Code of fair competition for the spray painting and finishing equipment manufacturing industry as approved on April 19, 1934


Material Information

Code of fair competition for the spray painting and finishing equipment manufacturing industry as approved on April 19, 1934
Portion of title:
Spray painting and finishing equipment manufacturing industry
Physical Description:
p. 317-330 : ; 24 cm.
United States -- National Recovery Administration
United States Government Printing Office
Place of Publication:
Washington, D.C
Publication Date:


Subjects / Keywords:
Spray painting -- Equipment and supplies   ( lcsh )
non-fiction   ( marcgt )


General Note:
Cover title.
General Note:
At head of title: National Recovery Administration.
General Note:
"Approved Code No. 397."
General Note:
"Registry no. 1341-02."

Record Information

Source Institution:
University of Florida
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
aleph - 004931514
oclc - 646192039
System ID:

Full Text









S .... : ....TO Y


For ale by the Superintendent of Documents, Washington, D.C. Price 5 cents

Approved Code No. 397

Regisfry No. 1341--02

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. 397



As Approved on April 19, 1934


An application having been duly made pursuant to and in full
compliance with the provisions of Title I of the National Industrial
Recovery Act, approved June 16, 1933, for approval of a Code of
Fair Competition for the Spray Painting and Finishing Equipment
Manu fact during Industry, and hearings having been duly held thereon
and the annexed report on said Code, containing findings with respect
thereto, having been made and directed to the President:
NOW, THEREFORE, on behalf of the President of the United
States, I, Hugh S. Johnson, Administrator for Industrial Recovery,
pursuant to authority vested in me by Executive Orders of the Presi-
dent, including Executive Order No. 6543-A, dated December 30,
1933, and otherwise; do hereby incorporate by reference said annexed
report and do find that said 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 Code of Fair
Competition be and it is hereby approved; provided, however, that
the provisions of Article IX, Section 1, paragraph (b) insofar as
they prescribe a waiting period between the filing of price lists and
the effective date of revised price lists or revised terms and conditions
of sale be and they are hereby stayed for a period of sixty (60) days,
or pending my further Order.
Administrator for Industrial Recovery.
Approval recomnnended:
Division Admnb istrator.
APRIL 19, 1934.
53948--482-111---34 (317)


The White House.
SIR: This is a report on the Code of Fair Competition for the
Spray Painting and Finishing Equipment Manufacturing Industry
as revised after a Public Hearing held in Washington on the 15th
day of December, 1933, according to the provisions of the National
Industrial Recovery Act.


Employment is limited to 8 hours per day and 40 hours per week
with the exception of those employees engaged in emergency main-
tenlance, or emergency repair work, but to provide for seasonal de-
mands, tolerance is permitted for 6 weeks in any 26 weeks' period.
Firemen, truckmen and shipping clerks are allowed a tolerance of
10 percent in hours. Watchmen are not permitted to work in excess
of 56 hours per week.
Time and one-half is paid for any work in excess of 8 hours per
day or 40 hours per week.
Minimum wages are established at 40 cents for males and 35 cents
for females. Clerical employees shall not be paid less than $15.00
per week.

The Industry has been established for less than 25 years. The
principal use of the products of the Industry is in the spraying of
paints and lacquers.
It is estimated the Industry employed during its peak in 1929
approximately 1100 employees. This dropped to approximately 500
in 1933. The Industry has been operating at an average of 40 hours
a week since the adoption of the Pre-ident's Reemployment Agree-
ment, so that additional employment can only be obtained through
general resumption of business.
It is estimated that. under the wage rates established by the Code,
the wages of the Industry will be raised to the 1929 level.


The Deputy Admiinistrator in his final report to me on said Code
having found as Ilirein set forth and on the basis of all the pro-
ceedings in this matter;
I find that:
(a) Said Code is well designed to promote the policies and pur-
poses of Title I of the National Industrial Recovery Act, including
removal of obstructions to the free flow of interstate and foreign


