Oleomargarine Manufacturing Industry

16 CFR Part 134 · Trade practice rules · in the Code of Federal Regulations 1938-1976 (13 annual editions)

Scanned CFR pages, OCR text may contain errors; the linked Library of Congress PDF is the authority. Not legal advice; not affiliated with the FTC. These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.

Latest edition: Library of Congress, 1976 CFR · Earliest edition: 1938 CFR

Text (1976 edition, OCR)

Chapter I|—Federal

and recommends, the practice of mem-
bers making fair and truthful disclosure,
in their advertising, labeling, sales lit-
erature, and other selling representa-~
tions of the quality and content of their
products.

§ 133.105 Dissemination of credit in-

formation.

The industry records its approval of
distributing information covering delin-
quent and slow accounts insofar as it
may be lawfully done.

PART 134—OLEOMARGARINE MAN-
UFACTURING INDUSTRY

Group I

Sec.

184.1 Misrepresentation of industry prod-
ucts.

184.2 Misbranding.

184.3 Substitution of products not con-
forming to specifications.

184.4 Misrepresentation as to milk content.

185.6 Misrepresentation as to fat content.

134.6 Compliance with State and Federal

. spectfication requirements.

134.7. Commercial bribery.

134.8 Unlawful interference with raw ma-
terlal purchases.

1384.9 Defamation of competitors and dis-
paragement of their products.

184.10 False invoicing.

134.11 Inducing breach of contract.

184.12 Enticing away employees of competi-

Ts.

134.18 Consignment selling.

184.14 Publication or circulation of false or
misleading price quotations, etc.

284.15 Selling below cost.

134.16 “Loss leaders.”

«34.17 Discrimination.

Group II

184.101 Cost records,

184.102 Repudiation of contracts.

134.103 Promotion of use of American agri-
cultural products.

AUTHORITY: Secs. 6(g), 5, 88 Stat. 722, 719;
15 U.S.C. 46(g), 45, unless otherwise noted.

Source: 3 FR 28238, Sept. 28, 1938, unless
otherwise noted.

Group I

§ 134.1 Misrepresentation of industry
products.

It ts an unfair trade practice to make
or publish, or cause to be made or pub-
lished, directly or indirectly, any false,
misieading or deceptive statement or
representation, by way of advertisement
or otherwise, concerning the grade, qual-

Trade Commission § 134.6
ity, quantity, use, material, content,
origin, nutritive value, preparation, man-
ufacture, or distribution of oleomarga-
rine, or in any other material respect.

§ 134.2 Misbranding.

The false or deceptive marking or
branding of oleomargarine with any
word, phrase, name, trade-mark, labei,
picture, design, device, or other represen-
tation, with respect to the grade, quality,
quantity, use, content, origin, prepara-

‘ tion, manufacture, or distribution of such

oleomargarine, or, in any other matertal
respect, is an unfair trade practice.

§ 134.3 Substitution of products not
conforming to specifications.

The substitution and delivery to cus-
tomers, without the consent of the pur-
chaser, of eleomargarine which does not
conform to formula specifications, sam-
ples, or representations upon which the
purchase order is based; or the substitu-
tion or delivery, with or without the con-
sent to the purchaser, of oleomargarine
which does not conform to applicable
Federal or State laws or regulations;
with the purpose or with the tendency
and capacity or effect of misleading, the
purchasing or consuming public, is an
unfair trade practice.

§ 134.4 Misrepresentation as to milk
content.

Falsely representing, directly or in-
directly, through advertising or other-
wise, that any type of oleomargarine
contains milk when, in fact, the cream
or any other food content has been ex-
tracted therefrom, for the purpose or
with the tendency, capacity or effect of
misleading or deceiving purchasers,
propective purchasers, or the consuming
pubiic, is an unfair trade practice.

§ 134.5 Misrepresentation as to fat cou-
tent.

It is an unfair trade practice for any
member of the industry to sell, or offer
for sale through advertising or otherwise,
any oleomargarine the fact content of
which is less than that specified in ap-
plicable regulations, duly promulgated
by authority of law, for the purpose, or
with the tendency, capacity or effect of
misleading or deceiving purchasers, pro-
spective purchasers, or the consuming
public.

