Seam Binding Industry

16 CFR Part 201 · Trade practice rules · in the Code of Federal Regulations 1959-1977 (12 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 These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.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, 1977 CFR · Earliest edition: 1959 CFR

Text (1977 edition, OCR)

§ 199.103

§ 199.103 Repndiation 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
condemned by the industry.

§ 199.104 Manner of disclosure of type
of canvas material.

It is the recommendation of the indus-
try that denomination of the type of
canvas material of which a canvas cover
is made be in accord with the nomencla-
ture and definitions contained in Com-
mercial Standard CS28-46 (Cotton
Fabric Tents, Tarpaulins, and Covers) of
the National Bureau of Standards.

PART 201—SEAM BINDING

INDUSTRY
Sec.
201.0 Definition of “seam binding.”
Group I
201.1  Misrepresentation and misbranding.
201.2 Identification and disclosure of fiber
or material content.
201.8 Disclosure of yardage.
201.4 Deception respecting type of edge.
201.5 Deception as to origin.
201.6 Selling below cost.
201.7 False invoicing.
201.8 Consignment distribution.
201.9 Combination or coercion to fix prices,

suppress competition, or restrain
trade.

201.10 Prohibited discrimination.

201.11 Aiding or abetting use of unfair
trade practices.

AurHogrtry: The provisions of this Part 201
issued under secs. 6, 5, 88 Stat. 721, 719; 16
U.S.C. 46, 45, unless otherwise noted.

Source: The provisions of this Part 201 ap-
pear at 16 F.R. 6367, June 30, 1951, unless
otherwise noted.

§ 201.0 Definition of “seam binding.”

As used in this part, the term “seam
binding’ shall be understood as embrac-
ing any narrow fabric (other than bias
binding) having a woven, cut, or other
kind of edge, and which is of the type
used in the manufacture of wearing ap-
parel to prevent ravelling or fraying at
seams and hems.

Group I
§ 201.1 Misrepresentation and mis-
branding.

It is an unfair trade practice for any
member of the industry to use, or cause
or promote the use of, any trade promo-

Title 16—Commercial Practices

tional literature, advertisement matter,
guarantee, mark, brand, label, desig-
nation, or other form of representation,
however disseminated or published,
which has the capacity and tendency or
effect of misleading or deceiving pur-
chasers or prospective purchasers with
respect to the grade, quality, freedom
from imperfections, color fastness, wasb-
ability, fiber or material content, yard-
age, size, origin, fabrication, type of
edge, manufacture, finishing, or distribu-
tion of any seam binding, or which is
false, misleading, or deceptive in any
other material respect.

§ 201.2 Identification and disclosure of
fiber or material content.

(a) In the sale, offering for sale, or
distribution of seam binding, it is an
unfair trade practice to misrepresent or
deceptively conceal the fiber or material
content of any such product.

(b) Seam binding containing rayon,
silk, or linen shall be identified as to its
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 linen industry: Pro-
vided, That seam binding containing,
purporting to contam, or in any way
represented as containing wool, re-
processed wool, or reused wool, shall be
labeled in accordance with the require-
ments of the Wool Products Labeling
Act of 1939 and the rules and regulations
issued thereunder.

Note: A copy of the above-mentioned trade
practice rules, and of the Wool Products
Labeling Act of 1939 and the rules and reg-
ulations Issued thereunder, may be obtained
from the Commission by any industry mem-
ber making request therefor.

§ 201.3 Disclosure of yardage.

In order that purchasers may not be
deceived as to the yardage of seam bind-
ing and that misrepresentation and de-
ceptive concealment in respect thereto
may be avoided and prevented, the mini-
mum yardage of the article should be
clearly and nondeceptively marked on
the product or on the disks, spools, bolts,
cards, or other form of immediate pack-
aging of the product; and the sale, offer
for sale, or distribution of any seam bind-
ing not so marked, with the tendency and
capacity or effect of misleading or de-
ceiving purchasers or the consuming
public, is an unfair trade practice.

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Chapter |—Federal

Norz: In cutting seam binding in the
greige or after finishing, adequate allowance
sbould be made for any subsequent shrinkage
or contraction of such products, to the end
that purchasers may be assured the full
yardage represented.

§ 201.4 Deception respecting type of
edge.

