V Approved Code No. 347 — Supplement No. 9 Registry No. 1321—01 NATIONAL RECOVERY ADMINISTRATION SUPPLEMENTARY CODE OF FAIR COMPETITION FOR THE DIAMOND CORE DRILL MANUFACTURING INDUSTRY (A Division of the Machinery and Allied Products Industry) AS APPROVED ON MAY 31, 1934 WE DO OUR PART UNIV. OF FL Lit. DOCUMENTS PEPT. , ,>■. U.S. DEPOSITORY UNITED STATES GOVERNMENT PRINTING OFFICE WASHINGTON: 1934 For sale by the Superintendent of Documents, Washington, D.C. --- Price 5 cents This publication is for sale by the Superintendent of Documents, Government Printing Office, Washington, D.C., and by district offices of the Bureau of Foreign and Domestic Commerce. DISTRICT OFFICES OF THE DEPARTMENT OF COMMERCE Atlanta, Ga. : 504 Post Office Building. Birmingham, Ala. : 257 Federal Building. Boston, Mass. : 1801 Customhouse. Buffalo, N.Y. : Chamber of Commerce Building. Charleston, S.C. : Chamber of Commerce Building. Chicago, 111. : Suite 1706, 201 North Wells Street. 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Approved Code No. 347 — Supplement No. 9 SUPPLEMENTARY CODE OF FAIR COMPETITION m FOR THE DIAMOND CORE DRILL MANUFACTURING INDUSTRY As Approved on May 31, 1934 ORDER Approving Supplementary Code of Fair Competition for the Diamond Core Drill Manufacturing Industry, a Division of the Machinery and Allied Products Industry An application having been duly made pursuant to and in full compliance with the provisions of title I of the National Industrial Recovery Act, approved June 16, 1933, for approval of a Supple- mental Code of Fair Competition for the Diamond Core Drill Manu- facturing Subdivision of Machinery and Allied Products Industry, and hearings having been duly held thereon and the annexed report on said Supplemental Code containing findings with respect thereto, having been made and directed to the President : NOW, THEREFORE, on behalf of the President of the United States, I, Hugh S. Johnson, Administrator for Industrial Recovery, pursuant to authority vested in me by Executive Orders of the Pres- ident, including Executive Order No. 6543-A, dated December 30, 1933, and otherwise ; do hereby incorporate by reference said annexed report and do find that said Supplemental Code complies in all respects with the pertinent provisions and will promote the policy and purposes of said Title of said Act; and do hereby order that said Supplemental Code of Fair Competition be and it is hereby approved subject to the following conditions : # - 1. That the provisions of Article VIII, Section (a) insofar as they prescribe a waiting period between the filing with the Code Authority (or such agency as may be designated in the Supplemental Code) and the effective date of price lists, as originally filed and/or revised price lists or revised terms and conditions of sale, be and they hereby are stayed pending my further order. 2. That the provisions of Article VIII, Section (e) be and they hereby are stayed, pending the submission of satisfactory evidence concerning distribution of the products of the Subdivision to the Administrator. Hugh S. Johnson, Administrator for Industrial Recovery. Approval recommended: A. R. Glancy, Division Administrator. Washington, D.C., May SI, 1934 64003° 657-1 34 (1) REPORT TO THE PRESIDENT The President, The White House. Sir: This is a report on the Supplemental Code of Fair Compe- tition for the Diamond Core Drill Manufacturing Subdivision of the Machinery and Allied Products Industry, public hearing having been conducted thereon in Washington, D.C., December 21, 1933, in accordance with the provisions of Title I of the National Indus- trial Recovery Act. Every person who filed a request for an appear- ance was freely heard and all statutory and regulatory requirements were complied with. GENERAL STATEMENT The Diamond Core Drill Manufacturers Association, being truly representative of this Subdivision of the Machinery and Allied Products Industry, has elected to avail itself of the option of sub- mitting a Supplemental Code of Fair Competition, as provided in Paragraph (2) Article I of the Basic Code for the Machinery and Allied Products Industry, approved by you on the seventeenth day of March 1934. This Subdivision represents a part of the capital goods industry, manufacturing and selling diamond core drills, supplies, fittings, equipment and parts thereof. ECONOMIC EFFECT This Subdivision, in 1929 employed approximately 220 persons, including office workers. Employment of factory workers, esti- mated to be 176 in 1929, declined to approximately 72 in October 1933, or 59%. Annual sales of the Subdivision, based on estimates furnished by the Diamond Core Drill Manufacturers Association, declined from $1,450,000 in 1929 to $175,000 in 1932, or 88%. Sales amounting to $130,000 for the first seven months of 1933 point to a probable in- crease in business in 1933 over the 1932 level, if the present monthly rate