Approved Code No. 347 — Supplement No. 42 Registry No. 1399—67 NATIONAL RECOVERY ADMINISTRATION SUPPLEMENTARY CODE OF FAIR COMPETITION FOR THE PULP AND PAPER MACHINERY INDUSTRY (A Division of the Machinery and Allied Products Industry) AS APPROVED ON AUGUST 11, 1934 WE DO OUR PART " iTNitED STATES GOVERNMENT PRINTING OFFICE WASHINGTON: 1934 For sale by the Superintendent of Documents, Washington, D.C. Price 3 cents This publication is for sale by the Superintendent of Documents, Government Printing OflBce, Washington, D.C., and by district offices of the Bureau of Foreign and Domestic Commerce. DISTRICT OFFICES OF THE DEPARTMENT OF COIVLMERCE Atlanta, Ga. : 504 Fust Office Building. Birmingham, Ala. : 257 L'ederal Building. Boston, Mass. : 1801 Customhouse. Buffalo, N.Y. : Chamber of Commerce Building. Charleston, S.C. : Ciiamber of Commerce Building. Chicago, 111. : Suite 1706, 201 North Wells Street. Cleveland, Ohio: Chamber of Commerce. Dallas, Tex. : Chamber of Commerce Building. 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Seattle, Wash. : 809 Federal Office Buildins, Approved Code No. 347 — Supplement No. 42 SUPPLEMENTARY CODE OF FAIR COMPETITION FOR THE PULP AND PAPER MACfflNERY INDUSTRY As Approved on August 11, 1934 ORDER Approving Supplementary Code of Fair Competition for the Pulp AND Paper Machinery 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 Indus- trial Recovery Act, approved June 16, 1933, for approval of a Supplemental Code of Fair Competition for the Pulp and Paper Machinery Subdivision of Machinery and Allied Products Industry, and hearing having been 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 President, 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. Hugh S. Johnson, AdirdnistratoT for Industrial Recovery. Approval recommended : Barton W. Murray, Division Administrator. Washington, D.C, Augmt 11, 193If. 79942° 1044-60 34 (1) KEPORT TO THE PRESIDENT The President, The White Hoiise. Sir: This is a report on the Supplemental Code of Fair Compe- tition for the Pulp and Paper JSIachinery Subdivision of Machinery and Allied Products Industry, a public hearing on which was held in Washington, D.C., on May 10, 1934, The hearing was con- ducted in full accordance with the provisions of Title I of the National Industrial Recovery Act. GENERAL STATEMENT The Pulp and Paper Machinery Subdivision, being tnily repre- sentative of the manufacturers of the products defined in Article II of the Supplemental Code, has elected to formulate and submit a Supplemental Code of Fair Competition as provided in the second paragraph of Article I in the Code of Fair Competition for the Machinery and Allied Products Industry, approved by you on the seventeenth day of ISIarch, 1934. The Subdivision includes the manufacture for sale of machinery and equipment used directly in the processing of pulp and paper in pulp mills, paper mills, and paper converting and processing establishments and/or specially designed parts therefor, except paper machines, beaters and jordans and any other machinery and equipment and/or parts thereof produced under the provisions of any other code of fair competition or any other subdivision of this Basic Code heretofore approved, and is intended to include all those engaged in such manufacture for sale. ECONOMIC EFFECT It is estimated that this Subdivision in 1929 employed approxi- mately 1,250 persons. This estimate is based on data contained in National Recovery Administration questionnaires. According to a summary of questionnaires returned by fifteen members of the Subdivision, factory employment declined G0.4 per cent from 1929 to the first quarter of 1933. An increase in employment of 11.4 per cent was noted from June, 1933 to Novem- ber, 1933. Employment in November, 1933 was approximately 35 per cent below the 1929 level. Annual sales of the Subdivision, based on National Recovery Ad- ministration questionnaire returns, fourteen concerns reporting, de- clined from $0,743,000 in 1929 to $2,223,000 in 1933, or 07 per cent. Approximately G4.9 per cent of the v/orkers were employed more than 40 hours per Aveek during a representative week of June 1933. The average work-week declined from 47.5 hours in June 1929 to 43.7 hours in June 1933, and 38.G hours in November, 1933. (2) Man-hours per week declined 45.3 per cent from June, 1929 to November, 1933. The decline from June 1933 to November 1933 was 1.6 per cent. Due to the fact that the Subdivision in November 1933 was operating on an average of 38.6 hours per week, little increase in emplo3anent may be expected as a result of the adoption of a 40-hour week. Approximately 31.5 per cent of the factory workers employed in June, 1933 were receiving less than 40 cents per hour; 28.3 per cent were receiving less than 38 cents per hour; 25.1 per cent were receiving less than 36 cents per hour; and 16.0 per cent were receiv- ing less than 32 cents per hour. Based on the