NATIONAL RECOVERY ADMINISTRATION
CODE OF FAIR COMPETITION
SPROCKET CHAIN INDUSTRY
UNIV. OF FL LIB.
DOCU ENT S DEPT.
For sale by the Superintendent of Documents, Washington, D.C. - Price 5 cents
Approved Code No. 347--Supplement No. 34
Registry No. 1107--04
(A Division of the M~achinery and Allied Products Industry)
AS APPROVED ON JULY 21, 1934
WE DO OUR PART
GOVERNMENT PRINTING OFFICE
This publication is for sale by the Superintendent of Documents, Government
Printing Office, WVashington, D.C., and by district officers of the Bureau of
Foreign aind Domestic Commeree.
DISTRICT OFFICES OF THE DEPARTMENT OF COMMERCE
Atlanta, Ga.: 504 Post Office Building.
Birmuingham, Ala. : 257 Federal Building.
Boston, Mass. : 1801 Customhouse.
Buffulo, N.Y.: Chamber of Commerce Building.
Charleston, S.C.: Chamber of Commerce Building.
Chicago, Ill.: Suite 1706, 201 North Wells Street.
Cleveland, Ohio: Chamber of Commerce.
Dallas, Tex.: Chamber of Commerce Building.
Detroit, Miich.: 801 First National Bank Building.
HIouston, Tex.: Chamber of Commerce Building.
Indianapolis, Ind.: Chamber of Commerce Building.
Jacksonville, Fla.: Chamber of Commerce Building.
Kansas City, MIo.: 1028 Baltimore Avenue.
Los Angeles, Calif.: 1163 South Broadway.
Loulsville, Ky.: 408 Federal Building.
Mlemphis, Tenn.: 229 Federal Building.
Mlinneapolis, M~inn.: 213 Federal Building.
New Orleans, La.: Room 225-A, Custombouse.
New York, N.Y.: 734 Custombouse.
Norfolk, Va.: 406 East Plume Street.
Philadelphia, Pa.: 422 Commercial Trust Building.
Pittsburgh, Pa.: Chamber of Commerce Building.
Portland, Oreg.: 215 New Post Office Building.
St. Louis, Mo.: 506 Olive Street.
Ban Francisco, Calif.: 310 Customhouse.
Battle, Wash.: 809 Federal Office Building.
Approved Code No. 847--Sup. #84 Rtegistryr N;o. 1107-4
CODE OF FAIR COMPIETITILION
SPROCKET~ CHAIN ~INDUTRY
As Approved on July 21, 1934
Approved code =#347, Suppl. #lt34, Page 10, ~Article V, Section
.8 (f), last word in first line. The word not should be act."'
W. 1. 11OVERNMENT PRININGB OFFICE: 1984
I ,J I
gpproved Cede No. 347-Sopp. No. 84
Realabtsy ]Rlo. 2107-DI
CODE OF FAIR COMIPETITON
SPROCKCET CHAIN INDUSTRY
As Approved on July 21, 1934
Page 7, first word, 15th line bais "' should be basic". The!
heading, Article IV: should appear between the two paragraphs now
contained in Article III, page 10, first line last word "not ") sholdl
be "L ac t".
0. s. oVERIWWER Prgrag d: WArar
Approved Code No. 347--Supplement No. 84
SUPPLEMSENTARY CODE OF FAIR COMPE1~TITION
SPROCKET CHAIN ~JINDSTRY
~As Approved on JulyT 21, "1934
APPROVING SUPPLEM~ENTA~RY CODE OF ~FAIR 60OMPETITION FOR THE~1
SPROCKET CIKilN INDUSTRY
A DIVISION OF THE MACHINERY AND CALLED PRODUCTS INDUSTRY
An application having been dulyr made pursuant to and in full
compliance with the provisions of Tiit~le I of the Nliational ICndustrial
Recovery Act, approved June 16, 1933, for Sprocket Chain Subdivi-
sion of M~achinery and Allied Products Industry, and a hearing hnav-
ing been duly held thereon a~nd the annexed report on said Supple-
mental Code, containing findings with respect thereto, having been
made and directed t~o the President:
NOWV, THEREFORE, on behalf of the President of the United
States, I[, Hugah S. Johnson, Administrator for Industrial Recovery,
puresuant, to authoits vested in me by Executive Orders of the
Preidet, ncldin Eecutive Order No. 6i543-, datedc D~ecember
30, 1933, and otherwise; do hereby incorporate by reference said
annexed report and do find that said Supplemental Code complies in
all respects with the pertinent provisions and will promote the policy
and purposes of said Title of said Act; and do hereby order that said
Supplemental Ciode of Fair Competition be and it is hereby ap-
proved; provided, however, that the provisions of ~Article VIII, See-
tion (a), insofar as they prescribe a waiting period between the
fiing with the Code Authority (or such agency as may be designated
in the Supplemental Code) and the effective date of price lists, ats
originally filed and/or revised price lists or :revised terms and condi-
tions of sale, be and they hereby are stayed pending my furrther
HUGioH S. JOHNSONc,
Admnin~istr~ator for In~dustrilal R~ecov'ery.
