Citation
Supplementary code of fair competition for the cotton textile industry

Material Information

Title:
Supplementary code of fair competition for the cotton textile industry as approved on January 24, 1934
Portion of title:
Cotton textile industry
Creator:
United States -- National Recovery Administration
Place of Publication:
Washington, D. C
Publisher:
United States Government Printing Office
Publication Date:
Language:
English
Physical Description:
13 p. : ; 24 cm.

Subjects

Subjects / Keywords:
Cotton textiles -- United States ( lcsh )
Genre:
federal government publication ( marcgt )
non-fiction ( marcgt )

Notes

General Note:
Cover title.
General Note:
At head of title: National Recovery Administration.
General Note:
"Registry No. 299-25."
General Note:
"Approved Code No. 1. Supplement No. 1."

Record Information

Source Institution:
University of Florida
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
005024656 ( ALEPH )
63654438 ( OCLC )

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UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON: 1934


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


Registry No. 299-25


Approved Code No. 1. Supplement No. 1


NATIONAL RECOVERY ADMINISTRATION




SUPPLEMENTARY
CODE OF FAIR COMPETITION
FOR THE

COTTON TEXTILE INDUSTRY

AS APPROVED ON JANUARY 24, 1934

























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.
DISTRICT OFFICES OF THE DEPARTMENT OF COMMERCE

Atlanta, Ga.: 504 Post Office Building.
Birmingham, Ala.: 257 Federal Building.
Boston, Mass.: 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: 801 First National Bank Building.
Houston, Tex.: Chamber of Commerce Building.
Indianapolis, Ind.: Chamber of Commerce Building.
Jacksonville, Fla.: Chamber of Commerce Building.
Kansas City, Mo.: 1028 Baltimore Avenue.
Los Angeles, Calif.: 1163 South Broadway.
Louisville, Ky.: 408 Federal Building.
Memphis, Tenn.: 229 Federal Building.
Minneapolis, Minn.: 213 Federal Building.
New Orleans, La.: Room 225-A, Customhouse.
New York, N.Y.: 734 Customhouse.
Norfolk, Va.: 406 East Plume Street.
Philadelphia, Pa.: 422 Commercial Trust Building.
Pittsburgh, Pa.: Chamber of Commerce Building.
Portland, Oreg.: 215 New Post Office Building.
St. Louis, Mo.: 506 Olive Street.
San Francisco, Calif.: 310 Customhouse.
Seattle, Wash.: 809 Federal Office Building.













Approved Code No. 1-Supplement No. 1


SUPPLEMENTARY CODE OF FAIR COMPETITION
FOR THE

COTTON TEXTILE INDUSTRY
As Approved on January 24, 1934


I 3


ORDER

APPROVING SUPPLEMENTARY
CODE OF FAIR COMPETITION
FOR THE

COTTON TEXTILE INDUSTRY


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 Supple-
mental Code to the Code of Fair Competition for the Cotton Textile
Industry, and hearings having been duly held thereon and the an-
nexed 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
President, 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 pur-
poses of said Title of said Act; and do hereby order that said Code
of Fair Competition be and it is hereby approved.
HUGH S. JOHNSON,
Administrator for Industrial Recovery.
Approval recommended:
A. D. WHIITESIDE,
Division Administrator.
WASHINGTON, D.C.,
January 24, 1934.
35743 --313-133--34 (1
















The PRESIDENT,
The Whit House.
SIR: This is a report on the Hearing on Supplemental Code No. 1
to the Cotton Textile Code, containing trade practices relating to
the sale and distribution of products of the Cotton Textile Industry,
held in accordance with the provisions of the National Industrial
Recovery Act, in the Willard Room of the New Willard Hotel on
November 23, 1933. The Code, which is attached, was presented by
duly qualified and authorized representatives of the Industry, com-
plying with statutory requirements, said to represent 177 out of
350 concerns and 75%o in volume of the Industry.
In accordance with the customary procedure every person who
had filed a request for an appearance was freely heard in public,
and all statutory and regulatory requirements were complied with.
The Code originally proposed was for the Cotton Converting
Industry. To understand the functions of converting, it must be
appreciated that the business of merchandising goods included under
this Code involves an element of speculation in style and market.
Where this speculation is inherent to a marked degree, the function
of risk taking and merchandising has been fulfilled by concerns
separate from manufacturers and producers of the. merchandise.
Where portions of the business handled by these converting firms are
found to be of such a nature that stability of style and use lessens
the risk and where it is not necessary to distribute the product of
one manufacturing establishment over a too-extended variety of
outlets, the plants themselves are found to be in competition with
the converters. Accordingly, it was found that the converting in-
dustry wanted its trade practices to cover original sale by manu-
facturing, plants, designated as integrated producers ", while man-
ufacturing plants themselves wanted the sale of their products
covered, as in most other instances, by their own manufacturing code.
To solve this problem, the Cotton Converting Industry has been
brought into the Cotton Textile Code. It constitutes in essence part
of the original sale of merchandise manufactured under this latter
Code, rather than occupying the position of jobber or distributor.

THE INDUSTRY
The Industry comprises about 350 concerns, having an aggregate
invested capital of approximately $200,000,000. In 1929 the Industry
provided employment for 10,000 workers. This figure has declined
to about 9,000 employees in 1933. The aggregate annual sales have
fallen from $1,000,000,000 in 1929 to about $600,000,000 in 1932.
(2)








PROVISIONS OF THE CODE
While the problem of employment from a Code point of view in
the Industry is a comparatively minor one, the orderly maintenance
of the right kind of market for cloth is a help toward more con-
tinuous employment in the weaving and finishing mills which supply
this market. Accordingly, the trade practices submitted in the pro-
posed supplemental Code have been given careful study. They have
been assented to by the preponderant majority of the Converting
Industry, and by the Cotton Textile Industry Committee, subject to
individual members of the Industry having the right to make their
own objections. Such objections have been duly heard. The pro-
visions offered herewith are not nearly as restrictive in many cases
as those proposed. They are, however, corrective of certain ad-
mitted abuses and are an attempt at self-regulation on the part
of the Industry, while containing no provisions likely to constitute
a burdensome hampering of trade.

FINDINGS
The Deputy Administrator in his final report to me on said Code
having found as herein set forth and on the basis of all the proceed-
ings in this matter;
I find that:
(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 provide
for the general welfare by promoting the organization -of industry
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 elimi-
nating unfair competitive practices, by promoting the fullest possible
utilization of the present productive capacity of industries, by
avoiding undue restriction of production (except as may be tempo-
rarily required), by increasing the consumption of industrial and
agricultural products through increasing purchasing power, by re-
ducing 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.







4

(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, the Code has been approved.
Respectful ly.
HUGH S. JOHNSON,
Administrator.
JANUARY 24, 1934.