distnbution of hourly rates for June, 1933 the adoption of the minimum wage rates provided by the code will effect a concomitant increase in total pa3^rolls of approximately 6.0 per cent, assuming upward adjust- ment in the brackets below the 40-cent minimum only and no change in man-hour requirements. RESUME OF SUPPLEMETsTAL CODE Article I states the purpose of the Supplemental Code. Article II accurately defines specific terms applicable to the Sub- division as used in this Supplemental Code. Article III provides for the adoption of the emplo^'ment provi- sions of the Code of Fair Competition for the Machinery and Allied Products Industry, as approved by you, and as from time to time amended. Article IV provides for the adoption of Articles II, VI and VIII of the Code of Fair Competition for the Machinery and Allied Products Industry. Article V provides for the establishment of a Code Authority and defines its powers and duties. Article VI provides for an accounting system and methods of cost finding and/or estimating. Article VII provides that no products of the Subdivision shall be sold or offered for sale below a reasonable cost when the Code Authority determines that an emergency exists. Article VIII sets forth trade practices for the Subdivision. Article IX states that no provision of this Supplemental Code relating to pricing and marketing shall apply to export sales. Article X provides that this Supplemental Code and all the provisions thereof are expressly made subject to the right of the President, in accordance with Subsection (b) of Section 10 of the Act, from time to time to cancel or modify any order, approval, license, rule or regulation issued under said Act. Provision is also made that modifications may be submitted by the Code Authority. Article XI provides for the withdrawal of the Subdivision from the jurisdiction of the Basic Code Authority in accordance with the provisions in this Article governing such withdrawal. Article XII. No provision of this Supplemental Code shall be so applied as to permit monopolies, or monopolistic practices, or to eliminate, oppress, or discriminate against small enterprises. Article XIII states the effective date of this Supplemental Code. FINDINGS The Assistant Deputy Administrator in his final report to me on said Supplemental 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 poli- cies 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 organi- zation of industry for the purpose of cooperative action among the trade groups, by inducing and maintaining united action of labor and management under adequate governuiental sanctions and super- vision, by eliminating unfair competitive practices, by promoting the fullest possible utilization of the present productive capacity of industries, 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 emploj's not more than 50,000 employees; and is not classified by me as a major industr}-. (c) The Supplemental Code as approved complies in all respects with the pertinent provisions of said Title of said Act, including v;ithout 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 representative 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 v/ill not per- mit monopolies or monopolistic practices. (e) The Supplemental Code is not designed to and will not elim- inate 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 Supjilemental Code. For these reasons, therefore, I have approved this Supplemental Code. Respectfully, August 11, 1934. Hugh S. Johnson, A dmmistrator. SUPPLEMENTARY CODE OF FAIR COMPETITION FOR THE PULP AND PAPER MACHINERY INDUSTRY A DIVISION OF THE MACHINERY AND ALLIED PKODUCTS INDUSTRY Article I — Purposes To effectuate the policy of Title I of the National Industrial Re- covery Act, the following provisions are established as a Supple- mental Code of Fair Competition for the Pulp and Paper Machinery Subdivision of the Machinery and Allied Products Industry, and together with the Code of Fair Competition for the 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 Pulp and Paper Machinery Association, a trade organization, all members of which are engaged in the manu- facture for sale of the ])roducts of the Pulp and Paper Subdivision of the Machinery and Allied Products Industr5^ " Industry " means the Machineiy and Allied Products Industry, as defined in its Code of Fair Competition as approved by the Pres- ident, and as such definition may from time to time be amended. " Subdivision " means the Pulp and Paper Machinery Subdivision of the Machinery and Allied Products Industry as defined and set forth in Article II of the Code of Fair Competition for the Machinery and Allied Products Industry as follows : " Pulp and Paper Machineiy Subdivision " means the manufac- ture for sale of machinery and equipment used directly in the pro- cessing of pulp and paper in pulp mills, paper mills, and paper converting and processing establishments and/or specially