Approval recommended :
BBaRow W. Manant~,
July fl, 1934.
7533P"-82--'-1 22--34 (1)
REPORT TO THE PRESIDENT
Th.e W~hite House.
SIR: This is a report on the Supplemental Code of F'air Comnpeti-
tion for the Sprocket Chain Subdivision of M\Iachinery and Ali~ed
Pmroducts Indusit~ry, a pubhlic hearing on which was held in Wash-
ington, D.C. on December 21, 1933. The hearing was conducted in
full accordance with the provisions of Title I of the National In-
dust rial Recovery Act.
The Sprocket Chain Subdlivision, being truly representative of the
manufacturers of the products defined in Article II of the Supple-
mental Code, has elected to formulate and submit a Supplemental
Code of Fair Competition as provided in the second prgphof
Article I in the Code of Fair Competition for the Machinery and
Allied Products Industry, approved by you on the seventeenth day
of March, 1934.
The Subdivlision includes the manufacture for sale of sprocket
chains of mnalleable iron, steel, and other metals for conveying, ele-
vatingr, and the transmission of power of the types generally known
as roller chains, rollerless bushing chains, block chains, malleable
and' other cast detachable pintle and roller chains, balance and leaf
chains, bar link chains, steel detachable link chains, combination cast
and bar linkr chains, drop forged and rivetless chains, draw bench and
haul-up chains, t~aintor gate and bridge chains, and parts for such
chains and sprockets for same, and includes all those engaged in such
manufacture for sale; except that there shall not be included therein
the manufacture for sale of chains for hand hoists and those generally
known as round link or coil chains, nor machine finished chains as
defined in the definition of the Roller and Silent Chain' Subdivision.
The manufacture of sprockret chain by farm equipment manufac-
turers is excluded from the manufacturing provisions of this Code
but the marketing and trade provisions shall apply to all sprocket
chain soldl by such farm implement manufacturers for all purposes
other than for use on farm implements.
Annual sales of malleable iron sprocket chains and sprockets for
elevating, conv-eying and transmission of power declined from
$;5,431,00i0 in 19329 to $1,408,000 in 1932, or 74 per cent. The Subdi-
vision has estimated the value for the year 1933 at $1,535,000 which
indicates an increase of 9 per cent over the 1932 level.
Aggregate invested enpital has declined 9 per cent since 19203, while
production capacity3 has r~emainedl constant.
The trade association, inl it~s code application, hlas estimated that,
this Subdiv-ision employed appr~oximately 585 emnployees in the year
1929. A tabulation of questionnaire returns from five establishmlents
of the Subdivision show~s that in :19,29, 83.2 per ce~nt of the total
number of employees w~ere factory w~orkers~; on this basis 98 office
workersc havea been segppreatedl from the 19289 figure, leavingr 487
Factoryr employment declinled from 487 wForkrers in 1929J to a mnini-
mum of 216 in the third quarter of 1932, or nearly 56 per cent. Since
then employment increased almost constantly to 256 factory workers
in the third quarter of 1933, or nearly 19 per cent. ]Factory emp~loy-
ment as of October 15, 1933 declined again to 234 workers or nearly
9 per cent.
Ai summarized tabulattion of five~ National RecoveryS Administra-
tion questionnaire returns shows average? hours per week for factory
workers of this Subdivision as follows:
Hbure per~ ~teekb
June 15, 19r29 -.. ---------------------------------------- 49. 4
June 15, 1933 ---------------1---------------- ------------- 24. 4
October 15, 1933_ __ __ ------------------------------------- 34. 2
After 1929 man-hours declined steadily from 24,060 to a minimum
of 6,965 in the first quarter in 1933. For the third quarter of 1933
man-hours increased to 9,421 but since then havPe decreased2 again to
8,003 or 15 per cent as reported on October 15, 1933. Based on the
man-hour requirements as of Oct~ober 15, 1933, on the average t~he
40~-hour provision will probably cause litl further reemployment.
The wage provisions for the Subdivision, which is operating under
the Code of the M~achinery and Allied Products Industr, provide
that employees engaged in plant operations shall be paid as follows:
(1) in cities of more than 50),000 population and their immediate
vicinity, 40 cents per hour; (12) in cities of more than 10,000 but not
more than 50,000 population and their immediate vicinity, which
cities are not in the immediate vicinity of a city of more than 50,000
population, 38 cents per hour; (3) in cities of 10,000 population or
less and their immediate vicinity', which cities are not in the immedi-
ate vicinity of a city of more than 10,000 population, 36 cents per
hour, except that employees e~neagred in plant operations in all locali-
ties in the states of Virginia forth Carolina., South Carolina, Geor-
gia, Florida, Tennessee, Alabama, Mississippi, Arkansas, Louisiana,
Texas, and Oklahoman, shall be paid not less than 32 cents per hour.
