Approved Code No. 462
NATIONAL RECOVERY ADMINISTRATION
CODE OF FAIR COMPETITION
AS APPROVED ON JUNE 9, 1934
WE DO OUR PART
GOVERNMENT PRINTING OFFICE
Por sale by the Superintendent of Documents. Washington, D.O. - Price 5 cents
WHOLESALE TOBACCO TRADE
This publication Is for sale by the Superintendent of Documents, Government
Printing Office, Washington, D.C., and by district offices of the Bureau of
Foreign and Domestic Commerce.
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Approved Code No. 462
CODE OF FAIR COMRIPETI[TION
WVHOLLESAL~E TOBACCO TRADE
As Approved on June 9, 1934
CODE OF FAIR COMrPETITION FOR TH WHOLESAULE 1LOBACCO TRADEz
An application having been duly made pursuant to and inl full
compliance w1ith the provisions of Tfitle I of the National Industrial
Recovery Act, approved June 16, 1933, for approval of a Code of
F~air Competition for the Wholesale Tobacco Trade, and hearings
having been duly held thereon and the annexed report on said Code~
containing findings wtith respect thereto, having been madean
directed to the Presidenrt:
NOW, THIEREFORIE, on behalf of the President of the Unlited
Stats, Huh S Johson Adinistrator for Industrial. Reco~veryv,
pursuant to authority vestedi eb Executive Orders of the Pres-
ident, including Executive Order N.64-,dtdDcme 0
1933, and otherwise; do heirecby incorporate by reference said anznexe
report and do ~find that said Code complies in all respects with the
pertinent provisions anrd will promote the policy anld purposes of
said Title of said Act; and do hereby order that the said Code of
Fair Com~petition be and it is hereby~ approved, and shall become
effective on the date of this Order; subject, however, to the following
(1) That the provisions of Part I of Article VI and of Schedule
I--the Ciga~r e~rchandrising 1Plan-b~e stayed and shall not become
effective until said planl shall have become effective pursuant to codes
of fair competition for the Cigar Manufacturing Industry and the
Retail Tobacco Trade.
(2) That theL waiting periods of five and three days contained in
Schedule I, Part A, Section 1, and in A1?rticle VJI, Part I, Sections
1 and 2, and Schedule I, Part B, Sections 1 and 2, respectively, be
stayed and shall not become effective, notwithstanding said cigar
merchandising plan becoming effective, until my1 further order.
(3) That all provisions for the filing of prices and discounts in
said cigar merchandising plan be stayed until arrangements satis-
factory to the Administrator, are madle for confidential treatment
and for simultaneous distribution thereof to all members of the
trade and customers wFilling to pay the cost thereof.
66673 0-667-10 1---34 (275)
(4) -That the preamble and Sections 1, 2, and 3, of Part II: of
Article VI be stayed and that th~e trade accept in place thereof, the
"A~s to cigars, w~ith respect to which the pr- visions of Part I or
Schedule I shlal not at t~he time be operative or shall be stayed, and
as to cigarettes, smoking tobacco, chewing tobacco apndsnuff,,the
standards of fair competition for the trade with reference to pricing
practices are declared to be as follows:
'"SECTION 1 (a) : Wilfully destructive price cutting is an unfair
.methood of competition and is forbidden. Any member of the trade
or of atny other trade or industry or the customers of either may, at
any time, complain to the Code Authority that any actual price con-
stitutes unfair competition as destructive prrric cuttingipriln
small enterprises or tending toward monopoly or the impairment of
code wages or wTorking conditions. The Code Authority shall,
within five days, afford an opportunity to the member making such
price to answer such comnplaint and shall, within fourteen days, make
a ruling or adjustment thereon. I~f such ruling is not concurred in
by either party to the complaint, all papers shall be referred to the
Research and Planniing Division of NRA which shall render a
report and recommendation thereon to the Administrator.
"'(b): WVhen no declared emergency exists as to such products or
any specified part thereof, there is to be no fixed minimum basis for
I~t is intended that sound cost estimating methods should be
used and thant consideration should be given to costs (including
costs of wholesale distribution) in the determination 'of pricing
(c) WThen an emnergaency, by reason of unfair competitive prac-
tices or other conditions, exists in t~he trade as to such products or
any specified part thereof, sale below the stated minimum price of
such products or suchi obidn specified part thereof, in violation of Section 2
'" SECTION 2. Emergency Provisions.-(a) : If t~he Administrator,
after investigation, shall at any time find both (1) that an emergency
hias arisen within the trade, adversely affecting small enterprises or
wages or labor conditions, or tending toward monopoly or other
acute conditions which tend to defeat t~he purposes of the Act; and
(2) that the finding of a basis for determining minimum prices for
such products or any specified part thereof is necessary for a limited
period, to correct the conditions constituting such emergency and
t~o effectuate the purposes of the Act, the Cod~e Authority may cause
anr impartial agency to investigate costs (including the costs of
wholesale distribution) and to recommend to the Administrator a
basis for determining- minimum prices of the said products or the
said specified part thereof affected by the emergency, and thereupon
the Administrator may proceed to fix a basis for determining such
"-(b) : When the Administrator shall have fixed a basis for deter-
minmng minimum prices for the said products or said specified part
thereof for a stated period which prices shall be reasonably cal-
culated to correct the conditions of such emergency and to effectuate
the purposes of the Act, he shall publish the said basis. Thereafter,
during such stated period, no member of t~he trade shall sell such
products at a net realized price below the minimum. price determined
upon the basis so fjixed, and any such sale shall be deemeatd destrue-
tive price cutting. olfrromn time to -time, the Code Authority- may
recommend review or reconsideration or the Aldministrator may cause
-any determination hereunder to be reviewed or reconsidered, and
appropriate~ action ta~ken."
(5) That the provisions of ALrticles III and IV shall be and the
s~ame hereby are stayed until and shall become effective on M~ondlay,
June 25, 1934.
Evnc S. JoHNson.
Approval recommended :
AnaInw W. Ru.EY,
Junme 9, 193~4.
REPORT TO THE PRESIDENT
Th~e Wiite Hou~se.
Smz: A Public Hearing on the Code of F'air Competition for the
Wholesale and Retail Tobacco Distributing Industry, submitted by
the National Association of Tobacco Distributors, Inc., and the Re-
tail Tobacco Dealers of America, Inc., was held in WVashington, D. C.
on Decembr 15 and 16, 1933, in accordance with the provisions ol
the National Industrial Recovery Act, pursuant to Notice of Hearing
signed by the Secretary of Agriculture by virtue of Executive Order
of June 26i, 1933. Under Executive Order of January 8, 19341, juris-
diction over this Code was transferred to the Administrator for
Industrial Recovery, whose representatives have made cer-tain re-
visions in the Code, as is customary after Public Hearing. These
changes are not in conflict with the testimony in the record of the
]Public Hearing and have been assented to by t~he Industry.
The most important change was the division of the Code into two
codes, namely, this Clode and the Code of Fair Competition for the
Retail Tobacco Trade. This step was deemed advisable, inasmuch
as the two trades each withl its different problems, should be able
to operate m~ore satisfactorily under separate Codes and different
ECONOMIC EFFECTS OF THE OODE
The W~holesale Tobacco Trade covers the wholesale distribution
of cigars, cigarettes, smoking tobacco, chewinga tobacco, snuff, and
other tobacco products.
_According to the 1929 Census of Dist~ribution there were approxi-
mately 2,000) estaRblishlments in the United States engaged in the
distribution of tobacco products. There were about 20,000 em-
ployees, approximately eight~y-four percent (84%1) being men. In
19333 employment hadi declined about twenty percent (20%0), the
empIloy'ees numlbe~ring around 16,000.
It is estimated that t~he increase in employment resulting from the
operation of the Code will be about. ten percent (10%).
T'he foregoing Census shows that t~he annual gross volume of busi-
ness had reached the high total of $1,691,000,000. In 1932, due to
the general economic conditions, the estimated volume had shrunk
thirty percent (30%0), or to $1,084,000,000, and the net profit margin
had been reduced from one andi four-t~enths percent (1.4%0) to three-
tenths percent (0.34ro), since expenses could not be reduced in pro-
portion to sales volumle. It is thought that t~he figures for 1933 will
show still greater decline.
