Water Heater Industry

16 CFR Part 160 · Trade practice rules · in the Code of Federal Regulations 1945-1978 (14 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 These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.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, 1978 CFR · Earliest edition: 1945 CFR

Text (1978 edition, OCR)

§ 157.10

a@ commission, brokerage, or other
compensation, or any allowance or dis-
count in lieu thereof, except for ser-
vices 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 intermediary is
acting in fact for or in behalf, or is
subject to the direct or indirect con-
trol, of any party to such transaction
other than the person by whom such
compensation is so granted or paid.

(c) Prohibited advertising or promo-
tional allowances, ete. 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
compensation or in consideration for
any services or facilities furnished by
or through such customer in connec-
tion with the processing, handling,
saie, or offering for sale, of any prod-
ucts or commodities manufactured,
sold or offered for sale by such
member, unless such payment or con-
sideration is available on proportional-
ly equal terms to all other customers
competing in the distribution of such
products or commodities.

(d) Prohibited discriminatory ser-
vices or facilities. It is an unfair trade

practice for any member of the indus-.

try engaged in commerce to discrimi-
nate in faver of one purchaser against
another purchaser cr purchasers of a
commodity bought for resale, with or
without processing, by contracting to
furnish or furnishing of, any services
or facilities connected with the pro-
cessing, handling, sale, or offering for
sale, cf such commodity so purchased
upon terms not accorded to ail pur-
chasers on propcrtionally equai terms.

(e) Inducing or receiving an illegal
discrimination in price. It is an unfair
trade practice for any member of the
industry engaged in commerce, in the
course of such commeree, knowingly
to induce or receive a discrimination in
price which is prohibited by the fore-
going provisions of this section.

(f) Purchases by schools, colleges, .

universities, public libraries, churehes,

Title 16—Commercial Practices

hospitals, and charitable institutions
not operated for profit. The foregoing
provisions of this section relate to
practices within the purview of the
Robinson-Patman Antidiscrimination
Act, which Act and the application
thereunder of this section are subject
to the limitations expressed in the
amendment to such Robinson-Patman
Antidiserimination Act which amend-
ment was approved May 26, 1938, and
reads as foliows:

Be it enacted by the Senate and House of
Representatives of the United States of
America in Congress assembled, That noth-
ing in the Act approved June 19, 1936
(Public, Numbered 692, Seventy-fourth Con-
gress, second session), known as the Robin-
son Patman Antidiscrimination Act, shall
apply to purchases of their supplies for
their own use by schools, colieges, universi-
ties, public libraries, churches, hospitals,
and charitabie institutions not operated for
profit.

(Sec. 2, 38 Stat. 730, as amended, secs. 2, 3,
4, 49 Stat. 1527, 1528, ch. 283, 52 Stat. 446;
15 U.S.C. 13, 13a, 13b, 13¢, 21a)

§ 157.10 Aiding or abetting use of unfair
trade practices.

It is an unfair trade practice for any
person, firm, or corporation to aid,
abet, coerce, or induce another, direct-
ly or indirectly, to use or promote the
use of any unfair trade practice speci-
fied in the sections in this part.

PART 160—WATER HEATER
INDUSTRY

Grovr I

Sec.

160.1 Misrepresentation in general.

160.2 Mlsrepresentation as to character of
business.

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

160.4 Other false or deceptive selling meth-
ods.

160.5 Guarantees, warranties, etc.
160.6 Misuse of terms “close-outs,’”’ “discon-
tinued lines,” “special bargains,’’ etc.
160.7 Misrepresentation as to installment
sales contracts, their terms, conditions,
etc.

160.8 Misrepresenting products as _ con-
forming to standard.

160.9 Deception as to rebuilt or second-
hand products.

160.10 Imitation of trade-marks,
names, etc.

trade

32


Chapter i—Federai Trade Commissien

Sec.