SUPPLEMENTARY CODE OF FAIR COMPETITION


FOR THE
COTTON TEXTILE INDUSTRY

To effectuate the policies of Title I of the National Industrial
Recovery Act (hereinafter referred to as the "Act "), the following
provisions are established as Supplemental Code No. 1 to the Code
of Fair Competition for the Cotton Textile Industry, to deal with
trade practices in the sale and distribution of the products of that
Industry, and shall be the standard of fair competition for such
Industry in respect of such sale and distribution, and shall be bind-
ing upon every member thereof in the manner and to the extent
therein provided.
I. Definitions.-(1) Master Code means the Code of Fair Com-
petition for the Cotton Textile Industry, finally approved July 16,
1933, as heretofore or hereafter amended.
(2) Branch of the Industry means the sale and distribution at
wholesale of products of the Cotton Textile Industry by any concern
insofar as it does manufacturing and/or finishing of the same for its
own account or the account of others or has the same finished by
others for its own account or for the account of others, or by a
commission house or broker acting for same.
(3) "Member of branch of the Industry" means any business
entity engaged in this branch of the Industry.
(4) Finished goods means grey goods, products of the Cotton
Textile Industry, after being processed or finished in the completed
fabrics as intended for use.
II. All members of this branch of the Industry shall be subject
to and comply with the provisions of the Master Code in addition
to the applicable provisions of this Supplemental Code.
III. There shall be constituted at this time in this branch of the
Industry the following divisions of finished goods, the precise scope
of these divisions being further defined in Section V hereof:
1. Clothiers' Linings (other than all-cotton).
2. Corset, Brassiere, and Allied Trades Fabrics.
3. All-Cotton Clothing Lining.
4. Curtain and Drapery Fabrics.
5. Shirtings.
6. Wash Goods.
7. Interlinings.
Anything herein or in Section V hereof to the contrary notwith-
standing the foregoing divisions shall not include the following:
Moleskins and corduroys;
Bleached wide sheetings, sheets, pillow cases, dyed ducks;
Unbleached, bleached, colored, dyed and printed flannels,
suedes and duveteens;









Outerwear material such as mineral and sulphur khakis,
ducks, summer suitings, pantaloonings, raincoatings, water-
proof clothing fabrics, and all other converted fabrics for
similar purposes;
Towelling, crashes, and plain bleached Terry Cloths;
Table damask and napkin fabrics;
Birdseye and diaper cloths.
IV. All members of this branch of the Industry insofar as their
activities fall within any of the divisions enumerated in Section III
hereof shall comply with the following general rules of trade practice:
1. The secret payment or allowance, directly or indirectly, or by
any scheme, method, or device, of rebates, refunds, commissions,
credits, or unearned discounts, whether in the form of money or
otherwise, or the secret, extension to certain purchasers of special
services or privileges not extended to all purchasers on like terms
and conditions is prohibited.
2. The false marking or branding of any product which has the
tendency to mislead or deceive customers or prospective customers
in any way whatsoever is prohibited.
3. The imitation of a trade mark, trade name, slogan, or the other
marks of identification of competitors, having the tendency and
capacity to mislead or deceive is prohibited.
4. Upon approval of the Administrative Committee of a plan of
registration, members of this branch of the Industry may register
with the Textile Fabrics Association the following: Jacquard de-
signs, twenty-harness dobby designs, prints, and such other designs
or styles as may be considered as novel. Upon registration, such
designs or styles shall be confined to the registrant for a six-month
period and for an additional six months thereafter, if within the
first six-month period the registrant can demonstrate to the satis-
faction of the Administrative Committee that he has caused the
manufacture in further quantity of said design, pattern, or style.
At the end of the second six months' ownership period, the registrant
may obtain renewals of all rights to such design, pattern, or style
by semiannual re-registration. A proper registration fee will be
determined by the Administrative Committee.
No member of this branch of the Industry shall commit or be a
party to the piracy of any design, pattern, or style originated by
another member of the Industry in a form sufficiently like the
original to be mistaken for it, or the sale thereof, or sell br quote
on the pattern, design, or style of another member of the Industry.
V. Members of this branch of the Industry insofar as their activi-
ties fall within any of the divisions described in Section III shall
comply with the particular rules applicable to such divisions as
follows:
DIVISION 1
CLOTHIERS' LININGS (OTHER THAN ALL COTTON)
DEFINITION
The products included in this Division are body and/or sleeve lin-
ings (other than all cotton) for use by manufacturers of men's and
boys' clothing, and also by book tailor and trimming establishments.









TRADE PRACTICES
1. Term. of sale shall not exceed net 60 E.O.M., except that bills
on and after the 25th of the month may be dated as of the 1st of the
following month. Anticipation may be allowed at a rate not to
exceed 6% per annum. Sample pieces shipped on memorandum
shall be billed retroactively as of date of shipment.
Where, subsequent to date of sale, a credit situation previously
unknown to seller, should render impossible adherence to this Sec-
tion, these provisions may be relaxed upon approval of application
to Divisional Committee.
2. Deliveries.-All goods shall be sold F.O.B. finisher or main
office registered with the Textile Fabrics Association.
3. Uniform Contract.-The provisions of a sales note recom-
mended by the Divisional Committee and the Administrative Com-
mittee, when approved by the Code Authority and the Administra-
tor, shall be used and adhered to on all sales for future delivery.
4. The Divisional Committee may make recommendations: (1) For
the use by all members of the Division of a system of cost accounting
at least as detailed and complete as a standard system of cost account-
ing adopted by the Divisional Committee. (2) For regulation of
sale below cost when and if same may be so determined, but nothing
herein contained shall limit the right to sell seconds, out-of-fashion,
distress, and shopworn goods, when so billed.
Such recommendations (numbers 1 and 2, supra) when approved
by the Administrative Committee, the Code Authority, and the
Administrator, shall have the same force and effect as the other
provisions of this Supplemental Code.
The above-mentioned recommendations must be communicated by
the Divisional Committee to all members of said Division not less
than ten days prior to date of submission of Divisional Committee's
recommendations to the Administrative Committee or other superior
agency.
5. No merchandise may be sold on consignment, nor may any
method of selling be used which has the effect of selling on consign-
ment or memorandum. Sample pieces to manufacturers for irrspec-
tion are exempt from the application of this rule. The Divisional
Committee shall have the power to suspend the operation of the
provisions of this Section.
6. No stock protection or price guarantee shall be given.
7. Sales offices shall not be open for the transaction of business on
Saturday and Sundays.
DIVISION 2
CORSET, BRASSIERE, AND ALLIED TRADES FABRICS

DEFINITION
The products included in this Division are those sold for use in
the manufacture of corsets, girdle corsets, step-in corsets, brassieres,
bandeaux-brassieres, corsets, girdle corsets, or step-in corsets attached
to brassieres or bandeaux-brassieres and all similar body-supporting
garments, and in the manufacture and supply of accessories such as









shields, stripping, binding, tabs, hook-and-eye cloth, etc., cut from
converted cloths, entering into or used with such finished products.

