Water Proof Paper Industry (Asphaltic Type)
16 CFR Part 219 · Trade practice rules · in the Code of Federal Regulations 1960-1960 (1 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 These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.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: 1960 CFR
Text (1960 edition, OCR)
§ 21817
essing preparation for marketing, sale
and delivery All elements recognized
by good accounting practice as proper
elements of such cost shall be Included
in determining 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
(c) This section 1s 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 with the
wrongful intent or purpose referred to
and where the effect may be to injure
destroy or prevent competition or tend
to create a monopoly
§ 21817 Prohihited forms of trade re-
straints (unlawful price fixing, ete ) ”
It 1s an unfair trade practice for any
member of the industry either directly
or indirectly to engage in any planned
common course of action or to enter
into or take part in any understanding
agreement combination or conspiracy
with one or more members of the indus-
try or with any other person or persons
to fix or maintain the price of any goods
or otherwise unlawfully to restrain trade
or to use any form of threat imtimida-
tion or coercion to induce any member
of the industry or other person or per-
sons to engage in any such planned com-
mon course of action or to become a
party to any such understanding agree-
ment combination or conspiracy
? The inhibitions of this section are subject
to Public Law 542 approved July 14 1952 66
Stat 632 (the McGuire Act) which provides
that with respect to a commodity which
bears or the label or container of which
bears the trade-mark brand or name of the
producer or distributor of such commodity
and which is in free and open competition
with commodities of the same general class
produced or distributed by others a seller
of such a commodity may enter into a con-
tract or agreement with a buyer thereof
which establishes a minimum or stipulated
price at which such commodity may be resold
by such buyer when such contract or agree-
ment 1s lawful as applied to intrastate trans
actions under the laws of the State Terri-
tory or territoriai jurisdiction in which the
resale is to be made or to which the com-
modity is to be transported for such resale
and when such contract or agreement is not
between manufacturers or between whole-
salers or between brokers or between fac-
tors or between retailers or between persons
firms or corporations in competition with
each other
Page 716
Title 16—Commercial Practices
PART 219—WATERPROOF PAPER
INDUSTRY (ASPHALTIC TYPE)
Sec
2190 Industry definition
Group I
2191 Selling below cost
2192 # False invoicing
2193 Prohibited discrimination
2194 Substitution of products
2195 Push money
2196 False and misleading price quota
tions etc
2197 Deceptive use of trade or corporate
names trade-marks etc
2198 Inducing breach of contract
2199 Defamation of competitors or false
disparagement of their products
21910 Commercial bribery
21911 Procurement of competitors confi-
dential information
21912 Prohibited forms of trade restraints
(unlawful price fixing etc )
21913 Enticing away employees of competi
tors
1914 Deception in marking of industry
products
21915 Misrepresentation as to character of
business
21916 Misrepresenting products as con
forming to standard
21917 Aiding or abetting use of unfair
trade practices
COMMITTEE ON TRADE PRACTICES
219 201 Industry committee
AUTHORITY §§ 2190 to 219 201 issued un
der sec 6 38 Stat 721 150 S C 46 Inter-
pret or apply sec 5 38 Stat 719 as amended
i650 S © 45
Source §§ 2190 to 219201 appear at 19
F R 4019 July 2 1954 except as otherwise
noted
§2190 Industry definition
As used 1n this part the term ‘water-
proof paper” makes reference to sheets
of laminated paper the bond of which 1s
asphalt or an asphaltic compound and
sheets of paper infused or coated with
asphalt or an asphaitic compound
Group I
§2191 Sellimg helow cost
The practice of selling industry prod-
ucts at a price less than the cost thereof
to the seller, with the purpose or intent
and where the effect may be to injure
suppress or stifie competition or tend to
create a Monopoly in the production or
sale of such ploducts 1s an unfair trade
practice As used in this section the
term cost means the total cost to the
seller inciuding the costs of acquisition
Chapter I—Federal Trade Commission
processing, preparation for marketing
sale and delivery
§ 2192 False mvoicmg
(a) Withholdmg from or inserting in
invoices or sales slips any statements or
information by reason of which omission
or insertion a false record 1s made wholly
or in part of the transactions repre-
sented on the face of such invoices or
sales slips with the effect of thereby
misleading or deceiving purchasers pro-
spective purchasers or the consuming
public 1s an unfair trade practice
(b) The practice of delivering prod-
ucts In a number less than called for
on the delivery record or invoice (so-
called short count’) with the capacity
and tendency or effect of thereby mis-
leading or decelving the purchasing or
consuming public 1s an unfair trade
practice
§ 2193 Prohrbited discrimmaton’?