160.11 Fictitious prices.

160.12 Combination or coercion to fix
prices, suppress competition or restrain
trade.

160.13 Defamation of competitors or dis-
paragement of their products.

160.14 Substitution of products.

160.15 False invoicing.

160.16 Inducing breach of contract.

160.17 Use of lottery schemes.

160.18 Commercial bribery.

160.19 Enticing away employees of com-
petitors.

160.20 Procurement of competitors’ confi-
dential information by unfair means and
wrongful use thereof.

160.21 Unfair threats of infringement
sults.

160.22 Coercing purchase of one product as
a prerequisite to the purchase of other
products.

160.23 Unlawful interference.

160.24 Selling below cost.

160.25 Discrimination.

160.26 Price discrimination by
small deliveries at priees applicable only
to larger quantities.

160.27 Discriminatory returns.

160.28 Deception through failure to differ-
entiate betwecn wholesale and retail
transactions.

160.29 Aiding or abetting use of unfair
trade practices.

Groop Il

160.101 Publication of price lists and terms
of sale.

160.102 Repudiation of contracts.

160.103 Maintenance of accurate records.

160.104 Arbitration.

160.105 Fictitious bids.

160.106 Coercion in sales.

Avurtuoniry: Secs. 6(g), 5, 38 Stat. 722, 719;
15 U.S.C. 46(g), 46, unless otherwise noted.

Source: 10 FR 447, Jan. 11, 1945, unless
otherwise noted.

Group I

§ 160.1 Misrepresentation in general.

It is an unfair trade practice to use,
or cause or promote the use of, any ad-
vertising by radio, newspapers, maga-
zines or other media, or any trade pro-
motional literature, label, brand,
mark, designation or representation
(whether in the form of a guarantee,
warranty, or otherwise), however dis-
seminated or published:

(a) Which has the capacity and ten-
dency or effect of misleading or de-
ceiving the purchasing or consuming
public with respect to the quality,

33

§ 160.5

grade, size, capacity, properties, dura-
bility, serviceability, life, or perfor-
mance of any product of the industry,
or with respect to the construction,
constituent materials, manufacture,
distribution, or terms or conditions of
sale of such product; or

(b) Which is false, misleading, or de-
ceptive in any other respect.

$160.2 Misrepresentation as to character
of business.

It is an unfair trade practice for any
concern, in the course of or in connec-
tion with the distribution of industry
products, to represent, directly or indi-
rectly, that it is a manufacturer of in-
dustry products, or that it owns or
controis a factory making such prod-
ucts, when such is not the fact, or in
any other manner to misrepresent the
character, extent, or type of its busi-
ness.

$160.3 Deceptive use of trade or corporate
names, or trade-marks, ete.

The use of any trade name, corpo-
rate name, trade-mark, or other trade
designation which has the capacity
and tendency or effect of misleading
or deceiving the purchasing or con-
suming public as to the character,
name, nature, or origin of any product
of the industry, or any material used
therein, or which is false or misleading
in any other respect, is an unfair trade
practice.

§ 160.4 Other false or deceptive selling
methods.

To use or promote the use of any
selling method which has the capacity
and tendency or effect of misleading
or deceiving the purchasing or con-
suming public is an unfair trade prac-
tice.

§ 160.5 Guarantees, warranties, ete.

(a) Guarantees which afford pur-
chasers or users substantial and ade-
quate protection, and are fully and
fairly stated or disclosed and scrupu-
lously adhered to by the guarantor,
are desirable and recommended. It is
an unfair trade practice to use or
cause to be used any guarantee which
is false, misleading, deceptive or unfair
to the purchasing or consuming
public.


