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UNIVERSITY OF FLORIDA
illIIIilllll IIII lll I 111111111111i ll l IlI1
3 1262 08482 9802
NATIONAL RECOVERY ADMINISTRATION
CODE OF FAIR COMPETITION
AS SUBMITTED ON AUGUST 30, 1933
REGISTRY No. 299-32
The Code for the Interlining Importing Industry
in its present form merely reflects the proposal of the above-mentioned
industry, and none of the provisions contained therein are
to be regarded as having received the approval of
the National Recovery Administration
as applying to this industry
GOVERNMENT PRINTING OFFICE
WASHINGTON s 198
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CODE OF FAIR COMPETITION OF THE INTERLINING
(PURSUANT TO THE PROVISIONS OF TITLE I OF THE N.I.R.A.)
The importers of interlining recognize the existence of an emer-
gency affecting the welfare of both uLmployers and employees in the
importation and domestic distribution of interlining. The emer-
gency demands that unfair competitive practices be eliminated, that
unemployment be reduced and relieved and that standards of em-
ployment be improved. It is the declared purpose of the importers
of interlining and adherents to this code to bring as far as may be
practicable the rates of wages paid in the interlining importing trade
to such levels as are necessary for the creation and maintenance of
the highest practicable standard of living; to restore the income of
enterprises within the trade to levels which will make possible the
payment of such wages and avoid further depletion and destruction
of capital assets; and from time to time to revise the rates of wages
in such manner as will currently reflect their equitable adjustment
to variation in the cost of living.
The interlining importing trade is fully cognizant of the fact
that under clause (e) of Section 3 of the N.I.R.A., the President,
on his own motion or on complaint of producers or distributors of
competing domestic products, is authorized and empowered to direct
an investigation by the U.S. Tariff Commission of the domestic
effect of competition by imported products with domestic products,
to determine whether the imported articles render or tend to render
ineffective any code or agreement "; that if he so finds, he is directed,
after investigation and notice and hearing of importers, to permit
such imported articles to enter only upon such terms and conditions
and subject to such fees and to such limitation in total quantity
that may be imported in the course of any specified period, as he
may find necessary; that in order to enforce a Presidential limitation
on imports, the President is authorized by the Act to forbid their
importation without a Treasury license, and the Secretary of the
Treasury is directed to admit only those articles that conform to the
President's directions regarding terms, conditions, fees, limitations on
quantities that may be imported, and licensing; that the President's
decision as to the facts is declared conclusive; and that the Presi-
dent's conditions or limitations with respect to imported articles shall
continue until the President finds and informs the Secretary of the
Treasury that the facts which led to their imposition no longer exist.
It is therefore the further purpose of this code to effect cooperation
with the President in regard to the interests of importers of inter-
lining, in connection with any complaint, investigation, hearing, or
order, under the aforementioned section and subdivision of the
To effectuate the policy of Title I of the N.I.R.A., the following
provisions are established as a code of fair competition for interlining
1. The term interlining as used herein is defined as follows:
Canvas padding composed of jute; cotton and jute; linen, or linen
and jute, which is imported and sold entirely to (a) clothing manu-
facturers who themselves manufacture the goods into coat fronts,
or (b) to coat-front manufacturers, who cut the canvas, manufacture
it into coat fronts, and .-ell it to the clothing manufacturers.
2. The term employees as used herein shall inlcluide all persons
employed in the selling and shipping departments or as office help.
3. The term effective date as used herein is defied to mean
August 31, 1933, or if this code shall not have been approved by the
President two weeks prior thereto, then the secnrld Monday follow-
ing such approval.
4. The term persons shall include natural persons, partnerships,
II-PuRIVISIONx PUIlsUANT TO SEC. 7A
Employers in the interlining importing trade shall comply with
the following requirements of section Ta of Title I of the N.I.R.A.
