Registry No. 619--1-03
NATIONAL RECOVERY ADMINISTRATION
CODE OF FAIR COMPETITION
AND LACQUER MANUFACTURING
AS APPROVED ON OCTOBER 31, 1933
UNIV. OF FL LIB. WE D(
For sale by the Sulperintendent of Documents, Washington, D.C. - Price 5 cents
) OUR PART
U.S. DEPOSITO zecu e Order
zA. L&LLs~k of Transmittal
GOVERNMENT PRINTING OFFICE
This publication is for sale by the Superintendent of Documents, Government
Printing Offc~e, Washington, D.C., and by district offices of the Bureau of Foreign
and Domestic Commerce.
DISTRICT OFFICES OF THE DEPARTMENT OF COMMERCE
Atlanta, Ga.: 504 Post Office Building.
Birmingham, Ala.: 257 Federal Building.
Boston, M~ass.: 1801 Customhouse.
Buffalo, 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, Mich.: 2213 First: National Bank Building.
Houston, Tex.: Chamber of Commerce Building.
Indianap~olis, Ind.: Chamber of Commerce Building.
Jackisonville, Fla.: Chamber of Commerce Building.
Kansas City, Mo. : 1028 Baltimore Avenue.
Los Angeles, C~alif.: 1163 South Broadway.
Louisville, K~y.: d08 Federal Building.
Mermphis, Tenn.: 229 Federal Building.
Minneapolis, Minn.: 213 Federal Building.
New O~rlenus, La.: Room 225-A, Customhouse.
New \'ork, N.Y'.: 7~34 Customhouse.
Norfelk, V'a.: 406 East Plume Street.
Philadelphia, Pa.: 933 Commercial Trust Building.
Pittsburgh, Pa,: Chamber of Commerce Building.
Portland, Oreg.: 215 New Post Offce Building.
St. Louis, Mlo.: 506 Olive Street.
Ban Francisco, Calif.: 310 Custombouse.
Battle, W7ash.: 800 Federal Building.
CODE OF FAIR CjOM~PETITION FORP THE PAINT, VARNISH AND LACQUER
An application having been duly ma~de, pursuant to and in full
compliance with the provisions of title I of theuNational Industrial
Recovery Act, approved JTune 16, 193:3, for myv approval of a Code
of Fair Competition for the PAINlrT, V'ARNISH AND LACQUER
M~ANUFACTURING INDUSTRY, and hearings having been held
thereon and the Administrator having rendered his report containing
an analysis of the said code of fair competition together with his
recommendations and findings with respect thereto, and the Ad-
ministrator havinga found that the said code of fair competition
complies in all respects with the pertinent provisions of title I of
said act and that the requirements of clauses (1) and (2) of sub-
section (a) of section 3 of the said act have been met:
NOW, THEREFORE, I, Franklin D. Roosevelt, President of the
United States, pursuant to the authority vested in me by title I of the
National Industrial Recovery Act, approved June 16, 1933, and other-
wise, do adopt and approve the report, recommendations, and find-
ings of the Administrator and do order that the said code of fair
competition be and is hereby approved.
FRANKLIN D. ROOSEVELT.
THE TH~ITE HOUSE,
October 31, 1933.
Approval recommended :
HUGH S. JoHNson,
188714 *--188-115 -33
THE PRESIDENT,OrBE 7 9.
The Wihi'te House.
SIn: This is a report of the hearing on the Code of Fair Compe-
tition for the Paint, Varnish, and Lacquer Manufacturing Industry
conducted in W~ashington on the 26thi of September, 1933, in accord-
ance with the provisions of the National Industrial Recovery Act.
Ecoh~ourec EFFECT OF THE CODE
Paint is a mnanufactured product used in part for new production
of industrial and consumers goods, and in part as a maintenance
material. The quantity required for the former purpose bears a
positive relation to general manufacturing activity. For the latter
purpose, where the need may be deferred, the current financial con-
dition of the owner of t.he proper~ty has considerable bearing upon
the quantity of paint used. For this latter purpose also the cost of
the paint is a factor of considerable importance.
The quality of paint in general may be judged by the effective-
ness of the covering produced, either as protection or appearance, or
both, and t~he life of t~hat~ covering These qualities are, not only a.
function of the ingredients of the paint, but also are a function of
the method of preparation of the ingredients and their mixing. It
is possible, therefore, to produce paint of varying degrees of quality
through a wide scale of costs, and the public is not necessarily in a
position to judge quality other than by price. As a consequence of
this condition, many practices involving the sale of cheap paint have
grown up in the industry, which, coupled with the financial situation
of the last few years, has tended to cause demoralization.
The Code, as submitted herewith, contains in Part Two an un-
usual number of trade practices which are considered detrimental to
the industry and consequently are prohibited. In the form in which
they now stand they meet the approval of the Consumers' Advisory
The provisions contained in this Code as to minimum wages and
maximum hours are generally in line with approved codes employ-
ing labor of the same quality and under similar conditions.
The reduction in the number of hours from 47.5 of June 1933, to a
maxim~um of 41.2 average for a six months' period provided by the
Code will mean an increase in employment of approximately 25%/.