(a) Prohibited discriminatory prices
or rebates refunds, discounts credits,
etc which effect unlawful price discrim-
mation 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 re-
fund discount credit or other form of
price differential effects a discrimina-
tion in price between different pur-
chasers of goods of lke 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 @ monopoly 1n 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 custom-
ers of either of them Provided how-
ever
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
Territory of the United States and any State
Territory or foreign natlon or between any
insular 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 Dis-
trict of Columbia or any foreign nation or
within the District of Columbia or any Ter-
ritory or any insular possession or other place
under the jurisdiction of the United States
§ 2193
(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 only due allowance for dif-
ferences in the cost of manufacture, sale
or dehvery resulting from the differing
methods or quantities 1n which such
commodities are to such purchasers sold
or delivered
NoTeE Spindling of orders This proviso
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 billing as a single
order an aggregate of the amounts of two
or more orders separately delivered when
such price differentlal is not justified by
savings to the seller which make only due
allowance for differences ir the cost of man-
ufacture sale or dellvery resulting from the
differing methods or quantities in which
such products 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 thelr own
customers 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 in response to
changing conditions affecting the mar-
ket for or the marketability of the goods
concerned, such as but not limited to ob-
solescence 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 Itis 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 commus-
slon, brokerage or other compensation
or any allowance or discount in heu
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 interme-
diary 18 acting 1n 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 1s so granted or paid
Page 717
§ 2194
(c) Prohibited advertising or promo-
tional allowances etc It 1s an unfair
trade practice for any member of the in-
dustry engaged in commerce to pay or
contract for the payment of advertising
or promottonal allowances or any other
thing of value to or for the benefit of a
customer of such member in the course
os such commerce as compensation or 1n
consideration for any services or facil-
ties furmshed by or through such cus-
tomer 1n 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 1s
available on proportionally equal terms
to all other customers competing in
the distribution of such products or
commodities
(d) Prohibited discriminatory services
or facilities ~=It 1s 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 fur-
mshing or by contributing to the
furnishing of any services or facilities
connected with the processing handling
sale or offering for sale of such coin-
modity so purchased upon terms not ac-
corded to all competing purchasers on
proportionally equal terms
(e)Inducing or recewing 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 1s prohibited by the fore-
going provisions of this section
(f) Exemptions The inhibitions of
this section shall not apply to purchases
of their supplies for their own use by
schools colleges universities public
hbraries churches hospitals and chari-
table institutions not operated for profit
Notre In complaint proceedings charging
discrimination in price or services or facili-
ties 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 justification shall
be affirmatively shown the Commission is
authorized to issue an order terminating the
discrimination Provided however That
nothing contained in this section shail pre-
vent a seiler rebutting the prima facie case
Page 718
Title 16—Commercial Practices
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 competitor or the services or faciilties
furnished by a competitor See section 2—b
Clayton Act
§ 2194 Substitution of products
The practice of shipping or delivering
products which do not conform to sam-
ples submitted to specifications upon
which the sale 1s consummated, or to
representations made prior to securing
the order without the consent of the
purchasers to such substitutions or
falsely representing the reason for mak-
ing a substitution with the capacity and
tendency or effect of misleading or de-
ceiving the purchasing or consuming
Public is an unfa.r trade practice
Nore Nothing in this section shall be
construed as preventing the application of
such tolerances as are agreed upon between
buyer and seller or are otherwise deemed
reasonable and proper and where no misrep-
resentation or deception of the purchasing
public is practiced or promoted in relation
to the product or its deviation from samples
or specifications
§2195 Pnsh money
It 1s an unfair trade practice for any
industry member to pay or contract to