continues. Approximately 92% of the workers were working more than 40 hours per week as of June 15, 1933. The average work-week de- clined from 50.9 hours in 1929 to 33.7 hours in October 1933. Estimated average man-hours per week declined from 8,958 in 1929 to 2,426 in October, 1933, or 73%-. Unless there is a further increase in man-hour requirements, the adoption of the 40 hour week is not expected to cause additional employment in this Subdivision. Summarized National Recovery Administration questionnaire re- turns show that, as of October 15, 1933, the lowest minimum wage (2) paid by one or more establishments of this Subdivision ranged be- tween 40 cents and 45 cents per hour. The adoption of the minimum wage rates therefore, will not cause an increase in the payroll of the Subdivision, based on the adjustment of hourly rates which fall below the minimum rate provided in the Code, employment remain- ing the same. RESUME OF SUPPLEMENTAL CODE Article I states the purpose of the Supplemental Code. Article II accurately defines specific terms employed in the Sup- plemental Code. Article III. The labor provisions of the Basic Code for the Ma- chinery and Allied Products Industry as approved March 17, 1934, are incorporated by reference as the labor provisions of this Supple- mental Code. Article IV adopts the relevant portions of Article II " Defini- tions " and Article VI "Administration "; and Articles VIII " Modi- fications and Termination ", and IX " Withdrawal " of the Basic Code for the Machinery and Allied Products Industry, as approved March 17, 1934. Article V establishes a Code Authority consisting of five mem- bers. The Administrator may, in his discretion, appoint one addi- tional member (without vote and without expense to the Subdivi- sion). Together with the applicable provisions of the Basic Code, mechanism is provided for the administration of this Supplemental Code. Article VI provides for an accounting system and methods of cost finding and/or estimating. Article VII provides that when an emergency exists in this Subdi- vision and that the cause thereof is destructive price-cutting such as to render ineffective or seriously endanger the maintenance of the provisions of this Supplemental Code, the Code Authority may cause to be determined the lowest reasonable cost of the products of this Subdivision. The Administrator may approve, disapprove or modify the determination. Article VIII provides methods of setting up and revising price lists. Article IX sets forth the unfair trade practices which have been especially designed to restrain unfair competition in this Subdivision. Article X defines export territory and provides that filed prices are not applicable to export shipments. Article XI contains the mandatory provisions contained in Sec- tion 10 (b) of the Act and also provides for the submission of proposed amendments to the Supplemental Code. Article XII provides for the withdrawal of this Subdivision from jurisdiction of the Basic Code and for the continued functioning of this Subdivision as an individual industry under its own Code. Article XIII stipulates that there shall be no inequitable restric- tions and provides against monopolies. Article XIV gives the effective date of this Supplemental Code. FINDINGS The Deputy Administrator in his final report to me on said Supple- mental Code having found as herein set forth and on the basis of all the proceedings in this matter : I find that: (a) Said Supplemental Code is well designed to promote the policies and purposes of Title I of the National Industrial Recovery Act, including removal of obstructions to the free flow of interstate and foreign commerce which tend to diminish the amount thereof and will provide for the general welfare by promoting the organiza- tion of industry for the purpose of cooperative action among the trade groups by inducing and maintaining united action of labor and management under adequate governmental sanctions and super- vision, by eliminating unfair competitive practices, by promoting the fullest possible utilization of the present productive capacity of in- dustries, by avoiding undue restriction of production (except as may be temporarily required), by increasing the consumption of industrial and agricultural products through increasing purchasing power, by reducing and relieving unemployment, by improving standards of labor, and by otherwise rehabilitating industry. (b) Said Subdivision normally employs not more than 50,000 employees; and is not classified by me as a major industry. (c) The Supplemental Code as approved complies in all respects with the pertinent provisions of said Title of said Act, including without limitation Subsection (a) of Section 3, Subsection (a) of Section 7, and Subsection (b) of Section 10 thereof; and that the applicant association is an industrial association truly representa- tive of the aforesaid Subdivision; and