It is estimated that at the low point of employment there were ap
proximnately 18,000 workers in early 1933, and that the provisions o
this Code, even under present conditions, should increase the num-
ber employed to nearly 25,000.
The wages set up in the Code will increase the pay of only about
20% of the workers in the Northern area and 30% of the workers
in the Southern area, but the resultingr increase in purchasing power,
when coupled with the increase in number of workers in the indus-
try, will be material.
The Administrator finds that--
(a) The Code as recommended complies in all respects with the
pertinent provisions of Title I of the Act, including, without limita-
tion, subsection (a) of Section 7 and subsection (b) of Section to
thereof : and that
(b) The applicant group imposes no inequitable restrictions on
admission to memnbership therein and is truly representative of thle
Paint, Varnish, and Lacquer Mianufacturing Industry; and that
(c) The Code as recommended is not. designedl to p~romlote mno-
nopolies or to eliminate or oppress small enterprises and will not
operate to discriminate against them and will tend to effectuate thle
policy of Title I of the N~ational Industrial Recovery Act.
It is recommended, therefore, that thiis Code be imlmediately
HcuI S. JrOHNSON,
CODE OF FAIR COMPETITION FOR THE PAINT, VARCNISHI,
AND LACQUER MANUFACTURING INDUSTRY
AnnTCLE I PUTRPOSE
For the purpose of effect~uatingi the policy of Title I of the Act of
June 16, 1933, known as the National Industrial Recovery Act, the
following provisions are established as a Codle of Fair Competition
for the Paint, \'arnish, and Lacquer M~anufacturinlg Industry.
The term The Industry means all persons in thle continental
UTnited States engaged in t~he manufacture of paint, kulsomine and
water paint, varnish includingr shellac vanrnish lacquer, and kindred
products, includ-ing putty, semnifinished base materials for lacquers,
thinners, and diluents (when such semnifinished base materials are
sold or offered for sale in competition with the finished products of
this Industry), liquid and plastic roof coatings and roof cements, and
artists' colors; and.'or such branches or subdivisions thereof as may
fromi time to time be included under the provisions of this Code,
provided th~at. if any member of the Industy also manufnctures p~rod-
uicts of any other industry, the provisions of this Code shall apply
only to that part of his business which is included in this Code.
The term "' Export Trade means any business transacted with any
purchaser for shipment of products of the Industry outside of the
continental United States.
The term employee as used herein includes any person engaged
in any phase of the Industry in any capacity in t~he nature of emi-
p'loyee irrespective of the method of payment of his compennsation
The term employer ": as used herein includes anyone for whose bene-
fit such~ an employee is so engaged. The termt member of The
Industry includes any manufacturer who shall be subject to this
Code. The term member of the Code "' includes any member of The
Industry who shall expressly signify assent to this Code. The terml
"Association herein means the American Paint and Y'arnish Mlanu-
facturers' Association, Inc., and the National Paint Oil and Varnish
Association, Inc., or their successor or successors. The termn "Asso-
ciation Headquarters means the office maintained jointly by the As-
sociations at 2'201 New York Avenue, NWV., Washinglton, D.C. The
term Trade Sales as used herein means all sales to jobbers, dealers,
pointers, automotive refinishing shops, and sales made directly t~o the
consumer, with the exception of such sales as are her~einafter defined
as Industrial Sales." The term "' Industrial Sales "' as used herein
means all sales to the following classes of buyers, covering products
of The Industry used by such buyers on their products or for thle
finishing of their equipnmentt and for the painting, upkeep, and
maintenance of their plants, equipment, tenements, and for any other
Industrial plants of all kinds (such as automobile manufac-
t.urers, implement manufacturers, furniture manufacturers,
Transportation companies (including street railways, bus, and
air transportation companies)
Car and locomotive builders
Public service companies
Oil refiners and pipe-line companies
Steel manufacturers and those who fabricate their own prod-
Bridge builders and bridges
Coal or other mining operations
Steamship lines, shipyards, wharves, and docks
All departments of any State, County, Miunicipal, or other
political subdivisions, but only for the following products:
traffic paint; road paint; products used on bridges, trucks,
and machinery; automobile license tag coatings; or mate-
rials for finishing furniture, or any other products manu-
factured in prisons or reformatories. All other business
from State, County, Mlunicipal, and other political subdi-
visions, such as products used on buildlings, institutions, etc.,
to be classified as Trade Sales."
All Departments of the U~nited.States Government, regardless
ARTICIA III --NDUSTRY LAW AND EFFECTIVE DATE
On and after the fifteenth calendar day after the President of the
,United States shall have approved this Code, the provisions hereof
shall constitute standards of fair competition for The Industry and
shall be automatically binding upon all members of The Industry,
except that all articles of this Code which are included in Part 2
hereof shall not apply to export trade.
