Wholesale Optical Industry

16 CFR Part 192 · Trade practice rules · in the Code of Federal Regulations 1959-1960 (2 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 These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.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, 1960 CFR · Earliest edition: 1959 CFR

Decisions that mention this industry's rules (1)

Text (1960 edition, OCR)

§$ 191 25

the person by whom such compensation
is so granted or paid

(d) Prohibited advertising or promo-
tional allowances etc In the selling of
industry products in commerce by any
member of the industry and in the
course thereof, 1t is an unfair trade prac-
tice for such member to pay or contract
for the payment of any advertising or
promotional allowances or any other
thing of value to or for the benefit of his
customer as compensation or 1n consid-
eration for certain services or facilities
furnished by or through such custoiner
unless such payinent or consideration is
avallable on proportionally equal terms
to all other customers of such member
competing in the distribution of such
products

(1) As used in this paragraph the
certain services or facilities referred to
are such as are furnished by or through
the customer in connection with the
processing handling sale or offering for
sale of such industry member’s
products

(e) Prohibited discrimination in serv-
ices or facilites In the sale of indus-
try products bought for resale with or
without processing it is an unfair trade
practice for any member of the industry
engaged 1n commerce to discriminate in
favor of one purchaser against another
purchaser by furnishing certain services
or facilities upon terms not accorded to
all competing purchasers on propor-
tionally equal terms

(1) Said services or facilities referred
to in this paragraph are such as are con-
nected with the processing handling
sale or offering for sale of the products
purchased and the term ‘furnishing’
as used in this paragraph shall be con-
strued as including contracting to fur-
nish and contributing to the furnishing
of, the services or facilities

(f) Inducing or recewing an illegal
discrimination in price It is an unfair
trade practice for any member of the in-
dustry m the course of commerce in
which he 1s engaged knowingly to induce
or receive a discrimination in price
which is prohibited by the foregoing pro-
visions of this section

(g) Exemptions The inhibitions of
this section shall not apply to purchases
of their supphes for ther own use by
schools colleges universities public
libraries churches hospitals and chari-
table institutions not operated for profit

Page 588

Title 16—-Commercial Practices

§ 19125 Unlawful interference with

competitors’ purchases or sales

It 1s an unfair trade practice for any
member of the industry by means of any
monopolistic practices or through com-
bination conspiracy coercion boycott
threats or any other unlawful means,
directly or indirectly to interfere with
a competitor s right to purchase his raw
materials and supphes from whomso-
ever he chooses or to sell his product to
whomsoever he chooses

§ 19126 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
§§ 1911 to 191 25, mnclusive

Grotvp II
§ 191101 Arbitration

The industry approves the practice of
handling business disputes between
members of the industry and their cus-
tomers in a fair and reasonable manner
coupled with a spirit of moderation and
good will and every effort should be
inade by the disputants themselves to
compose their differences If unable to
do so they should if possible submit
these disputes to arbitration

§ 191102 Coercion im sales

The use of buying power to force un-
economic or unjust terins of sale upon
sellers and the uSe of selling power to
force uneconomic or unjust terms of sale
upon buyers are condemned by the
industry

PART 192—-WHOLESALE OPTICAL
INDUSTRY

Sec
1920 Definition industry products
Group I

1921 Prohibited discrimination

1922 Deceptive use of trade or corporate
names trade-marks etc

1928 Misrepresentation

1924 Deception as to origin

1925 Misrepresenting products as Ccon-
forming to standard

1926  Misrepresentation as to character of
business

1927 Deception through failure to differ-
entiate between wholesale and
retail transactions

1923 False invoicing


Chapter |—Federal

Sec

1929 Misuse of terms close-outs ’ dis-
continued lines etc

19210 Consignment distribution

19211 Transactions beiow cost

19212 Commercial bribery

19213 Defamation of competitors or dis-
paragement of their products

19214 Coercing purchase of one product as
prerequisite to purchase of other
products

19215 Inducing breach of contract

19216 Enticing away employees of competi-
tors

19217 Imitation of trade-marks trade
names etc

19218 Combination or coercion to fix prices
suppress competition or restrain
trade

Group II

192101 Nature of business should be dis-

closed

192102 Return cf merchandise
192103 Disputes

AvurnHorITY §§ 1920 to 192103 issued un-
der sec 6 38 Stat 721 15U S C 46 Inter-
pret or apply sec 5 38 Stat 719 as amended
15U 8S C 45