commerce which tend to diminish the amount thereof and will pro-
vide for the general welfare by promoting the organization of indus-
try for the purpose of cooperative action among the trade groups, by
inducing and maintaining united action of labor and management
under adequate governmental sanctions and supervision, by eliminat-
ing unfair competitive practices, by promoting the fullest possible
utilization of the present productive capacity of indlust rics, by avoid-
ing undue restriction of production (except as may be temporarily
required). by increasing the consumption of industrial and agricul-
tural products through increasing purchasing power, by reducing
and relieving unemployment, by improving standards of labor, and
by otherwise rehabilitating industry.
(b) Said Industry normally employs not more than 50,000 em-
ployees; and is not classified by me as a major industry.
(c) The Code as approved complies in all respects with the perti-
nent provisions of said Title of said Act, including without limita-
tion Subsection (a) of Section 3, Subsection (a) of Section 7, and
Subsection (b) of Section 10 thereof; and that the applicant associa-
tion is an industrial association truly representative of the aforesaid
Industry; and that said association imposes no inequitable restric-
tions on admission to membership therein.
(d) The Code is not designed to and will not permit monopolies
or monopolistic practices.
(e) The Code is not designed to and will not eliminate or oppress
small enterprises and will not operate to discriminate against them.
(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 Code.
For these reasons, this Code has been approved by me.
APRIL 19, 1934.


To effectuate the policies of Title I of the National Industrial
Recovery Act, the following provisions are established as a Code of
Fair Competition for the Spray Painting and Finishing Equipment
Malufacituring Industry, and shall be the standards of fair compe-
tition for such Industry and shall be binding upon every member

The term Spray Painting and Finishing Equipment Manufac-
turing Industry ", as used herein, includes the manufacturing and/or
assenmblilng for sale of spray painting and finishing equipment units
and of component and repair parts and accessories of such units by
manufacturers or assemblers of such units, and such related branches
or hlllbdivisions thereof as may from time to time be included under
the provisions of this Code, except such equipment as may be specifi-
cally included ulndtr another or other approved Code or Codes.
The term "employee", as used herein, includes anyone engaged
in the Industry in any capacity receiving compensation for his serv-
ices, irrepuctive of the nature or method of paymentlt of such com-
The term employer", as used hervin, includes anyone by whom
any such employee is compensated or employed.
The term "member of the Industry as used herein, includes
anyone engaged in the Industry as above defined, either as an em-
ployer or on his own behalf.
The term Association ", as used herein, means the "National
Spr1'y Painting and Finishing Association ".
The terms "'President.", "Act", and "Administrator ", as used
herein, shall mean respectively the President of the United States of
America, Title I of the National Industrial Recovery Act, and the
Administrator for Industrial Recovery.

SECTION 1. No employee shall be permitted to work in excess of
forty (40) hours in any one (1) week or eight (8) hours in any
twenty-four (24) hour period, except as herein otherwise provided,
nor more than six (6) days per week.
SECTION 2. The maximum hours fixed in Section 1 shall not apply
to employees engaged as research technicians who receive more than
thirty-five ($35.00) dollars per week or to those employees who are


engaged in an executive, managerial or supervisory capacity, who
receive more than thirty-five ($35.00) dollars per week, and outside
SECTION 3. The maximum hours fixed in Section 1 shall not apply
to any employee on emergency maintenance or emergency repair
work involving breakdowns or protection of life or property, but in
any such special case at least one and one-half (11/) tnmes the
normal rate of pay shall be paid for hours worked in excess of
eight (8) hours per day and forty (40) hours per week.
SECTION 4. The maximum hours fixed in Section 1 shall not apply
for six (6) weeks in any twenty-six (26) weeks' period, during which
time overtime shall not exceed eight (8) hours in any one (1) week;
provided, however, that in any such special case at least one and
one-half (1%) times the normal rate of pay shall be paid for hours
worked in excess of eight (8) hours per day and forty (40) hours
per week.
SECTION 5. Watchmen shall not be permitted to work in excess of
fifty-six (56) hours per week.
SECTION 6. Firemen, truckmen and shipping clerks may be per-
mitted to work not in excess of forty-four (44) hours in any one (1)
week, provided that one and one-half (11/) times the normal rate
of pay shall be paid for hours worked in excess of eight (8) hours
per day and forty (40) hours per week.
SECTION 7. No employer shall knowingly permit any employee to
work for any time which, when totaled with that already performed
for another employer or employers, exceeds the maximum permitted
SECTION 8. NO accounting, clerical or office employees shall be em-
ployed in excess of forty (40) hours in any one (1) week or nine (9)
hours in any one (1) day. Eight (8) hours constitute a normal
work day.
SECTION 9. Employers who personally perform manual work or
are engaged in mechanical operations shall not exceed the prescribed
maximum number of hours.