AnywIC IV--CousECava BBRCasmINo
In accordance with Section 7 (a) of the Act of June 16, 1933,
k-nown as the National Industrial Recovery Act, it is agreed: (1) that.
employees shall havre the right to organize and bargain collectively
through representatives of their own choosing, and shall be free from.
interference, restraint, or coercion of employers of labor or their
agents, in the designation of such representatives or in self-organiza-
tion or in other concerted activities for the purpose of collective
bargaining or other mutual aid or protection; (2) that no employee
andi no one seeking employment shall be required as a condition of
employment to join any company union or to refrain from joining,
organizing, or assisting a labor organization of his own choosing;
and (3) that employers shall comply with the maximum hours of
labor, minimum rates of pay, and other conditions of employment
approved or prescribed by the President.
ABrTICLE VT-MINIMUM ACCTGES AND MAXIMUMI Houns
(a) No employee engaged in accounting, clerical, office, or delivery
service in any office or in any other place or manner, exceptmng emn-
plyees in retail stores and excepting outside salesmen, shall work or
permitted to work in excess of 40O hours per week for 20 weeks
and 48 hours per week for 6 weeks in any 26-wreek period.
(b) No factory or mechanical worker or artisan shall work or be
permitted to wFork more than 40 hours in one wveek nor more than 8
hours in any one day; provided, however, that during any 6 weeks
of a 26-week period (t~he first nperiod ton begPin on the effective date
of this Code) employees may work not more than 45 hours a week
nor more than 9 hours in any one day, with the exception of (1)
supervisory staff (including foremen), (2) maintenance workers,
engineers, and firemen, which excepted employlees may not work in
excess of the maximum hours stated above except by payment of one
and one third rate for overtime if such employees are compensated
on an hourly basis. Each week during any 26-week period shall be
considered as a complete unit of emp~loyrment for the purpose of pay-
ing for overtime to excepted employees. If an excepted employee on
an hourly basis works more than 40 hours and not more than 45
hours in any one week, the employer shall compensate him at the end
of said week for the hours worked in excess of 40 hours at the extra
rate or shall declare to the employee that such week will be considered
as one of the 6 weeks in which a maximum of 415 hours is permitted.
This does not, however, mean that an excepted employee, when neces-
sary, may not work more than 45 hours at the extra compensation.
If such excepted employees are paid by the week, month, or on a
yearly basis and enjoy vacation periods, sick leaves, and other benefits
granted to salaried workers they shall not be paid an additional
amount for any reasonable overtime work.
()The maximulm horslr fixed in the foregoning Paragraphs (a)
and ~(b) shall not apply to watchmen, janitors, or other caretakers;
nor to employees mna managerial, executive, or other capacity who
receive $35.00 per week or more; provided that. with respect to thie
exceptions in this Paragraph and in Paragraphs (a) and (b) of this
Article there shall be no evasion of this Code by reclassification of
the function of workers. A worker shall not. be mecluded in any one
of the above exceptions unless the identical functions w~hic~h he
performs were identically classified on June 16, 1933.
(d) The provisionsi for max~imum houirs set forth in Paragraphs
(a) and (b) of this Article establish a maximum number of hours of
labor per 26-week period for each employee so that under no circum-
stances shall any employee knowingly be employed or permitted to
work for one or more employers in The Industry in the aggregate
in excess of t~he prescribed number of hours.
(e) Employers in The Industry, subject to the exception provided
in Paragrraph (h) of this Article, shall not pay any of the classes of
employees covered by Paragraph (a) lesrs than $;15.00 per week in any
city of over 500,000 population, or in the immediate trade area of
such city; nor less than $;14.50 per week in any city of between 250,000~
and 500,000 population, or in the immediate trade area of such city;
nor less than $141.00) per week in any city or town of less than 250,000
18874 -1 88-1150-33----2
population, or in, the immediate trade area of such city bor town:"
provided that employers in The Industry mlay pay to anyV class o
employees covered by Paragraph (a) who perform the work o;f ofice
boys and offce girls, not less than 80 percent of! the minimum wage
designated by this Paragraph, provided that the number so excepted
shall not exceed 5 percent of the total employees of the employer and
provided, further, that each employer mayhv tlatoesc
employee. Popul ation for the purposes othise Code shal be de-h
termined by reference to the 1930 reldera~l Census.
(f) Employers in The Industry, subject to the exception provided
in Paragraph (b) of this Ar-ticle, shall not pay any employee of the,
classes covered by Paragraph (b), or employees exceptedI therein,
namely, supervisory staff (including foremen), maintenance workers,
engineers, and firemen, less than 40 cents per hour to male employees,
or less than 35 cents per hour to female employees. The foregoing
distinction in minimum rates between male and female employees is
not a discrimination by reason of sex but because of a difference in
the work done. Where female employees do the same kind and
amount of work as male employees they shall receive the same wages.
It is agreed that this Paragraph establishes a guaranteed minimum
rate of pay regardless of whether the employee is compensated on
the basis of a time rate or on piecework performance.
(g) The provisions of Paragraphs (e) and (f) of this Article
shall not apply to any employee partially incapacitated through age
or otherwise, who has served not less than 10 years in the continuous
employment of the employer, provided that the number so excepted
shall not exceed 5%0 of the total employees of the employer, and
provided that each employer may have at leas-t one such employee,
and provided further that t~he minimum wag~e paid to such employee
shall not be less than 30c per hour.
