Approved Code No. 487-Supplement No.2 Registry No. 246-01 

NATIONAL RECOVERY ADMINISTRATION 

SUPPLEMENTARY 

CODE OF FAIR COMPETITION 

FOR THE 

LINEN IMPORTING TRADE 

(A Division of the Importing Trade) 

AS APPROVED ON NOVEMBER 22, 1934 

WE DO OUR PART 

UNITED STATES 

GOVERNMENT PRINTING OFFICE 

WASHINGTON: 1934 

I ( 

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Approved Code No. 487-Supplement No. 2 

SUPPLEMENTARY CODE OF FAIR COMPETITION 

FOR THE 

LINEN IMPORTING TRADE 

As Approved on November 22, 1934 

ORDER 

APPROVING SuPPLEM:ENTARY ConE OF FAIR CoMPETITION FOR THE 

LINEN IMPORTING TRADE 

A DIVISION OF THE IMPORTING TRADE 

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 the Supplementary Code of Fair Competition for the Linen Importing Trade, 

to the Code of Fair Competition for the Importing Trade, and 

Hearings having been duly held thereon and the annexed report on 

said 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, the National Industrial Recovery Board, pursuant to authority vested in it by Executive Orders of the President, including 

Executive Order No. 6859, and otherwise, does hereby incorporate 

by reference said annexed report and does find that said Supplementary Code complies in all respects with the pertinent provisions 

and will promote the policies and purposes of said Title of said 

Act; and does hereby order that said Supplementary Code of Fair 

Competition be and 1t is hereby approved. 

NATIONAL INDUSTRIAL REcOVERY BoARD, 

By W. A. HARRIMAN, Administrative Officer. 

Approval recommended : 

RoBERT L. HousToN, 

Division Administrator. 

\iV ASHINGTON, D. c., 

N oven~ber 9393, 1934. 

98G58°----l325-75----34 (1) 
REPORT TO THE PRESIDENT 

The PRESIDENT, 

The lV hite House. 

SIR : This is a report of the Hearing on the Supplementary Code 

of Fair Competition for the Linen Importing Trade, conducted in 

Room D of the vV ashington Hotel, on ~1onday, August 20, 1934. 

The Supplementary Code which is attached, was presented by duly 

qualified and authorized representatives of the Trade, complying 

with the statutory requirements, said to represent 84 per cent in 

number and 86 per cent in volume of sales of the Trade which could 

be included in this Supplementary Code. 

THE TRADE 

According to statistics furnished by members of the Linen Imp orting Trade, there are 128 establishments in the Trade with aggregate annual sales of approximately $50,000,000, these firms employing about 2200 in 1933. Subsequent to the Public Hearing, the 

National Recovery Administration conducted a survey by means of 

an official questionnaire, the results of which survey indicate that 

the establishments in this Trade number 115. 

PROVISIONS OF THE CODE 

Since this Code is supplementary to the Code of Fair Competition 

for the Importing Trade, it contains no labor provisions. 

The various Trade Practice Provisions do not appear to be in any 

way objectionable. They are designed to eliminate certain unfair 

practices in the Trade through which a few members of the Trade 

have benefited at the expense of the public and other linen in1porters 

who do not engage in such practices. Among the several Trade 

Practice Provisions is one prohibiting consignment of merchandise, 

except :for fancy linen units with a value of $25.00 or more each, and 

except samples for inspection. Another Trade Practice Provision 

prohibits lot sales except in cases where articles are commonly sold 

in set or ensemble form. This Provision prevents the practice o:£ 

selling an article or articles at a price which is contingent upon the 

concurrent purchase and sale o:£ other articles, through which practice inferior or obsolete merhandise is often passed on in combination 

with more saleable items, without the buyer being fully aware of the 

fact that the entire lot purchase is not the bargain it appears to be. 

