Hon. J. PERCY PRIEST, THE SECRETARY OF COMMERCE, Washington 25, D. C., June 22, 1955. Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. DEAR MR. CHAIRMAN: This is in reply to your letter of March 5, 1955, requesting the views of this Department with respect to H. R. 4627, a bill to prohibit the transportation in interstate commerce of advertisements of alcoholic beverages, and for other purposes. The bill would make unlawful the transportation or causing to be transported in interstate commerce by any common carrier, publisher or person engaged in the sale of alcoholic beverages or advertisements of alcoholic beverages. The bill would also render unlawful radio broadcasts of such advertisements and would prohibit the mailing of such advertisements to any State or Territory if the advertisements would there be unlawful. Section 2 of the 21st amendment to the Constitution provides: "The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited." It appears to be the clear intention of this amendment to place within the several States complete power to prohibit or regulate the use within the territory of the individual State of alcoholic liquors. Although some of the States have adopted laws prohibiting the use of intoxicating liquors, the majority of the States have not adopted such laws. H. R. 4627 would interfere with the trade in intoxicating liquors in those States in which the use of intoxicating liquors is not forbidden. With respect to those States in which the use of intoxicating liquors is forbidden, circulations of advertisements would not appear to be of significant detrimental value. This Department, therefore, believes that enactment by the Federal Government of legislation such as H. R. 4627 would be contrary to the spirit of the 21st amendment. We have been advised by the Bureau of the Budget that it would interpose no objection to the submission of this letter to the committee. Sincerely yours, SINCLAIR WEEKS, Secretary of Commerce. Hon. J. PERCY PRIEST, GOVERNMENT OF THE DISTRICT OF COLUMBIA, Chairman, Committee on Interstate and Foreign Commerce, Washington, D. C. MY DEAR MR. PRIEST: The Commissioners have for report H. R. 4627, 84th Congress, a bill to prohibit the transportation in interstate commerce of advertisements of alcoholic beverages, and for other purposes. The bill prohibits the transportation in the mails or otherwise from any State or Territory or the District of Columbia to any other State or Territory or the District of Columbia of any newspaper, periodical, newsreel, photographic film, or record advertising alcoholic beverages or containing the solicitation of an order for alcoholic beverages. Radio and television stations are also prohibited from broadcasting such advertisements. This bill is substantially similar to H. R. 1227, 83d Congress, upon which the Commissioners requested the Alcoholic Beverage Control Board of the District for its views. This Board, in stating its opposition to the enactment of this legislation said that it did not know of any reason why the alcoholic beverage industry should be treated so singularly. Therefore the Commissioners recommend adverse action on the bill. The Commissioners have been advised by the Bureau of the Budget that there is no objection on the part of that office to submission of this report to the Congress. Yours very sincerely, SAMUEL SPENCER, Board of Commissioners. Hon. J. PERCY PRIEST, TREASURY DEPARTMENT, Washington, D. C., May 26, 1955. Chairman, Committee on Interstate and Foreign Commerce MY DEAR MR. CHAIRMAN: Reference is made to your request for the views of this Department on H. R. 4627, to prohibit the transportation in interstate commerce of advertisements of alcoholic beverages, and for other purposes. The bill would establish broad prohibitions against the transportation in interstate commerce of any newspaper, periodical, newsreel, photographic film, or record for mechanical reproduction advertising alcoholic beverages or containing the solicitation of an order for such beverages. It would also prohibit the broadcasting by radio or television of any advertisement of alcoholic beverages or the solicitation by radio of an order for such beverages. It would further forbid the deposit in or carriage by the mails, or the delivery by any postmaster or letter carrier, of any letter, postal card, circular, or pamphlet containing any advertisement of alcoholic beverages or the solicitation of an order for such beverages, when addressed to any place in any State or Territory of the United States or the District of Columbia at which it is by the law in force unlawful to advertise or solicit orders for alcoholic beverages. The bill would also define the term "alcoholic beverages" and provide penalties for the violation of any of its provisions. This Department is of the view that proposed restrictions on the use of certain media in the advertising of alcoholic beverages relate to a matter of national policy which is