(h) Employers in The ZIndustry shall not pay less than 90 percent
of the minimum wages provided in Paragraphs (e) and (f) of this
Article, to employees in the Southern states. For the purpose of this
Article, the Southern states are defined as-
Alabamna North Carolina
Florida South Carolina
S(i) No person under the age of 16 shall be employed in The
ARTICLE VI DRESIDENTIAL ArrrHORITY
As required by Section 10 (b) of Title I of the National Ibdus-
trial Recovery Act, the following provision is contained. in this
Code: The President mlay from time to time cancel or modify any
order, approval, license, rule, or regulation issued under Title I
ARTICLE VTII AI0NOPOLIES
No provision in this Codle shall be interpreter or applied in such
a manner as to: (1) Promote monopolies; (2) Permit or encoulralge
unfair competition; (3) Elimninate, oppress, or discriminate against
ARTICLE TIII--STATE Laws
Within eachi state, members of The Industry shall comply with
any lnaw of sciih state. imposning more stringent requirtiements, regu-
lating the age of employees, wages, hours of work, or general working
conditions, than under this Code.
The Paint Industry Recovery Board, through Association Head-
quarters, shall collect and provide all reports required by the Admin-
istrator under the National Industrial Recovery Act. Every member
of The Industry shall furnish such reports as are required pursuant
to such requirements.
In addition to information required to be submitted through the
Paint Industry Recovery Board, there shall be furnished to govern-
ment agencies such statistical information as t~he Administ~rator may
deem necessary for the purpose recited in Section 3(a) of the
National Industrial Recovery Act.
ARTICLE X -ADMIINISTRATION
After this Code shall have been approved by the President of the
United States, it shall be administered through the Aissociation by a
board to be immediately created and to be known as the i Paint
Industry Recovery Board."
This Boa~rd shall be composed of t~he followingr members: Not
more than 3 members without voting power to be appointed by the
President, the 8 members of thle present General Code Commilttee,,
20 members, representing commodity groups, 20 members repre-
The'members of the Board representing commodity groups shlall
be elected as follows: 5 members to be elected by paint mannufac-
turers, 5 members to be elected by varnish manufacturers, 5 mnemnbrs
to be elected by lacquer manufacturers, 5 members to be elected by
kalsom~ine and water-paint manufacturers.
Provided that each of these groups shall contain 2 members from
the East~ern States, 1 member froml t~he Stat~es in or west of the Rock~y
Mountains and 2 members from the remaining states. Nominations
for election to the Board for snid Commodity groups shall be made
by members of The Industry at large, regardless of membership in
any association, and the nommnt~ions so made shall be submitted to a
mail vote of all members of The Industr~y throughout the United
States and those receiving the highest number of votes in each Group
shall be declared to have been elected t.o represent the Commlodity
groups. The members of the Board representing communities shanll
be elected in the following m~anner: 1 each to be elected by the miem-
bers of The Industry doing business in the logical trading areas of
the following cities, which manufacturers shall be called together for
the purpose of such election by the President of the Local Paint
Club, or local paint manufacturers' association if any such exists:
Atlanta-New Orleans Kansas City
Baltimore Los Angeles
Buffalo Minneapolis-St. Paul
Chicago New York
Dal las -Hou ston Saint Louis
Denver San Francisco
Detroi t Sea ttle-Tacom a-Port~lan d
No person shall be eligible for membership on this Boafd who is
not directly engaged in the manufacture of products of The In-
dustry, except the members to be appointed by the President of the
United States. Furthermore, no company or group of affiliated com-
panies shall have more than one representative on this Board.
Vacancies which may occur in the Boardl for any reason whatsoever
shall be filled by election in the same manner as hereinbefore pro-
vided. This Board, subject to the approval of the Administrator,
shall elect its own Chairman, adopt its own rules of procedure (not
in conflict with any other provisions herein contained), appoint such
committees a~s may to it seem necessary from time to time, and may
delegate it~s authority to such committees. A majority of the Board
shall have the power to recommend to the Administrator for his
approval the addition of representatives of other groups or com-
munities to its membership; provided that such additional members
shall be elected in the same manner as above described.
The staff, Association Headquarters, and other facilities of the
Association shall be employed in carrying out the workr of the
Paint Industry Recovery Board. Such funds as may be required for
the work of this Board shall be subject to appropriation by the
Budget and Finance Comlmittee of the Association. All members
of the Industry or groups thereof who qualify as such under this
Code are eligible to membership in the American Paint & Varnish
Manufacturers' Association, Inc., or it~s successor, without payment
of initiation fee, which has been temporarily waived. If group
membership, such groups shall pay into the Treasury of the Ameri-
can Paint and Varnish M~anufacturers' Association, Inc., a total
amount equal to the dues of each member of such group as if each
member were a direct member of the American Paint and Varnish
Manufacturers' Associat~ion, Inc. If for any reason an eligible man-
ufacturer does not desire to join this Association he may, neverthe-
less, receive all of it~s benefits, including participation in this Code, by
paying a fee to its Trea.surer equal to the dues, provided that should
any member of this Code desire not to become a member of t.he Asso-
ciation and desire not to pay to its Treasurer a sum equal to the
dues, he shall nevertheless pay his proportionate share of the
amounts required to pay the cost of assembly, analysis and publi-
cation of necessary reports and data and of the maintenance of this
administrative authority and its activities and the Paint Industry
Recovery Board shall assess each such member of the Industry w7ith
his proportionate share based upon the value of sales or otherwise
as the Paint Indlustry Recovery Board may prescribe, subject to the
approval of the Adiministrator.