The Industry claims t.hat the average capital investment of each
establishment is between $;100,000 and $200,000, and that, with rare
exceptions, all tobacco wholesalers have been losingo money for the
past four years..
The salary and wage bill of the Industry bulks quite large in pro-
portion to total expenses: but shows a relatively low percentage to
net sales. It is diffclt to approximate the increase in payrolls
directly attributable to the Codle, inasmuch as outside factors enter
into such a calculation. However, a cross section of available data
indicates an increase of ten percent (100/o).
The outstanding feature of the fair trade practice? provisions is
the cigar merchandising plan, which is also to be :found in the Cigar
Manufacturinga, and Re~tail T~obacco Codes. I~t provides for the re-
tail sale of cigars at prices not less than those declared by the manu-
facturer for each of his products, and further prescribes za~ximumn
discounts alilowable~ by manufacturers or wholesalers from those
This plan was originated by the retail dealers, and was proposed
by them. to the wholesalers and cigar manufacturers. At the Publio
Hearing on this Code it wpas supported by these three groups as well
as by representatives of tobacco growers. It now has the approval
of the Consumners Advisory Board, Industrial Advisory Board, L~abor
Advisory Board, and Ltegal Di~vision.
It has long bteen a recognized custom. of the industry for mlanu-
facturers to declare intended retail prices, and internal revenue taxes
on eigalrs are computed on such a b6asis.- Thie plan is based on this
custom, but free competition between manufacturers, as well as
industry'rs recognition of thie impyerative need for the retention of the
five-en~zt cigar, shoulld serve to prevent increase in prices.
The sale of long shot cigars, induced by excessive~ discounts to
distributors has be~en an abuse of consumers which will be remedied
by the provisions limiting the amount of such discounts. This plan
will permit each maanufacturer to makie the best possible cigar in
each price? class.
The use of cigars as "' loss leaders by unrelated business has been
a, severe handlicap to those persons whose major line of business is in
tobacco andl tobacco products. The placing of the retail price on the
container of cigars should prevent passing down to the wholesaler
the burden caused by such practices, and thus protect those wcho are
dependent for their livelihood on this trade.
Part II of Article V7I of the Code provides for the sale of tobacco
products other than cigars carried by the merchandising plan in
Part I. The most important fe-ature of this Part II is the prohibi-
tion of sales below the lowest reasonable cost to the wholesaler.
The Administrator may, in order to temporarily restrict destructive
price cutting, fix a basis for the minimiumn wholesale price of tobacco
products which will be binding onl all wholesale distributors. It will
be an unfair trade practice for any wholesaler to sell or offer for
sale any tobacco product below this mIinimumz price.
.HOrUS AND~ WA~LGEES
This Code provides a maximum work week of forty (40) hours,
with a limitation of eight (8) hours in an twent-four (24) hour
period and sixr (6) days in any seven (7) day period, except that on
one (1) day in each seven (7) day period employees may be permit-
ted to work not in excess of ten (10) hours, provided however, that
for a period not to exceed two ( ) wveeks in the calendar year eml-
ployees may be permitted to work in excess of the maximum hours
provided herein but not in excess of forty-eight (48) hours per week
or nmne (9) hours per day. All such extra hours shall be compen-
ha~ted for at the rate of time and one-third.
In the event that t~he basiq work weekr under the Code for the
WTholesale Food and Grocery Trade is reduced to a maximum of less
than forty (40) hours but not less than thirty-six (36) hours per
week, the above provisions will be automatically amended so as to
substitute in the place of "L forty (40) hours such shorter number
of hours as shall be prescribed in such Code for the WVholesale Food
and Grocery Trade; and thereafter any changes either by way of re-
duction (but in no event to less than thirty-six (36) hours or in-
crease in such maximum hours in said Food Code shall result in a
lIke increase or reduction of the said number of hours so substituted
It is provided that no wholesale tobacco establishment shall per-
folrm any sales or service operations on Sunday.
SExemptions are made for executives, provided they receive regu-
Jarly not less than thirty-five dollars ($35.00) per week; and outside
Outside delivery employees and billing and shipping clerks and
cashiers, working mn conjunction with the outside delivery employees
i~n wiorkz of such nature that any inequality of hours would interrupt
the routine of the outside delivery department, may be permitted to
work not in excess of forty-eight (48) hours per week.
Watchmen may be permitted to work not in excess of fifty-six
(56) hours per week.
Employees are under a minimum by population for a forty (40)
hour week, starting at sixteen dollars ($16.00) in cities of 500,000
population or over and graded to fourteen dollars ($14.00) per week
In towns and cities up to 100,000 population, with the provision that
in the South employees may be paid one dollar ($1.00) less than the
minimum rate provided above, excepting that:
(a) Nio office employee shall be paid less than at the rate of sixteen
dollars ($16.00) per week, other than office boys and messengers
wPhere a differential of two dollars ($2.00) per week is permitted.
(b) Delivery helpers, not to exceedi one for each delivery vehicle
used byr the member, may be paid at the rate of eighty percent (80%/)
of the minimum wage provided herein.
(c) Apprentice employees may be paid at the rate of one dollar
($1.00) less than the minimum wage.
(d) No outside salesman, whether on a commission basis or other-
wise, shall be Paid less than at the rate of twenty-five dollars ($25.00)
per week of six (6) consecutive days.
Thle weekly wages of all employees receiving more than the mini-
Ilnum wages specified in this Article shall not be reduced below the
rates existing on June 1, 1933, notwithstanding any reduction in the
number of working hours of such employees.
The Division Administrator in his final report to me on said Code
having found as herein set forth and on the basis of all the proceed-
ings in this matter:
I find that:
"L(a) Said Clode is well designedl to promote the policies and pur-
poses of Title I of the National Indsrial Recovery A~ct, including
removal of obstructions to the fre flowF of interstate and foreign
commerce which tend to diminish the amnoun~t thereof and will pDro-
vide for the general welfare by promodtinga the organization of indus-
try for the purpose of cooperative action among trade groups, by
inducing and mainrtainling united action of labor and management
under adequate governmental sanctions and supervision, by elimiinat-
ing unfair competitive practicesbypo tigheuletosbe
utiiztio o th peset rodctve capacity ofidustries, by avoid-
ing undue restriction of production (except as may 'be temporarily
required), by increasing the consumption of industrial and agricul-
tural products through increasmg purchasing power, by reducing
and relieving unemployment, by improving standards of labor, and
by otherwise rehabilitating industry.
"((b) Said industry normally emlployrs not more tharn 50,000 em-
ployees; and it is not classified by me as a major industry.
"'(c) The Code as approved complies in all respects with the per-
tinent provisions of said Title of said Act, including without luni-
tation Subsection (a) of Section 3, Subsection (a),' of Section 7,
and Subsection (b) of Section 10 thereof; and tha te~ applicant
association is an industrial association truly representative of the
aforesaid Industry; and that said association imposes no inequitable
restrictions on admission to membership p~cfn,,; lonpltherein.
"L(d) The Code is not designed to andwlnopemtoools
or monopolistic practices.
"'(e) The Code is not dlesigned to and will not eliminate or oppress
small enterprises and wpill not operate to discriminate against them.
"(f) Those engaged in other steps of the economic process have
otbeen deprived of the right. ton be heard plrn ior tohe approval of
For the above reasons this Code has been approved.
IIUGH S. JOHNSO)N,
JUNE 9, 1934.
66673 "---6f~57-10 1----3-- 2
OODE OF F'AIR COMPETITION FOR THE WHEOLESALE
AnTrcraE I PURPOSES
To effectuate the policies of Title I of the National Industrial Re-
coeryAct, this Code is established as a Code of Fair Competition
fortheWholesale Tobacco Trade and its provisions shaU be the
standards of fair competition for such trade and shall be binding
upon every member thereof.
ARTICLE II -DEFINITIONS
As used in. this Code, the following words and phrases shall be
defined as follows:
SECTION 1. The term President means the President of the
United States of America.
SECTION 2. The terma "Administrator means the Administrator
for Indlustrial Recovery.I
SECTION 3. The term "Act "" means Title I of the National Indus-
trial Recovery Act.
SECTIN 4. The term tobacco products includes, without limi-
tation, all cigars, stogies, cheroots, little cigars, cigarettes, smoking
tobacco, chewing tobacco and snuff.
SECTION 5. The ter~m wholesale tobacco trade means and in-
cludes all selling and distributing of tobacco products at wvholesle.
