V 

Approved Code No. 545 Registry No. 613-04 

NATIONAL RECOVERY ADMINISTRATION 

CODE OF FAIR COMPETITION 

FOR THE 

NATURAL ORGANIC PRODUCTS 

INDUSTRY 

AS APPROVED ON JANUARY 25. 1935 , / 

WE DO OUR PART 

I ..,, 

A o r, - - --

UNITED STATES 

GOVERNMENT PRINTING OFFICE 

WASHING TON : 1935 

For sale by the Superintendent of Documents, Washington D. C. - - - - - - - - - Price 5 cents 
This publication i for sale by the "' uperintendent of Documents, Government 

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Approved Code No. 545 

CODE OF FAIR COMPETITION 

FOR THE 

NATURAL ORGANIC PRODUCTS INDUSTRY 

As Approved on January 25, 1935 

ORDER 

APPROVING CODE OF FAIR COMPETITION FOR THE .NATURAL ORGANIC 

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 Code o-f 

Fair Competition for the National Organic Products Industry, and 

hearir~g 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, TI-IEREFORE, on behalf o.f the President of the United 

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

Executive Order No. 6859, dated September 27, 1934, and otherwi,se; 

does hereby incorporate by reference said annexed report and does 

find that said Code complie in all respects with the pertinent provisions and will promote the policy and purposes of said Title of 

said Act; and does hereby order that said Code of Fair Competition be and it is hereby approved; provided, however, that the Code 

Authority shall obtain from members of the Industry and submit 

to the J ational Industrial Recovery Board at its request such labor 

statistics as said Board may deem necessary for determining the 

adequacy of the labor provisions of this Code and within four 

months from the effective date of this Code said Board shall conduct 

such hearings as it deems necessary to effectuate changes in said 

labor provisions of said Code and that any order the said Board 

may make as a result of such hearings, data and information shall 

ha Ye the effect of a condition on the approval of thi,s Code. 

N ATIO AL INDUSTRIAL RECOVERY BOARD, 

By W. A. HARRIMAN, Adminutrative Officer. 

Approval recommended: 

JOSEPH F. BATTLEY, 

Division Adm,inistrator. 

w .ASIUNGTON, D. c., 

J anuar-y 25, 1935. 

111343°-1465-112-35 (19) 
REPORT TO THE PRESIDENT 

The PRESIDENT 

T he White H ouse. 

Srn: This is a report on the Hearin a on the Code of Fair Competition for the Natural Organic Products Indu try, held on April 

20, 1934. The Code, which is attached, wa presented by duly quali- fied and authorized representatives of the Industry, complying with 

statutory requirements and claiming to repre ent ninety percent, by 

volume, of the Indu try. In accordance with the customary procedure every person who had 

filed a request for appearance was freely heard in public, and regulatory requirement were complied with. 

THE L DUSTRY 

The Industry is divided into five divi ion : The Botanical Drug 

Industry, the Es ential Oil Industry, the Spirit and Oil Soluble 

Gum Indu -try, the \\Tater Soluble Gum Industry, and the Vanilla 

Bean I n lu -try. The I ndu try as a whole comprises about 170 

e tabli hment . 

Ther e are no :figures available a to the capital inve tment in 

this Indu try, but the volume of bu ine in 1929 was about $50,000,-

000 and declined to about $25 000,000 in 1933. The I ndu try employed 1,958 person in 1929. This number fell to 1,852 in 1930 and 

f ell further to 1,736 in 1931, but ro e harply to 1,916 in 1932. 

The five mall indu tries compri ·ing the Natural Organic Product 

Indu try originally approached the National Re overy Admini tration separately, a king for separate Codes. Since it was found that 

they had common problems and overlapping function th y were 

asked to combine under one basic Code; a new trade association was 

formed to ponsor thi. Code, admitting member of all five indu tries. Since the e indu trie were thus combined for the fir. t time in their 

existence and ince they were compo ed of many mall and cattere l 

units it was found difficult to obtain accurate and comple.te tatistics 

and information covering the new I ndu try thus formed, and a clear 

picture of condition within it wa not obtainable. 