TRADE PRACTICES
1. Terms of sale shall not exceed 2%-10 days, 60 extra; or 3%-10
days, or 3%--C.O.D. No extra dating shall be allowed. Anticipa-
tion shall be at legal rate of interest. Past due payments shall carry
interest at legal rate from (late of maturity.
2. Delireries.-All goods shall be sold F.O.B. point of origin.
In the case of shipments from finished stock carried in New York
City the point of origin is the bleachery, dye works, and, or finish-
ing plant at which the goods were processed.
3. Uniform Contract.-The provisions of a sales note recommended
by the Divisional Committee and the Administrative Committee,
when approved by the Code Authority and the Administrator, shall
be used and adhered to on all sales for future delivery.
4. Sample Requirentedis.-Each sample cut in excess of one-half
yard in length furnished customers shall be charged for at regular
sales price of the fabric.
5. No merchandise may be sold on consignment, nor may any
method of selling be used which has the effect of selling on con-
signment or memorandum. Sample pieces to manufacturers for
inspection are exempt from the application of this rule. The Divi-
sional Committee shall have the power to suspend the operation of
the provisions of this Section.
6. No stock protection or price guarantee shall be given.
7. Sales offices shall not be open for the transaction of business
on Saturday and Sundays.
8. With respect to goods made entirely from synthetic yarns or
goods made from synthetic yarns mixed only with silk and pro-
duced by the seller's own manufacturing facilities, the applicable
provision of the Silk Textile Code with respect to terms of sale and
delivery may be substituted for the provisions of terms of sale and
delivery for this Division.
DIVISION 3

ALL-COTTON CLOTHING LININGS

DEFINITION
The products included in this Division are all-cotton clothing lin-
ings for use by manufacturers of men's and boys' clothing, tailor
trimming houses, and book tailor and trimming establishments.

TRADE PRACTICES
1. Terms of sale shall not exceed 2%, 60 days, E.O.M. 3%, 10
days, E.O.M. Goods shipped on or after the 25th of the month may
be billed as of the 1st. of the following month. Interest at the rate of
6% per annum shall be charged on all accounts past due. Sample
pieces shipped on memorandum shall be billed retroactively as of
date of shipment.









2. Deliveries.-All goods shall be sold F.O.B. mill, with the ex-
ception of sales made from open stock at main office, shipping point,
or established main depository which may be made F.O.B. such
main office, shipping point, or established main depository, provided
it is registered with the Textile Fabrics Association.
3. Uniform Contract.-The provisions of a sales note recommended
by the Divisional Committee and the Administrative Committee,
when approved by the Code Authority and the Administrator shall
be used and adhered to on all sales for future delivery.
4. The Divisional Committee may make recommendations: (1)
for the use by all members of the Division of a system of cost
accounting at least, as detailed and complete as a standard system
of cost accounting adopted by the divisional Committee, and (2) for
regulation of sales below cost when and if same may be so deter-
mined. Such recommendations, when approved by the Adminis-
trative Committee, the Code Authority, and the Administrator, shall
have the same force and effect, as the other provisions of this Supple-
mental Code.
5. Price Reporting.-Within thirty days after a majority vote
of this Division, all members thereof shall file with the Textile Fab-
rics Association a schedule of prices and terms covering the sale
of their standard numbers sold in the previous week; such schedule
to specify prices on different items (classified according to quantity
thereof), as may have been voted upon by the Division.
Such reports shall be prepared in summary form and submitted
in this form to each member of the Division in such a manner as
not to divulge the operations of any individual member. The Di-
visional Committee shall have the power to suspend the operation
of the provisions of this Section. All members of the Division shall
be notified by telegraph if the provisions of this Section are so
suspended.
6. No merchandise may be sold on consignment, nor may any
method of selling be used which has the effect of selling on con-
signment or memorandum. Sample pieces to manufacturers for
inspection are exempt from the application of this rule. The Divi-
sional Committee shall have the power to suspend the operation of
the provisions of this Section.
7. No stock protection or price guarantee shall be given.
8. Sales offices shall not be open for the transaction of business on
Saturday and Sundays.
DIVISION 4
CURTAIN AND DRAPERY FABRICS
DEFINITION

The products included in this Division are converted cotton and
cotton mixture curtain and drapery fabrics, including these same
fabrics when sold to other cutting trades and/or wholesale, retail,
chain stores, and/or mail-order distributors; but exclusive in all
cases of cloth manufactured on bobbinette or lace machines.









TRADE PRACTICES
1. Terms of sale to the manufacturing, chain-store, mail-order,
and retailers trade shall not exceed 2%, 10 days, 60 extra, or 3%,
10 days; no extra dating. Goods shipped on and after the 25th of
the month may be billed as of the first of the following month.
Terms of Sale to jobbers shall not exceed 2%, 10 days, 60 extra, or
3%, 10 days; June deliveries may be billed 2%, 10 days October 1st;
December deliveries may be billed 2%, 10 days April 1st.
2. Deliveries.-All goods sold to wholesalers, jobbers, chain stores,
mail-order houses, and manufacturers shall be sold F.O.B. mill. All
goods sold to retailers shall be sold F.O.B. mill or main warehouse,
provided the location of such main warehouse shall be registered
with the Textile Fabrics Association.
3. Sample Requirements.-Any form of sample requirement may
be supplied free only to wholesalers and not to exceed 2% of the
original order. All other sample requirements shall be charged for
at full cost, calculating fabric at sales price, and shall include de-
livery charge; provided that it is permissible to furnish one set of
reference samples without charge to each district office of chain-
store organizations where such district offices exist, or one set to the
main office of any chain organization not having district offices.
Only one swatch less than 11/2 yards in length of any one style shall
be given free to one customer. All swatches above 11/ yards shall
be paid for at sales price of the fabric.
4. Advertising Allowances.-No advertising allowances are per-
mitted.
5. No merchandise may be sold on consignment, nor may any
method of selling be used which has the effect of selling on con-
signment or memorandum. Sample pieces to manufacturers for
inspection are exempt from the application of this rule. The Divi-
sional Committee shall have the power to suspend the operation of
the provisions of this Section.
6. No stock protection or price guarantee shall be given.
7. Sales offices shall not be open for the transaction of business on
Saturday and Sundays.
DIVISION 5
SHIRTINGS

DEFINITION
The products included in this Division are shirting fabrics for
use by manufacturers of shirts, pajamas, underwear, boys' blouses,
and similar wearing apparel, including these same fabrics when sold
to other cutting trades and/or wholesale, retail, and/or mail-order
distributors.
TRADE PRACTICES
1. Terms of Sale shall not exceed 2%, 10 days, 60 extra, or 21/2%,
10 days, 30 extra, or 3% C.O.D., or 3%, 10 days, effective from date
of invoice or shipment, whichever is earlier, no extra dating.
Interest shall be charged at 6% on all past due accounts, such
charge starting at maturity period.