SECTION 6. The terms "' wholesale tobacco distributor ", wholesale
distributor "~, and member of the trade mean any person en-
gaged wholly or partially either as an employer or for his own
account, in the wholesale tobacco trade.
SECTION ?. The term "L wholesale tobacco establishment or estab-
lishment means any place of whiolesale business at which more
than one-half the dollar volulme of t~he sales made consists of tobacco
products, or at which the principal line of business is the sale oi
SECTION 8. Thle terms tobacco retailer and retailer mean
any person engaged whollyr or partially for his own account, in the
selling of tobacco pr1odiuc~ts directly to t.he consumer and not for
purposes of resale in any form.
SECTIONT 9. The term "cigar manufacturer means and includes
any person engagedl in the manufacturing into cigars of curedl leaf
tobacco, stemmed tobacco, scrap, and,'or shredded filler.
SECTTON 10O. The term tobacco manufacturer means and in-
clud~es any person engaged in the manufacture of cigarettes, smok-
ing, tobacco, snuff or tobacco products other than cigars, and the
dist~ributionl thereof, exclusive, however, of distribution by3 wholesale
distributors or retailers.
SECTION 11. The term cigar means and includes cigars, stogies,
cheroots and little cigars.
SECTION 12. Th6 (Orm "Obber means any wholesale tobacco
distributor who buys directly from the manufacturer.
SECTION 13. The term sub-jobber means any wholesale tobacco
distributor who opurchaises tobacco products from jobbers or jobbing~
establishments of manufacturers insteFad of directly from matnu-
(AL person may be a jobber as to certain tobacco products and a
sub-jobber as to others.)
SECTION 14. The term "' accreditedl cigar jobber means any whole-
sale distributor of cigars who maintains a sales organizattion and
has an exclusive selling arrangement for a brand or brands of cigars
for which he assumes the responsibility of promotion, distribution
and care in. a definite territory assigned to him.
SECTION 15. Thle term cigar service jobber means any whoe
sale distributor of cigars other than an accredited cigar job~ber.ol
(A jobber may be an accredited cigar jobber abs to a certain brand
or brands and a cigar service jobber as to others.)
SECTION li. The term 'L 01181n of stores means a group of retail
stores having single ownership and maintaining one or more bona
fide central distributing depots fromt which individual units are serv-
iced, and also bona fide central buying, storing, supervising and
SECTI[ON 17. The term employee includes any and all persons
engaged in the wholesale tobacco trade, however compensated, except
a member of the trade.
SECTION 18. The term employer '" means any person by whom any
such employee is compensated or employed.
SEPION 19. 1116 term (' exeutive "means an employee responrsi-
ble for the management of a business or a recognized subdivision
SECTION 20. The terml "C outside salesman .means an employee who
is engaged wholly or partially- in selling outside the establishment,
or any branch thereof, where he is employed.
SECTION 21. 1116 terIll Outside delivery employee means anr emn-
ployee engaged primarily in delivering merchandise outside the
establishment where he is employed.
SECTION 22. The term wPat~chman "' means an employee who for
not less than ninety (90) pe~r cent of his workingr hours is engaged
in watching and guardiner the premises of the establishment.
SECTION 23. The term apprentice means an employee with. less
than one (1) month's experience in the wholesale tobacco trade.
SECTION 241. The term. person includes all individuals, frms,
partnerships, unincorporated associations, corporations and other
forms of enterprise.
SECTION 25. The term State .means any State or Territory and
the Dist~rict of Columbia.
SECTION 26. 1116 t8717 '"South includes the following States:
Virginia, WTest Virginia, North Carolina, South Carolina, Georgaia
Florida, Kientucky, Tennessee, Alabama, MSississippi, A~rkansas,
Louisiana, Okrlahoma, New Mlexico, and Texas.
,, SEcLrow 27. Population for the purposes of this Code shall be
defermnined by reference t.o the latest census of the United States.
s~:_:iMon 28. The term "LAssociation means the Nat~ional Asso-
ciation of Tobacco Distributors Incorporated.
SECTION 29. The term LLCOURCi measS NatiOnal Tobacco Council,
Inc., a New Yorkr Corporation, or such other agency as shall be
designated for the purposes of Schedule I, hereto attached, by the
Code Authority hereby established and by the Code Authorities for
the Cigar MCanufactur~ing Industry and the Retail Tobacco Tratde.
ARTICLE III' -110RS
SECTION 1. (a) Except as hereinafter provided no employee of
any wholesale tobacco establishment shall permitted to work in
excess of forty (40) hours in any one week; or eight (8) hours in
any twenty-four (24l) hour period, except that on one day in each
seven-day period employees may be permitted to work not in excess
of ten (10) hours.
(b) In the event that the basic work week under the Code for the
Wholesale Food and Grocery Trade shall be reduced to a maximum
of less than forty (40) hours but not less than thirty-six (36) hours
per week, this Section 1 shall be amended so as to substitute in the
place of "L forty (40) hours such shorter number of hours as shall
be prescribed in such Code for the Wlholesale Food and G~rocery
Trade; and thereafter any changes either by way of reduction (but
in no event to less than thirty-six (36) hours) or increase in such
maximum hours in said Food Code shall result in a like increase
or reduction of the said number of hours so substituted as aforesaid.
SECTION 2. No office employee shall be permitted to work more
than forty (40) hours in any one week, nor more than eight (8)
hours in any one day.
SECTION 3. Watchmen may be permitted to work not in excess of
fifty-six (56) hours in any one week.
SjECTION 4. Outside delivery employees and billing and shipping
clerks and cashiers working in conjunction with the outside delivery
employees in work of such nature that any inequality of hours
would interrupt the routine of the outside delivery department may
be permitted to work not in excess of fort~y-eight (48) hours in any
SECTION 5. For a period not to exceed two weeks in the calendar
yea employees my be pe rmitted to work in excess of the maximum
hors provided in Se~ctton 1, but not in excess of forty-eight (48)
hours m any such week or nine (9) hours in any one day. tia~SndAll suchn
extra hours shall be compensated for at the rateoftean
SECTION 6. Executives who earn not less than thirty-five ($35)
dollars per week and outside salesmen, may be permitted to work
in excess of the maximum hours provided in this Code.
SECTION 7. No employee shall be permitted to work more than six
(6) days in any seven (7) day period.
SCECTION 8. No wholesale tobacco establishment shatll perform any
sales or service operations on Sundays.
r'ectire June 25, 1984---See paragraph 2 (5) of order approving this Code.
SECTION 9. No employer shall knmowingly permit_ any employee Lo
work for any time which when totalled with that already performed
with another employer, or emnployers, in this industry excetno the
maximum permitted herein.
Axioa IV 1- ABGES
SECTION 1. Except as hereinafter provided, the minimum weeklyg
rates of wages which shall be paid to employees of wholesale tobacco
establishments for a work-week as specified in ~Article III of this
Code-whether such. wages are calculated upon an hourly, w~eekly,
monthlly, commission, or any other basis--shall be as follows:
(e.) W~ithin cities of over 500,000 population, no employee ~shall
be paid less than at the rate of $16.00 per week for a forty (40) hour
(b3) Within cities of from 100,000 to 500,000 population, no em-
ployee shall be paid less than at the rate of $15.00 per week for a
forty (40) hour work-weekr.
(c) Wtithin cities of fromn f25,000 to 100,000 population, no em-
ployee shall be paid less than at the rate of $14.00 per week for a
forty (40) hour work-week.
(d) ~In the South employees may be paid $1.00 less than the mini-
mum wSagae rates provided above.
SECTION 2. Delivery helpers not to exceed one for each. delivery
vehicle used by the wholesale distributor, m~ag be paid at the rate
of not less than eight (80) per cent of the mimrmum wages provided
in Section 1 of this Article.
SECTION 3. Apprentice employees maay be paid at thie rate of $1.00
less than th-e minimum wages provided in Se~ction 1 of this Article.
SECTEON 4. 1NO Outside salesman, whether employed on a commis-
sion basis or other wise shall be paid less than at the rate of $25.00
per week; six (6) consecutive days shall constitute a week for the
purposes of this Section.
SECTION 5. No person employed as a watchman shall be paid less
than at the rate of $16.00 per week for a fifty$-six (56) hour week~z.
SECElON 6. NO Oilice employee shall be paid less than at the rate
of $16.00 for a, forty (40) hour workr-week.