To the end that misunderstanding,
confusion, misrepresentation, and decep-
tion respecting the type of edge on
seam binding may be avoided and pre-
vented, clear, legible, and nondeceptive
disclosure of the type of edge on such
binding should be made on each disk,
spool, bolt, card, or other form of im-
mediate packaging thereof, by tag, label,
stamp, or mark so affixed as to ensure
that it wiil remain thereon until such
binding reaches the ultimate user; and it
is an unfair trade practice to misrepre-
sent the type of edge on seam binding, or
to cause any seam binding to be offered
for sale, sold, or distributed, without
making adequate, nondeceptive dis-
closure of the type of edge thereon, where
failure to make such disclosure has the
capacity and tendency or effect of mis-
leading or deceiving purchasers.

The following are ilustrative examples
of the type of disclosure provided for in
this section:

“Cur Engr Sean Bryprve”’

or
“Szram BINDING, Cur Fusep Encr”
or
“WovEN Ence Stam BINDING”

8201.5 Deception as to origin.

With respect to any seam binding
which has been imported from a foreign
country into the United States in the
greige or other unfininshed state, or in
@ finished or semi-finished state, it is an
unfair trade practice:

(a) To offer for sale, sell, or distribute
any such seam binding under marks,
stamps, brands, labels, or representa-
tions which have the capacity and tend-
ency or effect of misleading or deceiving
purchasers, prospective purchasers, or
the consuming public into the belief (1)
that such seam binding was woven or
fabricated in the United States, when
such is not the fact; or (2) that it was
dyed, finished, redyed, or refinished else-
where than in the United States, when
such is not true; or

(b) To offer for sale, sell, or distribute
any such seam binding without the same
being marked, stamped, branded, or
labeled so as to indicate clearly and non-

Trade Commission $201.7

deceptively (1) the country of origin of
the seam binding, or (2) that such seam
binding was woven or fabricated in said
country and was dyed or finished or re-
dyed or refinished in the United States,
as the case may be, where the failure,
refusal, or omission to so mark, stamp,
brand, or label such seam binding has
the capacity and tendency or effect of
thereby promoting, abetting, or effectu-
ating the marketing of such products
under conditions which are misleading
or deceptive to purchasers, prospective
purchasers, or the consuming public.

Norz: Nothing tn this section shall be con-
strued as relieving any member of the in-
dustry or other party of the necessity of
complying with requirements of the customs
laws or regulations, or other applicable pro-
visions of law or regulations, relating to the
marking of imported articles.

§ 201.6 Selling below cost.

The practice of selling seam binding
at a price less than the cost thereof to
the seller, with the purpose or intent, and
where the effect may be, to injure, sup-
press, or stiflo competition or tend to
create a2 monopoly in the production or
sale of such products, is an unfair trade
practice. As used in this section, the
term “cost” means the total cost to the
seller, including the costs of acquisition,
processing, preparation for marketing,
sale, and delivery.

This section is not to be construed
as prohibiting all sales below cost, but
only such selling below the seller’s cost
as is resorted to and pursued as a mo-
nopolistic practice with the wrongful
intent referred to and where the effect
may be unreasonably to restrain trade,
tend to create a monopoly, or substan-
tially lessen competition.

All elements recognized by good ac-
counting practice as proper elements of
such cost shall be included in deter-
mining cost under this section. The
costs referred to in the 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.

§ 201.7 False invoicing.

Withholding from or inserting in in-
voices, or sales slips any statements or
information by reason of which omission
or insertion a false record is made, wholly
or in part, of the transactions repre-
sented on the face of such invoices or
sales slips, with the capacity and tend-

157


§ 201.8

ency or effect of thereby misleading or
deceiving purchasers, prospective pur-
chasers, or the consuming public, is an
unfair trade practice.

§ 201.8 Consignment distribution.

It is an unfair trade practice for any
member of the industry to employ the
practice of shipping seam binding 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
channels of distribution, thereby injur-
ing, destroying, or preventing competi-
tion, or tending to create a monopoly
or unreasonably to restrain trade. Noth-
ing in this section shall be construed
as restricting or preventing consign-
ment shipping or marketing of seam
binding in good faith where suppression
of competition, restraint cf trade, or
undue interference with competitors’ use
of the usual channels of distribution, is
not effected; nor shall anything in this
section be construed to authorize any
agreement, understanding, or common
course of action by and between industry
members to mutually conform or restrict
their practice of shipping goods on con-
signment with the intent or effect of
lessening competition.