Anticipation may be allowed at a rate not to exceed 6% per
annum.
2. Deliveries.-All goods shall be sold F.O.B. point of origin.
3. Sample Reqwirenents.-All sample requirements including sam-
ple cuts shall be charged to customer at full cost; fabric to be figured
at sales price. Reference sets not to exceed three (3) in number may
be furnished free; size of swatches not to exceed 2 x 4" and not to
be mounted on customer's cards; all reference sets to be plainly
marked For Reference Only."
4. Advertising Allowances.-Fabric demonstration, or allowance
therefore, or advertising allowances in any form whatsoever, are pro-
hibited.
5. Options.-No options shall be given.
6. Sale of Goods by Construction.-When finished goods are sold
on basis of grey construction, grey width, count and weight, shall be
shown on confirmation of order and invoice.
7. No merchandise may be sold on consignment, nor may any
method of selling be used which has the effect of selling on consign-
ment or memorandum. Sample pieces to manufacturers for inspec-
tion are exempt from application of this rule. The Divisional Com-
mittee shall have the power to suspend the operation of the
provisions of this Section.
8. No stock protection or price guarantee shall be given.
9. Sales offices shall not be open for the transaction of business on
Saturday and Sundays.
10. With respect to goods made entirely from synthetic yarns or
goods made from synthetic yarns mixed only with silk and produced
by the seller's own manufacturing facilities, the applicable provi-
sions of the Silk Textile Code with respect to terms of sale and
delivery may be substituted for the provisions of terms of sale and
delivery for this Division.
DIviSION 6

WASH GOODS

DEFINITION
The products included in this Division are wash goods for use by
manufacturers of men's, women's, and children's apparel including
these same fabrics when sold to other cutting trades and/or whole-
sale, retail, and/or mail order distributors.

TRADE PRACTICES
1. Ternz of Sale shall not exceed 2%, 10 days, 60 extra, or 21/2%,
10 days, 30 extra, or 3% C.O.D., or 3%, 10 days, effective from
date of invoice or shipment, whichever is earlier; no extra dating
to be allowed. Interest shall be charged at 6% on all past due
accounts, such charge starting at maturity of bill. Anticipation may
be allowed at a rate not to exceed 6% per annum.
2. Deliveries.-All goods shall be sold F.O.B. point of origin, with
the exception of goods sold to retailers and chain stores which shall
be sold F.O.B. plant or main warehouse registered with the Textile
Fabrics Association.









3. Sample Requirements.-All sample requirements furnished job-
bers, catalog houses, chain stores and manufacturers, shall be charged
at full cost, calculating fabric furnished at sales price. Reference
sets not to exceed three in number to any one customer may be fur-
nished free of charge on request.
4. Advertising Allowances.-Fabric demonstration, or allowances
therefore, or advertising allowances in any form, shall be prohibited.
5. Options.-No options shall be given.
6. No merchandise may be sold on consignment, nor may any method
of selling be used which has the effect of selling on consignment or
memorandum. Sample pieces to manufacturers for inspection are
exempt from the application of this rule. The Divisional Committee
shall have the power to suspend the operation of the provisions of
this Section.
7. No stock protection or price guarantee shall be given.
8. Sales offices shall not be open for the transaction of business on
Saturday and Sundays.
9. With respect to goods made entirely from synthetic yarns or
goods made from synthetic yarns mixed only with silk and produced
by the seller's own manufacturing facilities, the applicable provisions
of the Silk Textile Code with respect to terms of sale and delivery
may be substituted for the provisions of terms of sale and delivery
for this Division.
DIVISION 7

INTERLININGS

DEFINITION
The products included in this Division are fabrics made from
tobacco cloths, print cloths, sheetings, twills, drills, osnaburgs, and
ducks, but only where these finished fabrics are used for interlining
purposes for garments.
TRADE PRACTICES
1. Terms of sale shall not exceed 2%, 10 days, 60 extra, or 3%, 10
days, or 3% C.O.D., effective from date of invoice or shipping memo-
randum, whichever is the earlier. No extra dating shall be allowed.
Anticipation shall be at the legal rate of interest. Past due pay-
ments shall carry interest at the legal rate from date of maturity.
2. Deliveries.-All goods shall be sold F.O.B. point of origin. In
the case of shipments from finished stock carried in New York City,
the point of origin is the bleachery, dye works, and/or finishing
plant at which the goods were processed.
3. No merchandise may be sold on consignment, nor may any
method of selling be used which has the effect of selling on consign-
ment or memorandum. Sample pieces to manufacturers for inspec-
tion are exempt from the application of this rule. The Divisional
Committee shall have the power to suspend the operation of the
provisions of this Section.
4. No stock protection or price guarantee shall be given.
5. Sales offices shall not be open for the transaction of business
on Saturday and Sundays.









VI. Administration..-For the purpose of the general administra-
tion of the divisions enumerated in Article III, there shall be con-
stituted by the Code Authority an Administrative Committee which
shall have such duties and powers as the Code Authority may
delegate.
There shall be established by the Administrative Committee a
Divisional Committee in each of such divisions with such duties and
powers in each case as the Administrative Committee may delegate.
The Administrator shall have the right to appoint not more than
three members, without vote, to the Administrative Committee and
the Divisional Committees who shall serve without expense to the
Industry.
If the Administrator shall determine that any action of the Ad-
ministrative Committee or a Divisional Committee or any agency
thereof is unfair or unjust or contrary to the public interest, the
Administrator may require that such action be suspended for a period
of not to exceed thirty (30) days to afford an opportunity for in-
vestigation of the merits of such action and further consideration
by such Administrative Committee or Divisional Committee or
agency pending a final action, which shall be taken only upon
approval by the Admninistrator.
VII. The provisions for trade practices prescribed in Article IV
and V hereof are subject to such changes, modifications, and addi-
tions as may be recommended to the Code Authority by the Ad-
ministrative Committee and approved by the Administrator, but no
change affecting a division shall be submitted for the approval of
the Administrator without the approval of the Divisional Com-
mittee of the Division affected.
VIII. The Code Authority may from time to time establish such
additional divisions dealing with other activities of this branch of
the Industry as may seem desirable and, subject to the approval of
the Administrator, may provide for the formulation of such trade
practices applicable to such additional divisions and for their ad-
ministration in such manner as may seem desirable.
IX. Members of the Industry approve of the policy of arbitrating
all disputes wherever possible and the Administrative Committee
is hereby designated the agency to assist in bringing about such ar-
bitration as to any matters arising in the Divisions enumerated in
Article III.
X. This Supplemental Code and all the provisions thereof are
expressly made subject to the right of the President, in accordance
with the provisions of subsection (b) of Section 10 of the National
Industrial Recovery 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 supplemental code
or any conditions imposed by him upon his approval thereof.
XI. This Supplemental Code shall become effective on the second
Monday after its approval by the President of the United States.
Approved Code No. 1-Supplement No. 1.
Registry No. 290-25.