§ 134.6 Compliance with State and Fed-
eral specification requirements.

It is an unfair trade practice to sell or
distribute, or cause to be sold or dlstrib-

589


§ 134.7

uted, any oleomargarine manufactured
in conformity with formula specifica-
tions of buyers or customers or other-
wise, when such formula specifications or
manufacture is violative of applicable
Federal or State laws or regulations and
where the tendency and capacity or the
effect thereof is, directly or indirectly, to
mislead or deceive the purchasing or
consuming public.

§ 134.7 Commercial bribery.

It is an unfair trade practice for a
member of the mdustry directly or in-
directly to give or offer to give, or permit
or cause to be given, money or anything
of value to agents, employees, or repre-
sentatives of customers or prospective
customers, or to agents, employees, or
representatives of competitors’ custom-
ers or prospective customers, without
the knowledge of their employers or
principals, as an inducement to in-
fluence their employers or principals
to purchase or contract to purchase
products manufactured or sold by such
industry member or the maker of
such gift or offer, or to influence such
employers or primcipals to refraln from
dealmg in the products of competitors,
or from dealing or contracting to deal
with competitors.

§ 134.8 Unlawful interference with raw
material purchases.

It is an unfair trade practice for any
member of the industry, by means of
any monopolistic practices or through
combination, conspiracy, coercion, boy-
cott, threats, or any other unlawful
means, directly or indirectly, to inter-
fere with a competitor’s right to pur-
chase his raw materials and supplies
from whomsoever he chooses or to
sell his product to whomsoever he
chooses.

§ 134.9 Defamation of competitors and
disparagement of their products.

The defamation of a competitor by
falsely imputing to him dishonorable
conduct, inability to perform con-
tracts, questionable credit standing, or
by other false representations, or the
false disparagement of the grade, qual-
ity, or manufacture of the products of a
competitor or of his business methods,
selling prices, credit terms, policies, or
services, is an unfair trade practice.

§ 134.10 False invoicing.

Withholding from or inserting in an
invoice, billing or statement any ma-

Title 16—Commercial Practices

terial information by reason of which
omission or insertion, a false record is
made, wholly or in part, of the trans-
action which such invoice or billing or
statement purports to represent, with
the purpose or effect of thereby mislead-
ing or deceiving purchasers, prospective
purcliasers, or the consuming public, is
an unfair trade practice.

§ 134.11 Inducing breach of contract.

Inducing or attempting to induce the
breach of existing lawful contracts be-
tween competitors and their customers or
their suppliers, or between a competitor
and his distributor or agent, by any false
or deceptive means whatsoever, or inter-
fermg with or obstructing the perform-
ance of any such contractual duties or
services by any such means, with the
purpose and effect of unduly hamper-
ing, injuring or prejudicing competitors
in their businesses, is an unfair trade
practice.

§ 134.12 Enticing away employees of
competitors.

Willfully enticing away the employees.
of competitors, with the purpose and ef-
fect of unduly hampering, injuring or
prejudicing competitors in their busi-
nesses, is an unfair trade practice.

§ 134.13 Consignment selling.

It is an unfair trade practice for any
member of the industry to use the prac-
tice of shipping goods on consignment or
pretended consignment for the purpose
and with the effect of artificially com-
petitors’ use of said trade outlets in
getting their goods to consumers through
regular channels of distribution, or with
such purpose to entirely close said trade
outlets to such competitors so as to sub-
stantially lessen competition or tend to
create a monopoly or to unreasonably
restrain trade: Provided, however, That
nothing in this section shall be construed
or used as restricting or preventing con-
signment shipping or marketing of com-
modities in good faith and without arti-
ficial interference with competitors’ use
of the usual channels of distribution in
such manner as thereby to suppress
competition or restrain trade.

§ 134.14 Publication or circulation of
false or misleading price quotations,
ete.