pay anything of value to a salesperson
employed by a customer of the industry
member as compensation for or as an
inducement to obtain special or greater
effort or service on the part of the sales-
person in promoting the resale of prod-
ucts supphed by the industry member to
the customer—
(a) When the agreement or under-
standing under which the payment or
payments are made or are to be made is
without the knowledge and consent of
the salesperson’s employer or
(bo) When the terms and conditions
of the agreement or understanding are
such that any benefit to the salesperson
or customer is dependent on lottery or
chance or
(c) When any provision of the agree-
ment or understanding requires or con-
templates practices or a course of con-
duct unduly and intentionally hampering
sales of products of competitors of an
industry member, or
(d) When because of the terms and
conditions of the understanding or
agreement including its duration, or the
Chapter I—Federal Trade Commission
attendant circumstances, the effect may
be to substantially lessen competition or
tend to create a monopoly or
(e) When similar payments are not
accorded to sales persons of competing
customers on proportionally equal terms
in compliance with section 2 (d) and (e)
of the Clayton Act
NOTE Payments made by an industry
member to a salesperson of a customer under
any agreement or understanding that all or
any part of such payments is to be trans-
ferred by the salesperson to the customer or
is to result in a corresponding decrease in the
salesperson s salary are not to be considered
within the purview of this section 5 but are
to be considered as subject to the require-
ments and provislons of section 2 (a) of the
Clayton Act
§ 2196 False and misleading price quo-
tations, etc
The publishing or circulating by any
member of the industry of false or mis-~
leading price quotations price lists or
terms or conditions of sale with the
capacity and tendency or effect of there-
by musleading or deceiving purchasers
or prospective purchasers 1s an unfair
trade practice
[24FR 4327 May 29 1959]
§ 2197 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 decelv-
ing the purchasing or consuming public
as to the name nature or origin of any
product of the industry or of any ma-~
terial used therein or which 1s false or
misleading in any other respect, is an
unfair trade practice
§ 2198 Indueimg breach of contract
(a) Knowmely inducing or attempting
to induce the breach of existing lawful
contracts between competitors and their
customers or their suppliers or interfer~
ing with or obstructing the performance
of any such contractual duties or serv~
ices under any circumstance having the
capacity and tendency or effect of sub-
stantially mjyuring or lessening present
or potential competition, 1s an unfair
trade practice
(b) Nothing 1n this section is intended
to imply that 1t is mproper for any in-~
dustry member to solicit the business
of a customer of a competing industry
§ 21911
member, nor is the section to be con-
strued as in anywise authorizing any
agreement, understanding or planned
common course of action by two or more
industry members not to solicit business
from the customers of either of them or
from customers of any other industry
member
§ 2199 Defamation of competitors or
false disparagement of their prod-
ucts
It 1s an unfair trade practice—
(a) To defame competitors by falsely
imputing to them dishonorable conduct,
inability to perform contracts question-
able credit standing, or by other false
representations, or
(b) To falsely disparage a competi-
tors products business methods selling
prices values credit terms policies, or
services
§ 21910 Commercial bribery
It 1s an unfair trade practice for a
member of the industry directly or m-
directly, to give or offer to give, or permit
or cause to be given money or anything
of value to agents employees or repre-
sentatives of customers or prospective
customers or to agents employees or
representatives of competitors’ cus-
tomers or prospective customers with-
out the knowledge of their employers
or principals as an inducement to
influence ther employers or prin-
cipals to purchase or contract to pur-
chase products manufactured or sold
by such industry member or the maker
of such gift or offer or to influence such
employers or principals to refraln from
dealing in the products of competitors
or from dealing or contracting to deal
with competitors
§ 21911 Procurement of competitors?
confidential nformation
It 1s an unfair trade practice for
any member of the industry to ob-
tain information concerning the busi-
ness of a competitor by bribery of
an employee or agent of such com-
petitor, by false or misleading state-
ments or representations by the umper-
sonation of one in authority or by any
other unfair means and to use the infor-
mation so obtained in such manner as to
injure said competitor mm his business or
to suppress competition or unreasonably
restrain trade
Page 719
§ 21912
§ 21912 Prolubited forms of trade re
straints (nnlawful price fixing, ete ) ?