UNIVERSITY OF FLORIDA
III 1u6 ;III4 7624l ll l l ll2 H11h
3 1262 08482 7624




Full Text

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Approved Code No. 1. Supplement No. 1 Registry No. 299-25 NATIONAL RECOVERY ADMINISTRATION SUPPLEMENTARY CODE OF FAIR COMPETITION FOR THE COTTON TEXTILE INDUSTRY AS APPROVED ON JANUARY 24, 1934 WE DO OUR PART UNITED ST A TES GOVERNMENT PRINTING OFFICE WASHINGTON: 1934 l I For sale by the Superintendent of Documents, Washington, D.C. Price 5 cents , V

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.. This publication is for sale by the Superintendent of Documents, Government Printing Office, Wa s hington, 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 Offi c e Building. Birmingham, Ala. : 257 Federal Building. Boston, Mass. : 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. D et roit, Mich: 801 1Nrst Nation a l Bank Building. Houston, Tex. : Chamber of Commerct? Building. Indianapolis, Ind. : Chamber of Commerce Building. Jacksonville, Fla.: Chamber of Commerce Building. Kansas City, Mo.: 1028 Baltimore A venue. Los Angeles, Calif.: 1163 South Broadway. L o ui s ville, Ky . : 408 Federal Building. M e m p hi s , Tenn . : 229 Federal Building. Minneapolis, Minn. : 213 Federal Building. New Orleans, La.: Room 225-A, Customhouse. New York, N.Y.: 734 Customhouse. Norfolk, Va.: 406 East Plume Street. Philad e lphi a , Pa. : 4~2 Comm e rcial Trust Building. Pittsburgh, Pa.: Ch a mber of Commerce Building. Portland, Oreg. : 215 New Post Office Building. St. Louis, Mo. : 506 Olive Street. San Francisco, Calif. : 310 Customhouse. Seattle, Wash.: 809 Federal Office Building.

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Approved Code No. 1-Supplement No. 1 SUPPLEMENTARY CODE OF FAIR COMPETITION FOR THE COTTON TEXTILE INDUSTRY As Approved on January 24, 1934 ORDER APPROVING SUPPLEMENTARY CODE OF FAIR COMPETITION FOR THE COTTON TEXTILE INDUSTRY 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 Supple mental Code to the Code of Fair Competition for the Cotton Textile Industry, and hearings having been duly held thereon and the an nexed report on said Code, containing findings with respect thereto, having been made and dire c ted to the President: NOW, THEREFORE, on behalf of the Pre s ident of the United States, I, Hugh S. Johnson, Administrator for Industrial Recovery, pursuant to authority vested in me by Executive Orders of the President, 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 pur poses of sa id Title of said Act; and do h e reby order that said Code of Fair Competition be and it is her eby approved. HUGH s. JOHNSON, Adm , inistvrat or fo r I ndustrial Recovery. Approv al recommended: A. D. "\VHITE SIDE, Division Adm , inistrator . \VA SHINGTON, D.C., January f 4, 1934. 35713-313-133-34 (1)

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The PRESIDENT, The White HO'USe. Srn: This is a report on the Hearing on Supplemental Code No. 1 to the Cotton Textile Code, containing trade practices relating to the sale and distribution of products of the Cotton Textile Industry, held in accordance with the provisions of the National Industrial Recovery Act, in the Willard Room of the New Willard Hotel on November 23, 1933. The Code, which is attached, was presented by duly qualified and authorized representatives of the Industry, com plying with statutory requirements, said to represent 177 out of 350 concerns and 75% in volume of the Indu s try. In accordance with the customary procedure every person who had filed a request for an appearance was freely heard in public, and all statutory and regulatory requirements were complied with. The Code originally proposed was for the Cotton Converting Industry. To understand the functions of converting, it must be appreciated that the business of merchandising goods included under this Code involves an element of speculation in style and market. Where this speculation is inherent to a mark e d degree, the function of risk taking and merchandising has been fulfilled by concerns separate from manufacturers and producers of the merchandise. Where portions of the business handled by these converting firms are found to be of such a nature that stability of style and use lessens the risk and where it is not necessary to distribute the product of one manufacturing establishment over a too-extended variety of outlets, the plants themselves are ,-found to be in competition with the converters. Accordingly, it was found that the converting in dustry wanted its trade practices to cover original sale by manu facturing . plants, designated as "integrated producers", while man ufacturing plants themselves wanted the sale of their products covered, as in most other instances, by their own manufacturing code. To solve this problem, the Cotton Converting Industry has been brought into the Cotton Textile Code. It constitutes in essence part of the original sale of merchandise manufactured under this latter Code, rather than occupying the position of jobber or distributor. THE INDUSTRY The Industry comprises about 350 concerns, having an aggregate invested capital of approximately $200,000,000. In 1929 the Industry provided employment for 10,000 workers. This figure has declined to about 9,000 employees in 1933. The aggregate annual sales have fallen from $1,000,000,000 in 1929 to about $600,000,000 in 1932. (2) I

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3 PROVISIONS OF THE CODE While the problem of employment from a Code point of view in the Industry is a comparatively minor one, the orderly maintenance of the right kind of market for cloth is a help toward more con tinuous employment in the weaving and fini sh in g mill s which supply this market. Accordingly, the trade pra ctices submitted in the pro posed supplemental Code have b een give n carefu l study . They have been assented to by the preponderant majority of the Converting Indu st ry, and by the Cotton Textile Indu stry Committee, subject to individual members of the Indu stry havin g the right to make their own objections. Such objections have been duly he ard . The pro visions offered herewith are not nearly as restrictive in many cases as those propo sed . They are, however, corrective of certain ad mitted abuses and are an attempt at self-regulation on the part of the Industry, while containing no provisions likely to constitute a burdensome hampering of trade. FINDINGS The Deputy Administrator in his final report to me on said Code having found as herein set forth and on the basis of all the proceed ings in this matter; I find that: (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 t , o the free flow of interstate and foreign commerce which tend to diminish the amount thereof and will provide for the general welfare by promoting the organization -of industry for the purpose of cooperative action among the trade groqps, by inducing and maintaining united action of labor and management under adequate governmental sanctions and supervision, by elimi nating unfair competitive practices, by promoting the fullest possible utilization of the present productive capacity of industries, by avoiding undue restriction of production ( except as may be tempo rarily required), by increasing the consumption of industrial and agricultural products through increasing pur c hasing power, by re ducing and relieving unemployment, by improving standards of labor, and by otherwise rehabilitating industry. (b) Said Industrj7 normally employs not more than 50,000 em ployees; and is not classified by me as a major indu s try. (c) The Code as approved complies in all re spec ts 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 repr esen t ative of the aforesaid Industry; and th a t said association impo ses no inequitable restric tion s on admission to m embers hip therein. ( d) Th e Code is not designed to and will not permit monopolies or monopolistic practices.

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4 ( e) The Code is not designed to and will not eliminate or oppress bmall enterprises and will not operate to discriminate against them. ( f) Tho se engaged in other steps of the econo mic process have not been deprived of the right to be heard prior to approval of said Code. For these reasons, the Code has been approved. Respectfully. J ANU.ARY 24, 1934. HUGH 8. JOHNSON, Administrator.