SECTION 1. Except. as herein otherwise provided, no clerical or
office employee shall be paid less than at the rate of fifteen ($15.00)
dollars per week, nor any male employee at less than the rate of
forty (40) cents per hour, nor any female employee at less than the
rate of thirty-five (35) cents per hour. All rates which are now
in excess of these minima shall be promptly and equitably adjusted
and in no case shall they be decreased. Within sixty (60) days
after the effective date of the Code every employer in the Industry
shall file a complete statement of all such equitable adjustments with
the Code Authority, which shall furnish same to the Administrator
at his request.
SECTION 2. Office boys and girls shall be paid at a rate not less
than eighty (80) per cent of the minimum salary provided for
clerical or office employees in Section 1; provided that the number
of such office boys and girls so paid shall constitute not more than
five (5) per cent of the total number of office and clerical employees


of any one employer, but in any case, an employer shall be entitled
to employ one (1) such employee.
SEuTION 3. This Article establishes minimum rates of pay regard-
less of whether an employee is compensated on a time-rate, piece-
work, or other basis.
SECTION 4. Female employees performing substantially the same
work as male employees shall receive the same rate of pay as male
employees; and where they displace men, they shall receive the same
rate of earnings as the men they displace.
SEcrroN 5. A person whose earning capacity is limited because of
age, physical or menial handicap, or other infirmity, may be em-
ployOed on light work at a wage below the minimum established by
this Code, if the employer obtains from the state authority, desig-
nated by the Inited States Department of Labor, a certificate au-
thorizingi such person's employment at such wages and for such hours
as shall be stated in the certificate. Such authority shall be guided
by the instructions of the United States Department of Labor in
issuing certificates to such persons. Each employer shall file
monthly with the Code Authority a list of all such persons employed
l) him, showing the wages paid to, and the maximum hours of work
for such employee.


SECTION 1. As required by Section 7 (a) of Title I of the National
Industrial Recovery Act, it is hereby provided:
That employees shall have the right to organize and bargain col-
lectively 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 purpose
of collective bargaining or other mutual aid or protection.
That no employee and no one seeking employment shall be re-
quired as a condition of employment to join any company union or
to refrain from joining, organizing, or assisting a labor organiza-
tion of his own choosing.
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.
SECTION 2. No person under sixteen (16) years of age shall be
employed in the Industry nor any one under eighteen (18) years of
age at operations or occupations hazardous in nature or detrimental
to health. The Code Authority shall submit to the Administrator
within ninety (90) days after approval of this Code a list of such
occupations. In any State an employer shall be deemed to have
complied with this provision if he shall have on file a certificate
or permit duly issued by the Authority in such State empowered
to issue employment or age certificates or permits, showing that the
employee is of the required age.
SECTION 3. Within each State this Code shall not supersede any
laws of such State imposing more stringent requirements on em-
ployers regulating the age of employees, wages, hours of labor, or
health, fire, or general working conditions than under this Code.


SECTION 4. Employers shall not reclassify employees or duties of
occupations performed, or engage in any other subterfuge so as to
defeat the purposes or provisions of the Act or of this Code.
SECTION 5. Every emplloyer shall provide for the safety and health
of employees during the hours and at the places of their employment.
Standards for safety and health shall be submitted by the Code
Authority to the Administrator within six (6) months after the
effective date of the Code.
SECTION 6. Each employer shall comply with all rules and regula-
tions of the President or the Administrator as to posting this Code
or portions thereof.
To effectuate further the policies of the Act,, a Code Authority is
hereby constituted to cooperate with the Administrator in the admin-
istration of this Code.
SECTION 1. Organization, Constitution and Powers of the Code
Authority.-(a) The Code Authority shall consist of eight (8) in-
dividuals or such other number as may be approved by the Admin-
istrator (in addition to not to exceed three (3) members to be ap-
pointed by the Administrator if he so elects, to serve without vote).
Four (4) shall be members of the Board of Directors of the Associa-
tion and shall be appointed by said Board; two (2) shall be the
President and Vice-President, respectively, of said Association, and
two (2) shall be representatives of and elected by, members of the
Industry who are not members of that Association (provided any of
said non-members desire such representation, and signify their will-
ingness to pay their pro rata share of the cost of administering this
Code, as determined by the Code Authority, subject to review by the
The Code Authority shall complete its organization by electing its
officers. A majority of the voting members of the Code Authority
shall constitute a quorum at any meeting. A majority vote of the
voting members of the Code Authority shall decide any question
relating to the Industry subject to the right of any person aggrieved
or affected thereby to have such decision reviewed and approved or
disapl)roved thereupon by the Administrator.
(b) Members of the Industry shall be entitled to participate in
and share the benefits of the activities of the Code Authority and to
participate in the selection of the members thereof by assenting to
and complying with the requirements of this Code and sustaining
their reasonable share of the expenses of its administration. Such
reasonable share of the expenses of administration shall be deter-
mined by the Code Authority, subject to review by the Administra-
tor, on the basis of volume of business and/or such factors as may
be deemed to be equitable.
(c) The said Association, or any other trade association directly
or indirectly participating in the selection or activities of the Code
Authority, shall: (1) Impose no inequitable restrictions on member-
ship, and (2) Submit to the Administrator true copies of its Con-
stitution and By-Laws, and any amendments thereto, together with
such other information as to membership, organization and activi-