PROVISIONS OF THE CODE 

The Code provide for a basic forty ( 40) hour week and a thirty-

.five (35) cent minimum wage. The meagre statistics which are available tend to indicate that this will promote little if any re-employment or increa ed purcha ing power in this Industry. 

The hour wage: general labor, and admini tration pro vi ion in 

the Code are ommon to all five divi ion of this Indu try. In addi-

(20) 
21 

tion, each divj ion has a sepa rate checlule of trade practice rules 

to be admini tered by it Di, i ional Co-le Council. The Schedules, 

with minor difference , are identical and render enforceable under the 

Co le certain ba ic rule of fair trade practice which have been followed by the majority of the Indu try in the pa t. 

FINDIXGS 

The D€puty Administrator in his final report on said Code having 

found as herein et forth and on the ba. i of all the proceedings in 

thi matter: 

The Board finds that: 

(a) Said Co le i well designed to I romote the policies and purposes of Title I of the ational Indu trial Recovery Act, including 

removal of ob tructions to the free flow of inter-state and foreign 

commerce which tend to dimini h the amount thereof and will 

provide for the general ,,elfare bv promoting the organization of 

industry for the purpo e of cooperatiYe action among the trade 

groups, by inducing and maintaining united action of labor and 

management under adequate governmental sanctions and uperviion by eliminating unfair competitive practice, by promoting the 

fullest possible utilization of the present production capacity of 

indu tries, by a voiding undue re triction of production ( except as 

may be temporarily required), by increasing the consumption of 

industrial and agricultural product through increasing purchasing 

power, by reducing and relie,ing unemployment, by improving 

standards of labor, and by otherwise rehabilitating industry. 

(b) Said In lu try normally employs not more than 50,000 employee ; and i not clas ified a a major industry. 

( c) The Code a approved complie in all respects with the pertinent provisions of said Title of said Act, including without limitation Subsection (a) of Section 3, Sn b ection (a) of Section 7, and 

Sub ection (b) of Section 10 thereof; and that the applicant association is an industrial association truly repre entative of the afore aid 

Industry; and that said a ociation impo es no inequitable re trictions on admis ion to membership therein. 

( d) The Code is not designed to an l will not permit monopolies 

or monopoli tic practices. ( e) The Co le is not designed to and will not eliminate or oppress . mall enterprise and will not operate to di criminate against them. 

( f) Tho e engaged in other teps of the economic process have not 

been deprived of the right to be heard prior to approval of said Code. 

For the e reason , thi Code of Fair Competition for the Natural 

Organic Products Indu try has been approved. 

For the National Industrial Recovery Board: 

JANUARY 25, 1935. 

w. A. HARRIMAN, 

Administrative Officer. 
CODE OF FAIR COMPETITION FOR THE NATURAL 

ORGANIC PRODUCTS INDUSTRY 

ARTICLE I-PURPOSES 

To effect the policies of Title I of the National Industrial Recovery 

Act this Code is established as a Code of Fair Competition for the 

Natural Organic Products Industry, and its provisions shall be the 

standards of fair competition for such Industry and shall be binding 

upon every member thereof. 

ARTICLE II-DEFINITIONS 

SECTION 1. The term " Natural Organic Products Industry " or 

"Industry" as used herein includes the :following industries and such 

related branches or subdivisions thereof and such allied industries 

as may from time to time be included under the provisions of this 

Code: 

(a) The Botanical Drug lndustry .-The term "Botanical Drug 

Industry" as u ed herein includes the n1erchandising and/or importing and/or proce sing either as merchants or as cu tom millers, or 

a · both, of botanical drug and allied commodities. 

(b) The Essential Oil I ndust1'y .-The term " E ssential Oil Ind ustry" as used herein includes the manufacture and/or redistillation 

and/ or merchandising and/or importing and/ or packaging and distributing of essential oils, flor al products, animal fixatives, natural 

ethers and aldehydes, balsams and aromatic gums, fruit and other 

flavor· :for re-manufacturing purposes, natural aromatic products, 

oleo resins and allied natural products and mixtures of the abovenamed products and other aromatic chemicals known as "specialties " or " compounds "; and includes the importation for resale of 

synthetic aromatic chemicals, but does not include the manufacture 

or sale by the producer of synthetic aromatic chemicals. 