SlEOT~l 7. Office boys and messengers maylV be paid $2.00 per weekr
less than the minimum, wage rates provided in Section 6 provided
that where there is more than one such office boy or messenger not
moore than ten, (]10) per cent of the total number of offiice employees
m-ay be so paid.
SECTION 8. The weekly wages of aell employees receiving more than
the minimum wages specified in this Article shaUl not be reduced
below the rates existing on June 1, 1933, notwithstanding any reduc-
tion in the number of wrorkinga hours of such employees.
SECTION 9. A person wTThose earning capacity is limited because
of age or physical or mental handicap or other infirmity may be
employed on light work at a wage below the minimum established
by this Code if the employer obtamns from the Authority designated
by the United States Department of Labor, a certificate authorizing
his employment at such wages and for such hours as shall be, stated
a Eirective June 25, 1934i-See paragraph 2 (5) of order approving this Code.
in the certificate. Such employer shall file monthly with the Code
Authority a list of all such persons employed by him, showing the
wages paid to, and the maximum hours of work for such employee.
AnaIcus V---GENERAL LAB~OR PnovsIONs
SECTION 1. Employees shall have the right to organize and bar-
gain collectively through representatives of their own choosing, and
shall be free from the interference, restraint, or coercion of employers
of labor, or their agents, in the designation of such representatives
or in self-organization or in other concerted activities for the pur-
pose of collective bargaining or other mutual aid or protection.
SECIION 2. No employee and no one seeking employment shall be
required as a condition of employment to join any company umion
or to refrain from joining, organuzmng, or assisting a labor organize.
tion of his own choosing.
SECTION 3. Employers shall comply with the maximum hours of
labor, minimum rates of pay and other conditions of employment,
ap roved or prescribed by the President.
SECTION 4. No person under the age of sixteen (16) years shall
be employed in the wholesale tobacco trade.
SECTION 5. Nro person under eighteen (18) years of age shall be
employed or be permitted to work, at operations or occupations
hazardous in nature or detrimnental to health. The Code Authority
shall submit to the Administrator within sixty (60) days after the
effective date of this Code, a list of such occupations for his approval
SECTION 6. 'Employers shall make payment of all wages in lawu
currency or by negotiable checks, payable on demand. All con-
tracts of employment shall prescribe payment of wages at least every
two wee~s and salaries at least as often as every month.
SECTION 7. No provision in this Code shall supersede any State or
Federal law which imposes on employers more stringent requirements
as to age of employees, wages, hours of work, or as to safety, health,
sanitaryr or general working conditions, or insurance or fire protec-
tion, than are imposed by this Code.
SECTION 8. Employers shall not change the method of payment of
employees' compensation or re-classify employees or duties of occu-
pations performed by employees or engage in any other subterfuge
so as to defeat the purposes of the Act or the provisions of this Code.
SECTION 9. No employee paid at a rate in excess of the minimum
shall be discharged and reemployed at a lower rate of pay for the
purpose of evading the provisions of this Code.
SECTION 10. All employers shall keep posted complete copies of the
provisions of this Code dealing with hours, wages and conditions
of employment in conspicuous places of easy and continuous access
SECTION 11. Each member of the industry shall comply with such
rules and regulations wit~h regard to the posting of notices, bulletins
and extracts of Code provisions as may be from time to time further
issued by the Administrator. Such notices, bulletins and extracts of
Code provisions shall be written in English and such other language
as may be in general use throughout the establishment.
SECTION 12. Every employer shall make reasonable provision for
the safety and health of his employees at the place and durin th~e
hours of their employment.
Standards for safety and health shall be submitted by the Code
Authority to the Administrator within sixr months after the effective
date of this Code.
SECTION 13. After .the effective date of this Code, wages shall be
exempt from fines and rebates; and from charges and deductions,
except charges and deductions for employees contributions volun-
tarily made by employees or for benefit funds. No employer shall
withhold wages except upon, service of legal process or other papers
lawfullyl requliringt ucnh withholding.
Deductions for other purposes not heretofore stated may be made
only pursuant to a contract in writing and kept on file by the
employer for six months after the terminationr of the contract and
which shall be kept open for the .inspection of Government
DSECTION 14. Female employees performing substantially the same
workr as male employees, shall receive the same rate of pay as male
PART 1 s
Cigar Mlerchia~ndisin~g Plan.S--Thbe 1Merchandising Plan in Schied-
ule I1 annexed hereto adopted for the Cigar Manufacturilng Industry
and for the Rletail Tobacco Trade in their respective Codes of Fair
Competition and hereinafter for conavenient reference in part re-
peated, is hereby accepted, adopted and approved; and all of the
provisions of the said plan insofar as they purport to regulated the
conduct of members of the wholesale tobacco trade are hereby made
rules of fair practice and fair competition. for all members of the
wholesale tobacco trade.
The provisions of said Schedule I and of this Article VI may be
amended only by amendment of this Codte and of the Codes for
the Cigar Mannufacturingr Industry and the Retail Tobacco Trade.
The said provisions may at any time be stayed by the Administrator~
of his own motionl or on application by any interested party, and
on uchnoicean herin, f ayas the Administrator may direct;
and said provisions shall automaial esae pnteeeto
of the Code Authority established byu any toneo said three Coes,
such stay to become effective, unlesssuhectoshlhaebe
meanwhile withdrawn, thirty (30) days after notice of such election
shall have been filed with the Administrator.
SECTION 1. Each jobber shall record wFith the Council thie discounts
and credit terms (not exceeding the dliscounts which such jobber
shall have received from the manufacturer) to be allowed by the
jobber from t~he retail price as determined pursuant to the provisions
of said Schedule I in connection with all resales of cigars which in
SStayed until made eirective pursuant to codes of hfar competition for Cigar Mann-
facturindg Industry and Retail Tobacco Trade-See paragraph 2 (1) of order approving
a All provisions for filing of prices and discount in, eiar merchandising plan tempo-
rarily stayed-S8ee paragraph 2 (3) of order approvin this Code.
his discretion he may makre to sub-jobb~ers. Such discounts shall be
subject to change at the discretion of the jobber provided that the
revised discounts be recorded with the Council at least three daYa'
before the change becomes effective unless a shorter timze be reqzueed
in order to meet a competitor's redu~ctionr of price which is not in
vPiolation of this merca~ndif~sing1 plan; 4 and the discounts so recorded
shall so long as effective apply to all such resales by the jobber to
sub-jobbers and there shall in no case be any individual variation
or variations from the discount or discounts so established.
SECTION 2. Each jobber and each sub-jobber shall record with the
Council the discounts and credit terms (not exceedinar the discounts
from the retail price which such jobber or sub-jobfter shall have
received from t~he manufacturer or jobber, as the case may be) to be
allowed upon all resales of cigars to retailers. Such discounts shall
be subject to change at the discretion of the jobber or sub-jobber
provided the revised discounts be recorded with the Council at least
three days before the change becomes effective unl2ess a shorter
time be req~uired in. order to meet a competitor's reducction of price
ccsiah is no~t in violation of thi~s merchTandising plarz; and the dis-
counts so recorded shall so long as effective apply to all such resales
to retailers and there shall in no case be any individual variation
or variations from the discount or discounts so established.
SECTION 3. Each resale by a jobber or sub-jobber under this
merchandising plan shall be evidenced by an itemized invoice.
SSECTION 4. Nothinlg in this Part I contained shall affect or modify
the provisions set forth in Schedule I in relation to drop shipment
SECTION 5. ZNo jobber or sub-jobber shall sell cigars directly to the
consumer except through an established retail department and in
compliance with the provisions of this merchandising plan relating
to sales by retailers.
SECTION 6. Upon the recommendation of the Code Authority es-
tablished by this Code or the Code for the Cigar Manufact~uring In-
dust.ry or the Code for the Retail Tobacco Trade or upon application
of any member of the Cigar M~anufacturing Industry or of the Whole-
sale Tobacco Trade or of the Retail Tobacco Trade and the approval
of such recommendation or application by the Administrator, the
Code Authorities established by the said several Codes, shall, upon
such notice and opportunity to be heard, if any, as the Administrator
may require, determine by joint action minimum discounts to be
prescribed in connection with sales of cigars by any member o~f the
trade, and such determination shall be effective only upon the con-
currence of all three Code Authorities and, subject to the apprva
of the Administrator, such minimum discounts shall be bdn
upon all members of the trade.