The Paint Industry Recovery Board~ shall have full responsibility
for its expenditures within the limits of such appropriations as are
madIe from time to time, provided that no traveling or other ex-
penses of Board members shall be paid out of the Asso.ciation funds
when attending Board meetings, but actual expenses of members of
the Board when engaged in the business o~f the Boardl, other than
attendance at. Board meetings, mnay be paid out of such funds pr~o-
vided prior authority for such expenditure or expenditures has been
given by the Board.
Such of the provisions of this Code as are not, required to be in-
cluded therein by the N~ational Industr~ial Recovery Act. of June 16,
1933, may, with the approval of the Pr~esident? be modified or e~limni-
nated as changes andl circums~rtances or experience may indicate. It
is contemplated that from timne to time sup~pleme~ntaryv provisions to
this Clode will be submitted for the approval1 o~f the Presidenlt to
prevent unfair competition in price and other unfair and dcstr~uctive
competitive practices and to eff'ectuate the other pur~poses andi poli-
cies of Title I of the National Industrial Recovery Act, consistent
with the provisions hereof. Members of The Indlustry or a local
paint manufacturers association, if any such existsr, shall suibmit
de~sir~ed amendments of this Clode to the Paint Indlustryg Recovery
Board through Association Headquarters. By agr~eemlent of at ma-
jority of the Boar~d, an amendment, so receivedl or one initiatedl by
the Board itself, shall be referred to The Industry in the following
manner: those members of the Board who represent the con~uodity
groups shall submiit the proposed amendments to their respective
groups, if in their opinion it is germane to the interests of such
groups; those members of the Board who represent manufacturers
from the several cities shall call meetings of the malnufacturers in
their communities. The several Board members shall then submit
individual reports to Associatio~n Headquar~ters, which shall collate
them and submit a full report to the Board. Thereafter t~he Board
shall vote on submitting the Amendment to the Gov-ernmnent and
shall so submllit it. if at least t wo thirds of the Board v.ote to doso
provided that the proponent of any' amendment shall hav~e the righ
to submit such amendment direct. to the National Recovery Admiin-
istration for its consideration.
By presenting this C'ode the members of The Industry do not
thereby consent to any modifient.ions thereof and reserve the right
to object individually or jointly to any such modifications.
PART 2--TRADE PRACTICES
ARTICLE XII--MISBRANDING, RIlSLABELING, AN~D FALSE ADV'ERTISING
Misbranding, mislabeling, and false, deceptive, and misleading ad-
vertising are prohibited by this Code.
ARTICLE XIrT--GrlFTS To EMPLOYEES OF ANOTHER
It shall be a violation of this Code for any person engaged in The
Industry, t~o offer or give--or to permit any representative of his to
offer or give--any commiission, gratuity, or other thing of substantial
value to employees of his customers or prospective customers, except
in the case of payments made with the consent of the employer for a,
definite service rendered.
ARTICLE 11Y- MANUFACTURING RESTRICTIONS
It shall be a violation of this Code for any manufacturer to fail
to abide by the manufacturing restrictions as set out in Schedule
A which is attached hereto anid made a part of this Code, provided
that this Article shall not apply to export trade and provided fur-
ther that Paragraphs 2, 4, 5, and 6 of Schedule A shall not apply
to products commonly known as 5-, 10-, and 25-cent merchandise
which is sold at retail to the consumer at not more than 25 cents per
ARTICLE XV EXCHANGE OF GOODS
The practice of taking in exchange for one's own goods, Industry
products of another manufacturer, distributor, or dealer, is un-
ethical, unfair, and is hereby prohibited. It shall be a violation of
this Code for any manufacturer in the Industry to take or allow to
be taken in exchange for his own products, any products of the
Industry, or to give or permit the giving of any advice or assistance
in facilitating such exchange or replacement, or to make or permit
to be made any concessions, allowances, or gifts of any kind to
promote or facilitate such exchange.
Every member of the Industry is required to enter into a written
agreement with his jobbers and/or distributors whereby such job-
bers and. or distributors agree to refrain from the practice prohibited
by this Article. It shall be a violation of this Cod~e for any member
of thle Industryr to deal or continue to deal with any jobber and/or
distributor who shall have acted contrary to such agreement, pro-
vided that no member of the Industrshlbeedrspniefo
suchdeaing ashe ay aveenggedin prior to the time he has
received notice of the breach of such agreement by a jobber
and, or distributor, and provided that no member of the Industry
shall be held responsible for such dealings after the Paint Industry
Recovery Board has given approval for further dealings with a
jobber annd 'or distributor who may have violated such an agreement.