that said association imposes no inequitable restrictions on admission to membership therein. (d) The Supplemental Code is not designed to and will not per- mit monopolies or monopolistic practices. (e) The Supplemental Code is not designed to and will not elimi- nate or oppress small enterprises and will not operate to discrimi- nate against them. (f) Those engaged in other steps of the economic process have not been deprived of the right to be heard prior to approval of said Supplemental Code. For these reasons, therefore, I have approved this Supplemental Code, provided that certain provisions relating to price publica- tion are stayed and that the provisions of Article VIII Section (e) are stayed, as stated in the Order. Respectfully, Hugh S. Johnson, A dministrator. May 31, 1934. SUPPLEMENTARY CODE OF FAIR COMPETITION FOR THE DIAMOND CORE DRILL MANUFACTURING IN- DUSTRY, A DIVISION OF THE MACHINERY AND ALLIED PRODUCTS INDUSTRY Article I — Purposes To effectuate the policy of Title I of the National Industrial Recov- ery Act, the following provisions are established as a Supplemental Code for the Diamond Core Drill Manufacturing Subdivision of the Machinery and Allied Products Industry, and together with the Code of Fair Competition for Machinery and Allied Products Industry, shall be the standard of fair competition for this Subdivision, and shall be binding on every employer therein. Article II — Definitions "Applicant " means the Diamond Core Drill Manufacturers' Asso- ciation, a trade organization which organization is truly represen- tative of this Subdivision, all members of which are engaged in the manufacture for sale of the products of the Diamond Core Drill Manufacturing Subdivision of the Machinery and Allied Products Industry. " Industry " means the Machinery and Allied Products Industry, as defined in its National Industrial Recovery Code as approved by the President, and as such definition may from time to time be amended. " Subdivision " means the Diamond Core Drill Manufacturing Subdivision of the Machinery and Allied Products Industry as defined and set forth in paragraph 9, Article II of the National Industrial Recovery Code of the Machinery and Allied Products Industry as follows: " Diamond core drill manufacturing subdivision means the manu- facture for sale of diamond core drills, supplies, fittings, equipment, and parts thereof, and includes all those engaged in such manufac- ture for sale." " Code " means the National Industrial Recovery Code of the Machinery and Allied Products Industry as approved by the Presi- dent, March 17, 1934, and as from time to time amended. " Person " means a natural person, a partnership, a corporation, an association, a trust, a trustee, a trustee in bankruptcy, a receiver or other entity. " Employer " means any person engaged in this Subdivision either on his own behalf or as an employer of labor. " Employee " means any one who is employed in the Subdivision by any such Employer. " The Act " means Title I of the National Industrial Recovery Act. (5) " The President " means the President of the United States. " The Administrator " means the Administrator for Industrial Recovery. " Basic Code Authority " means the Code Authority for the Machinery and Allied Products Industry as constituted by the Code. " Code Authority " means the Code Authority constituted for this Subdivision as provided by the Code and by this Supplemental Code. " Group Code Authority " means the Code Authority for any group or product classification within this Subdivision. " Publish " means to make available to the public. Article III — Employment Provisions The following Articles of the Code, viz: Article III, "Working Hours " ; Article IV, " Wages " ; # and Article V, " General Labor Provisions " are hereby made a part of this Supplemental Code, with the same effect as if they were written into this Supplemental Code. Article IV — Adoption of Other Provisions of Code The following Articles of the Code, viz : Article II, " Defini- tions " ; Article VI, "Administration ", to the extent that they shall be applicable to this Supplemental Code as such or as it may here- after be administered as an autonomous Code ; Article VIII, Modi- fications and Termination " ; and Article IX, " Withdrawal ", are hereby made a part of this Supplemental Code, with the same effect as if they were written into this Supplemental Code. Article V — Administration (a) A Code Authority for this Subdivision is hereby constituted to administer, supervise and facilitate the enforcement of the Code and of this Supplemental Code in the manner and to the extent pro- vided in the Code and in this Supplemental Code. (b) During a period not to exceed sixty (60) days following the effective date and pending the election of the permanent Code Au- thority, the Executive Committee of the Applicant shall constitute a temporary Code Authority. (c) The