SECTION f. EllTereVer Bny Of the provisions of this merchandisin
plan provide for two or more discounts from the retail price, sc
discounts shall be computed separately and successively so that each
succeeding discount shall be computed upon the balance of the retail
price remaining after the deduction of the next preceding discount
Italicized words deleted-see paragraph 2 (2) of order approving this Code.
SacrrZow 8. Any change in the retail price shall be applicable as
at the effective date of such change to all mercadise thereafter
sold by wholesale distributors, but wholesale distributors mayl not-
withstanding any reductions of the retail price, dispose of existing
stocks on the basis of the retail price prevailing whn such stocks
SwrIION 9. Nothing in this merchandising plan shall be construed
to prevent the free, and general distribution of articlets commnl
used for advertising purposes and premiums except insofar as sc
distribution or use of premiums would constitutet, in effect, an addi-
tional discount or a reduction in price below the m~inima established
SEcTION 10. All prices and discounts filed with the Council by
jobbers or sub-jobbers, as hereinbefore provided shall immediately
be reported by the Council to the respective Code .Authorities for the
Cigar M~anufacturing Industry, thre Wholesale Tobacco Trade and
the Retail Tobacco Trade. 1Each such Code Authority shall cause
such prices and discountsl to be made available. to all members of its
respective industry or trade and shall comply with any regulations
which may .be issued by such Code Authorits with the approval of
the Administrator as to the publication and dissemination thereof.
Minimum 1Prices F'or Products Not Governed By The~ Plan.---At~s to
oigcars wi'th respect to which the pr~ovisions of Part I or SCchedulle I
shall not at thre time be operative or shall be stayed and b as to oiga-
rettes, smokCing tobacco, chTewi~ngc tobacco and~ eneff, the following
trade practices shall be obselreld by all moberPs of the wholesale
Section 1. No wcholesale dilstribuctor shall~2 at any time sell any such
tobacco prrod'uct belowo tlhe merchandise cost thereof to susch wh~ole-
solre distributor. For the purposes of this Part II the term mzer
ohacndise coet" mean (1) actzpal set delivered cost, less trade d'is-
counts or ewr~rent replacement cost, wnhiche is lvower; and isrz adddi-
tion thereto, (Se) the amount of any farr on the sale of the prod~c~t
directly ~paid by the wh~olesal~e distribiUtor, or (3) in thet e~en~t of a
sale involving a shtprmentf to a buyer situsated at thie time of sulch sale
in another state, an anweount eqyual to all taxes other th~an taxes paid
dirctly by thre mavulfa~cturer which ouldz~~c be included in the sale
price of such2 product were such product bought from a wolT~esale
d~istr~ibu~tor located in such state.
Section R. Tlhe Code Authori'ty shall" from, time to time u~pon
such notice and oppoort~unity to be hFeard, if" an&, as th~e Administrator
may require, determine th~e l7owe4st reasonable cost of the wlhol~esale
distribution of tobacco products, such determination to be subject to
the a~pprovual of the A~dminJistratfor. It shYall be an, u/nfai'r trladle proo-
tice and is hereby p~rohzibited for any wtholesale distributor to sell or
offer to sell any tobacco product at such price or epona such7~ terms or
conditions of sale that the buyer wrill pay less therefore than such~
a Italicized words deleted-Bee paragraph 2 (4) of order approving this Code.
lowest reasonable cost of distributing as so determined and approred~,
plus thle mercha~ndise cost thereof to such wholoesale distributor.
Section 3. Pending a determination ru~rsuant to Beotion & of this
Part II, and in order temporarily to restrict destructive price-cutting
inr thTe wholesale tobacco trade, the Administrator may, subject to
such notice and opportunity to be heard as he may deem necessary,
fiat a basis for the computat'o~n of the m~inimum *6 wholesale price
of tobacco products, which ehall be binding on all wuholesale dis-
"'As to cigars, with respect to which the provisions of Part I or
Schedule I shall not at the time be operative or shall be stayed, and
as to cigarettes, smoking tobacco, chewing tobacco and snuff, the
standards of fair competition for the trade with reference to pricing
practices are declared to be as follows:
"L SECTION 1 (a) : Wilfully destructive price cutting is an unfair
method of competition and is forbidden. Any member of the trade
or of any other trade or industry or the customers of either may,
at any9 time, complain to the Code Authority that any actual price
constitutes unfair competition as destructive price cutting, imperilling
sman~ll entecrprisesc or tePnding toward monopoly or the impairment
of codep wagercs. or working conditions. The Code Authority shall,
within five days, afford an opportunity to the member making such
price to answer such complaint and shall, within fourteen days, make
a, ruling or adjustment thereon. If such ruling is not concurred in
by either party to the complaint, all papers shall be referred to
the Research and Planning Division of NRA which shall render a
report and recommendation thereon to the Administ~rator.
"(b) :When no declared emergency exists as to such products or
any specified part thereof, there is to be no fixed rminimum basis
"L It is intended that sound cost estimating methods should be used
and that consideration should be given to costs (including costs
of wholesale distribution) in the determination of pricing policies.
"L(a) When. an emergency by reason of unfair competitive prac-
tices or other conditions, exists in the trade as to such products or
any specified part thereof, sale below the stated minimum price of
such products or such specified part thereof, in violation of Section
2 hereof, is forbidden.
"L SECTION 2. ~Emergency Provisions.--(a) : If the 'Administrator,
after investigation, shall at any time find both (1) that an emer-
gencyv has arisen within the trade, adversely affecting small enter-
prises or wages or labor conditions, or tending toward monopoly
or other acute conditions which tend to defeat the purposes of the
Act: (2~) that the finding of a basis for determining minimum
prices for such products or any specified pairt thereof is necessary
for a limited period, to correct the conditions constituting suc
emergency and, to effectuate the purposes of the Act, the Co~de Au-
thority may cause an impartial agency to investigate costs (including
the costs of wholesale distribution) and to recommend to the Ad-
ministrator a basis for determining minimum prices of the said
products or the said specified part thereof affected by the emer-
Italicised words deleted--See paragraph 2 (4) of order approving this Code.
agency, and thereupon the Adrriinistrator may proced to fix a basis
frdtermining such minimum prices.
"'(b): When the Administrator shall have fixed a basis for de-
termmmig minimum prices fo~r the said products or said specified
part thereof for a, stated period, which. prices -shall be reasonably,
calculated to correct the conditions of such emergency and to effectu-
ate the purposes of thee Act, he shall publish the said basis. Thec~re-
after, during such stated period, no member of the trade shall sell
such products at a net realized price below the minimum price~
determined upon the bases so fixed, and any such sale shall be deemed
destruc~tive price culttin. Efom time to time, the Code Authority
may recommnendi review or reconsideration or the Administrator
mray cause any determination hereunder to be reviewed or reconsid-
ered, and appropriate action taken."'6
SECTION 3. Notwithstandingr the provisions of this Part II iany~
wholesale distributor may sell any tobacco product as low aes the
price set by any competitor in his trade area onl merchandise which
is identical or essentially the same, if such competitors' price is
set inl conformlity weith the provisions of this Section, provided that
such wholesale distributor shall immediately notify the Code AIuI
thority or its nearest local agency- of such action and of all facts
SECTION 4. Notwithstanding a~ny of the! provisions of this Part
II[, any tobacco wholesaler macy sell at less than the prices ther~ein
prescribed merchandise sold as bona fide clearance or bona fide dis-
cont~inued lines of merchandise or imperfect or actually ramaaged
merchandise or merchandise sold upon the completed final liquidazl.
tion of any business or merchandise donated: for charitable pur
poses or to unemployment relif agencies, prsovid tat l such adta
merchandise shall be advertised, mrJarked and oda uhadta
a strip label shall be placed across the inside lid label of box goods
to be disposed of, stating the reason the said merchandise is being[
sold below the pre~scribed prices therefore and provided further thatf
such merchandise shall be disposed of pursuant to any regulation
ais to the manner of such. disposal which shall be issued by the Code
Authority subject to the disapproval of ~the Administrator.