1. That employees shall have the right to ,rganiize and bargain
collectively through representatives of their own choosing and shall
be free from interfer.inre. restraint, or coercion of employers of
labor or their agents,; in the designation of such repre sentatmives or
in self-wrgranization or in other concerted a' tivities for tlhe irpose
of collec-tive bargaining or other mutual aid or protection.
2. That no employee :nd no ,one seekingg employment shall be re-
quired as a condition of eiploymient to join any co,,painy union or
to refrain from joining, orumanizing, or assisting a labor union of his
own chasing; and
3. That employers shall comply with Ilaxilili hour's of labor,
minimum rates of pay, and other conditions of employment.
III--MINMl.M:T R.vrI- OF PAY
On and after the effective date, and coitinulini,' during the period
of the *-n.ergeiwcy as defined in the N.I.R.A., the minimun wage
that shall be paid by eim!loyers in the iiterlining iiimporting trade
to any of their employees shall be at the rate per week for forty
hours of labor as follows: $15 a week; provided. further, that com-
pensation for employment now in excess of the minimum wages
l. :v'by agreed to shall not be reduced.
IV-3MAIM.UMi HOURS OAF EI'.MPYMENT
On and after the effective date, employer., in the trade shall not
nemp loy their employees in exce-: of 40 hours per week.
With a view to keeping the President informed as to the observ-
ance or nonobservance of this code of fair competition and as to
whether the trade is taking appropriate steps to effectuate the de-
clared policy of the N.I.R.A., each person engaged in the interlining
importing trade shall furnish duly certified reports to the Execu-
tive Secretary of the Association hereinafter named in such sub-
stance and in such form as may from time to time be required:
1. Returns every four weeks showing actual hours worked by the
various occupational groups of employees, and the minimum weekly
rates of pay.
2. Weekly reports of imports received, sales, sales contracts for
future delivery and a record of shipments made against such con-
tracts. Provided, however, that all reports and information fur-
nished by members or obtained from their contracts, books, or records,
shall not be divulged to any other member, nor to any other person,
except as it may be necessary to divulge such information to enforce
the observance of the provisions of this code or with a bonn fide pur-
pose to enforce such observance.
The Interlining Manufacturers Association, Inc., is constituted the
agency to collect and receive such reports.
VI--PLANNING AND FAIR PRACTICE AGENCY
To further effectuate the policy of the N.T.R.A., the Board of
Directors of the Association is set up to coopern;i' with the President
as a planning and fair-practice agency for the interlining import-
The Board of Directors may from time to time present to the Ad-
ministrator recommendations based on conditions in the interlining
importing trade as they may develop from time to time, which will
tend to effectuate the operation of the provisions of this code and
the policy of the Act, and more particularly along the following
A. Recommendations as to the requirement by the Administrator
of such further reports from the persons engaged in the trade, of sta-
tistical information and the keeping of uniform accounts, as may be
required to secure the proper observance of the code and promote the
proper balancing of production and consumption and the stabiliza-
tion of the trade and employment.
B. Recommendations for the setting up of a service bureau for
accounting, reporting, collection, and dissemination of credit infor-
mation, and other purposes, and to meet the conditions of the emer-
gency and the requirements of this code.
C. Recommendations for the making by the Administrator of
requirements as to methods and conditions of trading, the naming
and reporting of prices which may be appropriate to avoid discrimi-
nation, to promote the stabilization of the trade, and to prevent and
eliminate unfair and destructive competitive prices and practices.
D. Recommendations for regulating the disposal of distress mer-
chandise in a way to secure the protection of the owners and to pro-
mote sound and stable conditions in the trade.
E. Recommendations as to the making available to the supplier of
credit to those engaged in the trade of information regarding terms
and actual functioning of any or all the provisions of the code, the
conditions of the trade, and regarding the operations of any and all
of the members of the trade covered by such code, to the end that
during the period of the emergency available credit may be adapted
to the needs of such trade considered as a whole, and to the needs
of the small as well as the large units.