§ 160.6

(b) Under this section guarantees of
the following type or character shall
not be used:

(1) Guarantees containing state-
ments, representations or assertions
which have the capacity and tendency
or effect of misleading and deceiving
in any respect; or

(2) Guarantees which are so used or
are of such form, text or character as
to import, imply or represent that the
guarantee is broader than is in fact
true, or that the guarantee covers the
entire heater or certain parts thereof
which are not in fact covered, or will
afford more protection to purchasers
or users than is in fact true; or

(3) Guarantees in which any condi-
tion, qualification or contingency ap-
plied by the guarantor thereto is not
fully and nondeceptiveiy stated there-
in, or is stated in such manner or form
as to be deceptively minimized, ob-
scured or concealed, wholiy or in part;
or

(4) Guarantees which are stated,
phrased or set forth in such manner
that although the statements con-
tained therein are literally and techni-
caliy true, the whole is misleading in
that purchasers or users are not made
sufficiently aware of certain contin-
gencies or conditions applicable to
such guarantee which materially
lessen the value or protection thereof
as a guarantee to purchasers or users;
or

(5) Guarantees which purportedly
extend for such indefinite or unlimit-
ed period of time or for such long
period of years as to have the capacity
and tendency or effect of thereby mis-
leading or deceiving purchasers or
users into the belief that the product
has or is definitely known to have
greater degree of serviceability or du-
rability in actual use than is in fact
true; or

(6) Guarantees which have the ca-
pacity and tendency or effect of other-
wise misrepresenting the serviceabil-
ity, durabllity, or lasting qualities of
the product, such as, for example, a
guarantee extending for a certain
number of years or other long period
of time when the ability of the prod-
uct to last, endure, or remain service-
able for such period of time has not
been estabiished by actual experience

Titie 16—Commerciai Practices

or by competent and adequate tests
definitely showing in either case that
the product has such lasting qualities
under the conditions encountered or
to be encountered in the respective lo-
cality where the product is sold and
used under the guarantee; or

(7) Purported guarantees in the
form of documents, promises, repre-
sentations or other form which are
represented or held out to be guaran-
tees when such is not the fact, or
when they are service contracts of the
type which are not guarantees, or
when they involve any deceptive or
misleading use of the word “guaran-
tee” or term of similar import; or

(8) Guarantees issued, or directly or
indirectly caused to be used, by any
member of the industry when or
under which the guarantor fails or re-
fuses to scrupulously observe his obli-
gation thereunder or fails or refuses to
make good on claims coming reason-
ably within the terms of the guaran-
tee; or

(9) Guarantees which in themselves
or in the manner of their use are oth-
erwise false, misleading or deceptive.

(c) This section shall be appiicable
not only to guarantees but also to war-
ranties, to purported warranties and
guarantees, and to any promise or rep-
resentation in the nature of or pur-
porting to be a guarantee or warranty.

§ 160.6 Misuse of terms “close-outs,” “dis-
continued lines,” “special bargains,”
etc.

It is an unfair trade practice to offer
for sale, sell, advertise, describe or oth-
erwise represent regular lines of indus-
try products as “ciose-outs,” “discon-
tinued lines,” “special bargains,” or by
words or representations of similar
import, when such are not true in fact:
or to so offer for sale, sell, advertise,
describe or otherwise represent indus-
try products where the capacity and
tendency of effect thereof is to lead
the purchasing or consuming public to
belleve such products are being of-
fered for sale or sold at greatiy re-
duced prices or at so-called “bargain”
prices, when such is not the fact.

34


Chapter I—Federal Trade Commissien

§ 160.7 Misrepresentation as to install-
ment sales contracts, their terms, con-
ditions, etc.

It is an unfair trade practice to make
or publish, or cause to be made or pub-
lished, directly or indirectly, any false,
misleading or deceptive statement or
representation, through advertising or
otherwise, concerning installment
sales contracts used or their terms and
conditions, inciuding down payments,
interest, carrying charges, etc., or re-
specting any other matters relative to
such contracts or their terms and con-
ditions.

§ 160.8 Misrepresenting products as con-
forming to standard.

Representing, through advertise-
ment or otherwise, that any products
of the industry conform to a standard
recognized in or applicable to the in-
dustry when such is not the fact, with
the capacity and tendency or effect of
misleading or deceiving the purchas-
ing or consuming public, is an unfair
trade practice.

3160.9 Deception as to rebuilt or second-
hand prodncts.

(a) It is an unfair trade practice for
any member of the industry to sell,
offer for sale, advertise, or otherwise
represent, any product of the industry
as being new when such is not true in
fact.