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SUPPLEMENTARY CODE OF FAIR COMPETIT'ION FOR THE COTTON TEXTILE INDUSTRY To effectuate the policies 0 Title I 0 the National Industrial Recovery Act (hereinafter referred to as the "Act"), the following provisions are e s tablished as Supplemental Code No. 1 to the Code 0 Fair Competition for the Cotton Textile Industry, to deal with trade practices in the sale and distribution 0 the products 0 that Industry, and shall be the standard 0 fair competition for such Industry in respect of such sale and distribution, and shall be bind ing upon every member thereof in the manner and to the extent th e rein provided. I. D e finitions.-(!) "Master Code" means the Code 0 Fair Com petition for the Cotton Textile Industry, finally approved July 16, 1933, as heretofore or hereafter amended. (2) "Branch 0 the Industry" means the sale and distribution at wholesale 0 products of the Cotton Textile Indvstry by any concern insofar as it does manufacturing and/or finishing 0 the same for its own account or the account of others or has the same finished by others for its own account or or the account of others, or by a commission house or broker acting for same. (3) "Member 0 branch 0 the Industry" means any business entity engaged in this branch 0 the Industry. ( 4) " Finished goods " means grey goods, products of the Cotton Textile Industry, after being processed or finished in the completed fabrics as intended for use. II. All members 0 this branch of the Industry shall be subject to and comply with the provisions of the Master Code in addition to the applicable provisions 0 this Supplemental Code. III. There shall be constituted at this time in this branch of the Industry the following divisions 0 finished goods, the precise scope 0 these divisions being further defined in Section V hereof: 1. Clothiers' Linings ( other than all-cotton). 2. Corset, Bra s siere, and Allied Trades Fabrics. 3. All-Cotton Clothing Lining. 4. Curtain and Drapery Fabrics. 5. Shirtings. G. \V ash Goods. 7. In t erlining s . Anything herein or in S e ction V hereof to the contrary notwith standing th e foreo oing divi s i o n s s hall not includ e the following: Mole s kin ancl corduroy s ; Bl e a c hed w icl 0 h ee ting s, s h ee t s , pillow c a se d ye d ducks; U nbleachecl, bleach e d, color d, dyed and printed flannels, su e d e s and duveteen ; (5)

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6 Outerwear material such as min e ral and sulphur khakis, ducks, summer s uitings, pantaloonings, raincoatings, water proof clothing fabrics, and all oth e r c onverted fabrics for similar purpo s e s ; Towelling , cra s h es , and plain blea c hed T er ry Cloths; Table damask and napkin fabrics; Bird se ye and diaper cloths . IV. All m e mbers of this branch of the Indu s try in s ofar as their activities fall within any of the divisions enumerat e d in Sec ti o n III hereof shall comply with the following gen e r a l rul es of t ra de pra c tice: 1. The secret payment or allowance, dire c tly or indir e ctly, or by any s c heme, m ethod , or d evice, of rebates, refunds, commis s ions, credits, or un e arn e d di s co unts, whether i n the f o rm of money or otherwi se, o r t he sec r e t ex ten s ion to c ertain purchasers of special service s or privileg es n o t ex t e nded to all purcha s er s on like terms and conditions i s prohibited. 2. Th e false marking or branding of any product which has the tend e ncy to misl e ad or deceive cu s tom e rs or pro s pective customers in any w a y w hat s o eve r i s prohibited. 3. The imitation of a tr a de mark, trad e n a m e , s logan, or the other mark s of id e ntification of competitor s, having the t e ndency and capacity to mi s l e ad or d ecei ve is prohibited. 4. Upon approval of the Administrative Committee of a plan of regi s tration , m e mbers of this branch of the Industry may register with the T e xtile F a bri c s Association the following: Ja c quard de signs, twenty-h a rne s s dobby designs, print s , and s uch other d e signs or styles as m a y be con s idered as novel. Upon r e gistration, such d es ign s or styles s hall be confined to the registrant for a six-month period and for an additional six months thereafter, if within the first six-month period the registrant can demonstra t e to the satis faction of the Admini s trative Committee that he has caused the manufacture in further quantity of said de s ign, pattern, or style. At the end of the second six months' ownership period, the registrant may obtain renewals of all rights to such design, pattern, or style by semiannual re-regi s tration. A proper registration fee will be determined by the Administrative Committee. No member of this branch of the Industry shall commit or be a party to the piracy of any design, pattern, or style originated by another member of the Industry in a form sufficiently like the original to be mi s taken for it, or the sale thereof, or sell br quote on the pattern, design, or style of another member of the Industry. V. Memb e rs of this branc!iof the Industry insofar as their activi ties fall within any of the divisions described in Section III s hall comply with the particular rules applicable to such divisions as follows: DIVISION 1 CLOTHIERS' LININGS (OTHER THAN ALL COTTON) DEFINITION The product s in c lud e d in this Division are b o dy and / or s l e eve lin ings ( oth e r than all c otton) for us e by manufactur e r s of m e n' s and boys' clothing, and al s o by book tailor and trimming e s tablishments.

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7 TRADE PRACTICES 1. Term.s of sale shall not exceed net 60 E.O.M., except that bills on and after the 25th of the month may be dated as of the 1st of the following month. Anticipation may be allowed at a rate not to exceed 6% per annum. Sample pieces shipped on memorandum shall be billed retroactively as of date of shipment. Where, subsequent to date of sale, a credit situation previously unknown to seller, should render impossible adherence to this Sec tion, the se provi si ons may be relaxed upon approval of application to Divisional Committee. 2. Delvveri es. -All goods shall be sold F.O.B. finisher or main office registered with the Textile Fabrics As soc iation. 3. Unifonn Oontract.-The provisions of a sales note recom mended by the Divisional Committee and the Administrative Com mittee, when approved by the Code Authority and the Administra tor, shall be used and adhered to on all sales for future delivery. 4. The Divisional Committee may make recommendations: (1) For the use by all members of the Division of a system of cost accounting at l east as d e tailed and complete as a sta ndard system of cost account ing adopted by the Divisional Committee. (2) For regulation of sale below cost when and if same n1.ay be so determined, but nothing herein contained shall limit the right to sell seconds, out-of-fashion, distr ess, and shopworn goods, when so billed. Such recommendations (numbers 1 and 2, supra) when approved by the Admini st rative Committee, the Code Authority, and the Administrator, shall have the same force and effect as the other provisions of this Supplemental Code. The above-mentioned recommendations must be communicated by the Divi siona l Committee to dl members of said Division not less than ten days prior to date of submission of Divisional Con1.mittee's recommendations to the Administrative Com1nittee or other superior agency. 5. No merchandise may be sold on consignment, nor may any method of se lling be used which has the effect of selling on consign ment or memorandum. Sample pieces to manufacturers for irrspec tion are exempt from the application of this rule. The Divisional Committee shall have the power to suspend the operation of the provisions of this Section. 6. No stock protection or price guarantee sha ll be given. 7. Sales offices sha ll not be open for the transaction of business on Saturdays and Sundays. DIVISION 2 CORSET, BRASSIERE, AND ALLIED TRADES FABRICS DEFINITION The products included in this Division are those sold for use in the manufacture of corsets, girdle corsets, tep-in corsets, brassieres, bandeaux-brassieres, corsets, girdle corsets, or step-in corsets attached to brassieres or bandeaux-bras ieres and all similar body-supporting garments, and in the manufacture and supply of accessories such as