It 1s an unfair trade practice for any
member of the industry either directly
or indirectly to engage in any planned
common course of action or to enter
into or take part in any understanding
agreement combination or conspiracy,
with one or more members of the indus-
try or with any other person or persons
to fix or maintain the price of any goods
or otherwise unlawfully to restrain trade,
or to use any form of threat intimida~
tion or coercion to induce any member
of the mdustry or other person or per-
sons to engage 1n any such planned com-
mon course of action or to become a
party to any such understanding agree-
ment combination or conspiracy
§ 21913 Enticmg away employees of
competitors
It 1s an unfair trade piactice for
any member of the industry willfully
to entice away employees or sales
representatives of competitors with the
intent and effect of thereby unduly
hampering or injuring competitors in
their business and destroying or sub-
stantially lessening competition Pro-
vided That nothing 1n this section shall
be construed as prohibiting employees
from seeking more favorable employ-
ment or as prohibiting employers from
hiring or offermmg employment to em-
ployees of competitors in good faith and
not solely for the purpose of inflicting
injury on a competitor
?The inhibitions of this section are sub-
ject to Public Law 542 approved July 14
1952 66 Stat 632 (the McGuire Act) which
provides that with respect to a commodity
which bears or the label or container of
which bears the trade-mark brand or name
of the producer or distributor of such com-
modity and which ts In free and open compe-
tition with commodities of the same general
class produced or distributed by others a
seller of such a commodity may enter into
a contract or agreement with a buyer thereof
which establishes a minimum or stipuiated
price at which such commodity may he re-
sold by such buyer when such contract or
agreement is lawful as applied to intrastate
transactions under the laws of the State
Territory or territorial Jurisdiction in which
the resale {s to be made or to which the
commodity is to be transported for such re-
sale and when such contract or agreement
is not between manufacturers or between
wholesalers or between brokers or between
factors or between retailers or between per-
sons firms or corporations in competition
with each other
Page 720
Title 16—Commercial Practices
§ 21914 Deception m markmg of m
dnstry prodnets
It 1s an unfair trade practice to
make or publish or cause to be made
or published in trade promotional
literature in advertising in the form
of a label or marking on an indus-
try product or otherwise any statement
or representation which directly or by
reason of concealment of material fact
has the capacity and tendency or effect
of misleading or deceiving purchasers
or prospective purchasers concerning the
grade quahty use size composition and
finish strength thickness origin prep-
aration manufacture or distribution of
any product of the industry or which
has the capacity and tendency or effect
of misleading or deceiving purchasers
or prospective purchasers in any other
material respect
§ 21915 Miusrepresentation as to char-
acter of business
It 1s an unfair trade practice for
any industry member in the course
of or mm connection with the distribu-
tion of industry products, to rep-
lesent directly or indirectly that he 1s
a manufacturer of industry products or
that he owns or controls a factory mak-
ing such products when such 1s not the
fact or in any other manner to muis-
represent the character extent or type
of his busmess
§ 21916 Mhusrepresenting products as
conforming to standard
Representmg through advertising
personal solicitation or otherwise, that
any product of the industry conforms to
a standard recognized in or applicable to
the industry when such 1s not the fact
ls an unfair trade practice
§ 21917 Aiding or abctting use of un-
fair trade practices
It 1s an unfair trade practice for any
person firm or corporation to aid abet
coerce or induce another directly or in-
directly to use or promote the use of
any unfair trade practice specified in
the foregoing sections 1n this part
COMMITTEE ON TRADE PRACTICES
§ 219 201 Industry committee
The provisions of § 161 of this sub-
chapter shall be applicable to an in-
dustry committee established under this