Source §§ 1920 to 192103 appear at 15
F R 4190 June 30 1950

§ 1920 Defimtion, mdustry products

AS used im this part the term “industry
products (or products of the industry”)
shall be understood as embracing eye-
glasses and eyeglass lenses which are
designed to provide correction and/or
improvement of eyesight and as also
embracing frames mountings parts and
accessories for any kind of eyeglasses and
similar ophthalmic goods and materials

Note Sunglasses and goggies or spectacles
which are designed for protection of the eyes
or eyesight as distinguished from correctlon
or improvement of eyesight are not included
nor are contact lenses precision lenses for
telescopes binoculars etc to be considered
as included

Group I
§ 1921 Prohibited discrimination *

(a) Prohibited discruminatory prices,
or rebates, refunds discounts credits,

1As used in this section the word com-
merce means trade or commerce among the
several States and with foreign nations or
between the District of Columbia or any Ter-
ritory 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 be-
tween any such possession or place and any
State or Territory of the United States or
the District of Columbia or any foreign na-

Trade Commission § 1921
ete which effect unlawful price discrimi-
nation Its an unfair trade practice for
any member of the industry engaged in
commerce, mm the course of such com-
merce to grant or allow secretly or
openly, directly or indirectly any rebate
refund, discount credit or other form
of price differential where such rebate,
refund discount credit or other form of
price differential effects a discrimina-
tion in price between different purchas-
ers of goods of hke grade and quahty
where either or any of the purchases in-
volved therein are m 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 mvolved in any
such transaction are sold for use con-
sumption or resale within any place
under 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 inanufacture’
sale or delivery resulting from the dif-
fering methods or quantities in which
such commodities are to such purchasers
sold or delivered

Note Spindling of orders This pro-
viso shall not be construed as permitting
the practice of allowing a price differential
whether in the form of a discount rebate
or other form through bllling as a single
order an aggregate of the amounts of two
or more orders separately delivered when
such price differentiai is not justified by
savings to the seller which makes oniy due
allowance for differences in the cost of man-
ufacture? sale or delivery resulting from the

tion or within the District of Columbia or
any Territory or any insular possesslon or
other place under the jurisdiction of the
United States

2 Manufacture as used in this section
and for the purposes of these rules is
synonymous with the term processing in-
cluding but not iimited to (1) surface
grinding and polishing to produce the neces-
sary curves on the surfaces of lenses (2) the
centering cutting clipping and edging of
surface finished lenses to the size and shape
required and the drilling or slotting of lenses
(3) the assembling of the finished lenses in
frames or mountings and (4) the final
shaping and truing of the completed spec-
tacles or eyeglasses

Page 589


§ 1921

differing methods or quantities in which such
products are to such purchasers sold or de-
livered )

(3) That nothing contained in this
paragraph shall prevent persons engaged
in selling goods wares or merchandise in
commerce froin 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 maiket for or the marketability of
the goods concerned such as but not
hmuited to actual or :mmuinent deteriora-
tion of perishable goods obsolescence of
seasonal goods distress sales under court
Process or sales in good faith in discon-
tinuance of business in the goods con-
cerned

(b) Prohibited brokerage and commus-
sions It1s 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 in-
termediary therein where such inter-
mediary is acting 1n fact for or m behalf
or 1s subject to the direct or indi-
rect control of any party to such trans-
action other than the person by whom
such compensation 1s so granted or paid

(c) Prohibited advertising or promo-
tional allowances, etc It 1s an unfair
trade practice for any member of the
industry engaged in commerce to pay
or contract for the payment of advertis-
ing or promotional allowances or any
other thing of value to or for the benefit
of a customer of such inember in the
course of such commerce as compensa-
tion or in consideration for any services
or facilities furnished by or through
such customer 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 proportion-

