COMPETITIVE BIDDING IN SALE OF SECURITIES.

The article focuses on competitive bidding in the United States and government policy concerning the securities industry. Reports from the Securities and Exchange Commission, Interstate Commerce Commission, and Halsey Stuart & Co. Inc. support competitive bidding. The principal opponents are the Investment Bankers Association of America, National Association of Securities Dealers and institutional investors. Rule U-50 and the Public Utility Holding Company Act of 1935 require competitive bidding in some corporations. Arguments for competitive bidding include elimination of banker domination and reduction in the concentration of underwriting firms. Topics are arm's length bargaining and factors that favor negotiation, rather than competitive bidding, in the sale of new issues.