The Paint Industry Recovery Board may require each member of
the Industry to file a copy of each agreement which he may make
with a jobber and 'or distributor.
ARTICLE XIY~I-STANDARD TERMS OF CASH DISCOUrT
On and after the effective darte the terms granted by manufac-
turers, excluding export trade, shall not exceed: Trade sales accounts,
2%o for cash in 10 days, net 60 days; industrial sales accounts, 1%/
for cash in 10 days, net 30 days; except that the discount to trade
sales accounts may be extended to the 10t~h day of the month follow-
ing purchase and the discount to industrial sales accounts may be
extended to the 20th day of the monthly following purchase to cus-
tome~rs who regula~rly discount in t~he month followingr purchase, and
provided that no discount shall be allowed after the discount date.
~AnaIcL XVII--DAT ros
Except as specifically provided by this Article, members of The
Industry shall not grant any dating on the sales of any Industry
(a) Spring Stock Order~s.--Datings on orders to established dealer
and,/or jobber accounts, excluding export trade, shall be limited to
dating on Spring Stock Orders shipped at the manufacturer's con-
venience after October 15, with an April 1 dating and2 regular terms;
one order to an account.
(b) New Accountfs.--The maximum dating on trade sales stock
orders (initial stock order only) t.o new dealer and/~;or jobber so;-
counts, excluding export trade, shall be limited to four months fromt
the date of shipment and with standard terms, provided that orders
shipped between October 15 and December 1 in any year may be with
an April 1 dating and with regular terms.
(c) Roof Coatin~gs andzc Cernents.-AX maximum dating of foutr
months may be given on a carload of not less than 40,000 lbsE. of
liquid and plastic roof coatings andi'or roof cements, not including
other products, whenever the lowrest published less-than-carload
freight rate (by rail or water) is more than 50 cents per owt.
(d) Anticipa~ted Discounz.t.--If any dating shlall be permitted
under this Article, an anticipated discount may be allowed to thei
extent of one half of one percent a month.
(a) Price Guarantees.-GCr uarantees ufagi nst price decline shall be
prohibited except in the case of an order on which a dating has been
allowed umder Article XVII, when such a price guarantee may be,
given for a time not to exceed t~he dating: period granted.
(b) Tirne Guar)an~tees.-Definit~e time guarantees on the life and/'or
service of the products of The Industry are hereby prohibited.
The practice of supplying accounts on consignment and,/or trust
certificate agreements, except as hereinafter provided, is prohibited.
This also includes consignments which are sometimes made under
so-called "' warehouse agreements but does not prohibit manufac-
turers from carrying a stock of their goods in a public or private
warehouse at their own expense in any section of the United States,
provided that such stocks must. not be warehoused with or for the
account of any person, firm, or corporation dealing in or handling
(as a merchant) or using (as a painter) products of t~he indcustry.
Every manufacturer who has any such consignment stocks in the
handsj of buyers on the effective late of this Code may continue the
same but he shall file a detailed list of such accounts within 60 days
of the effective date of this Code with Association Headquarters
and,/or the offce of a local paint manufacturers' association, if any
such exists, where reference may be made to it at an y reasonable time
by interested parties. Until such time as an account as listed above
is discontinued, such accounts may be similarly supplied by any
manufacturer in the Industry~. The Paint Industry Recovery Board
shall, subject to t~he approval of the A~dministrator, develop such
plans as will effectuate the ultimate elimination of consignments
from the Industry. This Article shall not apply to export trade.
ARTIcLE XS FREE DEALS
Except as otherwise provided herein, free deals in or connected
with Industry products are prohibited. "L Free deals for the pur-
pose of this Code means all forms of marketing devices, inclulding
the gift or loan of spraying or other valuable equipment, whether
the full cost thereof or only a part of said cost is borne by the manu-
facturer, whereby the said manufacturer furnishes goods of any kind
other than such of his own products as have been contracted for on
his usual terms: Provided that the term Free Deals shall not
apply to t~he furnishing of advertisinacesrsofmllvue
such as the usual circulars, color cards, windiesow dspalas dislay
racksl and posters which accompany paint and varnish products as a
description thereof, nor shall it apply to novelties of small value such
as caps, yardsticks, paddles etc.
Furthermore, t~he term Free Deals shall not be construed to
include any advertising allowance which is made for a definite serv-
ice rendered and for which there is a proper arccounting that is audit-
able as a direct charge for cooperative advertising.
Illustrative of the practices which are prohibited are included the
(a) Premiums (gifts of unrelated merchandise) such as blankets,
articles of furniture, etc.
(b) Prizes and awards. This does not refer to prizes and awards
given witlun a manufacturer's own organization.
(c) Free Goods (extra amounts of one's own products).
(d) Mferchandising practices of the type commnonly known as
"L One-cent sales."
(e) Free Samples. (But the term "L Free Deals does not apply
to samples given for test purposes; neither does it apply to trade-sale
samples given for demonstration purposes, provided that no size
larger than 5-lb. samples of water-paint goods in dry form or 1/32
gallons of other industry products shall be so used and that such
samples are plainly labeled "' Samples."