primarily for determination by the Congress and not within the especial province of this Department as administrator of the Federal Alcohol Administration Act. Accordingly, the Department is of the opinion that it should make no specific recommendations regarding the merits of the proposal. The Department has been advised by the Bureau of the Budget that there is no objection to the submission of this report to your committee. Very truly yours, M. B. FOLSOM, Acting Secretary of the Treasury. EXECUTIVE OFFICE OF THE PRESIDENT, BUREAU OF THE BUDGET, Washington, D. C., May 25, 1955. Hon. J. PERCY PRIEST, Chairman, Committee on Interstate and Foreign Commerce, MY DEAR MR. CHAIRMAN: This will acknowledge your request of March 5, 1955, for the views of the Bureau of the Budget on H. R. 4627, a bill to prohibit the transportation in interstate commerce of advertisements of alcoholic beverages, and for other purposes. The Bureau of the Budget is in general agreement with the positions of the Departments of State and Commerce and the Post Office Department, and recommends against enactment of H. R. 4627. Sincerely yours, HAROLD PEARSON, Hon. J. PERCY PRIEST, DEPARTMENT OF JUSTICE, OFFICE OF THE DEPUTY ATTORNEY GENERAL, Chairman, Committee on Interstate and Foreign Commerce House of Representatives, Washington, D. C. DEAR MR. CHAIRMAN: This is in response to your request for the views of the Department of Justice relative to the bill (H. R. 4627) to prohibit the transportation in interstate commerce of advertisements of alcoholic beverages, and for other purposes. Section 1 of the bill would make it unlawful for any distiller, brewer, vintner, manufacturer, wholesaler, or retailer, or for the agent, broker, or factor of any of them, engaged in the sale of alcoholic beverages to cause to be transported in the mails or otherwise from any State or Territory or the District of Columbia to any other State or Territory or the District of Columbia any newspaper, periodical, newsreel, photographic film, or record for mechanical reproduction advertising alcoholic beverages or containing the solicitation of an order for alcoholic beverages. Section 2 would impose the same prohibition on publishers and their agents, and section 3 would prohibit common carriers and private carriers for hire from transporting such material in interstate commerce. Broadcasting or permitting the broadcasting of advertisements of alcoholic beverages and the solicitation of orders for such beverages over licensed radio stations would be prohibited by section 4. Section 5 would prohibit the depositing in or carrying by the mails, and the delivery by any postmaster or letter carrier, of mail matter advertising alcoholic beverages or soliciting orders for such beverages, when such matter is addressed or directed to any place in any State or Territory, or the District of Columbia, at which it is by law unlawful to so advertise or solicit. "Alcoholic beverages" would be defined in section 6 to include any spirituous, vinous, malted, or other fermented liquor, or any compound containing any spiritous, vinous, malted, or other fermented liquor fit for use for beverage purposes as defined by the law of the State or Territory or the District of Columbia into which such advertisement or solicitation of an order may be transported. Finally, section 7 would make first offenses committed in violation of any of the measure's provisions punishable by fines of not less than $100 nor more than $1,000 and/or imprisonment for not less than 6 months nor more than 1 year. Imprisonment for not less than 1 year would be mandatory for subsequent offenses. Whether the bill should be enacted involves questions of policy concerning which the Department of Justice prefers not to make any recommendations. It may be noted, however, that sections 2, 3, and 4 of the legislation present a question of interpretation as to whether they would be limited to the transportation of advertisements from one State or Territory of the United States to another, without affecting advertisements introduced into the United States from foreign countries. If so, they would place foreign liquor manufacturers and dealers in a favored position as compared to manufacturers and dealers in the United States. The Bureau of the Budget has advised that there is no objection to the submission of this report. DEAR MR. CHAIRMAN: Reference is made to your request for a report on H. R. 4627, a bill to prohibit the transportation in interstate commerce of advertisements of alcoholic beverages, and for other purposes. This measure (1) prohibits the transportation in the mails or otherwise of any advertisements of, or solicitation of orders for, alcoholic beverages; (2) the term "alcoholic beverages" is construed as defined by law of the State or Territory or District of Columbia into which such advertisement or solicitation of an order may be transported. The Postmaster General is authorized and directed to