WVhen females do substantially the same work as males or replace
males, they shall receive thle same pay. Howevr;er, nlo female employee
shall be paid less than ST90~0 of the proper rate for the locality in
Office boys and girls and apprentices shall be paid not less than
80 'o of the minimum wage.
Employees other than those engaged in plant operations shall
receive not less than $15.00 per week.
Distributions of the number of factory workers receiving classified
rates in the specified areas are not available. ConsequentlyT, it is only
possible to estimate the approximate number of factory workers who
will receive the benefit of the proposed minimum hourly rates, re-
gardless of location, on the basis of the number of factory workers
receiving less than the designated hourly rates as of June 15i, 1933.
letimated nurnber of factory woorkers receivingy less than~ desigarccted hou~rlU
Distribution of factory wmorkr
receiving less than the mint-
mum regardless of location
Proposed minimum hourly rates
40 cents (other U .S.)...........................--- -- -- ----- 45. 1 115
88cents (other U.S)..~....~..~~...~~~.............-------------------- 43. 3 111
86cents tot her U.S.).......~-~-~~ .....................------------ --- --- 4. 5 106
82 cents (South)~. ... ... ... ... ....... -- -- -- -- --- -- -- -- -- -- 86. 0 92
Based on the distribution as of June 15, 1933, and on the specified
percentages of the number of factory workers receiving less than the
designated rates shown in the above table, the adoption of the pro-
posed minimum rates will probably cause an mecrease in factory pay
rolls. The estimated increase as of Junel 1, 19.33, regardless of
location of the workers, will probably, under the most favorable
conditions, not exceed 14.0 percent assuming only upward adjustment
in the brackets belowv the 40O cent minimum and no change in man-
n~UIse OF SUPPLEMENTAL CODE
Article I states the purpose of the Supplemental Code.
Article II accurately defines specific terms applicable to the Sub-
division as used in this Supplemental Code.
Article III provides for the adoption of the employment provisions
of the Code of Fair Competition for the Machinery and Allied
Products Industry, as approved by you, and as from time to time
Article IV provides for the adoption of Articles II, VI, VIII, and
IX of the Code of Fair Compet~ition for the Machinery and Allied
Article V provides for the establishment of a Code Authority and
defines its powers and dut~ies.
Article VI provides for an accounting system and methods of cost
findinrr and 'or estimnating.
Art ele VII provides that no products of the Subdivision shall be
sold or offered for sale belowv a reasonable cost when the Code
Authority determines that an emergency exists.
Article VIII provides for methods of setting up, revising and
filing price lists and discount sheets and terms of sale and payment.
A ticle I~X sets forth trade practices for the Subdivision.
Article X states that no provision of this Supplemental Code relat-
ing to pricingr and marketing shall apply to export sales.
bArticle XI provides that this Supplemnental Code and all the pro-
visions thereof are expressly made subject to the right of the Presi-
dent, in accordance with Subsection (b) of Section 10 of the Act,
from time to time to cancel or mnodify any~ order,r approval, license,
rule or re~rulation issued under said Act. PrrovlSion is also made
that mnoditzentions maly be submitted by the Co~lo Authlorit~y to the
Admiinistrator for approval.
Article XII. No p~rovision of this Suppl:merlntl Code shall be so
applied as to permiit mlonoplolies~, or mnocrlpolistic p~ractices, or to
chiminate, op~press, or dliscriminate ag~ainst small e~nterprlises,
Article XIII states the effective~ date of this Supplemeilntal Code.,
The Assistant Deputy Aldministrator in, his final report to mre on
said Supplemental C'ode? having foundl as herecin set forth and on the
basis of all the proceedings in thnis matter:
I find that:
(a) Said Supplemental Code is well designed to promote the
policies and purposes of Title I of the National I~ndustrial 1Recovpery
Act, including removal of obstructions to the free~ flow of interstate
and foreign commerce which tend to diminish. the amount thereof
and will provide for the general welfare by promoting the organi-
zation of industry for the purpose of cooperative action among the
trade grroups, byv induciAng and maintaining united action of labor and
management under adequate governmental sanctions and super-vision,
by elimninating unfair competitive practices, by promoting the fullest
possible utilization of the present productive capacity of industries,
by avoidingr undue restriction of production (except as may be tem-
pararily requiredd, by increasing thte consumption of Industrial
and agricultural products through increasing purchasing power, by
reducing and relieving unemployment, by improving standards of
labor,! and by otherwise rehabilitating industry.
