Trade association code of ethics governing pricing and sel1ing practices The Commission recently rendered an…

No. 115. Trade association code of ethics governing pricing and sel1ing practices The Commission recently rendered an advisory opinion to a trade association of jobbers advising that while some of the submitted Code provisions appear innocuous, the Code as a whole is shot through with anti competitive implications. The Commission pointed out, by way of examples , that the question of establishing fair and adequate profit levels is not an appropriate trade association exercise; the use of price as an economic \veapon is iniegral to the competitive process and becomes anticompetitive only when used destructively; urging the frequent checking of competitive prices suggests an attempt of achieving price uniformity; complaining to a competitor about nis practices could be construed as an unfair method of competition depending upon the practice involved for if the "practices were low prices, the complaint could be construed as an appeal for price maintenance.

In disapproving the Code of Ethics as submitted the Commission advised that because the effect of issuance of such a Code \vould be coercive upon the members, the cumulative effect of its provisions could \vell operate to reduce or eliminate price competition and impair the right of each member to price and promote his products as he sees fit. (File No. 673 7053, released Mar. , 1967.