Three-party promotional program under investigation

No. 304. Three-party promotional program under investigation. The Commission has been requested to render an advisory opinion to a supplier regarding the use of a tripartite promotion plan. The requesting party is subj ect to an outstanding cease and desist order prohibiting it from making promotional payments to its customers in a discriminatory manner.

The supplier seJ1s its product through grocery, department discount, hardware and other retail stores. The Commission advised the requesting supplier that it had instituted an investigation of the operation of the promoter s program and therefore was of the opinion that the request was inappropriate at this time. (FiJe No. D-8175, released Oct. 22 , 1968. ) (Issued under authority of Section 3.61 (c) of the Commission s Rules of Practice (1967).

No. :105. Sales below cost provision in ethical advertising guide. In Advisory Opinion Digest No. 249, the Commission announced that a trade association s proposed "Guide to Ethical Advertising Practices" was unobjectionable save for its unqualified condemnation of advertising sales below cost. The foJ1owing revised sales below cost provision was subsequently found unobjectionable: Members wil not use below cost advertising as bait advertising. However either merchandise or servicss or a combination of both may be offered below a member s total cost for limited period of time in clOS€MQut sales, stock reduction sales, promoting offers, provided such offers are truthfully and non deceptively made and the member fuBy performs according to his offer.

(File No. 683 7097, released Nov. 18, 1968.