(b)j Said Subdiviision nor~mally employs not more than 50,000) em-
ployees; and is not classifiedl by me as a major industry.
(c) The Sup~plem~ental Code as approved complies in all respects
with the pe~t~inent provisions of said Title of said Act, including
without limiitation Subsection (a) of Section 3, Subsection (a) o
Section 7, and Subsection (b) of Section 10 thereof ; and that the
applicant association is an Indulstrial association truly representa-
t~ive of" the aforesaid Subdivision; and that said association imposes
no inequitable restrictions on admission to membership therein.
(d) The Supplemental Code is not designed to and wpill not per-
mitt monopolies or monopolistic practices.
(e) The Supplemlental Code is not designed to and will not elim~i-
nate or opp~ress small enterprises and will not operate to dliscrimninate -
(f) Those engaged in other steps of the economic process have not
been deprived of the right to be heard prior to approval of said
For these reasons, therefore, I hav~e approved this Supplemental
Code, provided that certain provisions relating to price publication
are staged, as stated in the Order.
HUGcH S. JOHNsoN,
JULY 21, 1934.
SUPPLEMENTARY' CODE OF FAIR COMPETITION FOR
THE SPROCKET CHAIN INDUSTRY
A DIVISION OF THE AIACHINERY AND ALLIED PRODUCTION INDU8BTY
ARTICLE I PURPOSES
To effectuate the. policy of Title I[ of the National Industrial Re-
covery Act, the following provisions are established as a Supple-
mental Code for the Sprocket Chain Subdivision of the Machinery
and Allied Products Industry, and together with the Code of Fair
Competition of 1Machinery and Allied Products Industry, to which
it is a supplement, shall be the standard of fair competition for this
Subdivision, and shall be binding on each employer therein.
"'Applicant means the Association of Sp"rcket Chain M~anufac-
turers, a trade organization, all members ofwhich are engaged in
the manufacture for sale of the products of the Sprocket Chamn Sub-
division of Miachinery and Allied Products Industry.
Indust.ry "' means the Machineryr and Allied Products Industrg,
as defined in its Code of Fair Competition, as approved by the Presi-
dent, and as such definition may from time to time be amended.
Subdivision means the Sprocket Chain M~anufacturigSb
division of the Mlachinery and Allied Products Industry as defie
and set forth in Paragraph 32 of Article II of the Code of ]Fair
Competition for the MlachineryT and Allied Products Industry, as
'Sprocket Chain Subdivision means the manufacture for sale
of sprocket chains of malleable iron, steel and other metals for con-
veyTing, elevating, and the transmission of power of the types gen-
erally known as roller chains, rollerless bushing chains, block chains,
malleable and other cast detachable, pintle, and roller chains, balance
and leaf chains, bar link chains, steel detachable link chains, com-
bination cast and bar link chains, drop forged and rivetless chains,
draw bench and haul-up chains, taintor gate and bridge chains, and
parts for such chains and sprockets for same, and includes all those
engaged in such manufacture for sale; except that there shall not
be included therein t~he manufacture for sale of chains for hand hoists
and those generally known as round linkr or coil chains, nor machine
finished chains, as defined in the definition of the Roller and Silent
Chain Subdivision. The manufacture of sprocket. chain by farm
equipment manufacturers is excluded from the manufacturing provi-
sions of this Code but the marketing and trade provisions shall apply
to all sprocket cha~in sold by such farm implement manufacturers for
all purposes other than for use on farm implementss.'
"L Code means the Code of Fair Comp~etition for the Machinery
and Allied Products Industry, as app~rovedl by the Presidecnt, Ma~rch
17th, 1934, and as fromt time to time am-endled.
"' Person means a natural person, a par1tne~rship, a corporation,
an association, a trust, a trustee, a trustee in bankirup~tcy, a receiver,
or other entity.
"L Employer means any person engaged in this Subdivision of
the Ilndustry, either on his owvn behalf or as an employer of labor.
"L Em[ployee means any one who is employed in this Subdiv~ision
by any such employer.
"Act means Title I of the National Industral RFecovery Act..
"L President means the President of the United Stat~es.
"Administrator means the Administrator for Industrial Re-
"L Baisc Code Authority means the Code Authority for the ]Mad-
chinery and Allied Products Industry as constituted by the. Code.
Code Authority "! means t~he Code Authority- constit~utedl for th~is
Subdivision or provided by the Code and by this Supplemental Code.
"L Group Code Authority means the 'Code Au~thority for any
Group or product classification within this Subdivision, constit~uted
under the authority of Article V of this Supplemnental Code.