Applicant shall, by written notice mailed to all employers known to the Applicant, call a meeting of employers to be held with- in sixty (60) days after the effective date for the purpose of adopt- ing procedural rules and regulations for the election, organization and operation of the permanent Code Authority and electing a per- manent Code Authority which shall consist of five (5) members, The Administrator, in his discretion, may appoint one additional member (without vote and without expense to the subdivision). The permanent Code Authority so elected and appointed shall super- sede the temporary Code Authority. (d) 1. It being found necessary, in order to support the adminis- tration of this Supplemental Code and to maintain the standards of Fair Competition established by this Supplemental Code and to effectuate the policy of the Act, the Code Authority is authorized, subject to the approval of the Administrator: (a) To incur such reasonable obligations as are necessary and proper for the foregoing purposes and to meet such obligations out of funds which may be raised as hereinafter provided and which shall be held in trust for the purposes of the Supplemental Code; (b) To submit to the Administrator for his approval, subject to such notice and opportunity to be heard as he may deem necessary, (1) An itemized budget of its estimated expenses for the foregoing purposes, and (2) an equitable basis upon which the funds necessary to support such budget shall be contributed by members of the Sub- division; (c) After such budget and basis of contributions have been ap- proved by the Administrator, to determine and secure equitable con- tribution as above set forth by all employers of the Subdivision, and to that end, if necessary, to institute legal proceedings therefor in its own name. 2. Only employers of the Subdivision complying with the Supple- mental Code and contributing to the expenses of its administration, as provided in Section 1 hereof, shall be entitled to participate in the selection of the members of the Code Authority, or to receive the benefit of its voluntary activities or to make use of any emblem or insignia of the National Recovery Administration. (e) Action by employers in any Subdivision meeting for the election of Code Authority shall be by vote of the employers en- titled to vote as provided in Section (d) of this Article V, each such employer to have one vote only. Action by employers in any Sub- division meeting for the adoption of procedural rules, revisions or additions to the Supplemental Code, or the transaction of other business of the Subdivision under this Supplemental Code, shall be by vote of the employers in the Subdivision who are entitled to vote thereat as provided in Section (d), Article V of the Supple- mental Code and are present in person or by proxy duly executed and filed with Code Authority; cast and computed in the manner provided in Section (d) Article VI of the Code. All questions as to the number of votes which each employer shall be entitled to cast at any meeting of employers other than the meeting held to vote for the election of the permanent Code Authority shall be determined by Code Authority, in accordance with Section (d) Article VI of the Code. Any vacancy on the Code Authority due to death, resignation, or because a member thereof has ceased to be connected with this Sub- division, shall be filled at a meeting of employers called by the Code Authority on at least ten (10) days notice by registered mail, sent to all employers in this Subdivision and by a vote similar to the vote by which the retired member was originally selected. (f ) Employers in this Subdivision having a common interest and common problems may be grouped by Code Authority for adminis- trative purposes. There shall be a Group Code Authority approved or appointed by Code Authority for each such group. (g) If formal complaint is made to Code Authority that provi- sions of this Supplemental Code have been violated by any employer, Code Authority or the proper Group Code Authority may to the extent permitted by the Act, cause such investigation or audit to be made, as may be deemed necessary. If such investigation is made by 8 Group Code Authority it shall report the result of such investigation or audit to Code Authority for action. (h) The Code Authority may appoint a Trade Practice Commit- tee which shall meet with the Trade Practice Committees appointed under such other Codes as may be related to the Subdivision for the purpose of formulating fair trade practices to govern the relation- ships between production and distribution employers under this Sup- plemental Code and under such others to the extent that such fair trade practices may be proposed to the Administrator as amendments to this Supplemental Code and such other codes. Article VI — Accounting and Costing The Code Authority shall cause to be formulated an