FINDINGS 

The Deputy Administrator in his final report to the National 

Industrial Recovery Board on said Supplementary Code having 

(2) 
3 

found as herein set forth and on the basis of all the proceedinas in 

this matter; o 

It finds that: 

(a) Said Supplementary 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 organization of industry for the purpose of cooperative action among trade 

groups, by inducing and maintaining united action of labor and 

management under adequate governmental sanction and supervision, 

by eliminating unfair competitive practices, by promoting the fullest 

possible use 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 unemployJUent, by improving standards of 

labor, and by otherwise rehabilitating industry. 

(b) Said Trade normally employs not more than 50,000 employees 

and it is not classified by the National Industrial Recovery Board as 

a major industry. 

(c) The Supplementary 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 a trade association truly representative of the 

aforesaid Trade; and that said association imposes no inequitable 

restrictions on admission to membership therein. 

(d) The Supplementary Code is not designed to and will not permit monopolies or monopolistic practices. 

(e) The Supplementary Code is not designed to and will not eliminate or oppress small enterprises and will not operate to discriminate against them. 

(f) Those engaged in other steps of the economic process have not 

been deprived of the right to be heard prior to the approval of this 

Supplementary Code. 

For these reasons, this Supplementary Code has been approved. 

For the National Industrial Recovery Board: 

NOVEMBER 22, 1934. 

w. A. HARRIMAN, 

Adtmi71Jistrative Officer. 
SUPPLEMENTARY CODE OF FAIR COMPETITION FOR 

THE LINEN IMPORTING TRADE 

A DIVISION OF THE UIPORTING TRADB 

ARTICLE !-PuRPosES 

To effectuate the policies of Title I of the National Industrial Recovery Act, this Supplementary Code is established as a Code o:f Fair 

Competition for the Linen Importing Trade pursuant to Article VI, 

Section 1 (C) of the General Code of Fair Competition for the Importing Trade, approved on July 20, 1934. All provisions of the said 

General Code which are not in conflict with the provisions of this 

Supplementary Code are hereby incorporated by reference in this 

Supplementary Code and made a part thereof. Such provisions of 

the General Code, together with the supplementing provisions of 

this Code, are the standards of fair competition for and are binding 

upon every member of said Trade. 

ARTICLE II-DEFINITIONS 

(Supplementing Article II of the General Code) 

SECTION 1. Linen lmporte:r.-For the purposes of this Supplementary Code, a "linen importer " shall be defined, but without limitation, as any individual, partnership, corporation, association, or 

other form of enterprise, or any organized division thereof, principally engaged in importing st.able linens, fancy linens, and/or apparel, and/ or principally engaged in the sale of imported fancy 

linens, staple linens, and/or apparel linens to manufacturers, wholesalers, retailers, and/or institutional, commercial., and/or industrial 

users; provided, however, that this Supplementary Code shall not 

govern the importation of merchandise which is solely for consumption of the linen importer, and not for resale. Modifications of, or 

extensions to this definition, or any part thereof, may be made when 

recommended by the Divisional Code Authority and approved by the 

National Industrial Recovery Bo::trd. 

SEcTION 2. Trade.-The term " Trade ", as used herein, shall mean 

the business in which linen importers, as above defined, are engaged. 

SECTION 3. Staple Linem.-The term "staple linens", as used 

herein, shall mean hemmed or hemstitched linen, damasks, plain 

sheets, towels and toweling, pillow cases, peasant types or printed 

linens, and household linen in piece goods form. 

SECTION 4. Fa/n~; Linem.-The term "Fancy Linens") as used 

herein, shall mean linens which have been decorated, embrOidered, or 

lace-trimmed. 

SECTION 5. Apparel Linens.-The term "Apparel Linens", as used 

herein, shall mean linens in the piece, which are sold for subsequent 

conversion into articles of wearing apparel or assessories thereto. 

{4) 
5 

S~cTION 6. General 0 ode.-The term " General Code ", as used 

hermn, .shall mean the General Code of Fair Competition for the 

Importing Trade, approved July 20, 1934, as heretofore or hereafter 

amended. 