(c) The Spirit and Oil Soluble Gurm l ndustry.-The term " Spirit 

and Oil Soluble Gum Industry" as used herein includes the importing and merchandising of spirit and oil-soluble natural resins, except shellac and naval stores, used in the manufacture of paint, 

va~nish, lacquer, and miscellaneous other products requiring natural 

resins. 

(d) The Wate1· Soluble Gum lndust?"!J.-The term "Water Soluble Gum Industry" as used herein includes the importing and merchandising and/or processing, either as merchants or as custom 

miller , or as both, of water-soluble gums and allied commodities. 

(e) The Vanilla Bean / nclitsfry.-The term " Vanilla Bean Indu try " as used herein includes the importing, merchandising and · distributing of tonka and vanilla beans. 

(22) 
23 

SECTION 2. (a) The term "member of the Industry" as used 

herein includes, but without limitation, any individual, partnership, 

association, corporation or other form of enterprise engaged in the 

Industry, either as an employer or on his or its own behalf; but 

does not include any person whose principal line of business is wholesaling or retailing under the operation of any wholesale or retail 

code unless such person imports for resale, and/or purchases for resale from the primary source of raw materials, and/or performs any 

processing or packaging operation upon any of the products of this 

Industry or any of its branches. 

(b) The term "person" a.s used herein includes, but without limitation, a natural person, or any partnership, association, corporation or other form of enterprise, or any government, governmental 

subdivision or agency thereof. 

SECTION 3. The term "employee" as used herein includes any and 

all persons engaged in the Industry, however compensated, except 

a member of the Indlli>---try. 

SECTION 4. The term " employer " as used herein includes anyone 

by whom such employee is compensated or employed. 

SECTION 5. The terms "President", "Act", and "Board" as used 

herein mean, respectively, the President of the United States, Title 

I of the National Industrial Recovery Act, and the National Industrial Recovery Board. 

SECTION 6·. The term "establishment" as used herein means any 

plant, laboratory, or office or any branch thereof in which any of 

the activities included in this Industry are carried on. 

SECTION 7. The term "Association" as used herein means the Natural Organic Products Association. 

SECTION 8. Definitions of Personnel.-(a) The term "executive" 

as used herein means an employee solely responsible for the management of a business or a recognized subdivision thereof. 

(b) The term " outside salesman " as used herein means a salesman who is engaged not more than fifteen (15) hours per week 

inside the establishment or any branch thereof by which he is 

employed. 

( c) The term " watchman " as used herein shall mean an employee 

engaged primarily in safeguarding the premises and property of a 

member of the Industry. 

SECTION 9. The term "continuous process" as used herein means 

a process which once begun, cannot be interrupted until complete 

without spoiling the goods processed or rendering the work done 

valueless; and which must be attended throughout by the same individual or individuals; and which cannot be begun at a sufficiently 

early hour to allow of its completion within the eight-hour shift in 

which it is begun. 

ARTICLE III-HOURS 

SEcm:ON 1 (a) No employee except as provided below shall be 

permitted to work more than forty (40) hours in any calendar week 

nor more than eight (8) hours in any twenty-four (24) hour period 

except that during any eight (8) weeks in one year employees may 

be permitted to work not in excess of forty-eight (48) hours per 
24 

week, provided that all hours worked in excess of forty ( 40) in any 

one week or eight (8) in any twenty-four (24) hour period are 

compensated at one and one-third (11/3 ) times the regular rate of 

parb) The provisions of Subsection (a) of this Section shall not 

apply to executives, supervisory employees, and scientific employees 

who are paid $35.00 or more per week, nor to outside salesmen and 

commission salesmen. 

(c) vVatchmen may work not in excess of fifty-six (56) hours in 

any one week provided they shall have one full day off in ea-ch seven 

(7) day period. 