accounting system and methods of cost finding and/or estimating capable of use by all employers of the Subdivision. After such system and meth- ods have been formulated, full details concerning them shall be made available to all employers. Thereafter all employers shall determine and/or estimate costs in accordance with the principles of such methods. Article VII — Selling Below Reasonable Cost When the Code Authority determines that an emergency exists in this Subdivision and that the cause thereof is destructive price- cutting such as to render ineffective or seriously endanger the main- tenance of the provisions of this Supplemental Code, the Code Au- thority may cause to be determined the lowest reasonable cost of the products of this Subdivision, such determination to be subject to such notice and hearing as the Administrator may require. The Ad- ministrator may approve, disapprove, or modify the determination. Thereafter, during the period of the emergency, it shall be an unfair trade practice for any employer of the Subdivision to sell or offer to sell any products of the Subdivision for which the lowest reasonable cost has been determined, at such prices or upon such terms or condi- tions of sale that the buyer will pay less therefor than the lowest reasonable cost of such products. When it appears that conditions have changed, the Code Au- thority, upon its own initiative or upon the request of any interested party, shall cause the determination to be reviewed. Article VIII — Price Lists (a) If and when Code Authority determines that in any group of the Subdivision it has been the generally recognized practice to sell a specified product on the basis of net price lists, or price lists with discount sheets, and fixed terms of sale and payment, each em- ployer engaged in the manufacture of such product, shall, within ten (10) days after notice of such determination, file with Code Au- thority a net price list, or a price list with discount sheet, as the case may be. individually prepared by him showing his current prices, or prices and discounts, and terms of sale and payment for such speci- fied product, and Code Authority shall immediately publish and send copies thereof to all known employers who are cooperating under this Supplemental Code as described in Article V (d) and engaged in the manufacture of such specified products. Revised price lists and/or discount sheets and/or terms of sale and payment may be filed from time to time thereafter with the Code Authority by any such employer, to become operative upon the date specified therein, but such revised price lists and/or dis- count sheets and/or terms of sale and payment shall be filed with the Code Authority ten (10) days in advance of the operative date. Copies thereof, with notice of the operative date specified, shall be immediately published and sent to all employers cooperating under this Supplemental Code as described in Article V (d), any of whom may file, if he so desires, revisions of his price lists and/or discount sheets and/or terms of sale and payment, which shall become effec- tive upon the date when the revised price list and/or discount sheet and/or terms of sale and payment first filed shall go into effect. 1 (b) If and when Code Authority shall determine that in any group of the Subdivision not now selling its product on the basis of price lists, with or without discount sheets, with fixed terms of sale and pa3mient, the distribution or marketing conditions in the group are the same as, or similar to, the distribution or marketing conditions in a group where the use of price lists, with or without discount sheets and fixed terms of sale and payment is well recog- nized, and that a system of selling on net price lists or price lists and discount sheets with fixed terms of sale and payment for such spec- ified product should be put into effect in such group, then each em- ployer in such group shall within twenty (20) days after notice of such determination, file with Code Authority net price lists or price lists and discount sheets, with fixed terms of sale and payment, show- ing his prices and discounts and terms of sale and payment, and such price lists ancl/or discount sheets and/or terms of sale and pay- ment may be thereafter revised in the manner hereinbefore pro- vided. Provided that Code Authority shall make no determination, to place any product of the Subdivision (not now on a price list basis) on a price list basis, as provided in this Section unless affirma- tive consent to such determination is given by a 66%% vote of employers who are at that time cooperating under this Supple- mental Code as described in Article V (d), and are engaged in man- ufacturing such product. The eligibility requirements, method, and effect of such voting shall be the same as is provided by Article V. (c) Code Authority for the purpose of determining the lowest rea- sonable