Tie Fabrics Industry
16 CFR Part 188 · Trade practice rules · in the Code of Federal Regulations 1959-1976 (11 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 These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.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: 1959 CFR
Text (1976 edition, OCR)
§ 188.1
PART 188—TIE FABRICS INDUSTRY
Group I
Sec.
188.1 Misrepresentation.
188.2 Misbranding.
188.8 Deception as to origin.
188.4 Identification and disclosure of fiber
or material content.
188.5 Substitution of products.
188.6 Inducing breach of contract.
188.7 Arrangements to exciude sale of
competitors’ products.
188.8 Transactions below cost.
188.9 Palse invoicing.
188.10 Commercial bribery.
188.11 Imitation of trade-marks, etc.
188.12 Defamation of competitors or dis-
paragement of their products.
188.18 Fictitious price Lets.
188.14 Prohibited discrimination.
188.15 Combination or coercion to fix
prices, suppress competition, or
restrain trade.
188.16 Consignment selling of deliveries
“on memorandum.”
198.17 Aiding or abetting use of unfair
trade practices.
Group Ir
188.101 Saturday and Sunday closings.
188.102 Use of written sales contracts.
188.108 Repudiation of contracts.
188.104 Use of samples.
188.105 Arbitration of disputes.
188.106 Registration of original and novel
designs.
188.107 Use of uniform standards for exami-
nation of finished piece goods.
Avrnorrrr: The provisions of this Part
188 issued under secs. 6, 6, 38 Stat. 721, 719;
15 U.S.C. 46, 45, unless otherwise noted.
Source: The provisions of this Part 188
appear at 15 F.R. 1483, Mar. 16, 1950, unless
otherwise noted.
Group I
8188.1 Misrepresentation-
It is an unfalr 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, by way of advertisement
or otherwise, with respect to the grade,
quality, freedom from defects or imper-
fections, quantity, use, size, material,
content, thread count, origin, shrinkage
properties, proof against or resistance to
wrinkling, creasing or crushing, color-
fastness, washability, production, manu-
facture, or distribution of any tie fabric
or any component thereof, or to mis-
represent such fabric in any other mate-
rial respect.
Title 16—Commercial Practices
§ 188.2 Misbranding.
It is an unfair trade practice falsely or
deceptively to label, mark, or brand tie
fabrics with respect to the grade, quality,
freedom from defects or imperfections,
quantity, use, size, material, content,
thread count, origin, shrinkage proper-
ties, proof against or resistance to wrin-
kling, creasing or crushing, colorfastness,
washability, production, manufacture, or
distribution of such products or any com-
ponent thereof, or to misbrand such fab-
rics in any other material respect.
§ 188.3 Deception as to origin.
With respect to any tie fabrics cf the
following types: Fabrics which have been
woven or fabricated in a foreign country
and imported in the grey or other un-
finished state and dyed or finished in the
United States; and fabrics which have
been imported in the finished state, and
dyed, redyed, or refinished in the
United States; it is an unfair trade
practice:
(a) To offer for sale, sell, or distribute
any such fabrics under marks, stamps,
brands, labels, or representations which
have the capacity and tendency or ef-
fect of misleading or deceiving purchas-
ers, prospective purchasers, or the
consuming public into the belief (1) that
such fabrics were woven or fabricated in
the United States, when such is not the
fact; or (2) that they were dyed, fin-
ished, redyed, or refinished elsewhere
than in the United States, when such is
not true; or
(b) To offer for sale, sell, or distribute
any such fabrics without the same being
marked, stamped, branded, or labeled
so as to indicate clearly and nondecep-
tively (1) the country of origin of the
fabrics, and (2) that such fabrics were
woven or fabricated in said country and
were dyed or finished or redyed or re-
finished in the United States, as the case
may be, where the failure, refusal, or
omission to so mark, stamp, brand, or
label such fabrics has the capacity and
tendency or effect of thereby promoting,
abetting, or effectuating the marketing
of such products under conditions which
are misleading or deceptive to purchas-
ers, prospective purchasers, or the con-
suming public.
Nore: Nothing in this section shall be con-
strued as relieving any member of the indus-
try or other party of the necessity of com-
plying with requirements of the customs laws
150
Chapter l—Federal
or reguistions, or other applicable provisions
of law or regulations relating to the marking
of imported articles.
Cross REYERENCE: For regulations of the
U.S. Customs Service, see 19 CFR Chapter I.