(b) In the marketing of rebuilt or
second-hand products of the industry,
or parts thereof, or the marketing of
products containing rebuilt or second-
hand parts, it is an unfair trade prac-
tice to fail or refuse to make full and
nondeceptive disclosure, by mark se-
curely affixed to the extcrior of the
product in an accessible place, of the
fact that such product or parts are not
new but are used, rebuilt, or second-
hand, as the case may be, such failure
or refusal to disclose having the capac-
ity and tendency or effect of mislead-
ing or deceiving the purchasing or con-
suming public.

§ 160.10 Imitation of trade-marks, trade
names, ete.
The imitation or simulation of trade-
marks, trade names, brands, or labels
of competitors, with the capacity and

§ 160.14

tendency or effect of misleading or de-
ceiving the purchasing or consuming
public, is an unfair trade practice.

$160.11 Fictitious prices.

It is an unfair trade practice to sell
or offer for sale industry products at
prices purported to be reduced from
what are in fact fictitious prices, or to
sell or offer for sale such products at a
purported reduction in price when
such purported reduction is in fact fic-
titious or is otherwise misleading or
deceptive.

§ 160.12 Combination or coercion to fix
prices, suppress competition or restrain
trade.

It is an unfair trade practice for a
member of the industry, or any other
person:

(a) To use, directly or indirectly, any
form of threat, intimidation or coer-
cion against any member of the indus-
try or other person to unlawfully fix,
maintain or enhance prices, suppress
competition or restrain trade; or

(b) To enter into or take part in, di-
rectly or indirectly, any agreement,
understanding, combination, conspir-
acy or concerted action with one or
more members of the industry, or with
one or more other persons, to unlaw-
fully fix, maintain or enhance prices,
suppress competition or restrain trade.

§ 160.13 Defamation of competitors or dis-
paragement of their products.

The defamation of competitors by
falsely imputing to them dishonorable
conduct, inability to perform con-
tracts, questionable credit standing, or
by other false representations, or the
false disparagement of competitors’
products in any respect, or of their
business methods, _ selling prices,
values, credit terms, policies, or ser-
vices, is an unfair trade practice.

§ 160.14 Substitution of products.

The practice of shipping or deliver-
ing products which do not conform to
samples submitted, to specifications
upon which the sale is consummated,
or to representations made prior to se-
curing the order, without the consent
of the purchasers to such substitution,
or with the capacity and tendency or
effect of misleading or deceiving the

35


§ 160.15

purchasing or consuming public, is an
unfair trade practice.

§ 160.15 False invoicing.

It is an unfair trade practice to with-
hold from or insert in invoices any
statements or information by reason
of which omission or insertion of a
false record is made, wholly or in part,
of the transactions represented on the
face of such invoices, with the effect
of thereby misleading or deceiving the
purchasing or consuming public.

§ 160.16 Inducing breach of contract.

It is an unfair trade practice to
induce or attempt to induce the
breach of existing lawful contracts be-
tween competitors and their custom-
ers, or their suppliers, by any false or
deceptive means whatsoever, or to in-
terfere with or obstruct the perfor-
mance of any such contractual duties
or services by any such means, with
the purpose and effect of unduly ham-
pering, injuring, or prejudicing com-
petitors in their business.

§ 160.17 Use of lottery schemes.

The offering or giving of prizes, pre-
miums, or gifts in connection with the
saie of industry products, or as an in-
ducement thereto, by any scheme
which involves lottery or scheme of
chance, is an unfair trade practice.

\
§ 160.18 Commercial bribery. |

It is an unfair trade practice for a
member of the industry, directly or in-
directly, to give, or offer to give, or
permit or cause to be given, money or
anything of vaiue to agents, employ-
ees, or representatives of customers or
prospective customers, or to agents,
employees, or representatives of com-
petitors’ customers or prospective cus-
tomers, without the knowledge of
their employers or principals, as an in-
ducement to influence 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 influ-
ence such employers or principals to
refrain from dealing in the products of
competitors or from dealing or con-
tracting to deai with competitors.