SECTION 7. Divisional Oode Awthority.-The term "Divisional 

Code Authority", as used herein, shall mean the Divisional Code 

Authority for the Linen Importing Trade, a division of the 

Importing Trade. 

SEcTION 8. Association.-The term "Association", as used herein, 

shall mean the Linen Trade Association, the Association which has 

presented this Supplementary Code on hehalf of the Linen Importing 

Trade. 

SECTION 9. Oonsignnwnt.-The term "Consignment", as used 

herein, shall mean delivering to or leaving merchandise with a customer, the title to remain with the linen importer until such time as 

his or its customer shall sell or return the merchandise. 

ARTICLE III-AnMINIS'l'RA TION 

(Supplementing Article VI of the General Code) 

SECTION 1. Divisional Oode Awthority.-(a) The Divisional Code 

Authority for this Trade shall consist of seven (7) persons to represent the following groups: three (3) shall be elected by the vote of 

the entire Trade, to be known as " general members "; one ( 1) shall 

be a non-member of the Association, to be elected by the non-members 

of the Association; one (1) shall be an importer of fancy linens and 

shall be elected by the importers of fancy linens; one ( 1) shall be 

an importer of staple linens and shall be elected by the importers of 

staple linens; and one (1) shall be an importer of apparel linens and 

shall be elected by the importers of apparel linens. 

(b) The members of the Divisional Code Authority shall be elected 

as follows: The Board of Directors of the Association, plus a nonmember of t1le Association to be appointed by the National Recovery 

Administration, shall constitute a nominating committee. This nomInating committee shall draw up a ballot which shall contain sufficient 

names to give a choice of at least two (2) persons for each place on 

the Divisional Code Authority and blank spaces in which linen 

importers may write their choice if it be different from the names 

appearing on the ballot. Cumulative voting shall not be permitted. 

This ballot shall be sent to all known linen importers. Fifteen (15) 

days after the ballots are mailed to linen importers, they shall be 

opened and counted in the pre~ ence of the nominating committee. 

The linen importers receiving the highest number of votes for each 

of the Divisional Code Authority memberships designated shall be 

declared to be elected. 

(c) The term of office of members of the Divisional Code Authority shall be one ( 1) year and the method of electing their successors, 

whether for new terms or for unexpired terms, shall be the same as 

established in Subsections (a) and (b) of this Section. 

(d) Until such time as the Divisional Code Authority is elected, 

as herein ~rovided, the committee elected by the Association to 

present this Supplementary Code shall act as the temporary 

Divisional Code Authority. 
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SECTION 2. Powers and Duties.-The Divisional Code Authority 

shall have the following duties and powers in addition to those 

prescribed in the General Code : 

(a) To adopt by-laws and rules and regulations for its procedure. 

(b) To use such trade associations and other agencies as it deems 

proper for the carrying out of its activities provided for herein, provided that nothing herein shall relieve the Divisional Code Authority of its duties or responsibilities under this Supplementary Code, 

and that such trade associations and agencies shall at all times be 

subject to and comply with the provisions hereof. 

(c) To organize, elect officers, hire employees, and perform such 

other acts as may be necessary for the proper administration of this 

Supplementary Code, and to recommend to the National Industrial 

Recovery Board for adoption, such measures as may be appropriate 

to prevent unsound, unfair, or destructive competitive practices 

which interfere with the effectuation of the policies o:f the Act. 

(d) To recmnmend to the National Industrial Recovery Board 

such amendments or modifications of this Supplementary Code as 

may seem desirable to effectuate the policies o:f the Act and to assent 

to such amendments or modifications on behal:f o:f the Trade. 

(e) To appoint a Trade Practice Committee, which shall meet 

with the Trade Practice Committees appointed under such other 

Codes as may be related to the trade, except other Supplementary 

Codes to the General Code, for the purpose of :formulating fair trade 

practices to govern the relations between the production and distribution employers under this Supplementary Code and under such 

others, to the end that such :fair trade practices may be proposed to 

the National Industrial Recovery Board as an amendment to this 

Supplementary Code and such other Codes. 