8188.4 Identification and disclosure of
fiber or material content,
(a) In the sale, offering for sale, or dis-
tribution of tie fabrics, it is an unfair
trade practice to misrepresent or decep-
tively conceal the fiber or material con-
tent of any such product.
(b) Tie fabrics containing rayon, silk,
or linen shall be identified as to their
fiber and material content in labels, in-
voices, and advertisements, in accord-
ance with the requirements of trade
practice rules heretofore promulgated by
the Commission for the rayon industry,
silk industry, and Unen industry: Pro-
vided, That products containing, pur-
porting to contain, or in any way repre-
sented as containing, wool, reprocessed
wool, or reused wool, shall be labeled in
accordance with the requirements of the
Wool Products Labeling Act of 1939 and
the rules and regulations issued there-
under.
Nore: A copy of the above-mentioned
trade practice rules, and of the Wool Products
Labeling Act of 1989 and the rules and regu-
lations issued thereunder, may be obtained
from the Commission by any industry mem-
ber making request therefor.
§ 188.5 Substitution of products.
It is an unfair trade practice to ship or
deliver tie fabrics which do not conform
to samples submitted, to specifications
upon which the sale is consummated, or
to representations made prior to securing
the order, without the consent of the
purchasers to such substitutions and
with the capacity and tendency or effect
of misleading or deceiving purchasers,
prospective purchasers, or the consum-
ing public.
- §188.6 Inducing breach of contract.
It is an unfair trade practice to induce
or attempt to induce the breach of exist-
ing lawful contracts between competitors
and their customers or their suppliers by
any false or deceptive means whatsoever,
or to interfere with or obstruct the per-
formance of any such contractual duties
or services by any such means, with the
purpose and effect of unduly hampering,
injuring, or prejudicing competitors in
their business.
Trade Commission §$ 188.10
§ 188.7 Arrangements to exclude sale of
competitors’ products.
It is an unfair trade practice to sell or
contract for the sale of tie fabrics, or to
fix a price charged therefor, or to allow a
discount from, or rebate upon, such price,
on the condition, agreement, or under-
standing that the purchaser shall not use
or deal in the products of a competitor or
competitors of the seller, where the effect
of such sale or contract for sale, or such
condition, agreement, or understanding
may be to substantially lessen competi-
tion or tend to create a monopoly.
§ 188.8 Transactions below cost.
(a) The practice of selling tie fabrics
below the seller’s cost, when pursued with
wrongful intent of thereby injuring a
competitor and where the effect of such
practice is to umreasonably restrain
trade, tend to create a monopoly, or
substantially lessen competition, is an
unfair trade practice.
(b) This section is not to be construed
as prohibiting all transactions below cost,
but only such selling below the seller’s
cost as is resorted to and pursued as a
monopolistic practice with the wrongful
intent referred to and coupled with the
effect of unreasonably restraining trade,
tending to create a monopoly, or sub-
stantially lessening competition.
(c) 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.
§ 188.9 - False invoicing.
It is an unfair trade practice to with-
hold from or insert in invoices any state-
ments or information by reason of which
omission or insertion a false record is
made, wholly or in part, of the transac-
tions represented on the face of such
invoices, with the effect of thereby mis-
leading or deceiving purchasers, pro-
spective purchasers, or the consuming
public.
§ 188.10 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 value to agents, employees, or repre-
sentatives of customers or prospective
customers, or to agents, employees, or
151
§188.11
representatives of competitors’ custom-
ers or prospective customers, without the
knowledge of their employers or prin-
cipals, as an inducement to influence
their employers or principals to purchase
or contract to purchase products manu-
factured or sold by such industry member
or the maker of such gift or offer, or to
influence such employers or principals
to refrain from dealing in the products
of competitors or from dealing or con-
tracting to deal with competitors.
§ 188.11 Imitation of trade-marks, ete.
It is an unfair trade practice to imi-
tate or cause to be imitated, or directly
or indirectly to promote or aid the imi-
tation of, the trade-marks, trade names,
other exclusively owned symbols or
marks of identification of competitors,
or the exclusively owned designs or pat-
terns of competitors which have not been
directly, or by operation of law, dedicated
to the public, where such imitation has
the capacity and tendency or effect of
misleading or deceiving purchasers, pro-
spective purchasers, or the consuming
public.
§ 188.12 Defamation of competitors or
disparagement of their products.