ties as the Administrator may deem neccs.-ary to effectuate the
purposes of the Act.
(d) In order that the Code Authority shall at all times be truly
representative of the Industry and in other respects comply with
the provisions of the Act, the Administrator may prescribe such
hearings as he may deeni 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 in the method of selection of the Code
(e) For the purpose of keeping the Administrator informed as to
the observance of this Code each member of the Industry shall, when
information is called for by the Administrator or the Code Author-
ity, furnish certified reports to the Code Authority. The Code
Authority may appoint a disinterested agency for receiving such
information. Information with respect to sales volume, cost and
other details of operation which may be furnished by any member
of the Industry to such disinterested agencies shall be considered
confidential and shall not be divulged to the Code Authority or to
any member of the Industry but only to the duly appointed and con-
stituted representative of the Administrator.
SECTION 2. The Code Authority shall have the following further
duties and powers to the extent permitted by the Act:
(a) To adopt By-Laws and rules and regulations for its pro-
cedure and for the administration of the Code.
(b) To represent the Industry in conferring with the President
Sor his agents with respect to the administration of this Code and in
Respect of the National Industrial Recovery Act and any regulation
Issued thereunder.
(c) To hear complaints and attempt to adjust the same, under
Such rules and regulations as may be prescribed by the Administrator.
(d) To obtain from members of the Industry such information, and reports as may be necessary for the administration of this
Code. Such information, data and reports as may be submitted by
a member shall not be revealed, except in summary. The disinter-
ested agency receiving this information is hereby charged with the
duty and responsibility of receiving such information, data and
reports and keeping same confidential, but such information, data
Sand reports shall at all times be available to the Administrator.
In addition to the information required to be submitted to the
Code Authority there shall be furnished to Government Agencies
such statistical information as the Administrator may deem neces-
sary for the purposes recited in Section 3 (a) of the Act but nothing
in this Code shall relieve any person of any existing obligation to
furnish reports to Government Agencies.
(e) To coordinate the administration of this Code with such codes,
if any, as may be adopted by any subdivision of this Industry or
any related Industry, with a view to providing joint and harmonious
action on all matters of common interest, all with the approval of
the Administrator.
(f) To study the effect of the various provisions of this Code on
the Industry and consider proposals for amendments or modifica-
tions and make recommendations from time to time thereon which
amendments or modifications will become effective as part of the


Code, upon approval of the Administrator after such notice and
hearing as he may specify.
(g) To make rules and regulations necessary for the adiiiiiistra-
tion and for facilitating the enforcement of this Code, under such
rules and regulations as lmay be prescribed by the Administrator,
subject to the right of any affected person to appeal to the Allinin-
(h) To appoint a trade prai-tice committee which shall iiieet. with
the trade practice committees appointed under such other codes as
may be related to the Industry for the purpolUe of formulating fair
trade practices to govern the relationships between production and
distribution employers under this Code and under such others to
the end that such fair trade practices may be proliosedt to the Adlmin-
istrator as amendments to this Code and such other codes.
SECTION 3. If the Administrator shall 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 investiga-
tion of the merits of such action and further consideration 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 (30) days' notice to him of intention to
proceed with such action in its original or modified form.