Title 16—Commercial Practices

§ 160.19 Enticing away employees of com-
petitors.

It is an unfair trade practice for any
member of the industry willfully to
entice away employees of competitors
with the purpose and effect of thereby
unduly hampering or injuring com-
petitors in their business and destroy-
ing or substantially lessening competi-
tion.

§ 160.20 Procurement of competitors’ con-
fidential information by unfair means
and wrongful use thereof.

It is an unfair trade practice for any
member of the industry to obtain in-
formation concerr:ing the business of a
competitor by bribery of an employee
or agent of such competitor, by false
or misleading statements or represen-
tations, by the impersonation of one in
authority, or by any other unfair
means, and to use the information so
obtained in such manner as to injure
said competitor in his business or to
suppress competition or unreasonably
restrain trade.

§ 160.21 Unfair threats of infringement
suits.

The circulation of threats of suit for
infringement of patents or trade-
marks among customers or prospective
customers of competitors, not made in
good faith but for the purpose or with
the effect of thereby harassing or in-
timidating such customers or prospec-
tive customers, or of unduiy hamper-
ing, injuring or prejudicing competi-
tors in their business, is an unfair
trade practice.

§ 160.22 Coercing purchase of one product
as a prerequisite to the purcbase of
other products.

The practice of coercing the pur-
chase of one or more products as a
prerequisite to the purchase of one or
more other products, where the effect
may be to substantially lessen compe-
tition or tend to create a monopoly or
to unreasonably restrain trade, is an
unfair trade practice.

§ 160.23 Unlawful interference.

It is an unfair trade practice for any
member of the industry, by means of
any monopolistic practices, or through

36


Chapter I—Federal Trade Commissien

combination, conspiracy, coercion,
boycott, threats, or any other unlaw-
ful means, directly or indirectly, to in-
terfere with a competitor’s right to
purchase his materials and supplies
from whomsoever he chooses, or to
sell to whomsoever he chooses.

$160.24 Selling below cost.

The practice of selling industry
products below the seller’s cost, when
pursued with wrongful intent of there-
by injuring a competitor and where
the effect of such practice is to unrea-
sonably restrain trade, tend to create a
monopoly, or substantially lessen com-
petition, is an unfair trade practice.

This section is not to be construed as
prohiblting all sales below cost, but
oniy such selling below the seller’s
cost as is resorted to and pursued as a
monopolistic practlce with the wrong-
ful intent referred to and coupled with
the effect of unreasonably restraining
trade, tending to create a monopoly,
or substantially lessening competitlon.

The costs referred to in this section
are actual costs of the respective seller
and not some other figure or average
costs in the industry, determined by
an industry cost survey or otherwise.

$160.25 Discrimination.

(a) Prohibited discriminatory prices,
or rebates, refunds, discounts, credits,
etc., which effect uniawful price dis-
crimination. It is an unfair trade prac-
tice for any member of the industry
engaged in commerce, in the course of
such commerce, to grant or allow, se-
cretly or openly, directly or indirectly,
any rebate, refund, discount, credit,
purported allowance for alleged imper-
fect workmanship or defective materi-
al, or other form of price differential,
where such rebate, refund, discount,
credit, purported allowance for alleged
imperfect workmanship or defective
material, 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 substantlal-
ly to lessen competition or tend to
create a monopoly in any line of com-
merce, Or to injure, destroy, or prevent
competition with any person who

U

§ 160.25

either grants or knowingly receives
the benefit of such elther of them:
Provided, however, (1) That the goods
involved in any such transaction are
sold for use, consumption, or resale
within any place under the jurisdic-
tion of the United States;

(2) That nothing contained in this
sectlon shall prevent differentials
which make only due allowance for
differences in the cost of manufacture,
sale, or delivery resulting from the dif-
fering methods or quantities in which
such commodities are to such purchas-

. ers sold or delivered;

37

(3) That notlling contained in this
section shall prevent persons engaged
in selling goods, wares, or merchandise
in commerce from selecting their own
customers in bona flde transactions
and not in restraint of trade;

(4) That nothing contained in this
section shall prevent changes from
time to time where made, in response
to changing conditlons affecting either
(i) the market for the goods con-
cerned, or (ii) the marketability of the
goods, such as, but not limited to,
actual or imminent deterioratlon of
perishable goods, obsolescence of sea-
sonal goods, distress sales under court
process, or sales in good faith in dis-
continuance of business in the goods
concerned.