part
[21 FR 1174 Feb 21 1956]
Chapter I—Federal
PART 220—LIBRARY BINDING
INDUSTRY
Sec
2200 Industry definition
Group I
2201 Deception (general)
2202 #Guarantees and warranties
2203 Other deception
2204 Deceptive representations as to prod-
ucts conforming to a standard or
specification
2205 Fictitious prices price lists ete
2206 Selling below cost
2207 Defamation of competitors or false
disparagement of their products
2208 Enticing away employees of competi-
tors
2209 Commercial bribery
22010 Procurement of competitors confi-
dential information
22011 Unlawful interference with competi-
tors purchases or sales
22012 Arrangements to exclude sale of com-
petitors products
22013 Tie-in sales coercing purchase of
one product as a prerequisite to
the purchase of other products
22014 Unfair threats of infringement suits
22015 Inducing breach of contract
22016 Prohibited forms of trade restraints
(unlawful price fixing etc )
22017 Prohibited discrimination
22018 Aiding or abetting unfair trade prac-
tices
AvrHoRITY §§ 2200 to 22018 issued under
sec 6 38 Stat 721 15U S C 46 Interpret
or apply sec 5 38 Stat 719 as amended 15
USC 45
Sousce §§ 2200 to 220 18 appear at 19 F BR.
5310 Aug 20 1954
§ 2200 Industry definition
Members of this industry are those
persons, firms corporations and organ-
izations engaged in the business of re-
binding and prebinding of books period-
icals and other documents especially
for use in public and private hbraries
GROUPTI
§ 2201 Deception (geueral)
It is an unfair trade practice for any
industry member to use or cause or
promote the use of any advertising mat-
ter guarantee warranty trade promo-
tional literature mark brand label or
other representation however d.issemi-
nated or published, which has the
capacity and tendency or effect of muis-
leading or deceiving purchasers pro-
spective purchasers or the consuming
public with respect to the grade quality,
conformity to a trade standard material,
composition construction fabrication
46018—-60-—_—47
Trade Commission § 2201
manufacture distribution origin, or
price or terms of sale, of library binding,
or which 1s false, misleading, or decep-
tive in any other material respect
Among the various deceptive practices
inhibited by the paragraph above are the
following
(a) Muisrepresentation as to character
of buseness It is an unfair trade prac-
tice for any member of the industry to
represent directly or indirectly through
the use of any word or term in his cor-
porate or trade name 1n his advertising
or otherwise, that he 1s a library binder
or that he 1s the owner or operator of
a library bindery, when such 1s not the
fact or in any other manner to misrep-
resent the character, extent, volume, or
type of his business
(b) Use of the word “free’ In con-
nection with the sale, offering for sale, or
distribution of industry products, 1t is an
unfair trade practice to use the word
“free’ or any other word or words of
similar import, in advertisements or in
other offers to the public, as descriptive
of an article of merchandise, or service,
which 1s not an unconditional gift under
the foliowing circumstances
(1) When all the conditions oblga-
tions, or other prerequisites to the re-
ceipt and retention of the free article
of merchandise or service offered are not
ciearly and conspicuously set forth at
the outset so as to leave no reasonable
probability that the terms of the offer
will be misunderstood and regardless of
such disciosure
(2) When with respect to any article
of merchandise required to be purchased
in order to obtain the “free’ articie or
service the offerer (1) increases the or-
dinary and usual price of such article of
merchandise or (1i) reduces its quality
or (111) reduces the quantity or size
thereof
Notre The disclosure required by subsec-
tion b (1) of this section shal! appear in close
conjunction with the word free (or other
word or words of similar import) wherever
such word first appears in each advertise-
ment or offer A disclosure in the form of a
footnote to which reference is made by use
of an asterisk or other symbol placed next to
the word free will not be regarded as
compliance
(ec) Misbranding of lubrary binding
The false or deceptive marking, brand-
ing or labeling of any library binding
with respect to the grade, quality, use,
effect, purpose, material, conformity to
Page 721