AnaTorm VII -TRADE PRACTICES
SECTION jl. FG &e Advlertiszng.--The making of or causina or pers
mitting to be made or published any false, untrue or deceptive state-
ment by way of advertising or otherwise concerning the grade,
quality, quantity, substance, character, nature, origin, size or prep-
aration of any product of the trade, having the tendency and capac-
ity to mislead or deceive purchasers or prospective purchasers and
the tendency injuriously to affect the business of competitors is pro-
hibited as an unfair method of competition.
SECTION 2. Deceptivle Brandcing.--The infringement of established
trademarks and the use of trademarks or trade names which will
result in deception of the public or enable -wholesale distributors
to perfect such deception is prohibited as an unfair method of com-
CoPreamble and sections 1 and 2 added---See paragraph 2 (4) of order approving this
SECTION 3. Terio'PIfa2 Prtfction, Bgain@#t Illeg~itifa~id Scd6.--
W'here a manufacturer has granted a, wholesale distributor an ex-
clusive territory for the distribution of his product, the obtaining
by any other wholesale distributor of such product and shipping
same to dealers within said territory is prohibited as an unfair
method of competition.
SECTION 4. Fal86 Bi/lilf~.--NO wholesale distributor shall kcnow-
ingaly withhold from or insert in any quotation or invoice any state-
ment that makes it inaccurate in any material particular.
SECTION 5. I7UaccuraCte Labeling.--No wholesale distributor shall
brand or mark or pack any tobacco products in any manner which is
intendedl to or does deceive or mislead purchasers with respect to
brand, grade, quality, quantity, origin, size, substance, character,
nature, material content, or preparation of such tobacco products.
SECTION 6. InGcczlrtf Referene68 To Competitors, Etc.--No whole-
sale distributor shall publish advertising which refers inaccurately
in any material particular to any competitor or his goods, prices,
values, credit terms, policies or services.
SECTION 7. Thr~eat8 oft Law ~Suits.--No wholesale distributor shall
publish or circulate unjustified or unwarranted threats of legal
proceedings which tend to have the effect of harrassing competitors
or intimidanting their customers. Failure to prosecute in due course
shall be evidence that any such threat is unwarranted or unjustified.
SECTION 8. Bribing Employees.--No wholesale distributor shall
give, permit to be given, or directly or indirectly offer to give any-
t~hing of value for t~he purpose of influencing or rewarding the action
of anyT employee, agent or representative of another in relation to the
business of the employer of such employee, the principal of such
agent or the represented party, without the knowledge of such
employer, principal or party~. This provision shaUl not be construed
to prohibit free and general distribution of articles commonly used
for advertising except so far as such articles are actually used for
commercial bribery as hereinabove defined.
SECTION 9. Interference 7?176 BnOtlbr'8 COnrfad8s.--No wholesale
distributor shall attempt to induce the breach of an existing contract
between a competitor or customer or source of supply ; nor shall any
such member interfere with or obstruct the performance of such
contractual duties or services.
SECTION 10. Coereion.--No wholesale distributor shall require that
a purc~~haf~se f tobacco product or other goods be a prerequisite
to he urcaseofany other tobacco products.
SECTroN 11. Rebates.--(a) No member of the industry sh all
secretly, directly or indirectly, offer to make any payment or allow-
ances of a rebate, refund, commission, credit, unearned discount, or
excess allowance, whether in the form of money or otherwise.
(b) No member of the industry shall, directly or indirectly, offer
to extend to any customer any special price, terms, service or privi-
lege not extended to all customers of the same class in the same mar-
keting area, for the: purpose of influencing a sale, or with the effect
of influencing a sale.
SECTION 12. Invoice anzd Bi:lling.--No member of the industry
shall sell any merchandise, either on open account or for cash, unless
an itemized bill or invoice bearing the name and address of the whole-
saler is issued at the time such sale is made.
SECTION 13. Protection to Retailers. -It shall be an. unfair trade
practice for m~embe~rs of the trade to enter or en~gage~ in competition
with retailers, by selig merchandise at wholesale prices to ultimate
consumers for personal use. NSothing in this section, however, shall
prevent bona fide sales to em~ployees in wholesale tobacco establish-
ments for their personal use.
~ArI~cuE VITII---ORGANIZATION, POWE6RS AND DUTI~ES OF THE CODIE
ORGANIZTION AND CONSTITUTION
SECTION 1. There shall. forthwith be constituted a Code Authority
consisting of not more t~han ten (10) members to be selected as
Eight members shall be designated by the Board of Directors or
the Executive Clommit~tee of National Association of Tobacco Dis-
One member shall. be appointed by the Conzsum~ers' Advrisory Board
of the Nation al 3Recovery Administraton.
One member shall be a non-member of National Association of
'Tobacco Distributors, Incorporated and a n~on-member of anyr of its
affiiated associations and shall be designated by such non-members
in a manner to be formulated by the other members of the Code
Authority and submitted to the APdministrator for hiis approval
within fifteen (15) days after the e~ffctive da~te hereof.
SECTION 2. In addition to membership as above provided, there
may be not more tha~n. three (83) mebes, to be appointed by the
Administrator, to serve without vote.
SECTION 3. The Association and each trade or industrial a.ssocia-
tion directly or indirectly participating in the selection or activities
of the Code Authorityr shall (1) impose no inequitable, restriction on
membership, and (2) submit to the Admlinistrator true copies of its
articles of association, by-lawfs regulations, and any amendments
when made thereto, together witlh such other inorma tion as to mem-
be~rship, organization, and activities as the Admilnistrator may deem
necessary to effectuat~e the purposes of the Act.
rSECTION 4. In order that the Code Authority shall at all times be
'truly representative of the trade anld in any ~other respects comply
with the provisions of the Act, the Administrator may prescribe
such hearings as he mazy deem proper and thereafter if he shall
find that the Code Authority is not truly representative or does not
in other respects comply with the provisions of the Act, may require
an appropriate modification of the method of selection of the C~ode
SECTION 5. Nothing contained in this Gode shall constitute the
members of the Ctode Authority partners for any purpose. Nor
shall any member of the Code Authority be liable in any manner to
anyone for any act of any other member, officer, agent, or employee
of the Code Authority. Nor shall any member of the Code Author-
ity exercising reasonable diligence in the conduct of his duties here-
under, be liable to anyone for any action or omission to act under
this Code, except for his own willful misfeasance or non-feasance.
SECTION 6. If the Admlinistrator shall at any time determine that
any action of the Code Authority or any agency thereof may be
unfair or unjust or contrary to the public interest, the Administrator
may require that such action be suspended to afford an opportunity
for investigation of the merits of such action and further considera-
tion by such Code Authority or agency pending final action which
shall not be effective unless the Administrator approves or unless he
shall fail to disapprove after thirty days' notice to him of intention
to proceed with such action in its original or modified form.
PORTER8 AND DUTIES
Sleorrow 7. Subject to such rules and regulations as may be issued
by the Administrator, the Code Authority shall have the following
powers: and duties, in addition to those authorized by other provi-
sionls of this Code:
(a) To insure the execution of the provisions of this Code and
to provide for the compliance of the trade with the provisions of
()To adopt by-lawfs and rules and regulations for its procedure.
()To obtain from members of thle trade such information and
reports as are required for the Administration of the Code. In addi-
tion to information required to be submitted to the Code Authority,
members of the trade subject to this Code shall furnish such sta-
tistical information as the Administrator may deem necessary for
the purposes recited in Section 3 (a) of the Act to such Federal and
State agencies as he may designate; provided that nothing in this
Code shall relieve any member of the trade of any existing obliga-
tions to furnish reports to any Government agency. No individual
report shall be disclosed to any other member of the trade or any
other party except to such other Governmental agencies as may be
directed by the Administrator.
(d) To use such trade associations and other agencies as it deems
prprfor the casrrying out of any of its activities provided for
heren, provided that nothing heremn shall relieve the Code Au-
thority of its duties or responsibilities under this Code and that such
trade associations and agencies shall at all1 times be subject to and
comply with the provisions hereof.
(e) To make recommendations to the Administrator for the co-
ordination of the administration of this Code with sudx~ other
codes, if any, as may be related to or affect members of the trade.