(b) Prohibited brokerage and com-
missions. It is an unfair trade practice
for any member of the industry en-
gaged in commerce, in the course of
such commerce, to pay or grant, or to
receive or accept, anything of value as
a commission, brokerage, or other
compensation, or any allowance or dis-
count in lieu thereof, except for ser-
vices 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 intermediary is
acting in fact for or in behalf, or is
subject to the direct or indirect con-
trol, of any party to such transaction
other than the person by whom such
compensation is so granted or pald.

(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-


§ 160.26

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
compensation or in consideration for
any services or facilities furnished by
or through such customer in connec-
tion with the processing, handling,
sale, or offering for sale of any prod-
ucts or commodities manufactured,
sold, or offered for sale by such
member, unless such payment or con-
slderatlon is available on proportional-
ly equal terms to ail other customers
competing in the distribution of such
products or commodities.

(ad) Prohibited discriminatory ser-
vices or facilities. It is an unfair trade
practice for any member of the indus-
try to discriminate in favor of one pur-
chaser against another purchaser or
nurchasers of a commodity bought for
resale, with or without processing, by
contracting to furnish or furnishing,
or by contributing to the furnishing
of, any services or facilities connected
with the processing, handling, sale, or
offering for sale of such commodity so
purchased upon terms not accorded to
ail purchasers on proportionally equal
terms.

(e) Inducing or receiving an illegal
discrimination in price. It is an unfair
trade practice for any member of the
industry engaged in commerce, in the
course of such commerce, knowingly
to induce or receive a discrimination in
price which is prohibited by the fore-
going provisions of this section.

(f) Purchases by schools, colleges,
universities, public libraries, churches,
hospitals, and charitable institutions
not operated for profit. The foregoing
vrovisions of this section relate to
practices within the purview of the
Robinson-Patman Antidiscriminatlon
Act, which act and the application
thereunder of this section are subject
to the limitations expressed in the
amendment to such Robinson-Patman
Antidiscriminatlon Act, which amend-
ment was approved May 26, 1938, and
reads as follows:

Be it enacted by the Senate and House of
Representatives of the United States of
America in Congress assembted, That noth-
ing in the Act approved June 19, 1936
(Public, Numbered 692, Seventy-fourth Con-
gress, second session), known as the Robin-

38

Title 16—Commerciai Practices

son-Patman Antidiscrimination Act, shall
apply to purchases of their supplies for
their own use by schools, colieges, universi-
ties, public libraries, churches, hospitals,
and charitable institutions not operated for
profit.

(Sec. 2, 38 Stat. 730, as amended, secs. 2, 3,
4, 49 Stat. 1527, 1528, ch. 263, 52 Stat. 446;
15 U.S.C. 13, 13a, 13b, 13c, 21a)

§ 160.26 Price discrimination by making
small deliveries at prices applicable
only to larger quantities.

1t is an unfair trade practice to dis-
criminate in price by making small de-
liveries to some purchasers at prices
applicable only to purchases and deliv-
eries in larger quantities where such
practice effects a discrimination in
price as in the case of a discriminatory
rebate, refund, discount, credit, service
or facility, of the type contrary to the
provisions of § 160.25 of this part.

$160.27 Discriminatory returns.

It is an unfair trade practice for any
member of the industry engaged in
commerce to discriminate in favor of
one customer-purchaser against an-
other customer-purchaser of products
bought from such member for resale,
by contracting to furnish, or furnish-
ing in connection therewith, upon
terms not accorded to ail customer-
purchasers on proportionaily equal
terms, the service or facility whereby
such favored purchaser is accorded the
privilege of returning products so pur-
chased and recelving therefor credit or
refund of purchase price.