*The term processing as here used shall
be understood as embracing the operations
set out in footnote 2

Page 590

Title 16—Commercial Practices

ally equal terms to all other customers
competing in the distribution of such
products or commodities

(d) Prohibited discriminatory services
or faciltres 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
without processing® by contracting to
furnish or furnishing or by contributing
to the furmishing 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
proportionately equal terms

(e) Inducing or receiving an illegal
discrimination in price It 1s 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 1s prohibited by the provi-
sions 1n paragraphs (a) to (d) of this
section

Note This provision is to be understood
as inhibiting industry members from know-
ingly inducing or receiving from their sup-
pliers price differentials prohibited by para-
graph (a) of this section whether such price
differentiais be given on goods resold by them
at wholesale or retail

(f) Prohibited discriminatory returns
It 1s an unfair trade practice for any
member of the imdustry engaged in
commerce to discriminate in favor of
one customer-purchaser against another
customer-purchaser of optical or oph-
thalmic goods bought from such member
of the industry for resale by contracting
to furnish or furnishing in connection
therewith upon terms not accorded to
all competing customer-purchasers on
proportionately equal terms the service
or facility whereby such favored pur-
chaser is accorded the privilege of re-
turning all or part of the optical or oph-
thaimic goods so purchased and
receiving therefor credit or refund of
purchase price Provided however That
nothing in any of the rules in §§ 1921
to 19218 shali prohibit or be used to
prevent the return of merchandise by
purchaser for credit or refund of pur-
chase price when and because such
merchandise has been falsely or decep-
tively labeled or represented or when
and because such merchandise is defec-
tive 1n material workmanship or in


Chapter I—Federal Trade Commission

other respect 1s contrary to guarantee
warranty or purchase contract

(g) Exemptions The inhibitions of
this section shall not apply to purchases
of their supphes for thelr own use by
schools colleges universities public
hbraries churches hospitals and chari-
table institutions not operated for profit

(h) Purchase by U S Government
applicability of Robinson-Patman Anti-
discrimination Act to same In an
oplnion submitted to the Secretary of
War under date of December 28 1936
the U S Attorney General advised that
the Robinson-Patman antidiscrimina-
tion Act “is not applicable to Govern-
ment contracts for supplies” (38
Opinions Attorney General 539)

§ 1922 Deceptive use of trade or cor-
porate names, trade marks, etc

The use of any trade name corporate
name trade-mark or other trade desig-
nation which has the capacity and tend-
ency or effect of misleading or decelving
purchasers prospective purchasers or
the buying public as to the character
name nature or origin of any product
of the industry or any material used
therein, or which 1s false or misleading
in any other respect, 1s an unfair trade
practice

§ 1923 Misreprcsentation

It is an unfair trade practice to make
or publish, or cause to be made or pub-
lished directly or indirectly any state-
ments or representations by way of ad-
vertisement or otherwise which have the
capacity and tendency or effect of muis-
leading or deceiving purchasers, prospec-
tive purchasers or the buying public
with respect to the quality, grade quan-
tity size precious inetal content origin
manufacture durability efficacy or
Serviceability of any industry product,
or to misrepresent any such product in
any other material respect

Note Among the inhibitions of this sec-
tion is false advertisement as defined in
eection 15 of the Federal Trade Commission
Act of any devices or other products with-
in the scope of such section Furthermore
nothing in this part is to be construed as
relieving any one of the necessity of com-
plying with the provisions of the Food Drug
and Cosmetic Act in respect to labeling or
any other matter coming within the pur-
view of that act

Cross REFERENCE For regulations of the
Food and Drug Administration see 21 CFR
Chapter I

§ 1926

§ 1924 Deception as to origin

In respect to industry products pro-
duced 1n a foreign country and imported
in the finished state or imported in the
unfinished state and finished in the
United States, 16 1s an unfair trade
practice