Except as may be subsequently set forth in a specific or supple-
mentary Export Code for the Industry, the provisions of the Code
now or hereafter adopted with regard to prices, dis.'ounts, deduc-
tion., allowances, extras, commissions or methods and/or terms of
sale are not to apply to direct export sales or to sales in course of
export (i.e., sales destined ultimately for export) or to sales of
materials used in the manufacture of products for export. The
terms "export" or "export sales" shall include all shipments to
outside the United States of America and those shipments to the
Canal Zone or Alaska.
Article VIII, and Sections 6, 8, 9, 11, 12, 13, 14, 15, 17, 18, 19, 21,
and 22 of Article X shall not apply to direct export, sales of any
product or to sales of any product destined ultimately for export.

In the conduct of its business each member of the Industry shall
use a method of cost accounting which conforms to the principles
of the standard method of cost accounting to be formulated or
adopted by the Code Authority and approved by the Administrator.
Variations from or modifications of the adopted method may be
required to fit the individual needs of particular members, but the
expression standard method is to imply in its narrowest sense:
(a) a definition of accounting terms, in order that all companies
may include the same elements in various stages of cost; and (b) a
model or standard to provide a gauge of the requirements for an
adequate procedure. Full details concerning such method shall be
made available to all members.


1. (a) Within five (5) days after the effective date of this Code,
ench member of the Industry shall file with the Code Authority his
prices, discounts, and other terms and/or conditions of sale, for
standard products of the Industry or products made under recog-
nized standard specifications, manufactured and/or assembled for
sale by him. Simultaneously he shall mail a copy thereof to other
members of the Industry, whose names can be ascertained by diligent
search, and to such of his purchasing trade as he may deem desirable.
(b) Revised prices, discounts, and other terms and/or condi-
tions of sale, may be filed with the Code Authority at any time by
any inmember of the Industry, provided they are to become effective
not earlier than five (5) days after the filing thereof. Simultane-
ously he shall mail a copy thereof to other known members of the
Industry, whose names can be ascertained by diligent search, and to
such of his purchasing trade as he may deem desirable.'
(c) The Code Authority shall make the effective prices, discounts,
and other terms and/or conditions of sale available to all interested
parties, as each may be concerned.
(d) Except where otherwise specifically provided for in this Code,
selling or offering to sell products of the Industry at prices, dis-
counts, and terms, and/or on other conditions, other than those
which are on file with the Code Authority as being effective, is
an unfair method of competition.
(e) Other members of the Industry who file with the Code Au-
thority revised prices, discounts, and other terms and/or conditions
of sale, prior to the effective date of such revised price lists, dis-
counts, and other terms and/or conditions-of sale, filed by another,
as provided in paragraph (b) of this Section 1, may make their
revised prices, discounts, and other terms and/or conditions of sale
effective on the same date as those first filed.
(f) The provision of paragraph (d) of this Section shall not
apply with respect to any addition to selling prices, so filed, due
to any excise, sales, occupational or privilege tax which may be
imposed upon the seller, in connection with any sale, under Federal
or State law.
2. Transportation allouwa'i.cs.-Terms of sale shall provide that
the selling price be f.o.b. seller's factory, but this shall not operate
to prevent the seller from meeting actual competition due to differ-
ence in published transportation charges of public service carriers
applying from the respective points of origin in competition to
the destination of the products.
3. The Code Authority shall establish by any means it deems prac-
ticable a merchandising plan for the designation of dealers, whole-
salers or distributors and manufacturers of equipment. and such
other designations as seem fitting. This plan to be submitted to the
Administrator for approval or disapproval.
The following practices constitute unfair methods of competition
for members of this Industry and are prohibited.
1 See paragraph 2 of order approving this Code.