designed parts therefor, except paper machines, beaters and jordans and any other machinerj^ and equipment and/or parts thereof produced under the provisions of any other code of fair competition or any other subdivision of this Basic Code heretofore approved, and is intended to include all those engaged in such manufacture for sale. " Code " means the Code of Fair Competition for the Machinery and Allied Products Industry as approved by the President, 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 anyone who is employed in the Subdivision by any such emj^loyer. (5) "The Act" means Title I of the National Industrial Kecovery Act. " The President " means the President of the United States. " The Administrator " means the Administrator for Industrial Kecovery. " Basic Code Authority " means the Code Authority for the Ma- chinery 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 tliis Supplemental Code. " Group Code Authority " means the Code Authority for any group or product classification within this Subdivision. Article III — E:mploymext 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 — Adoptiox of Other Provisions of Code The following Articles of the Code, viz : Article II, " Definitions "; Article VI, "Administration ", to the extent that they shall be ap- plicable to this Supplemental Code as such or as it may hereafter be administered as an autonomous Code ; and Article VIII, '' Modi- fications and Termination ", are hereby made a part of this Supple- mental 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 Authority, the Board of Directors of the Applicant shall constitute a temporary Code Authority. (c) The applicant shall, by written notice mailed to all employers whose names the applicant has obtained after reasonably diligent search, call a meeting of the emploj^ers to be held within sixty (GO) days after the effective date for the purpose of electing a permanent Code Authority, which shall consist of five (5) members, and for the purpose of adopting procedural rules and regulations for the organi- zation and operation of the permanent Code Authority. Any vacancy on the Code Authority due to death, resignation, or because a member thereof has ceased to be connected with the Sub- division, shall be filled at a meeting of employers called by the Code Authority on at least ten 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. The Administrator may, in his discretion, appoint one additional member (without vote and without expense to the Industry). The permanent Code Authority so elected and appointed shall super- sede the temporary Code Authority. (d) Any employer shall be entitled to vote at the election of the permanent Code Authority and at other meetings of employers and share in the benefits of the activities of Code Authority and may participate in any endeavors of Code Authority in the ])repar- ation of any amendments or revisions of, or additions or supplements to this Supplemental Code by paying or agreeing to pay, as and when assessed his proper pro rata share of the reasonable cost of administering this Supplemental Code as determined by Code Authority. (e) The members of the Permanent Code Authority shall be elected by a majority vote of employers present in person or by proxy. Each employer shall have one vote. The eligibility requirements for such voting shall be as provided in Section (d) of this Article V. This method of voting and the eligibility requirements therefor shall also apply to all other matters, except for additions to, amend- ments, revisions, or supplements to this Supplemental Code, as provided for by Article X of this Supplemental Code, and With- drawal, as provided for by Article XI of this Supplemental Code. (f ) Employers in this Subdivision having a common interest and connnon problems may be grouped by Code Authority for Adminis- trative purposes. There may be a Group Code Authority approved or appointed by Code Authority for each such group. (g) If formal complaint is made to the Code Authority that provisions of this Supplemental Code haA^e 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 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 Com- mittee which shall meet with the Trade Practice Committees ap- pointed under such other Codes as may be related to the Subdivision for the purpose of formulating fair trade practices to govern the relationships between production and distribution employers under this Supplemental 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 methods 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 Section 1. "Wlien the Code Authority determines that an emer- gency exists in this Subdivision and that the cause thereof is destruc- 8 tive 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, such determination to be subject to such notice and hearing as the Administrator may require. The Administration may approve, disapprove, or modify the determi- nation. 