However, nothing in any of §§ 160.1
to 160.29 of this part, inclusive, shall
be construed as prohiblting the return
of merchandise by purchaser, for
credit or refund of purchase price,
when and because such merchandise
has not been properly tagged, labeled
or marked by the seller in accordance
with the requirements of §§ 160.1 to
160.29 of this part, inclusive, or has
been otherwise falsely or deceptively
tagged, labeled or represented, or
when and because such merchandise is
defective in material, workmanship, or
in any other respect, contrary to guar-
antee, warranty or purchase contract.


Chapter I—Federal Trade Commissian

§ 160.28 Deception through failure to dif-
ferentiate betwecn wholesale and retail
transactions.

Where industry products are sold at
wholesale and at retail in the same es-
tablishment of a member of the indus-
try, the commingling of the two types
of business in such manner as to have
the capacity and tendency or effect to
misleading or deceiving purchasers or
prospective purchasers is an unfair
trade practice.

8160.29 Aiding or abetting use of unfair
trade practices.

It is an unfair trade practice for any
person to aid, abet, coerce, or induce
another, directly or indirectly, to use
or promote the use of any unfair trade
practice specifled in §§ 160.1 to 160.29
of this part.

Group II

§ 160.101 Publication of price lists and
terms of sale.

(a) The industry approves the prac-
tice of each individual member of the
industry independently publishmg and
circulating to the purchasing trade his
own price lists.

(b) The industry approves the prac-
tice of making the terms of sale a part
of all published price schedules.

$8 160.102 Repndiation of contracts.

Lawful contracts are business obliga-
tions which sliould 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
condemned by the industry. ;

§ 160.103 Maintenance of accurate re-
cords.

It is the judgment of the industry
that eacli member sliould indepen-
dently keep proper and accurate re-
cords for determining his costs.

$ 160.104 Arbitration.

The industry approves the practice
of handling business disputes between
members of the industry and their
customers in a fair and reasonable
manner, coupled with a spirit of mod-
eration and good will, and every effort
should be made by the disputants

30-035 O - 78 - 4

§ 160.106

themselves to compose their differ-
ences. If unable to do so they should,
if possible, submit these disputes to ar-
bitration.

§ 160.105 Fictitious bids.

When submitting blds, all bidders
should make their bids in good faith
and on a fully competitive basis. The
use by any member of the industry of
fake or fictitious bids, having the ten-
dency or effect of destroying competl-
tion and securing unfalr advantage, is
condemned by the industry.

§ 160.106 Coercion in sales.

The use of buying power to force un-
economic or unjust terms of sale upon
seilers, and the use of seiling power to
force uneconomic or unjust terms of
sale upon sellers, and the use of selling
power to force uneconomic or unjust
terms of sale upon buyers are con-
demned by the industry.

PART 162—WOOD CASED LEAD
PENCIL INDUSTRY

Grovr I

Sec.
162.1 Misrepresentation and misbranding.

162.2 Deception as to origin of pencils

39

made of fully fabricated imported lead
or slats.

162.3 Misuse of word ‘‘free,’’ etc.

162.4 Defamation of competitors or dispar-
agement of their products.

162.5 Procurement of competitors’ confi-
dential information by unfair means and
wrongful use thereof.

162.6 Commercial bribery.

162.7 Imitation or simulation of trade-
marks, trade names, etc.

162.8 Selling below cost.

162.9 Use of ‘loss leaders.”

162.10 Coercing purchase of one product as
a@ prerequisite to the purchase of other
products.

162.11 Substitution of products.

162.12 Combination or coercion to fix
prices, suppress competition, or restrain
trade.

162.13 Discrimination.

Grovr II

162.101 Ambiguity in contracts or orders.

162.102 Fictitious bids.

162.103 Recording of trade-marks, trade
names, etc., to avoid confusion.