F. Recommendations for dealing with any inequalities that may
otherwise arise to endanger the stability of the industry and of
production and employment.
Such recom nendations when approved by the Adnministrator shall
have the same force and effect as any other provisions of this code.
VII-UNFAIR METHODS OF COMPETITION
Violation by any interlining importer of any of the provisions of
this code, or of any approved rule issued thereunder, is an unfair
method of competition. The following are specifically declared to
be unfair methods of competition:
1. Selling or offering for sale any merchandise below cost.
2. Enticing away employees of competitors with the purpose and
effect of unduly hampering or injuring or-embarrassing competitors
in their business.
3. Making, causing, or permitting to be made, or published, any
false or deceptive statements on or concerning the business policies
or methods of competitors.
4. Selling or offering for sale any merchandise of the trade, with
misrepresentation calculated to deceive customers or prospective cus-
tomers as to the quality, quantity, grade, substance, nature, origin,
size, or preparation of any of said merchandise.
5. Shipping of goods on consignment or memorandum, either
directly or indirectly.
6. Paying or allowing secret rebates, refunds, credits, or unearned
discounts, whether in the form of money or otherwise, or extending
to certain purchasers confidential prices, special services, or privi-
leges not mentioned in his original specifications.
7. Substituting other materials or grades for the kind ordered
without written approval of the purchaser.
8. Selling any product or article other than canvas at an unreason-
able price for the purpose of evading or defeating the terms of this
9. Representing certain prices or terms as special when they are
in fact regular prices and regular terms, with the tendency and ca-
pacity to mislead and deceive purchasers.
10. Secret deviation from announced or published price lists di-
rectly or indirectly in any guise by allowance of rebates, commis-
sions, refunds, or unwarranted freight allowances.
11. Imitation of designs, names, borders, or selvedges or other
marks of identification of competitors, having the tendency or ca-
pacity to mislead or deceive purchasers or prospective purchasers.
12. Paying or promising to pay any employee or agent of the pur-
chaser or prospective purchaser a commission in the form of money
or anything of value, for the purpose of inducing or compensating
for the sale with or without the knowledge of the purchaser.
VIII-TRADE STANDARDS, PRACTICES, AND CUSTOMS
1. Each firm shall adhere to such terms of sale as are provided in
its contracts and shall enforce collection in accordance with its terms.
2. Each firm shall every 30 days before the 10th day of the suc-
ceeding month file with the association selling price lists of all items
offered for sale.
3. Terms shall be net cash U.S. funds with a maximum credit
limit of 90 days from the date of shipment.
4. The making of oral contracts, or of incomplete and ambiguous
written contracts for the sale of imported interlining provides a
medium for unfair price discrimination, including fraud, giving rise
to disputes and disturbing the stability of the industry. Therefore,
all contracts for the sale of interlining shall be in writing, signed by
the customer, and shall contain a definite statement of price, quantity
and grade, terms of payment, time, and place of delivery, and which
contracting party pays the freight and/or cartage, and all other
elements necessary for a complete contract. They shall also provide
for arbitration of all disputes arising out of said contracts, either
by the arbitration board of the textile industry or by the American
Arbitration Association. Such contracts shall also contain a provi-
sion reciting that the prices therein contained are subject to change
from time to time, to include any increases in duties which may be
decreed by the Secretary of the Treasury pursuant. to Presidential
direction under the import provisions of the N.I.R.A.
5. Whenever a customer shall fail to meet his obligations to any
member of the trade, dealings with him shall thereafter be on a
basis of cash on delivery, unless and until he shall state under oath,
upon a uniform questionnaire form to be prepared by the Associa-
tion for that purpose, his true financial condition at the time of mak-
ing said statement, provided, however, that such forms shall not
contain unreasonable request for information not germane to the
credit standing of such customer. Immediately upon receipt there-
of, the executive secretary shall notify the trade that such informa-
tion is available, and thereafter members of the trade may exercise
their own discretion as to whether they will extend credit to such
6. No customer or prospective customer of the trade shall be
eligible for credit unless at least once during his fiscal year he shall
submit a financial statement under oath referred to in the next pre-
ceding paragraph, on the forms specially provided therefore by the
7. No customer or prospective customer of the trade shall be
eligible for credit if he shall have been found guilty in a court of
record of concealing his assets or otherwise defrauding creditors, or
if this was the judgment of any board of arbitration in a controversy
to which he was a party.