ARTICLE III--E3[PLOYMENTT PROVISIONS
The following Art~icles of the Code, viz: A~rticle III, "'Workiing
Hours "; Article IV! Wanges "; and Article V, Gneral Labor
Provisions ", are hereby made a part of this Supplemiental Code,
with the same etfect as if they were w~rit~ten into this Supplemnental
The following Articles of thle Code, viz: Artile II, Defini-
tions "; Ar-ticle VI, "Admninistration ", to the extent that they shall-
be applicable to this Supplemental Code as such or as it :may ee
after be administered as an autonomous Code; Article VIII, "Md
ificat~ions an1d Termination "; andl Article IX, W~ithdrawal ", are
hereby made a part of this Supplemiental Code with thie same
effect as if they w~ere written into this Supplemnental Code.
(a) During the period not to exceed sixty days, following the ef-
fective dlate of this Supplemental Code, the code committee of the
Applicant shall constitute a temporary Code Authority. The Ad-
ministrator, inl his discretion, miay appoint one additional member
(without vote and without expense to this Subdivision).
This Subdivision, having hield an election for permianenit Code
Authority under the provisions of the Code of F'air Comp~ettiton
for the Manchinery and Alllied Products Indlustry, the Code Authority
so elected shllR1 constitute the first p~ermasnent Code AuthiorityS for
this Subdivision if this method of election meets with the alpproval
of the Admllinistrator. If this methodl of election does not mneet with
the approva~l of the Admninistrator then the provisions hereinlbeloww
provided shall apply for thie election of th~e first permanent (Codle
Authority. For elections after the first, the p~rovisions of thiis Su~p-
plemental Code for election of a permanent Code Authority shall
To permiit representation of employers who are not members of
Applicant, the Intter shall, withiin sixt~y days after this Supple-
miental. Code becomes effiective, set up a permanent Code Authority
to succeed the temporary C'ode Authority to administer, supervise
and facilitate the enforcement of this Supplement~al Code. Such
permanent C'ode A~uthiorityv shall be elected at a meeting called for
this pur~posie to which all known employers in this Subdivision shall
be invited, writh the right to vote either in person or by proxy, or
by mail. This permanent Code Authority shall consist of not less
than 3 and not more than S members, and in addition thereto, the
representative of the Admninistrator as referred to in the paragraph
above. Of the elective mlembers of Code Aluthorityv, one ne~mber may
be chosen in any fair manner approved by the Administrator, by
the employers (if azny) who are not members of the Applicant pro-
vided such representation shall be desired by such employers. Action
by the Subdivision at any meeting for the transaction of business,
adoption of procedural rules and regulations, subsequent election
of Code Authority, and amendment of this Supplemental Code, shall
be by vote of the employers in the Subdivision, present in person or
by proxy, or voting byI mail, wherein each such employer shall have
one vote; provided, however, that on any question except the elec-
tion of Code Aut~hority, any such employer shall have the right to
call for an additional vote and to have the same voted upon by each
employer, weighted on the basis of one vote for each $100,000.00 of
sales within the Subdivision, made by such employer in the two pre-
ceding years, each such employer, however, being entitled to one vote,
and in every such case action on the question shall be by both such
methods of votinlg. Members of the Code Authority so elected shall
hold office for t.erms provided for in the procedural Rules and Re~gu-
lations adopted byL this Subdivision.
(b) 1. It being found necessary in order to support the admin-
istration of this Supplemental Code and to maintain the standards
of aircometiionestblihedbythis Supplemental Codle and to
effectuate the policy of the Act, th oeAtoiyi uhrzd
subject to such rules and regulations as may be issued by the
Ad numn st.ra tor :
a. To incur such reasonable obligations as are necessary and proper
for t~he foregoing purposes and to meet sulch obligations out of funds
which mnay be raised as hiereinafter provided and which shall be held
in t.rust for the purposes of the Supplemental Code;
b. To submiit to the Administrator for hiis approval, subject to such
notice and opportunity to be heard as he may deem necessary, (1) an
itemized budget of its estimated expenses for the foregaoing purposes,
and (2) an equitable basis upon which the funds necessary to sup-
por~t such budget, shall be contributed by members of the Sub~division.
c. After such bud-gret and basis of contribution have been approved
by the Adlminisstraor, to determine and obtain equitable contribu-
tions as above set forth by all employers of the Subdivision, and to
that endl, if necessary,, to institute legal proceedings therefore in its
2. Each employer of the Subdivision shall pay his or its equitable
contribution to the expenses of the maintenance of the Code Au-
thority, determined as hereinabove provided, and subject to rules and
regulations pertaining thlereto issued by thie Adminliristra~tor. Only
employers of the Subdivision complyingf with the Suplplemenltal Cfode
and contributing to thle expenses of its admlinistraltion as hereinabove
provided shall be entitled to participate inr the sl~ctionr of members
of the Code Authority or to receive the benefits of anry of its volun-
tary activities or to makie use of any em~blemn or iinsigni of the
National RecoveryJ Administration.