PAGE 10

8 shields, stripping, binding, tabs, hook-and-eye cloth, etc., cut from converted cloths, entering into or used with such finished products. TRADE PRACTICES 1. T er ms of sale sha ll not exceed 2%-10 days, 60 extra; or 3%-10 days, or 3% -C.O.D. No extra dating shall be allowed. Anticipa tion sha ll be at legal rate of interest. Past due payments s hall carry interest at legal rate from date of maturity. 2. D e liv erie s.-All goods shall be sold F.O.B. point of origin. In the cuse of shipments from fini s h ed stock carried in New York City the point of origin is the bleachery, d_ye works, and / or finish ing plant at which the goods were processed. 3. Unifo1n Oont?act.-The provisions of a sales note re c ommended by the Divisional Committee and the Administrative Committee, when approved by the Code Authority and the Administrator, shall be used and adhered to on all sales for future delivery. 4. Sample R e qu irenients .-Each sample cut in excess of one-half yard in length furni s hed customers shall be charged for at regular sales price of ' the fabric. 5. No merchandise may be sold on consignment, nor may any method of selling be used which has the effect of selling on con signment or memorandum. Sample pieces to manufacturers for in sp ection are exempt from the application of this rule. The Divi sional Committee shall have the power to suspend the operation of the provisions of this Section. 6. No stock protection or price guarantee shall be given. 7. Sales offices shall not be open for the transaction of business on Saturdays and Sundays. 8. With respect to goods made entirely from synthetic yarns or goods made from synthetic yarns mixed only with silk and pro duced by the seller's own manufacturing facilities, the applicable provision of the Silk Textile Code with respect to terms of sale and delivery may be substituted for the provisions of terms of sale and delivery for this Division. DIVISION 3 ALL-COTTON CLOTHING LININGS DEFINITION The products included in this Division are all-cotton clothing lin ings for u se by manufacturers of men's and boys' clothing, tailor trimming houses, and book tailor and trimming establishments. TRADE PRACTICES 1. Terms of sale shall not exceed 2%, 60 days, E.O.NI. 3%, 10 days , E.O.~1. Goods shipped on or after the 25th of the month may be billed as of the 1st of the following month. Interest at the rate of 6 % per annum shall be charged on all accounts past due. Sample pieces shipped on memorandum shall be billed retroactively as of date of shipment.

PAGE 11

2. Deliveri e s.-All goods shall be sold F.O.B. mill, with the ex ception of sales made from . open stock at main office, shipping point, or established main depository which may be made F.O.B. such main office, shipping point, or established main depository, provided it is registered with the Textile Fabrics Association. 3. Uniform , Oontraot.-The provisions of a sales note recommended by the Divisional Committee and the Administrative Committee, when approved by the Code Authority and the Admini s trator shall be used and adhered to on all sales for future delivery. 4. The Divisional Committee may make recommendations: (1) for the use by all members of the Division of a system of cost accounting at least as detailed and complete as a standard system of cost accounting adopted by the divisional Committee, and (2) for regulation of sales below cost when and if same may be s o det e mined. Such recommendations, when approved by the Adminis trative Committee, the Code Authority, and the Administrator, shall have the same force and effect as the other provisions of this Supple mental Code. 5. Prioe Reporting.-,Vithin thirty days after a majority vote of this Division, all members thereof shall file with the Textile Fab rics Association a schedule of prices and terms covering the sale of their standard numbers sold in the previous week; such s chedule to specify prices on different items ( classified according to quantity thereof), as may have been voted upon by the Division. Such reports shall be prepared in summary form and submitted in this form to each member of the Division in such a manner as not to divulge the operations of any individual member. The Di visional Committee shall have the power to suspend the operation of the provisions of this Section. All members of the Division shall be notified by telegraph if the provisions of this Section are so suspended. 6. No merchandise may be sold on consignment, nor may any method of selling be used which has the effect of selling on con signment or memorandum. Sample pieces to manufacturers for inspection are exempt from the application of this rule. The Divi sional Committee shall have the power to suspend the operation o:f the provisions of this Section. 7. No stock protection or price guarantee shall be given. 8. Sales offices shall not be open for the transaction of business on Saturdays and Sundays. DIVISION 4 CURTAIN AND DRAPERY FABRICS DEFINITION The products included in this Division are converted cotton and cotton mixture curtain and drapery fabrics, including these same :fabrics when sold to other cutting trades and / or wholesale, retail, chain stores, and / or mail-order distributors; but exclusive in all cases of cloth manufactured on bobbinette or lace ma c hines.

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10 TRADE PRACTICES 1. Terms of sale to the manufacturing, chain-store, mail-order, and retailers trade shall not exceed 2%, 10 days, 60 extra, or 3 % , 10 days; no extra dating. Goods shipped on and after the 25th of the month may be billed as of the first of the following month. Terms of Sale to jobbers shall not exceed 2 %, 10 days, 60 extra, or 3 %, 10 days; June deliveries may be billed 2%, 10 days Octob e r 1st; December deliveries may be billed 2%, 10 days April 1 st. 2. D eliveries .-All goods sold to wholesalers, jobbers, chain stores, mail-order houses, and manufacturers sha ll be so ld F.O.B. mill. All goods sold to retailers shall be sold F.O.B. mill or main warehouse, provided the lo cation of such main warehouse shall be registered with the Textile Fabrics Association. 3. Sample R e quir e nients.-Any form of sample requirement may be supp li ed free only to wholesalers and not to exceed 2 % of the original order. All other sample requirements shall be charged for at full cost, ca l c ulating fabric at sales price, and shall include de livery charge; provided that it is permissible to furnish one set of re.ference samples without charge to each district office of chain s tore organizations where such district offices exist, or one set to the main office of any chain organization not having district offices. Only one swatc h less than 1 yards in length of any one style shall be given free to one customer. All swatches above 1 yards shall be paid for at sales price of the fabric. 4. Advertising Allowances.-N o advertising allowances are per mitted. 5. No merchandise may be sold on consignment, nor may any method of selling be used which has the effect of selling on con ,signment or memorandum. Sample pieces to manufacturers for inspection are exempt from the application of this rule. The Divi sional Committee shall have the power to suspend the operation of the provisions of this Section. 6. No stock protection or price guarantee shall be given. 7. Sales offices shall not be open for the transaction of business on Saturdays and Sundays. DIVISION 5 SHIRTINGS DEFINITION The products included in this Division are shirting fabrics for use by manufacturers of shirts pajamas, underwear, boys' blou,ses, and similar wearing apparel, including these ame fabri cs when sold to other cutting trad es and / or wholesale, retail, and / or mail-order di tributors. TRADE PRACTICES 1. Term s of Sa l e shall not exceed 2 % , 10 days, 60 extra, or 2%, 10 day s, 30 extra, or 3 % C.O.D., or 3 7<, 10 day s, effective from date of invoice or shipment, whichever is earli e r, no extra dating. Int e re s t shall be charged at 6 % on all past due accounts, such charge starting at maturity period.