It is an unfair trade practice to defame
competitors by falsely imputing to them
dishonorable conduct, inability to per-
form contracts, questionable credit
standing, or by other false representa-
tions; or to falsely disparage the grade,
quality, or manufacture of the products
of competitors, or their business meth-
ods, selling prices, values, credit terms,
policies, services, or conditions of em-
ployment.
§ 188.13 Fictitious price lists.
It is an unfair trade practice for any
member of the industry to publish or
circulate false or misleading price quota-
tions, price Usts, terms or conditions of
sale, or reports as to production or sales,
with the capacity and tendency or effect
of misleading or deceiving purchasers,
prospective purchasers, suppliers, pro-
spective suppliers, or the consuming
public.
§ 188.14 Prohibited discrimination.'
(a) Prohibited discriminatory prices,
or discounts, rebates, refunds, credits,
14s used throughout this section, the
word “commerce” means “trade or commerce
among the several States and with foreign
nations, or between the District of Columbia
Title 146—Commercial Practices
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 dis-
count, rebate, refund, credit, freight or
other transportation cost or any per-
centage thereof, or other form of price
differential, where such discount, rebate,
refund, credit, frelght or other transpor-
tation cost or any percentage thereof, or
other form of price differential, effects
a discrimination in price hetween differ-
ent purchasers of goods of like grade and
quality, where either or any of the pur-
chases involved therein are in commerce,
and where the effect thereof may be sub-
stantially 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 either
grants or knowingly receives the benefit
of such discrimination, or with customers
of either of them: Provided, however,
(1) That the goods involved in any
such transaction are sold for use, con-
sumption, or resale within any place un-
der the jurisdiction of the United States:
(2) That nothing contained in this
Paragraph shall prevent differentials
which make only due allowance for dif-
ferences in the cost of manufacture, sale,
or delivery resulting from the differing
methods or quantities in which such
commodities are to such purchasers sold
or delivered:
(3) That nothing contained in this
paragraph 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
paragraph shall prevent price changes
from time to time where made in re-
sponse to changing conditions affecting
the market for or the marketabllity of
the goods concerned, such as but not
limited to actual or imminent deteriora-
or any Territory of the United States and
any State, Territory, or foreign nation, or
between any insular possessions or other
places under the jurisdiction of the United
States, or between any such posseasion or
place and any State or Territory of the United
States or the District of Columbis or any
foreign nation, or within the District of Oo-
lumbia or any Territory or any insular pos-
session or other place under the jurisdiction
of tbe United States.
152
Chapter |—Federal
tion of perishable goods, obsolescence of
seasonal goods, distress sales under
court process, or sales in good faith in
discontinuance 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 com-
merce, to pay or grant, or to receive or
accept, anything of value as a commis-
sion, brokerage, or other compensation,
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 inter-
mediary therein, where such intermedi-
ary 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.
(ec) Prohibited advertising or promo-
tional allowances, etc. It is an unfair
trade practice for any member of the in~
dustry engaged in commerce to pay or
contract for the payment of advertising
or promotional allowances or any other
thing of value te or for the benefit cf a
customer of such member in the course
of such commerce as compensation or in
consideration for any services or facili-
ties furnished by or through such cus-
tomer in connection with the processing,
handling, sale, or offering for sale of any
products or commodities manufactured,
sold, or offered for sale by such member,
unless such payment or consideration is
available on proportionally equal terms
to all other customers competing in the
distribution of such products or com-
modities.
(d) Prohibited discriminatory serv-
ices or facilities. It is an unfair trade
practice for any member of the industry
to discriminate in favor of one purchaser
against another purchaser or purchasers
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 all purchasers on propor-
tionally 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
58—-064—76——11
Trade Commission § 188.16
course of such commerce, knowingly to
induce or receive a discrimination in
price which is prohibited by paragraphs
(a) to (d) of this section.
(2) Prohibited discriminatory returns.
It is an unfair trade practice for any
member of the industry engaged in com-
merce to discriminate in favor of one
customer-purchaser against another
customer-purchaser of a tie fabric,
bought from such member of the indus-
try for resale, by contracting to furnish,
or furnishing in connection therewith,
upon terms not accorded to all compet-
ing customer-purchasers on proportion-
ally equal terms, the service or facility
whereby such favored purchaser is ac-~
corded the privilege of returning all or
part of the fabric so purchased and re-
ceiving therefor credit or refund of pur-
chase price: Provided, however, Nothing
in §§ 188.1 to 188.17 shall prohibit or
be used to prevent the return of mer-
chandise by purchaser, for credit or
refund cf purchase price, when and be-
cause such merchandise has been falsely
or deceptively labeled or represented, or
when and because such merchandise is
defective in material, workmanship, or
in other respect is contrary to guarantee,
warranty, or purchase contract.