3. The Code Authiority shalll neither incur nor paS anyS obligation
in excess of the amount thereof as estimatedt in its approredl budget,
except upon approval of the Admiinistrator; andl no subsequent
budget shall contain any deficiency itemn for expendlitures in exce~ss
of prior budgets estimates except those which the Administrator
shall have so approved.
(c) For the purpose of administering and facilitatingr the enforce-
ment of the provisions of this Supplemental Codlce, Codte A~uthority,
by its duly authorized representatives (wFho shall not bej in the
employ of any employer affected by this Supplemental Code), shall
have access to any and all statistics, data and information, filed in
accordance with the provisions of the Code and this Supp~lemental
Code. All individual statistics, data and information of individual
employers as filed in accordance wvith the provisions of the Code and
this Supplemental Code shall be kept, confidential, except withl the
consent of such employer pertaining to his own statistics, and pro-
viding that nothing herein shall prevent publication of general
summaries of such statistics of this Subdlivision.
(d) For admlinistrative purposes, employers may be grouped by
Code Authority to bring into working association employers having
common interests and problems that are niot common to all emply
ers in this Subdivision. Eachi such group shall designate from-
among its members a Group Code Authority, and may adopt such
rules for the conduct of the business of th-e G~roup as are not in1-
consistent with the provisions of this Supplemecntal Code and the
Code; provided, however, that provisions of this Art~icle V shall
control the making of all examinations or audits and thre use to be
made of infor~mation so obtainedl with respect to any employer.
(e) Except as otherwise pr~ovided in this Supplemnental Code,
a Group Code Author~ity shlall have power to h-ear all matters per-
taininga to the pr~ovisions of this Supplemental Code havingr relation
to the employers in saidi Group, or any~ of thlem, and to that endl may,
to t~he extent permitted by the Aict., investigate and aIscertain the facts
through such examination or audit as such Group Codle ALuthorityr
may deem necessary Provided, however, that nothing in this
Article shall preclude the Code Author~ity from taking action, to the
extent permittedl by the Act, either upon comlplaintt of an employer,
or upon its own initiative, with respect to any matter.
Any decision of t.he G~roup Code Authorityg shall be final, unless
appeal is taken to the Code Authority or such decision involves
matters requir~ingi to be reportedly to thle Code Aluthr~it~y, in whichl
case pertinent information, papers and data in thle possession of the
Group Code Author~ity shall be turned over by it to th1e Code Author-
ity,~ and the Code Aluthority shall pass on the merits of thle case and~
make final decision or report thiereon to the Basic Code Authority
or the Adlministrator.
(f) The Code Authority or a Group Code Authority ay nort,
within its powerrs, on the affirmative vote of not less ta three-
fourths of its members entitled to vote; provided that any proposal
receiving less than the three-fourths majority vote shall be sub-
mitted upon the request of any member of the Code -Authority or
Group Code Aulthorityl having jurisdiction to a vote of all employers
cnooperting under this Supplemiental Code or t~he. cooperating em-
ployers comprising the Group affected, and the Code AuthorityT or
Group Code Authorityv having jurisdiction shall act as determined
by the majority of the number of votes so cast.
(g) If formal complaint be made to Code Authority, that pro-
visions of this Supplemental Code have been violated byany em-
ployer, the Code AuthoritSy shall investigate the facts, and to that
end may, to the extent permitted by the Act, cause such examination
to be madle as it may deem necessary, subject to the limitations con-
tained in Section (c) of this Article V.
(h) If any employer in this Subdivision is also an employer in
any other Subdivrision of the Industry, or in any other industry,
the provisions of this Supplemental Code, and t~he jurisdiction of
the Code Authority hereunder, shall apply to and affect only that
part of his business and product which is included in this
(i) An appeal from any action taken, or any rule or regulation
e~stabjlished affecting the right of any employer or employee in this
Subdivision, may be taken to the Basic Code Authority and there-
after to the Administrator.
(j) Nothing contained in this Supplemental Codle shall constitute
the members of the Code Authority or any Group Code Authority
as partners for any purpose. No hl ny ember of the Code
Authority or of any Group Code Authority b rbcm ibei
any manner to anyone for any act of any other member, offcer, agent,
or employee of the Code Authorityr or any G-roup Code Authority.
Nor shall any member of the Code Authorityr or Group Code Author-
ity, exercising reasonable diligence in the conduct of his duties here-
under, be or become liable to anyone for any action or omission to
act under this Supplemental Code and the Code, except for his own
wilful misfeasance or non-feasance.
ARTICLE VI--AccounNGI( AND COSTING
The Code Authority shall cause to be formulated an accounting
system and methods of cost finding and/or estimating capable o
use by all employers of the Subdivision. After such system and
methods have been formulated, full details concerning them shall
be made available to all employers. Thereafter all1 employers shall
determine and, or estimate costs in accordance with the principles
of such methods.