The making, publishing, or circulating
by any member of the industry of false
or misleading price quotations, price

590


Chapter I-—Federal

lists, terms or conditions of sale, or re-
ports as to production or sales, with the
tendency, capacity or effect of misleading
or deceiving purchasers, prospective pur-
chasers, or the consuming public, is an
unfair trade practice.

§ 134.15 Selling below cost.

The practice of selling oleomargarine
below the seller’s cost, with the intent
and with the effect of injuring a com-
petitor and where the effect may be to
substantially lessen competition or tend
to create a monopoly or unreasonably re-
strain trade, is an unfair trade prac-
tice: all elements recognized by good
accounting practice as proper elements
of such cost shall be included in deter-
mining cost under this section.

§ 134.16 “Loss leaders”.

The practice of selling oleomargarine
below the sellers cost as a “loss leader”
to induce the purchase of any other prod-
uct of the industry, the sale of the latter
being used to recoup the loss sustained
on the “loss leader” product so sold, with
the tendency or capacity to mislead or
deceive purchasers, prospective pur-
chasers, or the consuming public, is an
unfair trade practice.

§ 134.17 Discrimination.

(a) Prohibited discriminatory prices,
or rebates, refunds, discounts, credits,
etc.; which effect unlawful price discrim-
ination. It is an unfair trade practice
for any member of the industry engaged
in commerce, in the course of such com-
merce, to grant or allow, secretly or
openly, directly or indirectly, any rebate,
refund, discount, credit, payment of
dealer’s license, or other form of price
differential, where such rebate, refund,
discount, credit, payment of dealer's
license, or other form of price differ-
ential effects a discrimination in price
between different purchasers of goods
of like grade and quality where either
or any of the purchases involved
therein are in commerce, and where the
effect thereof may be substantially to
lessen competition or tend to create a
monopoly in any line of commerce, or to
injure, destroy, or prevent competition
with any person who either grants or
knowingly receives the benefit of such

1Paragraph (a) of § 134.17 shall not be
construed as embracing practices prohibited
by paragraphs (b), (c), and (d) of this
section.

Trade Commission § 134.17

discrimination or with customers of
either of them: Provided, however, (1)
That the goods involved in any such
transaction are sold for use, consump-
tion, or resale within any place under the
jurisdiction of the United States;

(2) That nothing contained in this
section shall prevent differentials which
make only due allowance for differences
in the cost of manufacture, sale, or de-
livery resulting from the differing meth-
ods or quantities in which such com-
modities are to such purchasers sold or
delivered;

(3) That nothing contalned in this
section shall prevent persons engaged in
selling goods, wares, or merchandise in
commerce from selecting their own cus-
tomers in bona fide transactions and not
in restraint of trade;

(4) That nothing contained in this
section shall prevent price changes from
time to time where made in response to
changing conditions affecting either (i)
the market for the goods concerned, or
(ii) the marketability of the goods, such
as, but not limited to, actual or imminent
deterioration of perishable goods, obso-
lescence of seasonal goods, distress sales
under court process, or sales in good faith
in dicontinuance of business in the
goods concerned.

(b) Prohibited brokerage and com-
missions. It is an unfair trade practice
for any member of the industry engaged
in commerce, in the course of such
commerce, to pay or grant, or to receive
or accept, anything of value as a com-
mission, brokerage, or other compensa-
tion, or any allowance or discount in
lieu thereof, except for services rendered
in connection with the sale or purchase
of goods, wares, or merchandise, either
to the other party to such transaction
or to an agent, representative, or other
intermediary therein where such inter-
mediary is acting in fact for or in behalf,
or is subject to the direct or indirect
control, of any party to such tranac-.
tion other than the person by whom
such compensation is so granted or paid.

(c) Prohibited advertising or promo-
tional allowances, etc. It is an unfair
trade practice for any member of the
industry engaged in commerce to pay
or contract for the payment of adver-
tising or promotional allowances or any
other thing of value to or for the benefit
of a customer of such member in the
course of such commerce as compensa- .
tion or in consideration for any services
of facilities furnished by or through such

591


§ 134.101

customer in connection with the process-
ing, handling, sale, or offering for sale
of any products or commodities manu-
factured, sold, or offered for sale by such
member, unless such payment or con-
sideration is available on proportionally
equal terms to all other customers com-
peting in the distribution of such prod-
ucts or commodities.