cost, shall, to the extent permitted by the Act, have power, on its own initiative, or on the complaint of any employer, to investi- gate any price or the terms of sale and payment for any product, and, for the purpose of the investigation thereof, to require such employer to furnish such information concerning the cost of manu- facturing and selling such product as Code Authority shall deem necessary or proper for such purpose, and as the Act may allow. (d) No employer shall sell directly or indirectly by any means whatsoever, any product of the Subdivision covered by provisions of this Article VIII at a price or at discounts or on terms of sale 1 See paragraph 2 (1) of order approving tLis Code. 10 and payment, different from those provided in his own current net price lists or price lists and discount sheets, and terms of sale and payment. (e) No emploj^er shall sell to or through any distributor who does not agree to resell in accordance with the provisions of Article VIII. 2 Article IX — Trade Practices 1. No employer shall secretly offer or make any payment or allow- ance of a rebate, refund, commission, credit, unearned discount or excess allowance whether in the form of money or otherwise, nor shall any employer of the Subdivision secretly offer or extend to any customer any special service or privilege not extended to all customers of the same class, for the purpose of influencing a sale. 2. No employer shall publish advertising (whether printed, radio, display or of any other nature), which is misleading or inaccurate in any material particular, nor shall any member in any way misrep- resent any goods (including but without limitation its use, trade- mark, grade, quality, quantity, origin, size, substance, character, nature, finish, material, content or preparation) or credit terms, values, policies, services, or the nature or form of the business) conducted. 3. No employer shall publish or circulate unjustified or unwar- ranted threats of legal proceedings which tend to or have the effect of harrassing competitors or intimidating their customers. 4. No employer shall engage in destructive price cutting. Article X — Sales for Export The provisions of this Supplemental Code concerning pricing and marketing shall not apply to direct export sales of any product. A similar exemption may be granted by the Code Authority as to sales of any product destined ultimately for export. Unless other- wise determined by the Code Authority the term " export " shall include all shipments to all places without the several states of the United States and the District of Columbia; provided, however, that no shipment to any territory or possession of the United States shall be considered an export when any employer is engaged in the Subdivision in such territory or possession. Article XI — Modifications (a) As provided by Section 10 (b) of the Act, the President may from time to time cancel or modify any order, approval, license, rule or regulation issued under Title I of the Act. (b) Any amendments, additions, revisions, or supplements of this Supplemental Code, proposed by Code Authority, and authorized by the affirmative vote of 66%% of the employers shall be in full force and effect upon approval by the Administrator. The eli- gibility requirements, method and effect of such voting shall be the same as provided by Article V hereof. 2 See paragraph 2 (2) of order approving this Code. 11 Article XII — Withdrawal Upon thirty clays notice to the Basic Code Authority and to the Administrator, this Subdivision may, upon the concurring affirmative vote of employers, within the said Subdivision entitled to cast two- thirds or more of all the votes that might be cast by all employers within the Subdivision entitled to vote thereon, withdraw from the jurisdiction of the Basic Code Authority. The eligibility of voters and the method and effect of such voting shall be in accordance with the provisions of Article V hereof. After and in the event such withdrawal is accomplished this Supplemental Code, together with the provisions of the Code shall become and be the sole code governing this Subdivision, and the Code Authority shall for this Subdivision, become and be the sole Code Authority and shall per- form all the functions with respect thereto. Article XIII — Monopolies Applicant imposes and shall impose no inequitable restrictions on membership therein. The Supplemental Code presented by it is not designed to promote monopoly, and shall not be so construed or ap- plied as to oppress or eliminate small enterprises or discriminate against them, and is designed to effectuate the policy of the Act. Article XIV — Effective Date This Supplemental Code shall become effective and binding on all persons engaged in the Subdivision on the eleventh day after its approval. Approved Code No. 347. Supplement No. 9. Registry No. 1321-01. O UNIVERSITY OF FLORIDA 3 1262 08850 5192