ARTICLE VTII-SELLING BELOW REASONABLE COST
SECTION 1. %71en the Code Authority determines that an emer-
gency exists in this Subdivision and that the cause thereof is destrue-
tive price-cutting such as to render ineffective or seriously endanger
the maintenance of the provisions of this Supplcementl Code, the
Code Authority may cause to be determlinedl the lost reasonable
cost of the products of this Sutbdivision. such determiination to be
subject to such notice and hearing as the Admninistrator may require.
The Administrator may approve, disapprove, or mnodify the determi-
nation. Thereafter, during the period of the emnergecncy, it shall
be an unfair trade practice for any member of the Subdivision to
sell or offer to sell any products of the Subdivision for which the
lowest reasonable cost has been determined at such prices or upon
such terms or conditions of sale that the buy~er will pay less ther~efor
than the lowest reasonable cost of such products.
When it appears that conditions have changed, the Code Author-
ity, upon its own initiative or ulpon the request of any interested
party, shall cause the determination to be revilewed.
SECTION 2. The foregoingn Section (1) shall not, apply to (a)
dropped lines, or (b) seconds, or (c) inventories which mnust be conl-
verted into cash to meet emergency needs, all of which mayS be dis-
posed of by any employer at any price and on any terms or condi-
tions, but only if such empoer, not less than two weeks before such
proposed dLisposal, hasfld with Clode Aut.hority, a statement in
writing settiny forth the facts of, and reasons for, such. proposed
disposal and t~e price and terms and conditions of sale, andl Code
Authority has not, (with the approval of the Administrator), before
the termination of such two week period, in writing, disapproved th
Notice of such disposal, if not disapproved, shall be sent imme-
diately to all employers manufacturing products of equivalent de-
sign, character, quality or specifications, who may sell such products
at prices and on terms and conditions as favorable as those stipulated
in the proposed disposal, when meeting the competition of such pro-
SECTION 3. The foregaoing Section (1) shall not apply to a sale
made in order to meet competition on products manufactured out-
side the United States. For such dlisposal, any employer may sell,
at prices and on terms and conditions as favorable as those of the
competing foreign product, but only if he has first reported to the
Codle Authority his intention so to sell, and the facts as to the comz-
petition which justifies such action.
ARTICLE VIII[--METHODSI OF PRICING AND TERMS OF ~PBAYENTT
(a) If and when the Code Authority determines that in any
branch or group of the Sulbdivision, it has been the generally recog-
nized practice of at least two-thirds of such branch or group of
the Subdivision, to sell a specified product on the basis of net price
lists or price lists with discount sheets and terms of sale and pay-
ment, each manufacturer of such product, shall, within ten days after
notice of such determination, file with the proper Group Code Au-
thority (or withl Code Authority i~f there is no Group Code Authority
having Jurisdiction), net price lists or price lists with discount sheets
and terms of sale and payment, individually prepared by hi, and
the Group Code Authorityv shall immediately send copies thereof to
the employers of this Sub~division cooperating under this Code, as
described in Article V, and who manufacture like products. Revi-
sions of the price lists and,/or discount sheets and/or terms of sale
and payment may be filed, in like manner, from time to time there-
after with the proper Group Code Authority or Code Authority by
any manufacturer of such products, each such revision to become
operative upon the date specified therein, but such revised price lists
and/lor discount sheets and,'or terms of sale and payment shall be
filed with t.he proper Group Code Authority or Code Authority ten
days in advance of the opelrat~ive date. Copies thereof with notice
of the operative date specified, shall immediately be sent to all manu-
fact.urers of such product, cooperating under this Supplemental
Code, as described in Article V, any of whom may file, if he so de-
sires, revisions of his price lists and/~or discount sheets and,/or terms
of sale and payment which shall become effective upon the date when
the revised price lists and/or discount sheets and/or terms of saile
and payment first. filed shall go into effect.
All price lists and 'or discount sheets and/or terms of sale and
payment so filed shall be published on the operative date by making
available to each consumer or resale buyer the price lists and/or
discount sheets and,'or term~s of sale and payment applicable respec-
tirely to such buyers trade classifications
(b) If and when a Grroup Code Authority or Code Authority shall
determine that in any branch or group of the Subdivision not now
selling its products on t~he basis of price lists, with or without dis-
count sheets, with terms of sale and payment, the distribution or
marketing conditions in said branch or group are the same as, or
similar to, t~he distribution or marketing conditions in a branch
or group of the Subdivision where the use of price lists, with or
without discount sheets, is well recognized, and that a system of
selling on net price lists or price lists with discount sheets and/or
terms of sale and payment., should b~e put into effect in such branch
or group, then each manufacturer of the product or products of such
branch or grIoup~, shall within twfentv d~ays after notice of such
determination, file with Group Code Authority or Code Authority
net price lists, or price lists and,/or discount sheets and/or terms of
sale and payment, and such price lists and/or discount sheets and/or
terms of sale and payment may be thereafter revised in the manner
hereinabove provided, and copies of such methods of pricing and
revisions thereof shall be sent in accordance with paragraph (a) of
this Article; provided that Group Code Authority or Code Authority
shall make no determination t~o place any product of the Subdivision
(not now on a price list basis) on a, price list basis as provided in
this Paragraph (b) of Article VIII, unless two thirds of the
employers cooperating under this Supplemental Code, as described
in Article V, who are at that time engaged in manufacturing such
product, shall affirmatively consent that such determination be made.