(f) (1) It being found necessary to support the administration
of this Code, in order to effectuate the Policy of the Act and to
maintain the standards of fair competition established hereunder,
the Code Authority is authorized:
(a) To incur such reasonable obligations as are necessary and
proper ftor the foregoing purposes and to meet such obligations
out of funds which shall be held in trust for the purposes of the
Code andl raised as hereinafter provided;
(b) T'o submit to the Administrator for his approval, subject
to such~ notice and opportunity to be heard as he may deem
1. An itemized budget of its estimated expenses for the forec
going purposes, and
2. An equitable basis upon which the funds necessary to
support such budget shall be contributed by aUl members of
(c) After such budget and basis of contribution have been
approved by the Adlmmistrator, to determine and collect eq-ui-
table contributions as abo~ve set forth, and to that end, if neces-
sar, t intiutelegl roceedings therefore in its own name.
(2)ig Eac mntuember o th trade ~shall be liable for his or its
equitable contribution to thie expenses of the maintenance of the
Code Authority as hereinabove provided. Only members of the
trade complyingwihteCd and making such contriutionshl
be entitled to participate in the selection of the members of the
Code Authority or to receive the benefits of its volunary activities or:
to make use of any N.R.A. insignia.
(g) To cooperate with the ALdministrator in regulating the use
of an N.R.A. insignia solely by those members of the tradc e who are
io-~~ng w~sith this Code.
(h Tlo recommend to the Administrator any action or measures
deemed advisable, including further fair trade practice provisions to
govern members of the trade in their relations with each other or
with other trades or industries; measures for industrial planrning,
and stabilization of employment; and including modifications of
this Code which shall become effective as part hereof upon approval
by the Administrator after such notice and hearing as he may
(i)To appoint a Trade Practice Committee which shall meet with
the Trade Practice Committees appointed under such other codes as
may b~e related to the trade for the purpose of formulaatinng fair trade
practices to govern the relationships betwcpeen employers under this
code and under such other codles to the end that such fair trade
practices may be proposed to the Administrator as amendments to
this Code and such other codes.
(j) T'o provide alppropr~iate facilities for arbitration, and subject
to the approval of the Administrator, to prescribe rules of procedure
and rules to effect compliance with aw~ardls and dleterminations.
SECTION 8. Any member of the trade may submit data tending to
prove that such member is placed at a competitive disadvantage wi~tly
or is subject, to differentt economic conditions to those of other mem-
bers of the trade; and the Code Authority may, after investigation,
recommend to the Administraltor that changes be m~ade in the Labor
Provisions of this Code, and upon approval by the Admlninistrator,
after such notice and hearing as h~e may spec~ify, suc~h ne~w provisions
shall become effective for that member of the trade.
SECTION 9. Whenever any question may arise under this Code as to
the construction and meaning of any portion thereof, the Code
Authority may issue such interpretations as may be necessary to
effectuate the operation of and com pliane with the policy of the At
subject at all times to the approval of the Administrator and sc
interpretations approved by the Administrator shall become opera
tive as a part of this Code.
SECTION 10. No provision of this Code shall deny to any member
of tlhe trade or to any party in any proceeding the right to appeal
to the Administrator nor prevent, at any time, direct appeal to him
from atny determination of the Code Au~thority. The Code Author-
ity may, if it chooses, invoke the procedure provided for in this
ARTICI;z IX -Ml~omFICBrroN
SECTION 1. This Code and all the provisions thereof are expressly
made subject to the right of the President, in accordance with the
provisions of sub-section (b) of Section 10 of the Act, from time
totime to cancel or modify any order, approval, license, rule, or
regulation issued under said Act.
OECTION 2. This Code, except as to provisions required by the Act,
may be modified on the basis of experience or changes in circum-
stances, such modifications to be based upon application to the Ad-
mninistrator and such notice and hearing as he shall specify, and to
become effective on approval by the Administrator.
ARTICLE X--BIONOPOLIES, ETo.
No provisions of this Code shall be so applied as to permit monop-
olies or monopolistic practices, or to eliminate, oppress, or discrimi-
nate~ against small enterprises.
ARTICLE XI--EFFECTn'E DATE
This Gode shall become effective the date specified in the order of
approval of this Code by the President of the United States.
Approved Code No. 462.
Registry No. 1615--15.
SCHEDULE I' --CBIGA 31E'CHANDISING PLAB~s
A. BALW BT ClGAR MANUFACTUREBS
Bnarlow 1. As to each of the cigars of his manufacture, each cigar manufae.
turer shall record with thie Council the minimum sales price at whieb such
cigar Is intended to be sold at retail (exclusive of anyB governmental tax or
charge thereon required to be paid by the jobber or retailer), which price,
hereinafter refesrred to as '"the retail price shall constitute the basis for
computing the discounts and terms for all dealers as hereinafter provided;
and shall also record w~ith the Council the discounts and credit terms to be
allowed by him from the retail price in connection with the several respective
classes of transactions described in subdivision (a) to (d) inclusive of Section 2
of this Division A. The retail price and, within the limits hereinafter pre~-
scribed, the discounts shall be subject to change at the discretion of the manu
faetarer, provided the revised price or discounts as the ease may be, be recorded
wPit~h the Council at3 least (5) dals before the change becomes effective sarless
a shorter time be required: br at oigar esoufacturer in order to mneet a conzpeti-
tor's reduction of pr~i;e wchicha is not int eiolation~ of this neerokarhndising~ plan~,
The retail price shall be prominently marked on each container of cigars.
SwarroN 2. Frrom the recorded retail price, each eigar manufacturer shall,
as to each of his cigars, grant discounts to be established by him in his dis-
cretion within the limits hereinafter in this Beetion 2 prescribed, as follow:
(a) In the case of sales, if apy, to retailers other than sales to chains of
stores and other thanl drop shipment sales under subdivision (d) of this
Beetion 2, a discount of not more than twenty-eight percent (28%1).
(b) In the case of sales to accredited eigar jobbers, a discount, in addition
tao the discount which shall have been established by the manufacturer under
subdivision (a), of not more than fourteen percent (14%r).
(c) In the case of sales to cigar service jobbers, a discount, in addition to
the discount which shall hav~e been established by the manufacturer under
subdivision (a), of not more than sixty-six and two-thirds percent (66%%O~)
of the established discount to accredited jobbers. Provided, however, that in
territories where no accredited cigar jobber exists, a moanufakcturer may allow
a cigar service jobber a discount not to exceed ten percent (10%r) on any
particular class of cigars in addition to the discount which shall have been
established by the manufacturer under sudivisionl (a).
(d) In a territory where a cigar manufacturer has an accredited cigar
jobber, the cigar manufacturer may, in his discretion, make drop shipments to
retailers or sub-jobbers, provided the neeredited cigar jobber agrees to or
requests such shipments; in a territory where the cigar manufacturer has no
accredited cigar jobber, the cigar manufacturer may, in his discretion, make
drop shipments to retailers. Provided that in either case shipments shall be
made onlly in quantities of not less than 2,000 cigars in the case of Class A,
and Class B cigars, and not less than 1,000 cigars in the case of Class C or
For such sales or drop shipments, there shall be established a discount for the
drop shipment purebaser, in addition to the discount which shall have been
established by the manufacturer under subdivision (a), of not more than five
percent (5%i), and this discount shall be allowed by the manufacturer or
jobber, whichever shall make the billing.
1 Stayed until made effective pursuant to codes of fair competition for Cigar Manufa>-
turing Industry and Retail Tobacco Trade--See paragraph 2 (1) of order approving
s All provisions for filing of prics and discounts in clgar merchandising Dlan tempo.
rarily sta.aed-See paragraph 2 (3) of order approving this Code.
aItalicized words deleted. See paragraph 2 (2) of order approving this Code.
The clgar manufacturer may in connection with each drop shipment
sale allow to the accredited eigar jobber who has requested or consented
to such sale a service credit. Provided, that the total of the service credit
and th discount allowed to the drop shipment purchaser and the accredited
cigar jobber shall not exceed the fourteen percent (14%) set forth in suqb-
division (b) above.
(e) In the ense of sales to chains of stores, discounts not exceeding the
discounts which the manufacturer shall have established for his sales to
accredited cigar jobbers under subdivision (b), provided, however, that each
cigar manufacturer may determine in his own discretion to which chains,
if any, he will make direct sales and, within the limits hereinabove pre-
scribed, the amount of discounts on each such sale.
On each transaction in any of the categories (a) to (d) inclusive above
described, the eigar manufacturer may allow a further discount of 2% for
cash within his established credit terms.