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11 Anticipation may be allowed at a rate not to exceed 6% per annum. 2. Ddiv e ries.-Ail goods shall be sold F.O.B. point of origin. 3. Sampl e Reqwi r e1n e nts.-Ail sample requirements including sam ple cut s shall be charged to cu s tom e r at full cost; fabric to be figured at sales price. Reference sets not to exceed three (3) in number may be furnished free; size of swatches not to exc e ed 2 X 4" and not to be mounted on cu s tomer's cards; all reference se ts to be plainly marked "For Reference Only." 4. Adv e r t is in g Allo w a nce s.-Fabric demon s tration, or allowan c e therefor, or advertising allowance s in any form whatsoever, are pro hibited. 5. Options.-No options shall be given. 6. Sal e of Goods by Oo ns t ruc t i o n .-When fini s hed g oods are sold on b as i s of grey con s tru c tion, grey width, count and w e ight, shall be shown on confirmation of ord e r and invoice. 7. No mer c handi s e may b e s o l d on con s ignment, nor may any method of s elling be used whi c h has the effect of selling on consign ment or memorandum. Sample pieces to manufa c turers for in~p e tion are exempt fr o m _ application of this rule. The Divisional Com mittee shall have the power to suspend the operation of the provisions of this Section. 8. No stock prote c tion or price guarantee shall be given. 9. Sales offi c e s shall not be open for the tran s action of business on Saturday s and Sundays. 10. With re s pect to goods made entirely from synthetic yarns or goods made from sy nthetic yarns mixed only with silk and produced by the seller ' s own manufacturing facilities, the applicable provi sions of the Silk Textile Code with respect to terms of sale and delivery may be substituted for the provisions of terms of sale and delivery for this Division. DIVISION 6 WASH GOODS DEFINITION The products included in this Division are wash goods for use by manufacturers of men's, women's, and children's apparel including these same fabrics when sold to other cutting trades and/or whole sale, retail, and/ or mail order distributors. TRADE PRACTICES l. Terms of Sal e shall not exceed 2%, 10 days, 60 extra, or 2%, 10 days, 30 extra, or 3% C.0.D., or 3%, 10 days, effective from date of invoice or shipment, whichever is earlier; no extra dating to be allowed. Inter es t s hall be charged at 6% on all past due account , such charge starting at maturity of bill. Anticipation may be allowed at a rat e not to exce e d 6 % per annum. 2. D e liv e ri e s.-All goods shall be s old F.0.B. point of origin, with the exception of good s sold to retailers and chain s tores which sh a ll be sold F . 0.B. pl a nt or main warehou s e regi s t e red wi t h the Textile Fabrics Association.

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12 3. Sample Requirem e 7:ts.-All sa:giple requirements furnished job bers, catalog houses, chain stores and manufacturers, shall be charged at full cost, calculating fabric furnished at sa les price. Reference sets not to exceed three in number to any one customer may be fur nished free of charge on request. 4. Advertising Allowanoes.-Fabric demonstration, or allowances therefor, or advertising allowances in any form, shall be prohibited. 5. Options.-N o options shall be given. 6. No merchandise may be sold on consignment, nor may any method of selling be used which has the effect of selling on consignment or memorandum. Sample J?ieces to manufacturers for inspection are exempt from the applicat10n of this rule. The Divisional Committee shall have the power to suspend the operation of the provisions of this Section. 7. No stock protection or price guarantee shall be given. 8. Sales offices shall not be open for the transaction of business on Saturdays and Sundays. 9. vVith respect to goods made entirely from synthetic yarns or goods made from synthetic yarns mixed only with silk and produced by the seller's own manufacturing facilities, the applicable provisions of the Silk Textile Code with respect to terms of sale and delivery may be substituted for the provisions of terms of sale and delivery for this Di vision. DIVISION 7 INTERLININGS DEFINITION The products included in this Division are fabrics made from tobacco cloths, print cloths, sheetings, twills, drills, osnaburgs 1 and ducks, but only where these fini shed fabrics are used for interlining purposes for garments. TRADE PRACTICES 1. T er m , s of sale shall not exceed 2%, 10 days, 60 extra, or 3%, 10 days, or 3% C .O.D., effective from date of invoice or shipping memo randum, whichever i.s the earlier. No extra dating shall be al,lowed. Anticipation shall be at the leg a l rate of interest. Past due pay ments shall carry interest at the legal rate from . date of maturity. 2. Deliveries.-All goods shall be sold F.0.B. point of origin. In the case of shipments from finished stock carried in New York City, the point of origin is the bleachery, dye works, and/or finishing plant at which the goods were processed. 3 . No merchandi e may be sold on consignment, nor may any m et hod of se lling be u se d which has the effect of selling on consign ment or memorandum. Sample pieces to manufacturer s for inspec tion are exempt from the application of this rule. The Divisional Committee shall ha ve the power to su pend the operation of the provisions of thi . Sect ion. 4. No stock protection or price guarantee shall be given. 5. Sales offices sha ll not be open for the transaction of business on Saturdays and Sundays.

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13 VI. Adniinistration.-For the purpose of the general administra tion of the divisions enumerated in Article III, there s hall be con stituted by the Code Authority an Administrative Committee which shall have such duties and pow er s as the Code Authority may delegate. There sha ll be established by the Administrative Committee a Divisional Committee in each of suc h divi s ions with s uch duties and powers in each case as the Administrative Committee may delegate. The Administrator shall have the right to appo int not more than three members, w ith out vote, to the Administrative Committee and the Divisional Committees who sha ll serve without expense to the Industry. If the Administrator s hall determine that any action of the Ad ministrative Committee or a Divi s ion al Committee or any agency thereof is unfair or unjust or contrary to the public interest, the Adminstrator may require that such action be suspended for a period of not to exceed thirty (30) days to afford an opportunity for in vestigation of the merits of such action and furth er consideration by such Administrative Committ ee or Divi siona l Committee or agency pending a final action, which shall be taken only upon approval by the Administrator. VII. The provisions for trade practices pre scr ib ed in Article IV and V hereof are subject to such changes, modifications, and addi tions as may be recommended to the Code Authority by the Ad ministrative Committee and approved by the Administrator, but no change affecting a division shall be submitted for the approval o f the Administrator without the approval of the Divi s ional Com mittee of the Division affected. VIII. The Code Authority may from time to time establi s h such additional divisions dealing with other activiti e s of this b ra nch of the Industry as may seem desirable and, subject to the approval of the Administrator, may provide for the formulation of s uch trade practices applicable to such additional divisions and for their ad ministration in such manner as may seem desirable. IX. Me1nbers of the Industry approve of the policy of arbitrating all disputes wherever possible and the Administrative Committee is hereby designated the agency to assist in bringing about such ar bitration as to any matters arising in the Divisions enumerated in Article III. X. This Supplemental Code and all the provisions thereof are expressly made subject to the right of the President, in accordance with the provisions of subsection (b) of Section 10 of the National Industrial Recovery 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 supplemental code or any conditions impo sed by him upon his approval thereof. XI. This Supplemental Code shall become effective on the seco nd Monday after its approval by the President of the United States. Approved Code No. 1-Su pp lement No. 1. Registry No. 29'9-25. 0

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