Trade association code of ethics The Commission recently advised a trade association that the objectives…

No. 119. Trade association code of ethics The Commission recently advised a trade association that the objectives sought by its proposed Code of Ethics appeared to be unobjectionable and that adherence to the Code should not operate to effect an unreasonable restraint of trade. Accordingly it is the Commission s view that the mere act of becoming a member of the association and joining in its activities for the purposes outlned will not in itself violate any statute administered by the Commission.

The association was advised, however, that if enforcernent of the Code, operated so as to effect an unreasonable restraint of trade, serious questions would be raised as to the plan s validity. The general test, the Commission stated, is whether concerted s abilityaction by competitors unreasonably affects a businessman to compete. Thus, if association membership is an important competitive factor, arbitrary or discriminatory refusal of membership to a qualified applicant because of a11eged failure to abide by the Code would raise serious questions under Commission-administered law, as would arbitrary or discriminatory expulsion of association members.

In conclusion, the Commission noted that it confined itself in its answer to so much of the question as falls \vithin Commission jurisdiction. The extent, if any, to which another Government agency may be concerned with the association s activity is a matter to be determined by reference to that agency. (File o. 673 7029, released Apr. 6 , 1967.