(a) To offer for sale sell or distribute
any such industry products under marks
stamps brands labels or representations
which have the capacity and tendency or
effect of misleading or deceiving purchas-
ers prospective purchasers or the buying
public into the erroneous belief that the
industry products were produced wholly
within the United States 01

(b) To offer for sale sell or distribute
any such industry products without the
same being marked stamped branded
or labeled so as to indicate clearly and
nondeceptively the country of origin of
such products the failure refusal or
omission to so mark stamp brand or
label such industry products having the
capacity and tendency or effect of thereby
promoting abetting or effectuating the
marketing of industry products under
conditions which are misleading or de-
ceptive to purchasers prospective pur-
chasers or the buying public

Nore Nothing in this section shall be con
strued as relieving any member of the
industry or other party of the necessity of
complying with the requirements of the
customs laws or regulations or other appli-
cable provisions of law or reguiation relating
to the marking of imported articles

Cross REFERENCE For regulations of the
Bureau of Customs see 19 CFR Chapter I

§ 1925 Mhisrepresenting products as con-
forming to standard

In connection with the sale or offering
for sale of products of the industry it
1s an unfair trade practice to represent
through advertising or otherwise that
such products conforin to any standards
recognized 1n or applicable to the in-
dustry when such 1s not the fact with
the capacity and tendency or effect of
misleading or deceiving purchasers pro-
spective purchasers or the buying public

§ 1926 Musrepresentation as to charac-
ter of husimess

It is an unfair trade practice for any
member of the industry in the course of
or 1n connection with the distribution or
sale of industry products to musrepre-
sent the character, extent or type of his
busmess

Page 591


$1927

§ 1927 Deception through failure to
differentiate hetween wholesale and
retail transactions

Where industry products are sold at
wholesale and at retail in the same es-
tablishment of a member of the industry
the comminghng of the two types of
business 1n such manner as to have the
capacity and tendency or effect of
misleading or decelving purchasers pro-
spective purchasers or the buying public
1s an unfair trade practice

§1928 False mvoicing

(a) It 18 an unfair trade practice to
withhold from or insert in invoices any
statements or information by reason of
which omission or insertion a false record
1s made wholly or in part of the transac-
tions represented on the face of such
invoices, with the capacity and tendency
or effect of thereby misleading or de-
celving purchasers prospective pur-
chasers or the buying public

(bo) Im order to prevent musunder-
standing confusion or deception the in-
voice or billing should disclose that the
products of the industry covered thereby
are seconds defective or other than
first-quality merchandise when such is
the fact

§ 1929 Misuse of terms “close outs,”’
“discontiuued lines,” ete

It 1s an unfair trade practice to offer
for sale sell advertise describe or other-
wise represent regular lines of merchan-
dise as ‘ close-outs ” “discontinued lines ”
or by words or representations of simuar
import when such are not true in fact
or to so offer for sale sell advertise de-
scribe or otherwise represent merchan-
dise where the capacity and tendency or
effect thereof 1s to lead purchasers pio-
spective purchasers or the buying public
to believe such merchandise 1s being of-
fered for sale and sold at greatly reduced
prices or al so-called bargain prices
when such is not the fact

§ 19210 Consignment distribution

It 1s an unfair trade practice for any
member of the Industry to employ the
practice of shipping Industry products on
consignment or pretended consignment
for the purpose and with the effect of
artificially clogging or closing trade out-
lets and unduly restricting competitors’
use of said trade outlets in getting their
products to consumers through regular

Page 592

Title 16—Commercial Practices

channels of distribution, thereby injur-
ing destroying or preventing competi-
tion or tending to create a monopoly or
to unreasonably restrain trade Nothing
in this section shall be construed as
restricting or preventing consignment
shipping or marketing of industry prod-
ucts In good faith where supplession of
competition restraint of trade or undue
interference with competitors’ use of the
usual channels of distribution 1s not
effected