1. Indui;ng Brearh of Con,,-act.-Inducing or attempting to in-
duce the Ibrachl of a co(imnercial contract between a member of the
Indrititry and anyone with whom he has a contract..
2. MJf.Ibradi-n/I.-Markiing, branding, or failing to .brand, for the
purpose ur with the effect of Illi.ilcading or deceiving with rc.i-c't
to the quantity, quality, size, style, grade or subitaiwn' of such
prod iut s.
3. False drrHi'm;,ig.-To make, cause or knowingly permit to be
made. or published any false, untrue or deceptive :-tatemllnt, directly
or implied, by way of advertisement or otherwise, ctn.crning the
grade, quality, quantity, substance, size, style, extent of 1i-age or
sale, capacity or performance of any product. of the Industry having
a tendency and capacity to mislead or deceive.
4. Disparoagru'n of Comnpettor or Product.-To make, cause or
knowingly permit to be made or published in any manner, any false,
misleading or deceptive statements concerning the financial stand-
ing, ability to perform contracts, business methods, policies or
products of a competitor.
5. False Piice List.-The publishing or circulating of false or
fictitious price lists.
6. Split Shipments.-Making partial deliveries under orders for
quantities of products at the quantity price when the sale price is
based on the shipment of the order at one time (excepting only bona
fide back orders).
7. Secret Rebates.-Withholding from, or inserting in, the invoice,
facts which make the invoice a false record, wholly or in part, of
the transaction represented on the face thereof, and/or the secret
payment or allowance of rebates, refunds, credits, unearned dis-
counts, whether in the form of money or otherwise, or the secret
extension to certain purchasers of services or privileges not extended
to all purchasers in the same class and under like term.-, or conditions.
8. "Free Deals."-The. practice of offering "Free Deals" in or
connected with this Industry's products, except as otherwise pro-
vided in this section. Free Deals" shall include all forms of mar-
keting devices, offering free merchandise of value whether of the
same kind as that sold or of a different kind, and whether all or
only a part of the cost is borne by the seller. The term Free Deals "
shall not apply to the furnishing of a reasoiable quantity of adver-
tising acces-arie-, of small value such as window displays, posters,
display fixtures, racks, holders, etc.
9. .s'al',e below Cost.-No member of the Industry shall sell below
cost as determined by the cost accounting system established under
Article VIII, except:
(a) to meet existing competition of a lower cost producer, or
(b) to meet competition in violation of this code concerning which
the member of the Industry has complained to the Code Authority
and on which violation decision is pending.
10. Commercial Bribery.-No member of the Industry shall give,
permit to be given, or directly offer to give, anything of value for
the purpose of influencing or rewarding the action of any employee,
agent or representative of another in relation to the business of the
employer of such employee, the principal of such agent or the repre-
sented party, without the knowledge of such employer, principal


or party. Commercial bribery provisions shall 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.
11. Price Guara ty.-Guaranteeing products against advance
and/or protecting against decline in price.
12. Consignment.-No member of the industry shall ship goods
on con-ignnent except under circumstances to be defined by the
Code Authority, where peculiar circumstances of the industry
require the practice.
13. Returned Goods, Obsolescence.-Allowing credit to whole-
salers, dealers and equipment manufacturers for return of unused
products of the Industry (other than returned for breach of con-
tract by the seller), except as follows in this section, viz:
Credit may be allowed dealers, wholesalers and equipment manu-
facturers (who purchased such products for combining with their
own products for resale) provided the said products still appear in
the current catalog of the member of this Industry from whom pur-
chased, and also provided that such purchasers pay to said member
full transportation, a reasonable handling charge, a reasonable recon-
ditioning charge, give such member an order not less in net amount
than the amount of the credit to be allowed on the products to be
returned, and that permission first is received from said member
of the Industry to return such products. This provision shall not
prohibit the return of merchandise due to financial inability on the
part of the purchaser to fulfill the conditions of the purchase
contract for such merchandise.
14. Credit 4Allowa~ice on Used Equipment.-Allowing credit for
the return of used products of the Industry to apply against the
purchase price of other products of the Industry.
(This section is not intended to prohibit acceptance of returned
products which have been slightly used, in exchange for similar prod-
ucts more suitable to the customer's requirements, in bona fide cases
of the seller's error or misunderstanding when accepting the order
or in cases of products which do not conform to specifications and
which the seller is by law obligated to accept.)
15. Closeouts.-If a member of the Industry deems it necessary to
liquidate dropped lines, seconds, used equipment or inventories
which must be converted into cash to meet emergency needs, the
same may be sold by any member at any price and on any terms and
conditions, but only if such member, not less than two (2) weeks
before offering said products for sale, has filed with the Code Author-
ity, a statement in writing, setting forth the fact of, and reasons for,
such proposed disposal, and provided that the invoice for such prod-
ucts so offered or sold shall be plainly marked Special price on
account of clos(.ont ", "Special price on account of seconds or
"Special price on account of used equipment ", as the case may be.
16. Conr, fr;buions.-Giving contributions or prizes to customers,
or their salesmen or other employees, the over liberal entertainment
of customers or prospective customers, the buying of space in special
advertising issues or sections where a direct return to the purchaser
commensurate with the cost thereof may not reasonably be expected,
and the extension of similar gratuities.