(d) Prohibited discriminatory services
or facilities. It is an unfair trade prac-
tice for any member of the industry
engaged in commerce to discriminate
in favor of one purchaser against an-
other purchaser or purchasers of a com-
modity bought for resale, with or with-
out processing, by contracting to furnish
or by furnishing, or by contributing to
the furnishing of, any services or facili-
ties connected with the processing, han-
dling, sale, or offering for sale of such
commodity so purchased upon terms not
accorded to all purchasers on propor-
tionally equal terms.

(e) IWegal price discrimination. It is
an unfair trade practice for any mem-
ber of the industry or other person en-
gaged in commerce, in the course of
such commerce, to discriminate in price
in any other respect contrary to section
2 of the Clayton Act as amended by the
act of Congress approved June 19, 1936
(49 Stat. 1526-8; 15 U.S.C. 13-13b, 21a),
or knowingly to induce or receive a dis-
crimination in price which is prohibited
by such section as amended.

(Sec. 2, 38 Stat. 730, as amended, secs. 2,3, 4,
so State. 1527, 1528; 15 U.S.C. 13, 18a, 18b

a

Group IT

§ 134.101 Cost records.

It is the judgment of the industry that
each member should independently keep
proper and accurate records for deter-
mining his costs.

§ 134.102 Repudiation of contracts.

Lawful contracts are business obliga-
tions which should be performed in
letter and in spirit. The repudiation of
contracts by sellers on a rising market or
by buyers on a declining market is con-
demned by the industry.

§ 134.103 Promotion of use of Ameri-
can agricultural produets.

The industry recommends that the
members thereof in the manufacture of
their products encourage and promote
the greater consumption of raw materials
produced by American agriculture.

Title 16—Commercial Practices

PART 136—PAINT AND VARNISH
BRUSH INDUSTRY

Sec.

136.0 Definitions.

136.1 Deception (general).

136.2 Deception as to the kind of material
of which the brushing part of a
brush is composed. .

136.3. Misrepresentation as to setting.

136.4 Misleading price quotations, etc.

136.5 False invoicing.

136.6 Substitution of products.

136.7 Inducing breach of contract.

136.8 Commerctal bribery.

136.9 Deceptive use of trade or corporate
names, trade-marks, etc.

136.10 Misrepresenting character of buai-
ness.

136.11 Use of word “free.”

136.12 Consignment distribution.

136.18 Prohibited sales below cost.

136.14 Misrepresenting products as con-
forming to standard.

136.15 Guarantees, warranties, etc.

136.16 Defamation of competitors or false
disparagement of their products.

136.17 Misrepresentation as to origin and

disclosure of foreign origin.

136.18 Prohibited forms of trade restraints.

136.19 Prohibited discrimination.

136.20 Exclusive deals.

136.21 Aiding or abetting use of unfair trade

practices.
COMMITYEE ON TRADE PRACTICES
136.201 Industry committee.

AvurHoriry: Secs. 6, 5, 388 Stat. 721, 719; 15
US.C. 46, 45, unless otherwise noted.

Sovurnoe: 23 FR 4362, June 17, 1958, unless
otherwise noted.

§136.0 Definitions.

(a) Industry members. Persons, firms,
corporations, and organizations engaged
in the manufacture, sale or distribution
of industry. products as defined in this
section.

(b) Industry products. The term “in-
dustry products” and the word “brushes”
as used in the rules in this part includes
all types and kinds of brushes which are
designed for use in applying paint, var-
nish, lacquer, calcimine, wallpaper or
other decorative or protectlve coatings or
primers or undercoatings for such coat-
ings. Also non-wire brushes for use in
dusting or cleaning surfaces preliminary
to the application of such coatings or
undercoatings.

§ 136.1 Deception (general).

In the sale, offering for sale, or distri-
bution of industry products it is an un-

592