(g) Exemptions. The inhibitions of
this section shall not apply to purchases
of their supplies for their own use by
schools, colleges, universities, public li-
braries, churches, hospitals, and charita.
ble institutions not operated for profit.
§ 188.15 Combination or coercion to fix
prices, suppress competition, or re-
strain 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 coercion
against any member of the industry 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, un-
derstanding, combination, conspiracy, or
concerted action with one or more mem-
bers of the industry, or with one or more
other persons, to unlawfully fix, main-
tain, or enhance prices, suppress compe-
tition, or restrain trade.
§ 188.16 Consignment selling or de-
liveries “on memorandum.”
(a) It is an unfair trade practice for
any member of the industry to use the
153
$188.17
practice of shipping goods on consign-
ment or pretended consignment, or of
delivering goods ‘“‘on memorandum,”
(1) When such practice is so used, or
the terms and conditions thereof so
varied or arranged, as to effectuate a
discrimination prohibited by the provi-
sions of § 188.14; or
(2) When such consignment, pre-
tended consignment, or delivery “on
memorandum,” is used for the purpose
and with the effect of artificially clog-
ging trade outlets and unduly restricting
competitors’ use of said trade outlets in
getting their goods to purchasers or con-
sumers through regular channels of
distribution, and thereby injuring, pre-
venting, or destroying competition, tend-
ing to create a monopoly, or unreasonably
restraining trade.
(b) Nothing in this section, however,
shall be construed or used as preventing
or restricting consignment shipping, or
marketing “on memorandum,” when
carried out in good faith and without the
wrongful purposes or effects specified in
paragraph (a) (1) and (2) of this sec-
tion.
§ 188.17 Aiding or abetting use of un-
fair trade practices.
It Is an unfair trade practice for any
person, firm, or corporation to aid, abet,
coerce, or induce another, directly or
indirectly, to use or promote the use of
any unfair trade practice specified in
$$ 188.2 to 188.16.
Grovur IZ
§ 188.101 Saturday and Sunday clos-
ings.
In the interest of the public and of
itself, the industry urges all members
of the industry to adhere to the practice
of not opening their sales offices on Sat-
urdays and Sundays for the transaction
of business,
§ 188.102 Use of written sales contracts.
(a) In order to avoid ambiguity and
misunderstanding between buyers and
sellers, all purchases and sales of prod-
ucts of the industry exceeding one
piece, regardless of the total value there-
of, should be made by written contract,
signed by the buyer and seller. Such
written contract should set forth the
actual terms and conditions of the sale
involved.
(b) Wherever practicable, the delivery
of all merchandise of any quantity
Title 16—Commercial Practices
should be made against a written receipt
signed by the purchaser or a qualified
agent or employee of the purchaser,
(c) The provisions of this section shall
not be construed as sanctioning or ap-
proving any agreement among competi-
tors or any planned common course of
action among competitors to agree upon
or to fix, specify, or determine the prices,
discounts, terms, or conditions of sale to
be covered in any sales contract or trans-
action, but these shall be open to individ-
ual negotiation between the seller and
buyer, subject to the requirements of
§§ 188.1 to 188.17 and applicable provi-
sions of law.
§ 188.103 Repudiation of contracts.
Lawful contracts are business obliga-
tions which should be performed in letter
and in spirit. The repudiation of con-
tracts by sellers on a rising market or by
buyers on a declining market is con-
demned by the industry.
§ 188.104 Use of samples.
The industry disapproves the giving of
samples without charge in greater quan-
tity than actually necessary to acquaint
purchasers or prospective purchasers
with the grade or quality of the product
offered for sale. However, the furnishing
of any samples shall not be carried out
in a manner involving discrimination
prohibited by the provisions of § 188.14.
§ 188.105 Arbitration of disputes.
The industry approves and recom-
mends the use of commercial arbitration.
for the speedy and efficient disposition
of disputes arising out of the sale, proc-
essing, and distribution of products of
the industry.
§ 188.106 Registration of original and
novel designs.
