Gasoline Marketing Divestiture Statutes: A Preliminary Constitutional and Economic Assessment

This Note has traced the recent developments in the oil industry and in gasoline marketing that have led to the enactment of divestiture statutes in three states and their consideration by the legislatures in many others. The statutes are essentially of two types: those prohibiting the owning or leasing of marketing outlets by vertically integrated oil companies and those prohibiting or limiting the operation of retail outlets with company employees. Both types of statutes, however, have as their primary aim the exclusion of the majors as competitors at the retail level. This is thought to be necessary to prevent anticompetitive behavior that results from the majors\u27 vertical integration combined with their oligopolistic control of crude oil producing, transporting, and refining. Although the divestiture statutes have been challenged in the states where they have been enacted, the courts have not handed down a definitive ruling on their constitutionality. While it is impossible in a general discussion of the statutes to determine their validity under the constitution of every state where they have been enacted or proposed, this Note has attempted to consider the federal constitutional arguments that might be raised against them