The Association shall proceed at once to provide for uniform
methods of cost finding, and shall ascertain and establish from time
to time, in conformity with such uniform method, the cost of various
ifems dealt in by the trade, which cost when so found, established
and filed with the Association, shall be the uniform cost to be
adopted by the trade.
The term cost shall be interpreted to include among other items,
duty, consul fees, broke age, cost of materials based on custom house
appraisal at port of entry plus freight, packing, cartage, insurance,
taxes, interest, selling and administration expense, credit losses, plus
5% of the amount of such cost to cover unforeseen exigencies or
emergencies in connection with business operations.
X-REVISION AND SUPERVISION
Such of the provisions of this code as are not required to be in-
cluded therein by the N.I.R.A. may, with the approval of the Presi-
dent be modified or eliminated if it appears that the public needs are
being served thereby and as changes in circumstances or experience
may indicate. They shall remain in effect unless and until so
modified or eliminated or until the expiration of the Act.
It is contemplated that froin time to time supplementary pro-
visions to this code or additional codes will be submitted for the
approval of the President to prievnt unfair competition in price
and other unfair practices, and to effe.tuate the purpose, and policies
of the N.I.R.A., and which shall not conflict with the provisions
The Board of Directors is hereby empowered to investigate as to
the functioning and observance of :any of the provisions of this code,
at its own instance or on complaint. of any person affected, to report
the same to the Administrator; to cooperate with the Administrator;
to propose additions, modifications, or revisions of this code; from
time to time to require such reports from manufacturers as in its
judgment may be necessary to advise it adequately of the adminis-
tration and enforcement of the provisions of this code; to propose a
marketing code with respect to collection and interchange of credit
information; cooperative administration of insolvent debtors' estates
and other aspects of marketing; to propose agreements or affiliation
with allied trades and industries and with customers for mutual
betterment and advancement; and, generally, to perform such other
acts as may be reasonably necessary andr proper to put these resolu-
tions into effect and to accomplish the objects and purposes of the
In the event that such committee shall find the rules of fair compe-
tition, or any provisions of this code have been violated, the violation
shall be reported to the board of directors for such action as they
shall deem proper in accordance with this code, including in appro-
priate cases report to the U.S. Attorney, the Federal Trade Commis-
.sion, or the instituting of license proceedings in accordance with law.
Such committee is also charged with the duty of keeping itself and
the trade informed of any complaints that shall be made to the
President with respect to any alleged competition of interlining im-
ports with any domestic products, and to take all steps which they
shall deem necessary and proper to further the interest of the inter-
lining importing industry.
Participation in this code or in any subsequent revision of or addi-
tion to this code shall be extended to any person, partnership, or
corporation in the interlining importing trade which shall accept its
share of the cost and responsibility as well as the benefit of partici-
pation by becoming a member of the Interlining Manufacturers
The members of the interlining importing trade endorse the prin-
ciple of arbitration for the settlement of all disputes within the
This code is not designed to promote monopolies and shall not be
availed of for that purpose.
The provisions of this code shall not be so interpreted or admin-
istered as to eliminate or oppress small enterpri-se or to discriminaite
against them. .
The President, in accordance with the provisions of section lOb)
of the N.I.R.A., may from time to time cancel or modify any order,
approval, license, rule, or regulation issued under Title I of the
The Interlining Manufacturers Association. Inc., will from time
upon request from the Administrator, furnish all data, information,
and statistics as it may have available bearing upon the question of
price increases, if any, in the industry.
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