issue annual bulletins or notices giving the names of States in which it is unlawful to advertise or solicit orders for alcoholic beverages. The enactment of this measure would impose an additional burden upon the Post Office Department in determining what it should and should not carry in the mails. A substantial increase in the workload would follow. There would be no compensating revenue. Under sections 5 and 6, the Postmaster General must keep himself advised as to the law of the various States, Territories, and the District of Columbia respecting the advertisement of alcoholic beverages and "issue annual bulletins or notices giving the names of the States in which it is unlawful to advertise or solicit orders for alcoholic beverages." This would require not only exam ination of the State laws but also examination of matter in the mails to ascertain whether it contains any advertisements of alcoholic beverages, and a check by the postmaster to determine (from the Postmaster General's bulletin) the law of the State where the addressee is located. Where there is a local prohibition law, usually a percentage of alcoholic content is established, beyond which the liquor is "intoxicating." It is believed that it would not be possible in all instances to determine, by reading an advertisement, the alcoholic content of the article advertised. Therefore, investigation undoubtedly would be required before a ruling as to mailability could be made. Section 5 forbids the depositing of alcoholic-beverage advertisements in the mails when addressed to a State in which it is unlawful to advertise or solicit orders for such beverages. Section 1 makes it a violation to transport "in the mails or otherwise" any of these advertisements "from any State *** to any other State * **" not limiting it to those wherein the circulation of the advertisements is forbidden by State law. The same applies to sections 2 and 3. The Universal Postal Union Convention, of which this Government is a signatory, provides that any article of mail prohibited in the domestic mails of a member country is likewise prohibited in the international mails (article 49). If this bill were to become law, all matter covered by it which contained advertisements of alcoholic beverages would be excluded from the international mails. There is no indication that the measure would have serious effect on postal revenues or expenditures. Some slight effect on receipts from second- and third-class mail might be traced to the provisions of the measure. The objection is based on considerations from the operational rather than the financial standpoint. In view of the foregoing, this Department is opposed to the enactment of this legislation. The Bureau of the Budget advised this Department that there would be no objection to the submission of the report to the committee. Sincerely yours, ABE MCGREGOR GOFF, Solicitor. FEDERAL COMMUNICATIONS COMMISSION, Hon. J. PERCY PRIEST, Chairman, Committee on Interstate and Foreign Commerce, DEAR CONGRESSMAN PRIEST: This is in reply to your request of March 5, 1955, for the Commission's comments concerning H. R. 4627, a bill to prohibit the transportation in interstate commerce of advertisements of alcoholic beverages, and for other purposes. Section 4 of H. R. 4627 would prohibit the broadcasting of any advertisement for or solicitation of an order for alcoholic beverages. The Commission believes that the proposed legislation presents a question of national policy, and we do not desire to express any opinion with respect to the merits of the bill. However, the Commission would like to take this opportunity to submit its views on certain of the legal questions raised in House Report No. 2670 (83d Cong., 2d sess.). This report was released by the committee on August 18, 1954, following hearings on H. R. 1227 (83d Cong., 1st sess.), a bill substantially identical to H. R. 4627. The questions with respect to which it is understood the committee desires the Commission's views are as follows: (1) Whether there would be any constitutional prohibition against section 4 of the proposed legislation because of curtailments of free speech. (2) Whether the second section of the 21st amendment gives a State the right to pass legislation comparable to that proposed in section 4 with respect to (a) radio and television stations operating within the State or (b) broadcasts from stations operating without the State. (3) Whether the Federal Communications Commission has jurisdiction under present law to carry out the objectives of section 4 without additional congressional action. 1. Is there any constitutional prohibition against section 4 of H. R. 4627 because of curtailments of free speech? "While the absolute prohibition of advertising (not involving liquor advertising) has been found in at least one State case to impair freedom of speech and to encroach upon contract and property rights (People v. Osborne, 59 P. 2d 1083, Calif. 