(f) In order to assist in making effective the reports :from the 

Trade and in eliminating unfair competition, the Divisional Code 

Authority shall at the order of the National Industrial Recovery 

Board appoint a cormnittee so constituted as to give consumer and 

governmental representation satisfactory to the National Industrial 

Recovery Board, to make a study with a view to the establishment of 

standard classifications and standards of quality (grades) of staple 

products of the Trade, wherever such standards are deemed feasible. 

The findings and recommendations of this committee shall be submitted to theN ational Industrial Recovery Board, within a period of 

time to be designated by it, and after such hearings and investigations as it may designate, and upon approval by it, shall be made a 

part of this Code and be binding upon every linen importer. 

SECTION 3. Payment of Oost of Ad1ninistration.-Tl;le Divisional 

Code Authority shall have the powers set forth in Article VI, Section 10, of the General Code in order to obtain funds to support the 

administration of this Supplementary Code, the General Code as 

applied to this division of the Importing Trade, and to effectuate the 

policy of the Act, and each linen importer shall be liable for assessments made under this power unless duly excepted from making 

such contribution. Nothing in this Supplementary Code shall relieve linen importers of their obligation to pay assessm.ents levied 

by the General Importers Code Authority in accordance with Article 

VI, Section 10 of the General Code. 
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SECTION 4:. Information for Government Agencies.-In addition to ! 

the information required to be submitted to the General Importers , Code Authority and the Divisional Code Authority on their agencies, 

all or any of the persons subject to this Supplementary Code shall 

furnish such statistical information and reports as the National · 

Industrial Recovery Board may deem necessary for the purposes recited in Title I, Sections 3 (a) and 3 (e) of the Act, to such federal 

and/or state agencies as the National Industrial Recovery Board 

may designate; but nothing in this Supplementary Code shall relieve any person of any existing or future obligation to furnish 

reports to government agencies. No individual report shall be disclosed to any other linen importer or any other party except to such 

other governmental agencies as may be directed by the National 

Indus trial Recovery Board. 

ARTICLE IV-TRADE PRACTICES 

(Supplementing Article VII of the General Code)' 

SECTION 1. Te1"1'n8.-The maximum terms in this trade shall be 

three per cent (3%) for payment in ten (10) days, with an option of 

E. 0. M. dating, or two per cent (2%) for longer dating, not in excess of seventy (70) days from date of invoice. Shipments on the 

25th day of the month and after may be allowed as of the first of the 

following month; no other advance dating shall be allowed. 

SECTION 2. Delivery.-Delivery of m·erchandise shall be F. 0. B. 

city of principal stock-carrying office. The term "New York City" 

as a principal stock-carrying office point shall mean only the five (5) 

boroughs thereof. Prices at branch offices and/or warehouses must 

include all transportation and handling charges between the principal stock-carrying office and such branch office and/or warehouse, 

which charges must be added to the F. 0. B. price at the principal stock-carrying office. After these transportation and handling 

charges have been added, free local city delivery may be made from 

said branch offices and/or warehouses. 

SECTION 3. No linen importer shall guarantee prices on any order 

for future delivery against a possible future decline in price, or 

guarantee then existing prices or reserve merchandise at then existing 

prices against a possible advance, unless in possession of a bona fide 

confirmed contract covering such future delivery, except that a linen 

importer may make an offer looking towards a bona fide confirmed 

contract containing such a guarantee. In case of complaint of violation, upon request of the Divisional Code Authority, linen importers 

concerned shall present proof of such bona fide confirmed contracts. 