(f) The sale of alcohol, turpentine, linseed oil, or any other prod-
ucts not manufactured by The Industry at prices less than the resale
AnrTICL XXI DISCONTINUANCE OF SHADES AND COLORS
WFhen it becomes necessary and advisable for any manufacturer to
discontinue certain shades or colors in any trade-sales line, he shall
give his dealer and/or jobber customers who purchase such~ lines six
months advance notice prior to discontinuing the manufacture of
suich shades or colors providingr that this Article shall not apply to
AuRICiE XXCII-SELLING BELOW COST
ProdZucts of The Industry shall nlot be sold at less: than cost as
(1) The cost of Lacquer Thinners in full tank cars or tank wragons
containing not less than one thousand gallon quantity, when sold and
delivered to one purchaser, shall be not, less than the sumi total of the
current market re~l~pnlacementrpic of each andl every~ ingredient in the
The cost of all other products shall include the following:
(2) The seller's total marrket replacement cost of rawf materials
(based on cost. furnished monthly! or oftener if necessary, by author-
ity of the Paint Industryv Recovery Board through Association Head-
quarters, subject to approval by the, Administrator); and if any rawc
materials are used (such as varnishes, japans, dlriers, etc., purchased
in finished form by the seller) for whiich costs are not. furnished
monthly or oftener, as herein provided, the cost used for such item
or items shall be the seller's total current delivered r~eplacement cost.
()Containers and,'or packagDes.
4)Cost of Prcicessinzg.-To include all direct costs (such as power
and labor), depreciation 6igured in accordance with provisions of the
Federal Incomie Tax laws, plus a proper proportion of all indirect
factory expenses (excepting interest. on investment), in accordance
with the share each product should bear, provided that the distribu-
tion of indirect factory expense per unit of production shall be on
the basis of the average rate of utilization of plant facilities of profit
maRking producers during the years 1928 to 1932 inclusive, and pro-
vided that such average rate shall not include any plants not in
(5) There shall also be included in the cost a proportion of the
general and administrative expenses, such proportion to be deter-
mined andi to be recommended by the Paint Industrv PRecovery Board
to the Administrator for approval.
(6) Transportation charges when goods are sold f.o.b. destination.
In the case of any complaint by an interested party that a manu-
facturer is violating the above cost provisions the burd-en of proof of
compliance shall rest, upon the accused manufacturer. If the Code
Authority or the Administrator is not satisfied by the proof furnished
by the defendant manufacturer the matter is to be referred to the
Federal Trade Commission who shall audit, the cost accounting of
the defendant and review his allocation of burden; and the report
of that Commission shall be final regarding the costs of the defend-
ARTICLE X XIII-C1OMPETITVE RELATIONS
(a) Induccing Brleac~h of Contra~ct.--No manufacturer either di-
rectly or indirectly or through his salesmen, representatives, or
agents, shall encourage any purchaser of the products of The In-
dnstry to disregard or fail to live up to his commitment to another
member of the Industry.
(b) Disparagyeme~nt of Comlpetitors.--The use of or participation
in the publishing or the disseminating of any false statement, repre-
sentation or insinuation which disparages the business of a competi-
tor, or attacks the reputation, goods, prices, credit, service, or adver-
tising of any competitor or of any other industry, is an unfair and
uneconomic practice and is prohibited.
(c ) Entici~ng Em ployees.-M~em be rs o f The Industry shall recog-
nize the right of employees to use all honorable and reasonable efforts
to better their conditions, but shall refrain from directly or indirectly
soliciting or bidding for the services of the employee of another
member. Only when such an employee takes the initiative shall a
member of The Industry have the right to negotiate with him about
AnnIcus XXIVT-RETUR~NED GOODS
No member of The Industry shall accept the return of merchan-
dise from any customer without having given prior consent to the
return thereof. On such goods as are accepted for return a reason-
able charge shall be made and the freight charges must be charged
to the shipper returning the merchandise, except in the case of de-
fective products or where in some other way the manufacturer may
Mansfoaotarfg restrictionzs.-Indust ry products, excepting those for export
trade, shall not be manufactured for the purpose of marketing them as trade
sales goods in containers of sizes and types prohibited by this rule, nor shall
they be produced in tints or shades to a greater number than allowed by this
rule, subject to Article XXI hereof, provided that Paragraphs 2, 4, 5, and 6
hereof shall not apply to products commonly known as 5-, 10-, and 25-cent
merchandise which la sold to the consumer at not more than 25 cents per
1, (a) No two-pound cans in any line, except floor wax.
(b) No three-pound cans in any line.
2. (a) No sizes less than quarter-gallon in barn and roof paint.
(b) No sizes less than gallon cans in shingle stain.
(8) No half-gallon cans in the following products: Aluminum paints, harn
paints, roof paints, auto-top dressing, wagon and carriage paints and enamels,
oil stains, spirit status, and varnish stains.