1936), the Commission does not believe that legislation such as proposed in H. R. 4627 could be validly attacked on the basis that it is an unconstitutional curtailment of free speech. Free speech is not an absolute right entitled to protection irrespective of considerations of public welfare. If other interests are found to be of greater importance, it is well recognized that the right may be abridged. Although the manufacture and sale of intoxicating liquors, in the absence of legislation to the contrary, is a lawful business, entitled to protection as such, it has been consistently subjected to strict regulation and control in view of its potential adverse effect on public health, safety, and morals. In the exercise of the police power various States have in various ways controlled and regulated the advertising of intoxicating liquor and the solicitation of orders therefor without encountering constitutional objections related to free speech. Furthermore, as the committee is aware, Congress has acted in this sphere to a limited extent by providing in the Federal Alcohol Administration Act (27 U. S. C. A., Sec. 205 (f)) that distillers, brewers, importers, wholesalers, or bottlers of distilled spirits, wine, or malt beverages shall not "publish or disseminate or cause to be published or disseminated by radio broadcast, or in any newspaper, periodical, or other publication or by any sign or outdoor advertisement or any other printed or graphic matter, any advertisement of distilled spirits, wine, or malt beverages, if such advertisement is in, or is calculated to induce sales in, interstate or foreign commerce, or is disseminated by mail, unless such advertisement is in conformity with *** regulations, to be prescribed by the Secretary of the Treasury ***" The Federal Alcohol Administration Act was held constitutional in Arrow Distilleries v. Alexander (109 F. 2d 397, cert. denied 310 U. S. 646). While the approach taken in H. R. 4627 is much more drastic insofar as advertising is concerned, the first amendment should not prove to be an obstacle to the legislation if there is present a substantial threat to the national welfare and it is otherwise within the power of Congress. 2. Does the 2d sentence of the 21st amendment give a State the right to pass legislation comparable to section 4 of H. R. 4627 with reference to (a) radio stations operating within a State, or (b) broadcasting stations operating without a State? It would appear that the answer to both of these questions is "No." While the 21st amendment exempts the States from some of the usual restrictions of the commerce clause in order that they may effectively control the traffic of intoxicating liquors within their borders, the 2d section thereof is expressly concerned with the "transportation or importation," of intoxicating liquor into the States and does not, it is believed, apply to the advertisement of alcoholic beverages either within the State itself or outside of the State under conditions where such advertisements can be heard within the State. The question of whether a State could pass legislation comparable to section 4 of H. R. 4627, however, does not appear to be limited to the question of whether it is authorized to do so by the 21st amendment to the Constitution. For it is conceivable that the States might be authorized to do so under their general police powers and totally aside from any possibly stemming from the 21st amendment. The Commission is not aware of any existing State legislation similar to that proposed in section 4 of H. R. 4627. It is understood, however, that legislation of this type has been introduced and is now pending in the North Dakota Legislature (N. D. House bill 836). The constitutional question concerning such legislation would, of course, be whether it is an improper impairment by the States of interstate commerce in view of the generally recognized interstate nature of radio broadcasting. The recent decision of the United States Court of Appeals for the Third Circuit in DuMont Laboratory, Inc. v. Carroll (184 F. 2d 159, certiorari denied 340 U. S. 929) would appear to cast some doubt as to the legality of any such State enactment, at least in the absence of Federal enabling legislation. In the DuMont case the court held improper the exercise by the Commonwealth of Pennsylvania of any advance censorship of motion pictures for use by television broadcast stations. The court stated that Congress in enacting the Communications Act had fully occupied the field of radio and television broadcasting to the exclusion of any regulation by the States. It pointed out that while section 326 of the Communications Act expressly denied rights of censorship of radio and television programs to the Commission, Congress had otherwise provided for the control of such programs by the Commission and in so doing had effectively barred both the Commission and the States from exercising program control by means of advance censorship. |