17. Membership in or Contribvut.ion to Organizations and Con-
ventions.-Taking membership, involving financial expenditure, or
contributing money or anything of substantial value to, or purchas-
ing exhibit space at a convention of, any local, state or regional
organization unless the said organization s openly declared policy
is to promote or encourage the .sale of the products of this Industry.
18. Replacement of Competitar,' Stock.-Accepting from whole-
salers or dealers the products of another member of this Industry
for the purpose of exchange and replacing them with the products
of the member of the Industry making such exchange.
19. Luuznp Sunm Bhiding.-Making lump sum bids without clearly
indicating on the bid the major standard items included therein.
20. Obtaining Lower Prices by Subterfuge.-Any plan or scheme
designed to enable a purchaser to obtain lower prices by subterfuge.
21. Substitution of Higher Priced Air Tankts.-Supplying in any
sale an air tank (or tanks) represented to be constructed under
published standards of the American Society of Mechanical Engi-
neers or similar provisions in force in any state or city, without add-
ing to the selling price the extra cost thereof to the seller above the
seller's price for air tanks that do not comply with the aforesaid
standards of construction.
22. Alteration of Standard Equipmn it.-Altering standard equip-
ment appearing in the seller's catalog or price list, without making
due allowance covering the cost of extra labor, materials and inci-
dental costs in the selling price of such unit article in the seller's
price list, and published and/or filed, or required by this Code to be
filed, with the Code Authority; except that deduction shall be made
for the value of any part or parts omitted from the altered unit in
the amount of the production cost thereof to the seller.
Any device or means resorted to for the purpose of selling such
altered unit at less than the price charged others for such unit, in
standard form, (plus the charge for alteration less the value of the
omitted part or parts, as above defined) shall be deemed a price
discrimination prohibited by this Code as an unfair method of
23. Lcd;in, or Donating Products of the Ilndu.ry.-Lenling or
donating spray guns or accessories thereto to manufacturers or dis-
tributors of spraying materials, or to their employees or agents, for
use in exploiting their products.
24. Threats of Litigation.-The publishing or circularizing of
threats of suits, or suits for infringement of patents or trade marks
or of any other legal proceedings not in good faith, with the tend-
ency or effect of harassing competitors or intimidating their
25. Espionage of Competitors.-Setcuring confidential information
concerning the business of a competitor by a false or misleading
statement or representation, by a false impersonation of one in au-
thority, by bribery, or by any other unfair method.
26. Other Unfair Pra:tiles.-Nothing in this Code shall limit the
effect of any adjudication by the Courts or holding by the Federal
Trade Commission, on complaint, finding, and order, that any prac-
tice or method is unfair, providing that such adjudication or holding
is not inconsistent with any provision of the Act or of this Code.


II11lllII llll lll | I ll l l H II Illl lI
330 3 1262 08583 0346

27. Allocation of Costs, Etc., for Unrelated Lines of Products.-
Where a member of this Industry produces more than one line of
products, each line shall be considered a separate unit for purposes
of ascertaining cots, and expenses of all kinds shall be fairly and
properly allocated to the several lines.
This Code and all the provisions thereof are expressly made sub-
ject to the right of the President, in accordance with the provisions
of subsection (b) of Section 10 of the Act, from time to time to cancel
or modify any order, approval, license, rule or regulation issued
under Title I of said Act and specifically, but without limitation, to
the right of the President to cancel or modify his approval of this
Code or any conditions imposed by him upon his approval thereof.
This Code, except as to provisions required by the Act, may be
modified on the basis of experience or changes in circumstances, such
modifications to be based upon application to the Administrator and
such notice and hearing as he shall specify, and to become effective
on approval of the Administrator.
No provision of this Code shall be so applied as to permit monopo-
lies or monopolistic practices, or to eliminate, oppress or discriminate
against small enterprises.


Whereas the policy of the Act to increase real purchasing power
will be made more difficult of consummation if prices of goods and
services increase as rapidly as wages it is recognized that price in-
creases except such as may be required to meet individual cost should
be delayed. But when made such increases should, so far as possible,
be limited to actual additional increases in the seller's costs.
This Code shall become effective on the 10th day after its approval
by the President.
Approved Code No. 397.
Registry No. 1341-02.