Vulcanized Fiber Industry

16 CFR Part 29 · Trade practice rules · in the Code of Federal Regulations 1938-1959 (4 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 These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.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, 1959 CFR · Earliest edition: 1938 CFR

Text (1959 edition, OCR)

Chapter I—Federal Trade Commission

(5) That nothing contained in this
section shall prevent the meeting in good
faith of an equally low price of a com-
petitor, or the services or facilities fur-
nished by a competitor (see paragraphs
(ec) and (d) of this section).

Nores: (1) Cost justification under the
proviso to this section depends upon net
savings in cost based on all facts relevant to
the transactions under the terms of subpara-
graph (2) of this paragraph. For example,
if a seller regularly grants @ discount based
upon the purchase of a specified quantity by
a single order for a single delivery, and this
discount is justified by cost differences, it
does not follow that the same discount can
be cost justified if granted to a purchaser of
the same quantity by multiple orders or for
multiple deliveries.

(2) In complaint proceedings, justification
of price differentials under subparagraphs
(2), (4) and (5) of this paragraph is a matter
of affirmative defense to be established by the
person or concern charged with price dis-
crimination.

(b) Prohibited brokerage and commis-
sions. 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 intermediary
is acting in fact for or in behalf, or is sub-
ject to the direct or indirect control, of
any party to such transaction other than
the person by whom such compensation
is so granted or paid.

(c) Prohibited advertising or pro-
motional allowances, etc. It is an unfair
trade practice for any member of the in-
dustry engaged in coimmerce to pay or
contract for the payment of advertising
or proinotional allowances or any other
thing of value to or for the benefit of a
customer of such member in the course
of such commerce as compensation or in
consideration for any services or 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
avallable on proportionally equal terms

§ 28.12

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
engaged 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-
nishing, 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.

Nore 1: Illustrative of the type of discrim~-
ination inhibited by this section is the prac-
tice by an industry member, in connection
with the sale of industry products, of servic~
ing or maintaining blueprint or diazotype
reproduction equipment used by a purchaser
of blueprint or diazotype sensitized material
bought for resale, with or without processing,
when such services or maintenance are not
accorded to all competing purchasers on pro-
portionally equal terms. (See also the note
to § 28.11.)

Nore 2: Nothing in paragraph (d) of this
section shall be construed as inhibiting ful-
fillment by an industry member, who is a
manufacturer of reproduction equipment, of
the obligations of expressed or implied war-
ranties attached to the equipment of his
manufacture.

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

(f) Purchases by U. S. Government—
Applicability of Robinson-Patman Anti-
discrimination Act to same. In an opin-
ion subinitted to the Secretary of War
under date of Deceinber 28, 1936, the
U. S. Attorney General advised that the
Robinson-Patman Antidiscrimination
Act “is not applicable to Government
contracts for supplies.” (38 Opinions,
Attorney General 539.)

Part 29——Vulcanized Fiber
Industry [Revoked]

CopiricaTIon: Part 29 was revoked, 19 F. R.
8467, June 12, 1954,

Page 191


§ 29.0

Part 29—Accident and Health
Insurance Industry [Added]

Sec.
29.0 Definitions.
GROUP I
29.1 Deception in general.
29.2 Advertisements of benefits, losses cov-
, ered, or premiums payable.

293 Disclosure as to exceptions, reduc-
tions, and limitations.

29.4 Disclosure of policy provisions relat-
ing to renewability, cancellability,
or termination.

29.5 Method of disclosure of required in-
formation.

29.6 Testimonials.

29.7 Deceptive use of statistics.

29.8 Availability of policy or refund of
premiunis.

29.9 Identification of pian or number of
policies.

29.10 Disparagement.

29.11 Deceptive use of trade names, service
marks, etc.

29.12 Deception as to “group” or “quasl-
group” policies.

29.18 Deception as to introductory, initial,
or special offers.

29.14 Misrepresentation as to approval or
endorsement of advertisements or
policies.

29.15 Misrepresentation as to payment of
claims.

29.16 Misrepresentation concerning the in-
surer.

AUTHORITY: §§ 29.0 to 29.16 issued under
sec. 6, 38 Stat. 721; 15 U.S. C. 46. Interpret
or apply sec. 5, 38 Stat. 719, as amended; 15
U.S. C. 45.

Source: §§ 29.0 to 29,16 appear at 21 F. R.
4228, June 15, 1956.

§ 29.0 Definitions. (a) “Advertise-
ment,” for the purpose of this part, shall
mean any of the following material when
used in connection with solicitation of
the original purchase of a policy, or
renewal or reinstatement thereof:

(1) Any printed and published mate-
rial. and descriptive literature, state-
ments, or depictions of an insurer used
in newspapers, Magazines, radio and TV
scripts or presentations, billboards, and
similar displays; and

(2) Descriptive literature and sales
aids of all kinds issued by an insurer for
presentation to members of the public,
including, but not limited to, circulars,

leafiets, booklets, depictions, illustra-
tions, and forin letters; and
(3) Prepared sales talks, presenta-

tions, and material of all kinds for use
by agents and brokers, and representa-

Page 192

Title 16—Commercial Practices

tions made by agents and brokers in
accordance therewith.

(b) “Policy,” for the purpose of this
part, shall include any policy, plan, cer-
tificate, contract, agreement, statement
of coverage, rider or endorsement, which
provides accident or sickness benefits,
or medical, surgical, or hospital expense
benefits, whether on a cash indemnity,
reimbursement, or service basis, except
when issued in connection with another
kind of insurance other than life, and
except disability and double indemnity
benefits included in life insurance and
annuity contracts.

(c) “Insurer,” for the purpose of this
part, shall include any individual, cor-
poration, association, partnership, re-
ciprocal exchange, inter-insurer, Lloyds,
fraternal benefit society, and any other
legal entity, engaged in the advertise-
ment of a policy as defined in this section.

(d) Agents and brokers: This part
shall also apply to agents and brokers to
the extent that they are responsible for
the advertisement of any policy.

GROUP I

§ 29.1 Deception in general. It is an
unfair trade practice for an insurer to
use, or cause to be used, any advertise-
ment which has the capacity and tend-
ency or effect of misleading or deceiv-
ing purchasers or prospective purchasers.

Nore: Words or phrases, the meaning of
which is clear only by implication or by
familiarity with insurance terminology, are
subject to this section.

§29.2 Advertisements of benefits,
losses covered, or premiums payable.
It is an unfair trade practice for an in-
surer to use, or cause to be used, in any
advertisement, words, phrases, or illus-
trations which mislead or have the
capacity and tendency or effect of mis-
leading or deceiving purchasers or pro-
spective purchasers with respect to any
policy benefit or benefits, loss or losses
covered, or premium or premiums pay-
able,

(a) It is an unfair trade practice for
an insurer to use, or cause to be used,
in any advertisement, words or phrases
such as “all,” “full,” “complete,” “com-
prehensive,” “unlimited,” “This policy
will pay your hospital and surgical bills,”
“This policy will replace your income,’
or words or phrases of similar import in
connection with losses covered or ben-
efits which are subject to exceptions,
reductions, or limitations, unless such