§ 201.9 Combinatiou or coercion to fix
prices, suppress competition, or re-
strain trade.

It is 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 unlawfully to 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, unlawfully to fix, main-
tain, or enhance prices, suppress compe-
tition, or restrain trade.

§ 201.10 Prohibited discrimination.*

(a) Prohibited discriminatory 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

Title 16—Commercial Practices

etc., which effeet 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, or other form
of price differential, where such rebate,
refund, discount, credit, or other form of
price differential, 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
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
under the jurisdiction of the United
States;

(2) That nothing contained in this
Paragraph shall prevent differentials
which make oniy due allowance for dif-
ferences in the cost of manufacture, sale,
or delivery resulting from the differing
methods or quantities in which such com-
inodities 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 marketability of
the goods concerned, such as but not
limited to obsolescence of seasonal goods,
distress sales under court process, or
sales in good faith in discontinuance of
business in the goods concerned.

Territory of the United States and any State,
Territory, or foreign nation, or between any
tnsular possessions or other places under the
jurisdiction of the United States, or between
any such possession or place and any State
or Territory of the United States or the
District of Columbia or any foretgn nation,
or within the District of Columbia or any
Territory or any insular possession or other
place under the jurisdiction of the United
States.”

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Chapter !—Federal Trade Commission

(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 in-
termediary therein where such interme-
diary is acting in fact for or in behalf,
or is subject to the direct or indirect
control, 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 advertis-
ing 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
or facilities furnished by or through such
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 en-
gaged in commerce to discriminate in
favor of one purchaser against another
purchaser or purchasers of a commodity
bought for resale, with or without proc-
essing, 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 com-
modity so purchased upon terms not ac-
corded to all competing 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.

§ 201.11

(f) Exemptions. The inhibitions of
this section shall not apply to purchases
of their supplies for their own use by
schools, colleges, universities, publle
libraries, churches, hospitals, and chari-
table institutions not operated for profit.

Note: In complaint preceedings charg-
ing discrimination in price or services or
facilities furnished and upon proof having
been made of such discrimination, the
burden of rebutting the prima facie case
thus made by showing justification shall be
upon the person charged; and unless justi-
fication shall be affirmatively shown, the
Commission is authorized to issue an order
terminating the discrimination: Provided,
however, That nothing herein shall prevent
& Seller rebutting the prima facie case thus
made by showing that his lower price or the
furnishing of services or facilities to any
purchaser or purchasers was made in good
faith to meet an equally low price of a com-
petitor, or the services or facilities furnished
by a competitor—(See sec. 2 (b) Clayton
Act.)

§ 201.11 Aiding or abetting use of un-
fair trade practices.

It is an unfalr trade practice for any
person, firm, or corporation to ald, abet,
coerce, or induce another, directly or in-
directly, to use or promote the use of any
unfair trade practice specified in this
part.

PART 202—SUN GLASS INDUSTRY

Sec.

202.0 Definitions.

202.1 Deception (general).

202.2 Misuse of the terms “ground,” “pol-
ished,” and “ground and polished."

202.8 Misrepresenting products as con-
forming to a standard or specifica-
tion.

202.4 Misuse of the word “Crookes.”

202.5 Deceptive price representations.

202.6 Misrepresentation as to origin and
disclosure of foreign origin.

202.7 Misuse of the term “certified,” etc.

202.8 Misrepresentation as to gold content.

202.9 Guarantees, warranties, etc.

202.10 Defamation of competitors or false
disparagement of their products.

202.11 Consignment distribution.

202.12 Prohibited discrimination.

202.18 Prohibited sales below cost.

202.14 Prohibited forms of trade restraints

(unlawful price fixing, etc.).

AvrHorITY: The provisions of this Part 202
issued under secs. 6, 5, 388 Stat. 721, 719: 15
U.S.C. 46, 45, unless otherwise noted.

Source: The provisions of this Part 202 ap-
pear at 24 F.R. 2952, Apr. 17, 1959, unless
otherwise noted.

159