( d) Employees whose work on continuous process requires it, may 

be permitted to work not in excess of twelve (12) hours in any 

twenty-four (24) hour period, and not in excess of forty (40) hours 

in any one week. 

( e) In case of an epidemic, catastrophe, or any emergency involving breakdowns, or protection of life or property, such employees as 

are necessary may be permitted to work unlimited overtime, provided 

that such employee shall be paid at the rate of at least time and onethird (11/3 ) for all hours worked in excess of the applicable maximum number of hours provided in Sub-sections (a) , ( c), and ( d) of 

this Section. A report of each such emergency shall be sent to the 

Code Authority within thirty (30) days after such emergency overtime work shall have commenced, giving such details as the Code 

Authority may prescribe. 

SECTION 2. No employer shall knowingly permit any employee to 

work for any time which when totalled with that already performed 

with another employer or employers in this or any other industry or 

trade exceeds the maxima permitted herein for such employee's 

class of work. 

SECTION 3. Employers who personally perform manual work or 

engage in mechanical operations shall not work longer than the maximum permitted herein for such class of work. 

ARTICLE IV-WAGES 

SECTION 1. No employee shall be paid less than at the rate of 

thirty-five cents (35¢) per hour, except as herein otherwise provided. 

SECTION 2. No hourly, daily or full time weekly compensation for 

employees who are paid less than $50.00 per week shall be less than 

such compensation existing as of June 16, 1933; and no employee 

shall be paid a. wage rate which will yield a leE:s wage for the shorter 

full time week herein established than he could have earned for the 

same cla · of work for the longer full time week exi ting as of June 

16, 1933. V\' age increases established under the President's Reemployment Agreement shall at least be maintained. 

SECTION 3. No employer or his agent shall accept any rebate on 

wages directly or indirectly, or give anything of value or extend 

favors to any person for the purpose of influencing rates of wage 

or the working conditions of his employees. 

SEcTio 4. No employee shall be discharged and reemployed at a 

lower rate. 

SECTION 5. A person whose earning capacity is limited because of 

age, physical or mental .handicap, or other infirmity, may be em-
25 

ployed on light work at a wage below the minjmum e tablished by 

this Code, if the employer obtains from the State Authority designated by the United State Department of Labor, a certificate authorizing such person's employment at such wages and for such hours as 

shall be stated in the certificate. Such Authority shall be guided by 

the instructions of the United States Department of Labor in issuing 

certificates to such persons. Each employer hall file monthly with 

the Code Authority a list of all such persons employed by him showing the wages paid to, and the maxjmum hours of work for such 

employees. 

SECTION 6. This Article stablishes a minimum rate of pay which 

shall apply irrespective of whether an employee is actually compensated on a time-rate, piece-work, or other basis. 

SECTION 7. No employer shall reclas ify employees or duties of occupati.ons performed or engage in any other subterfuge so as to defeat 

the purposes and provisions of the Act or of this Code. 

SECTION 8. Female employees performing substantially the same 

work as male employees shall receive the same rate of pay as male 

employees. 

SECTION 9. Wages shall be paid at least twice per month in lawful 

currency, or by negotiable check payable on demand. 

SECTION 10. ,v ages shall be exempt from all fines or deductions and 

from all payments for pensions, insurance or sick benefits other than 

those voluntarily paid by employees or required by law. 

ARTICLE V-GE~ER.:\L L ABOR PROVISIONS 

SECTION 1. No person under sixteen (16) years of age shall be employed in the Industry. No person under eighteen (18) years of age shall be employed at 

operations or occupations which are hazardou in nature or dangerous 

to health. The Code Authority shall submit to the Board, within 

six (6) months after the effective date of this Code, a list of such 

operations or occupations. In any State an employer shall be deemed 

to ha,e complied with the provision as to age if he shall have on file 

a certificate or permit duly issued by the Authority in such State, 

empowered to issue employment or age certificates or permit , show- ing that the employee is of the age required by this Section. 

