitant difficulty faced by domestic courts in precisely determining their requirements -- would present private firms with innumerable opportunities for evasion of antitrust requirements were any arguable "authorization" of the challenged conduct sufficient to give rise to the defense. similarly, the use of an active supervision standard of the sort applied in state action cases would require domestic courts to conduct difficult and troubling inquiries into the foreign sovereign's conduct of its own affairs.
we are not prepared at this time to suggest that there is any application of the sovereign compulsion defense that would be appropriate in the absence of actual compulsion by the foreign government. surely the mere fact that a trade restraint is consistent with the law of a foreign national's home state is not in itself a defense to an antitrust violation. nor should it lightly be inferred that congress intended to defer to foreign sovereigns to prescribe the norms for the volitional conduct of private persons concerning trade restraints directly affecting competition in the united states. this question, of course, need not be addressed by the court until it is squarely presented in a particular factual setting. the interests underlying the defense also shed light on the manner in which claims of sovereign compulsion should be presented to a united states court.
the defendant, of course, bears the burden of raising and proving such an affirmative defense. and because the defense is designed to forestall interference with foreign sovereign action and concomitant embarrassment in our dealings with foreign governments, claims of compulsion are most appropriately entertained when the foreign government, either directly or through the state department, informs the court that the conduct at issue was in fact compelled. /20/ it is in such instances that the depth of the foreign government's concern and the possibility of diplomatic friction following from further court proceedings will be most clearly expressed.
in the absence of such , the particular interests served by the defense -- as well as the narrow reading given to implied defenses to antitrust liability -- require that any claimed compulsion be demonstrated with .
for deference to , of course, the statement must be and intelligible. plainly ambiguous or inconsistent statements need not be as dispositive. and in extraordinary circumstances, concern for integrity of judicial process may obligate a to into underlying circumstances if believes that has been presented with statement that on face.. ..
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