The industry recommends that all
members should register their original
and novel designs, not directly or by op-
eration of law dedicated to the public,
with an accepted industry design regis-
tration bureau to the end that unauthor-
ized copying of designs and the resultant
confusion and misunderstanding be
eliminated and appropriate information
as to design in use be fully available to
the industry.
§ 188.107 Use of uniform standards for
examination of finished piece goods,
For the visuai examination of finished
piece goods, the industry recommends
154
Chapter |—Federal
that uniform standards, which are equi-
table as between buyer and seller and fair
to the trade and purchasing public, be
used in the settlement of disputes con-
cerning the quality of the industry’s
goods. Nothing in this section, however,
shall be construed as warranting classifi-
cation of any fabric of the industry as a
“first” when not fully qualified for such
designation; and in this connection, in-
dustry members recognize it as their
obligation to in nowise contribute to any
misrepresentation or deception as to
grade, quality, or otherwise, in the
further marketing of the fabric or prod-
ucts made therefrom.
PART 189—FINE AND WRAPPING
PAPER DISTRIBUTING INDUSTRY
Group I
Bec.
189.1 Misrepresentation in general.
189.2 Misrepresentation as to the charac-
ter of business.
189.3 Deception as to available supply of
advertised merchandise.
189.4 Palse invoicing.
189.5 False and misleading price quota-
tions, etc.
189.6 Misrepresenting products 8s con-
forming to standard.
189.7 Imitation or simulation of trade-
marks, trade names, etc.
189.8 Deceptive use of trade or corporate
names, trade-marks, etc.
189.9 Substitution of products.
189.10 Enticing away employees of com-
petitors.
188.11 Procurement of competitors’ cone
fidential information by unfair
means and wrongful use thereof.
189.12 Defamation of competitors or dis-
paragement of their products.
189.18 Selling below cost.
189.14 Combination or coercion to fix
. prices, suppress competition, or
restrain trade.
189.15 Prohibited discrimination.
189.16 Coercing purchase of one product
as & prerequisite to the purchase
of other products.
- 189.17 Abetting use of unfair trade prac-
tices,
Group
189.101 Arbitration.
189.102 Return of merchandise.
189.103 Price lists.
189.104 Cost records.
189.105 Dissemination of credit informa-
tion,
189.106 Repudiation of contracts.
189.107 Baturday-Sunday closing.
189.108 Labor conditions.
189.109 Statistical information.
Trade Commission § 189.4
COMMITTEE ON TRADE PRACTICES
Sec.
189.201 Industry committee.
AuTHoRITY: The provisions of this Part
189 issued under secs. 6, 5, 38 Stat. 721, 719;
15 U.S.C, 46, 45, unless otherwise noted.
Source: The provisions of this Part 189
appear at 15 F.R. 2901, May 16, 1950, unless
otherwise noted.
Group I
_§ 189.1 Misrepresentation in general, ‘
It is an unfair trade practice to use, or
cause or promote the use of, any trade
promotional literature, advertising mat-
ter, mark, brand, label, designation, or
other representation, however dissemi-
nated or published, which has the capac-
ity and tendency or effect of misleading
or deceiving purchasers or prospective
purchasers with respect to the grade,
quality, quantity, price, value, origin, size,
weight, strength, thickness, use, prepa-
ration, composition or “furnish”, pack-
ing, count, finish, manufacture, oF
distribution of any product of the indus-
try, or in any other material respect.
Nore: The word “furnish” as used in this
section means the composite ingredients fed
into a paper-making machine to produce a
particular kind of paper.
8189.2 Misrepresentation as to the
character of business.
It is an unfair trade practice for any
member of the industry, in the course of
or in connection with the distribution or
sale of industry products, to represent,
directly or indirectly, that he is a manu-
facturer, wholesaler, distributor, or ree
tailer of industry products when such {s
not the fact, or in any other manner to
misrepresent the character, extent, or
type of his business.
§ 189.3 Deception as to available supply
erchandis
of advertised m ise.
The advertising or offering for sale of
small and inadequate supplies (whether
as closeouts or otherwise) of well-known
brands of products at greatly reduced or
bargain prices without disclosure of the
quantity or of the inadequacy of the sup-
ply available at such prices, with the
capacity and tendency or effect of
thereby misleading or’ deceiving the pur-
chasing or consuming public, is an unfaiy
trade practice.
§ 189.4 False invoicing.
Withholding from or inserting in an
invoice, billing, or statement any mate-
rial information by reason of which
155