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 conditions of sale that the buyer will pay less therefor than the lowest reasonable cost of such products. AVhen it appeai-s that conditions have changed, the Code Author- ity, upon its own initiative or upon the request of any interested party, shall cause the determination to be reviewed. SEcnoN 2. The foregoing Section (1) shall not apply to (a) dropped lines, or (b) seconds, or (c) inventories which must be con- verted into cash to meet emergency needs, all of which may be dis- posed of by any employer at any price and on any terms_ or conditions, but only if such employer, not less than two weeks before such proposed disposal, has filed with Code Authority, a statement in writing setting forth the facts of, and reasons for, such proposed disposal and the price and terms and conditions of sale, and Code Authority has not, (with the approval of the Administrator), before the termination of such two week period, in writing, disapproved the proposed disposal. Notice of such disposal, if not disapproved, shall be sent immediately to all employers manufacturing products of equivalent design, character, quality or specifications, who may sell such products at prices and on terms and conditions as favorable as those stipulated in the proposed disposal, when meeting the com- petition of such proposed disposal. Section 3. The foregoing Section (1) shall not apply to a sale made in order to meet competition on products manufactured out- side the United States. For such disposal, any employer may sell, at prices and on terms and conditions as favorable as those of the competing foreign product, but only if he has first reported to the Code Authority his intention so to sell, and the facts as to the competition which justifies such action. Article VIII — Unfair Trade Practices The following are hereby declared to be unfair trade practices and are violations of this Supplemental Code, viz: 1. No employer of the Subdivision shall secretly offer or make any payment or allowance of a rebate, refund, commission credit, unearned discount or excess allowance, whether in the form of money or otherwise, nor shall an 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 of the Subdivision shall give, permit to be given, or offer to give, anything of value for the purpose of influencing or rewarding the action of any employee, agent, or representative of another in relation to the business of the employer of such employee, the principal of such agent or the represented party, without the knowledge of such employer, principal or party. This provision shall not be construed to prohibit free and general distribution of articles commonly used for advertising except so far as such articles are actually used for commercial bribery as hereinabove defined. 3. No employer of the Subdivision 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 misrepresent any goods (including but without limitation its use, trademark, 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. 4. No emploj^er of the Subdivision shall indulge in destructive price-cutting. Article IX — Sales for Export The provisions of this Supplemental Code concerning pricing and marketing are not to apply to direct export sales of anj^ product, or to any product destined ultimately for export. The term " export " shall include all shipments to all places without the several states of t^ie United States and the District of Columbia; provided, how- ever, that no shipment to any territory or possession of the United States shall be considered an export when any employer is engaged in the industry in such territory or possession. Article X — Modificatioxs (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 x\ct. (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 President. The eligibility requirements for employers for such voting shall be the same as provided by Section (d) of Article V hereof. Article XI — Withdrawal Upon thirty (30) days 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 emploj^ers within the Subdivision entitled to vote thereon, withdraw from the jurisdiction of the Basic Code Authority. The eligibility of voters for such voting shall be in accordance with the provisions of Section d of Article V hereof. After and in the event such with- drawal 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 perform all the functions with respect thereto. 10 Article XII — 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 applied as to oppress or eliminate small enterprises or discriminate against them, and is designed to effectuate the policy of the Act. Article XIII — Effective Date This Supplemental Code shall become effective and binding on all persons engaged in the Subdivision on the eleventh day after its approval by the President. Approved Code No. 347 — Supplement No. 42. • Registry No. 1399-67. O UIJIVERSITY OF FLORIDA ■ lllllll 3 1262 08850 5093