SECTION 2. (a) Employees shall have the right to organize and 

bargain collectively, through representatives of their own choosing, 

and shall be free from the interference, restraint, or coercion of em- ployers of labor, or their agents, in the designation of such representatives or in self-organization or in other concerted activities for the 

purpose of collective bargaining or other mutual aid or protection. 

(b) Jo employee and no one seeking employment shall be required 

as a condition of employment to join any company union or to refrain 

from joining, organizing, or as ·isting a labor organization of his own 

choosing. 

( c) Employers shall comply with the maximum hours of labor, 

minimum rates of pay, and other conditions of employment approved 

or prescribed by the President. 

111343°-1465-112-35-2 
26 

SECTION 3. Every employer shall provide for the safety and health 

oi his employees at the places and during the hours of their employment. Standards for safety and health shall be submitted by the 

Code Authority to the Board within three (3) months after the effective date of this Code, and upon approval by the Board, shall become 

e.ff ective as a part of this Code. 

SECTION 4. No provisions in this Code shall supersede any State or 

Federal law which imposes more stringent requirements on employers 

as to age of employees, wages, hours of work, or as to safety, health, 

sanitary or general working conditions, or insurance, or fire protection, than are in1po eel by this Code. 

SECTION 5. All 0 mployers shall post and keep posted complete copies 

of the labor provisions of this Code and all amendments thereto when 

made in conspicuous places easily accessible to all employees. Every 

member of the Industry shall comply with all rules and regulations 

relative to the posting of provisions of Codes of Fair Competition 

which may from time to time be prescribed by the Board. 

SECTION 6. No employee shall be dis1nissed by reason of making a 

complaint or giving evidence with re pect to an alleged violation of 

this Code. SECTION 7. Employers shall arrange that the hours worked by any 

employee during each day shall be consecutive, provided that an interval not longer than one hour may be allowed for each regular meal 

period, and such interval not counted as part of the employee's working time. Any rest period which may be given employees shall not 

be deducted from such employee's working time. 

SECTION 8. No employer shall contract for work to be clone except 

where the person performing the contract is subject to the provisions 

of this Code or the Code adopted by the industry covering such work; 

and in no case shall an employer avoid or evade the labor provisions 

of this Code by contracting his work to any persons subject to labor 

regulations le s stringent than those provided in this Code. 

ARTICLE VI-ORGANIZATION' POWERS .AND DUTIES OF THE CODE 

AUTHORITY. ORG.ANIZ.ATION .AND CONSTITUTION 

SECTION 1. (a) A Code Authority is hereby established consisting 

of one ( 1) member from each Divisional Code Council, elected by the 

members of each such Divisional Code Council to serve for one year 

and until their respective successors shall be elected. 

(b) Pending the election of the permanent Code Authority, the 

Board of Directors of the Association shall act as a temporary Code 

Authority. 

SECTION 2. (a) The following Divisional Code Councils are hereby 

established, consisting of five ( 5) members each, to administer the 

separate trade practice schedules of this Code applicable to their 

re pective Divi ions of this Indu try: 

The Botanical Drug Code Council 

The Es ential Oil Code Council 

The Spirit & Oil Soluble Gum Code Council 

The Water Soluble Gum Code Council 

The Vanilla Bean Code Council 
27 

(b) The members of each Divisional Code Council shall be elected 

in the following manner and shall serve for a term of one year or 

until their successors shall be elected : 

(1) After the effective date of this Code, each Vice-President of 

the Association in charge of a Di vision shall appoint a nominating 

Committee of three (3) which shall nominate at least ten (10) 

candidates. Any ten (10) members of the Division may, in writino-, 

submit an additional nomination. Each such Vice-President shall 

call an open meeting of his Division to which shall be invited all 

persons who are members 0f the Division and whose names can be 

ascertained by reasonable diligence. 