SECTION 4. In recognition of unavoidable irregularities in size in 

the production of staple, fancy, and apparel linens, Article VII, 

. Section 1 of the General Code is hereby modified to the following 

extent, to permit the following maximwn size variations: 

(a) No linen importer shall mark goods, or sell or distribute goods 

which are marked, in such a way as to vary more than two per cent 

(2%) in the case of staple and apparel linens, or three per cent (3%) 

in the ca-se of fancy linens, from the finished size in either length or 

:width. Any merchandise remaining in warehouse or in stock on the 
8 

effective date of this Supplementary Code either must be re-ma'rked, 

or the correct finished size, in accordance with this provision, must 

be directed to the attention o:f the buyer and the confirmation of the 

order must be marked accordingly. The merchandise shall be so 

invoiced. 

(b) The use of the terms "linen", "pure linen", and "all-linen" 

and terms of similar import shall be limited solely to articles the 

basic fabric of which has a linen content of ninety-five per cent 

(95%) or more in weight. No article the basic fabric of which contains less than five per cent ( 5%) of linen by weight shall be labeled, 

marked, branded, stamped, characterized, or named with the word 

" linen " in any form. Articles the basic fabric of which contains 

Letween five per cent ( 5%) and ninety-five per cent (95%) in weight 

of linen content shall be so labeled as to indicate the exact linen 

content expressed in percentage of weight, such figures to be printed 

jn the same si.ze type as the word " linen." The above limitations ~hall also apply in the case of fabrics. 

SECTION 5. No linen importer shall knowingly handle any goods 

for which standards of quality, quantity, size and/or performance, 

and/or labeling requirements, are provided for in accordance with 

Article ill, Section 2 (f) of this Code unless such goods, handled by 

such linen importer, comply with all such standards and/or labeling 

requirements; provided, however, that such goods, if non-standard, 

may be handled when appropriately labeled or otherwise identified 

as non -standard. 

SECTION 6. 0 onsig71JTTU3nt.-Except for fancy linen units with a 

value of $25.00 or more each, no merchandise may be shipped or 

delivered on consignment, nor may any method of alleged selling be 

used which has the effect of shipping or delivering on consignment. 

Samples for inspection, however, shall be exempt from the application of this provision. 

SECTION 7. Lot Sales.-No linen importer shall sell any article or 

articles at a price which is contingent upon the concurrent purchase 

and sale of another article or articles, or other sizes of the article; 

nor shall any linen importer sell different articles in group or combination at a special lot or group price; provided, however, that 

articles which are commonly sold in set or ensemble form shall not 

be subject to the restrictions of this provision. 

SECTION 8. Retwrn of M erchandise.-Merchandise purchased and 

shipped in good faith and in accordance with the buyer's specifications may not be received for credit by any linen importer; provided, 

however, that when goods do not conform to the specifications contained in the purchase order, the linen importer may allow a maximum of seven (7) successive business days after the receipt of such 

merchandise by the customer in which to accept clain1 for credit for 

such merchandise, and provided further, that this Section shall have 

no application to the return of merchandise in which there are defects in the merchandise or manufacture thereof. Whenever a 

linen importer shall accept the return of merchandise or allow a 

claim for credit after the merchandise has been in the customer's 

possession for more than a period of seven (7) successive business 

days, he shall report such transaction to the Div1sional Code Authority and certify that his action was in accordance with this provision. 
9 

Upon request of the Division Code Authority any linen importer 

concerned shall present proof that such returns or claims :for credit 

were accepted in good :faith and in accordance with the provisions 

herein.. 

ARTICLE V-MODIFICATION 

This Supplementary Code and all provisions thereof are expressly 

made subject to the right o:f the President in accordance with the 

provisions o:f Sub-section (b) o:f Section 10 o:f the Act, :from time to 

time to cancel or modify any order, approval, license, rule or regulation issued under Title I o:f said Act. 

ARTICLE VI-EFFECTIVE DATE 

This Supplementary Code shall become effective on the tenth 

day after approval. 

Approved Code No. 487-Supplement No. 2.. 

Registry No. 246--01. 

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