(c) No employer shall sell directly or indirectly any product of
this ;Subdivislon at prices or discounts different than those provided
in his own current price lists and,'or discount sheets and/or terms
of sale and payment or on more favorable terms of sale and payment
as covered by the provisions of this Article VIII and proceedings
See paragraph 2 of order approving this Code.
thereunder unless such employecr is meeting compettitive prices as
provided in Ar~ticle VII, Sections 2 and 3, of this~ Supplemental
ARTICLE IX- TRADE PRACTICES
Each of the following acts and practices is deemecd to be inimnical
to the best interests of the Subdivision and of the public, and each is
therefore, hereby declared to be and to constitute an unfair mnethodl
of competition, viz:
1. No employer shall secretly offer or make any paymetnt. or allowc-
ance of a rebate, refund, commiission, credit, unearned discount or
excess allowance, whether in the form of money or otherwise, nor
shall an employer secretly offer or extend to anyS customer any special
service or privilege not extended to all customers of the same class,
for the purpose of influencing a sale.
2. No employer shall give, permit to be given, or offer to give,
anything of value for t~he purpose of influencing or rewarding the
action ocf any' employee, agent, or representative of another in rela-
tion to the business of the employer of such employee, the principal
of such agent or the represented party,? without the k-nowledge of
such employer, principal or party. This provision shall not be
construed to prohibit free and general distribution of articles com-
monly used for advertising except so far as such articles are actually
used Ifor commercial bribery as hereinabove defined.
3. No employer shall publish adver-tising (whether printed, radio,
display or of any other nature), which is misleading or inaccurate
in any material particular, nor shall sh~y employer in any way mis-
represent any goods (including but without limitation its use, trade-
mark, grade, quality, quantity, origin, size, substance, character,
nature, finish, material, content or preparation) or credit terms,
values, policies, services, or the nature or form o'f the business con-
4. No employer shall defame a competitor by falsely imputing to
him dishonorable conduct, inability to perform contracts, question-
able credit standing, or by other false representation, or by falsely
disparaging t-he grade or quality of his goods.
5. No employer shall engage in destructive price cutting.
6. No employer shall cooperate in a violation of the provisionis
of this Supplemental Code or of the Code, or amendments thereto,
either directly or indirectly through a distributor or agent.
7. No employer shall publish or circulate unjustified or unwanr-
ranted threats of legal proceedingsa which tend to or havle the effect
of harassing competitors or intimidating their customers.
8. Each employer shall require com~pliance wFith the provisions
of this Supplemental Code, and of the ~Cod-e, by the agents of such
employer, whether such agents are directly employed on salary or
are employed on a commission basis.
ARTrCEn X-SAlLES FOR EXPORT
The p~rovisions of this Supplmenetal Code concerning pricing and
marketing are not to apply to direct, export sales of any product, or
to any product destined ultimately for export. Thle term "C export '"
.p UNIVERSITY OF FLORIDA
3 1262 08855 5734
shall include all shipments to all places without the several states *4f
the United States and the District of Columbia; provided, however,
that no shipment to any territory or possession of the Unlited States''
shall be considered an export when any employer is engaged in the
industry in such territory or possession.
AnuIctE 11- ATODIFICATIONS
(a) As provided by Section 10 (b) of the Act, the President ma
from time to time cancel or modify any order, approval, license, rl
or regulation issued under Title I of the Act.
(b) As study of the needs of the Subdivision is continued. after
the e~Fective date, amendments, additions, or revisions to this Supple-
mental Code may be proposed by Code Authority, which upon being
assented to in writing by two-thirds vote of members cooperating
under this Supplemental Code shall be in full force and elfect from
and after approval thereof by the Administrator.
This Supplemental Code is not designed to permit monopoly, and
shall not be so construed or applied as to oppress or eliminate small
enterprises or discriminate against them and Is designed to effectuate
the policy of the Act.
AaIRTclE XYIII -EFECTI;VE ABTE
This Supplemental Code hiall become effectivoe and binding on all
employers of the Subdivision on the eleventh day after its approval
by the President.
Approved Code No. 347---Supplement No. 84.
Registry No. 1107-04.