4. No half-pint cans in first-grade house paints.
5. No half-pint cans in first-grade flat paints.
6. No quarter-pint cans in all house paint and flat paint.
7. No oblong or square varnish cans in sizes smaller than one half gallon
for any product, excepting shellac varnishes, carriage and automotive finishes
(clear and colors), lacquers, lacquer thinners, liquid wax, liquid polish, varnish
remover, bronzing liquid, Japan and Liquid driers, penetrating stains and spirit
8. No shades or tints in excess of the following maximum numbers for each
brand and/or color card:
Interior floor paints and floor enamels- --,_---------------- 10
House Paints------- ---------------------------- ------,, 32
F'lat Wall Paints----------------------------,------ -. 20
Enamels--.. --- ---------------------------- .. 18
Porch Paints--,----------------------------------,-- 8
Roof and Barn Paints ---_-- ------.. -- --__ ---,_ 4
Shingle Stains .. _..... ...---- 14
Wagon and Carriage Paints or Enamels---- ---... .-- 10
Oil Stains .... _--_----------- 10
Varnish Stains..--- -- ,---- --,--.. ----- 8
Spirit and Penetrating Stains --- ------- ---- ..-, 14
Alli the foregoing exclusive of black & white)
Oil Colors._-- _____ -- ... ----- -------------- _____ 32
(Including black, but counting the several shades of a
single color as one color.)
8. (a) The maximum number of grades for the following products shall bes
Architectural and Masrine VarnisheIs-- -- ..... __ _-- 10
(Interior and exterior)
Other Varnishes________ -----------____ 28
(Including all not previously specified, such as Japan
Driers, Asphaltum, etc.)
9. No oil colors in other than liquid measure or in other than three sizes,
namely, gallons, quarts, and half-pints, with the exception of tubes, and except-
ing also glass jars when sold as a part of a sales unit with white base paint
to be tinted with such colors in oil in glass jars to standard colors, w'hiebh sales
unit has been especially developed for this purpose by the manufacturer.
UNIVERSITY OF FLORIDA
14. 3 1262 08851 8179
Manufacturing Restri-ction-s for Kalsomine and Water Podata---1. No shades ":I
or tints in excess of the following numbers for leach color cards
*Kalsomine (Hot Water) ---- ------ ___.. .....- 20
*Kalsomine ( Cold Wa ter) _- ---- ,,,______-- 20
Water Paint, Interior non-washable .___,-__ White only
Exterior water-mixed paints washable paste and powder
form _, ~ ________ -- -- 20
Interior Water-Mixed Paints washable paste and powder
form ___________,_ _____ 20
Fresco or Positive, Art or Deep Colora ... .. .__--- 20
Plastic Paints. _-_--_-_- -______ 8
Cement and/or Lime Water Mixed Paint-_-__,,,- 16 ; 1
11. Kcalsomine (H~ot or Cold) in the following sizes only: Barrels weighing
not less than 300 lbs. net, except for the Pacific Coast, where the 280 lb. barrel
ie authorized; hegs containing 100 Lbs. net weight; 25 lb. net weight packages;
5 lb. net weight containers. l
(Existing contracts covering Kalsomine in containers differing in weight ii
content from standards covered herein shall be completed prior to December
81, 1933, provided that should a purchaser, now under contract with a manu-
facturer extending beyond that date, decline to accept a readjustment ot' his
contract to bring the packages into line with these provisions, the manu-
facturer party to the contract shall refer the matter to the Paint Industry
Recovery Board prior to December 31, 1933, for such amicable adjustments as
the Board may be able to work out with the parties at interest.)
12. Interior Cold Water Paint, powder form, nonwashable. Barrels weigh-
ing not less than 350 lbs. net, 25 and 100 lb. containers, 5 lb. net weight
containers; to be made in White only.
13. Plastle or Texture Paints (Dry), in the following sizes only: 5, 10, 25,
50, and 100 lb. net weight containers and not less than 300 lb. net weight
Paste form in same size containers as First Grade Flat Paints.
14. Patching Plaster to be sold in sizes as now marketed.
15. Interior and Exterior Water-Mixed Paints, Washable, in the following
sizes only :
(a) Dry Pow~der Form,.-5 lb., 25 lb., and 100 lb. containers; barrels of 300
lbs. net, or more.
(b) Paste Form.-1l quart, 1 and 5 gallon cans and 30 gallons drums.
16. Cement and/or Lime Bound Water Mixed Paints in the followr~or~or~ing slaes
only : 5 and 10 lb. containers, 50 and 100 lb. containers, barrels of 800 lbsJ. net,
17. Fresco Colors (Positive, Deep, or Art Colors) to be packed in the flollow-
ing sizes only :.
(a) Pow~der Form.-1l lb. cartons or cans, 25 and 100 lb. containers, Barrels
or 800 lbs. net or more.
(b) Paste Fporm.--To be packed in % pint, quart, and 1 gallon cans only.
18. Dry Sizes, Water-Mixed. To be packed in the following ahzes only:
1 lb. cartons, 100 lb. containers, and 300 lb. Net Barrels, or more.
lhleans material commonly known and described by this term.