Each member of the Division shall be entitled to the number 

of votes indicated upon the following table: 

Aggregate Annual Sales Volume for the Calendar Year Corresponding 

Preceding the Year in Which the Election is Held: number of votes 

$25,000 or less________________________________________ 5 

$25.000.01 to $50,000__________________________________ 10 

$50,000.01 to $100,000__________________________________ 15 

$100,000.01 to $200,000 ___________________ _: _____________ 20 

$200,000.01 to $400,000 __________________________________ 25 

$400,000.01 to $800,000 ___ ____________________________ 30 

$800,000.01 to $1,600,000 _________________________________ 35 

More than $1,60,000 ____________________________________ 40 

NoTE.-Number of votes must be computed upon sales of products included 

under the definition of the Division. Sales in other- Divisions or other Industries cannot be counted in determining votes. 

Voting shall be cumulative and each member may cast his votes 

for any five or less number of nominees or may cast them all for one 

nominee. The five ( 5) individuals receiving the greatest number 

of votes shall be elected, and shall without delay elect one of their 

number to membership on the Code Authority. 

SECTION 3. In addition to membership as above provided, there 

111ay be three (3) or less members on the Code Authority and on 

each Divisional Code Council, without vote and without compensation from the Industry, to be known as Administration Members, 

to be appointed by the Board to serve for such terms as it may 

specify. 

SECTION 4. Each trade or industrial association directly or indirectly participating in the selection or activities of the Code Authority or any Divisional Code Council shall (1) impose no inequitable 

restriction on membership, and (2) submit to the Board true copies 

of its articles of association, by-laws, regulations, and any amendments when made thereto, together with such other information as 

to membership, organization, and activities as the Board may deem 

necessary to e:ff ectuate the purposes of the Act. 

SECTION 5. In order that the Code Authority and Divisional Code 

Councils shall, at all times, be truly representative of the Industry 

and in other respects comply with the provisions of the Act, the 

Board may provide such hearings as it may deem proper; and thereafter if it shall find that the Code Authority or any Divisional 

Code Council is not truly representative or does not in other respects 

comply with the provisions of the Act, may require an appropriate 
28 

modification in the method o:f selection o:f the Code Authority, or 

any Divisional Code Council. 

SECTION 6. Nothing contained in this Code shall constitute the 

members o:f the Code Authority nor the members o:f the Divisional 

Code Councils partners :for any purpo e. Nor shall any member 

o:f the Code Authority or Divisional Code Councils be liable in any 

manner to anyone :for any act o:f any other member, officer, agent, or 

employee o:f the Code Authority or Divisional Code Councils. Nor 

shall any member o:f the Code Authority or Divisional Code Councils, exercising reasonable diligence in the conduct o:f his duties 

.hereunder, be liable to anyone :for any action or omission to act under 

the Code, except for his own willful malfeasance or nonfea ance. 

SECTION 7. I:f the Board shall determine that any action of the 

Code Authority, Divisional Code Councils, or any agency thereof 

may be unfair or unju t or contrary to the public interest, the Board 

may require that such action be suspended to afford an opportunity 

for inve tigation o:f the merits of such action and :further consideration by the Code Authority, Divisional Code Council, or agency 

pending final action which shall not be effective unless the Board 

approves or unle s it shall :fail to disapprove after thirty days' notice 

to it o:f intention to proceed with such action in· its original or 

modified :form. 

POWERS .AND DUTIES 

SECTION 8. Subject to such rules and regulations as may be is ued 

by the Board, the Code Authority shall have the :following powers 

and duties, in addition to those authorized by other provisions of 

this Code; 

(a) To insure the execution o:f the provisions of this Code and to 

provide :for the compliance o:f the Industry with the provisions o:f 

the Act. 

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

( c) To obtain :from members of the Industry such information 

and reports as are required :for the administration of the Code. In 

addition to information required to be submitted to the Code Authority members of the Industry subject to this Code shall furnish such 

statistical information as the Board may deem necessary :for the 

purpo es recited in Section 3 (a) of the Act to such Federal an l State 

agencies as it may designate; provided that nothing in this Code 

shall relieve any member of the Industry of any existing obligations 

to :furnish reports to any Goverrunent agency. No individual report 

shall be disclosed to any other member of the Industry or to any other 

party except to such other Governmental agencies as may be directed 

by the Board. 