§ 19211 Transactions below cost

The practice of selling products of the
mdustry at a price less than the cost
theleof to the seller with the purpose or
intent and where the effect may be to
injure suppress or stifle competition or
tend to create a monopoly m the produc-
tion or sale of such products 1s an unfair
trade practice As used in this section
the term cost’ means the total cost to
the seller of any such transactions of
sale including tne costs of acquisition
processing preparation for marketing
sale and delivery of such products

§ 19212 Commercial bribery

It 1s an unfair trade practice for a
member of the industry directly or indi-
lectly 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-
els or prospective customers without the
knowledge of their employers or princi-
pals as an inducement to influence their
employers or principals to purchase or
contract to purchase products manufac-
tuied or sold by such industry member or
the maker of such gift or offer or to in-
fluence such employers or principals to
refrain from dealing 1n the products of
competitors or from dealing or contract-
ing to deal with competitors

§ 19213 Defamation of competitors or
disparagement of their products

The defamation of competitors by
falsely 1mputing to them dishonorable
conduct inability to perform contracts
questionable credit standing or by other
false representations or the false dis-
paragement of competitors’ products in
any respect or of their business methods,
selling prices values credit terms
policies 01 services 1s an unfair trade
practice


Chapter I—Federal

§ 19214 Coereimg purchase of one prod-
uct as prerequisite to purchase 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 competi-
tion or tend to create a monopoly or to
unreasonably restrain trade 1s an unfair
trade practice

§ 19215 Inducing hreach of contract

Inducing or attempting to induce the
breach of existing lawful contracts be-
tween competitors and their customers
or their suppliers by any false or decep-
tive means whatsoever or interfering
with or obstructing the performance of
any such contractual duties or services
by any such means, with the purpose
and effect of unduly hampering injur-
ing or prejudicing competitors in their
business 1s an unfair trade practice

§ 19216 Enticing away employees of
competitors

It 1s an unfair trade practice for any
member of the industry willfully to entice
away employees of competitors with the
intent and effect of thereby unduly ham-
pering or injuring competitors in their
business and destroying or substantially
lessening competition Prouded, That
nothing 1n this section shall be construed
as prohibiting employees or agents from
seeking or obtaining more favorable
employment

§ 19217 Imutatson of trade marks, trade
names, etc

The practice of imitating or causing to
be imitated or directly or indirectly pro-
moting the imitation of the trademarks
trade names or other exclusively owned
symbols or marks of identification of
competitors having the capacity and
tendency or effect of misleading or de-
celving purchasers prospective purchas-
ers or the buying public 1s an unfair
trade practice

§ 19218 Combmation or coercion to fix
prices, suppress eompetition, or re-
Strain trade

It 1s an unfair trade practice for a
member of the industry

(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

46018—60——39

Trade Commission § 192 103
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

Group II

§ 192101 Nature of husiness should he
disclosed

No member of the industry should use
any advertising letterhead or telephone
listing which 1s vague or confusing in
that 1t fails to indicate the true business
character of the firm

§ 192 102 Return of merchandise

The practice of sellmg merchandise
and later permitting the purchaser to re-
turn 1t for credit or refunds of purchase
price without just cause creates waste
and loss increases the cost of doing busl-
ness to the detriment of both the indus-
try and the public, and 1s deemed incon-
sistent with sound industry practice

§ 192103 Dhusputes

The industry approves the practice of
handling business disputes between
members of the industry and their cus-
tomers 1n a fair and reasonable manner,
coupled with a spirit of moderation and
good will and every effort should be made
by the disputants themselves to compose
their differences If unable to do so they
should 1f possible, submit these disputes
to arbitration

PART 193—SLIDE FASTENER

INDUSTRY

Sec

193 0 Definitions

193 1 Prohibited discrimination

193 2 Prohibited forms of trade restraints
(unlawful price fixing etc )

1933 Prohibited sales below cost

193 4 Exclusive deals

193 5 Coercing purchase of one product
as a prerequisite to the purchase
of other products

193 6 Consignment distribution

193 7 Unfair threats of infringement suits

193 8 Inducing breach of contract

193 9 Substitution of products

19310 False invoicing

19311 Commercial bribery

19312 Enticing away employees of com-

petitors

Page 593