Nothing herein contained shall prevent any cigar manufacturer from estab-
lishing within the maximum percentage limit hereinabove prescribed a
diffrent schedule of discounts with respect to each of the several brands,
sizes, shapes or prices of his products, or a schedule d discounts different
from that of any other eigar manufacturer; but each cigar manufacturer
shall apply his established system of discounts uniformly as to each of the
classes of transactions above enumerated in subdivisions (a) to (d) inclusive,
and within each of the said classes of transactions there shaUl in no ease
be any individual variation or variations from the discount or discounts so
established by such cigar manufacturer. The service credits provided for in
subdivision (d) need not be uniform and may vary in each individual case.
.SECTION 3. NO manufacturer shall sell cigars at retail to consumers except
in accordance with the provisions of this merchandising plan relating to
sales by retailers; but the provisions of this merchandising plan shall not
apply to any cigar manufacturer who sells exclusively and directly to the
SEcTIONc 4. No manufacturer shall offer or give a free deal. The term
" free deal as used in this paragraph means the gift of cigars or anything
of value or any special deal, discount or allowance conditioned upon the pur-
chase of a product.
SECTION 5. All sales by manufacturers shall be evidenced by itemized in-
voices showing the retail price and the discounts granted therefrom.
B. BALES BY JOBBERS AND BUB-JOBBERS
BEcTIONv 1. Each jobber shall record with the Council the discounts and
credit terms (not exceeding the discounts which such jobber shall have re-
ceived from the manufacturer) to be allowed by the jobber from the retail
price in connection with all resales of cigars which in his discretion he may
malie to sub-jobbers. Such discounts shall be subject to change at the dis-
eretion of the jobber provided that the revised discounts be recorded with
the Council at least three dayss before the change becomes elective saless
ab shorter tim~e be required in order to meet a competitor's reduction~ of price
whlich is nrot in violation of this mcerchalndising plan,a and the discounts so
recorded shall so long as effective apply to all such resales by the jobber to sub-
jobbers and there shall in no case be any individual variation or variations
from thie discount or discounts so established.
8Edono 2. Each jobber and each sub-jobber shall record with the Council
the discounts and credit terms (not exceeding the discounts from the retail
price which such jobber or sub-jobber shall have received from the manu-
facturer or jobber, as the case may be) to be allowed upon all resales of
cigars to retailers. Such discounts shall be subject to change at the discretion
of the jobber or sub-jobber provided the revised discounts be recorded with
the Council a't least three doay J before the change becomes effective uonless a
aborter tim-e be required in order to meet a competitor's reduction of price
which is not in violations of th~is mecrchawdising planr; s and the discounts so
recorded shall, so long as effective, apply to all such resales to retailers and
there shall in no case be any individual variation or variations from the dis-
cout or discounts so established.
Italicized words deleted. See paragraph 2 (2) of order approving this Code.
Smarrzow 8. Each resale by a jobber or sub-jobber under this merchandising
plan shall be evidenced by an, itemized invokce.
Swroro 4. Nothing in thi Division B contained shall affect or modify the
provisions above set forth in Division A in relation to drop shiipment sales,
SacrroN 5. No jobber or sub-jobber shal sell cigars directly to the consumer
except through imn established retail department and in compliance w~ith the
provisions of this merchandising plan relating to sales by retailers.
c. saL~s wra IarwerAILrn
Sweerrow 1. In the case of all cigars purchased by retailers from eigar man.
facturers, jobbers, or sub-jobbers in connection with which a retail price shall
have been recorded by the manufacturer as hereinabove provided, the retailer
shall sell such cigars at retail at not less than the retail price so recorded,
provided, however, that (1) in the case of the sale at retail of multiples of
not less than ten units (ezeept in the case of elgars selling for less than fve
cents (5e) each) a discount maay be allowed of not more than live percen$b
(5%') from the retail price, and (2) in the case of sales at retail of boxres of
twfenty-five (25) cigarS or more a discount of not more than eight percent
(8%r) from the retail price may be allowed unless the cigar manufacturer shall
record with the Council and mark a box price thereon involving a discount
of less than eight percent (8%r) in which case the maarked box price shall be
observed as a minimum, and (3) the retailer may give not more than one pad
of matches for each unit sold, or five pads per box: of twenty-five cigars or ten
pads per box of fiftyr (50) cigars sold. In the case of any retailer granting a
cash discount upon all puirchalses made, any sales of cigars shall be excluded in
computing the cash discount to be anlowed, or the amount of cash discount shall
be included in the price of the merchandise sold in addition to the minimum
prices herein provided.
SmrromN 2. Upon any sale to a consumer, situated at the time of such sale
in a state imposing a tax on tobacco products or the sale thereof (other than
a tax payable by thze manufacturer) the amount of such tax, if not paid by the
consumer, shall be added to the minimumn price herein provided, whether the
seller shall be located within or without such state.
SEcTION 3. Notwithstanding the provisions of this merchandising plan, any
tobacco retailer mayr sell at less than the prices therein prescribed merchandise
soild as bona fide clearance or bona ftide discontinued lines of merchandise or
imperfect or netually damaged merchandise or merchandise sold upon. the comn-
plte final liquidation of any business or merchandise donated for charitable
purposes or to unemployment relief agencies, provided that aUl such merchandise
shall be advertised, marked and sold as such and that a strip label shall be
plneed across the inside lid label of box goods to be disopoed] of, stating the
reason the said merchandise is being sold below the prescribed prices therefore
and provided further that such merchandise shall be disposed of pursuant to
any regulations as to the manner of such. disposal as shall be issued by the Code
Authority subect to the approval of the Administrator.
SECIO 4. Except as in this merchandising plan otherwise expressly provided
whfere~ver under any of the provisions of thiis merchandising plan any eigar is
required to be sold at retail at a minimum price, such minimum retail price~
shall nlot be reduced directly or indirectly or by any device or subterfuge such as
the giving of any trading or merchiandis~e coupons, prizes or premiums or any
other thing of value or discount, rebate, refund, commission, credits or allowo-
ances whether in the form of money or otherw~ise; nor shall any retailer offer
or extend special service or privilege to any customer which. is not available
to all customers.
D). MINIM6UM DISFCOUNTS
Upon the recommendation of the Code Anthority established byr the Code for
the Ciganr Alanufacturing Industryv or the Code for the Wholesale Tobacco Trade
or the C~ode for thle Retail Tobacco Trade or upon application of any memer
of the Cigar Manufacturing Indlustry or of the W~holesale Tob~acco Trade or of
the Retail Tobacco Trade and the approval of such recommendation or applica-
tion byv the Administrator, the Code Authorities established by the said several
codes, shall, upon such notice and opportunity to be heard, if anyg, as the
Administrator may require determine by joint action minimum discounts to be
prescribed in connection with sales of cigars by any member of said Industry
or Trades and such determination shall be effective only upon the concurrence
of all three Code Authorities and, subject 'to the further approval of the
Administrator, such minimum discounts shall be binding upon all such members.
EL PROVISIONS AlPPLICABE1 'ID AIL BAIES~ OF CIGAR
SEloTEO 1. Wherever any of the provisions of this merchandising plan provide
for two or more discounts from the retail price, such discounts shall be com-
puted separately and successively so that each succeeding discount shall be
computed upon the balance of the retail price remaining after the deduction of
the next preceding discount provided for.
SECTION 2. Any change in the retail price shall be applicable as at the effective
date of such change to all merchandise thereafter sold by wholesale distributors,
or retailers, but wholesale distributors may, notwithstanding any reduction of
the retail price, dispose of existing stocks on the basis of the retail price
prevailing when such stocks were acquired.
SwcTION 3. Nothing in this merchandising plan shall be construed to prevent
the free and general distribution of articles commonly used for advertising
purposes and premiums, except insofar as such distribution or use of premiums
would constitute, in etfect, an additional discount or a reduction in price below
thze minima established hereby.
ssECTON 4. All prices and discounts filed with the Council by manufacturers,
jobbers or sub-jobbers, as hereinbefore provided shall immediately be reported
by the Council to the respective Code Authorities for the Cigar Mianufacturing
Industry, the WTholesale Tobacco Trade and the Retail Tobacco Trade. Each
such Code'Authority shall cause such prices and discounts to be made available
to all members of its respective industry or trade and shall comply with any
regulations which may be issued by such Code Authority with the approval of
the Administrator as to the publication and dissemination thereof.
UNIVERSITY OF FLORIDA
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