( d) To use uch Trade associations and other agencies as it deems 

proper for the carrying out o:f any o:f it activities provided for 

herein, provided that nothing herein shall relieve the Code Authority 

of its dutie or responsibilitie under this Code and that such trade 

associations and agencies shall at all times be subject to and comply 

with the provisions hereof. 

( e) To delegate to the Divisional Code Councils such duties as 

are necessary to the proper admini. tration o:f thi Code within their 

respective Divisions, and to receive from such Councils recmmnenda-
29 

tions and suggestions for the bett rment of conditions within the 

Industry and :for the promotion of harmonious relation with the 

Consumer, labor and other industries upon matters o:f common interest, provided that nothing herein shall relieve the Code Authority of 

its duties or responsibilities under this Code. 

(f) To make recommendations to the Board for the coordination 

of the administration of this Code with such other codes, if any, 

as may be related to or affect rn.embers of the In lustry. 

(g) (1) It being found neces ary in order to upport the administration of this Code and to maintain the standards of fair competition established hereunder and to ffectuate the policy of the Act, 

the Code Authority is authorized: 

a .. To incur such reasonable obligations as are necessary and proper 

for the foregoing purpo es, and to meet uch obligations out of funds 

which may be raised as hereinafter provided and which shall be 

held in tru t for the purpos s of the Code; 

b. To submit to the Board for its approval, subject to such notice 

and opportunity to be h ard as it may deem necessary ( 1) an itemized budget o:f its estimated expenses for the foregoing purposes, and (2) an equitable basis upon which the funds nece sary to sup- port such budget shall be contributed by members of tlw Industry ; 

c. After such budget and basis of contribution have been approved by the Board, to determine and obtain equitable contribution 

as above set forth by all members of the Industry, and to that end, 

if necessary, to institute legal proceedings therefor in it own name. 

(2) Each member of the Industry shall pay his or its equitable 

contribution to the expenses of the maintenance of the Code Authority, determined as hereinabove provided, and subject to such rules 

and regulations pertaining thereto issued by the Board. Only members of the Industry complying with the Code and contributi11g 

to the expen es of its administration as hereinabove provided, unless 

duly exempted from making such contributions, shall be entitled 

to participate in the selection of members of the Code Authority 

or to receive the benefits of any of its voluntary activities or to make • 

use of any ·emblem or insignia of the National Recovery Administration. 

(3) The Code Authority shall neither incur nor pay any obligation 

substantially in excess of the amount thereof as estimated in its 

approved budget, and shall in no event exceed the total amount contained in the approved budget, except upon approval of the Board; 

and no subsequent budget shall contain any deficiency budget item 

for expenditures in excess of the required budget e timat s ex ept 

which the Board shall have so approved. 

(h) To recommend to the Board any action or measures deemed 

advi able, including further :fair trade practice provisions to govern 

members of the Industry in their relations with each other or with 

other trades or industries ; measures for industrial planning, and 

stabilization of employment; and including modifications of this 

Code which shall become effective as part hereof upon approval 

by the Board after such notice and hearing as it may specify. 

(i) 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 Industry for the purpose o:f formula6ng 
30 

fair trade practice to govern the relationships between employers 

under thi Cod and under such other codes to the nd that such fair 

trade practice may be proposed to the Board a amendments to this 

ode and uch other Codes. 

(j) The Code Authority hall cause to be formulated methods of 

co t finding an l a counting capable of use bv all members of the 

Industry, and shall submit such methods to the Board for review. 

If approved by the Board, full information concerning such 

methods shall be made available to all members of the Industry. 

Thereafter, ea h member of the In lu try shall utilize such methods 

to the extent found practicable. Nothing herein contained shall be 

con trued to permit the Code Authority, any agency thereof, or any 

member of the Industry to suggest uniform additions, percentages or 

differentials or other uniform items of cost which are designed to 

bring about arbitrary uniformity of co ts or prices. 

(k) To provide appropriate facilities for arbitration, and subject 

to the approval of the Board, to prescribe rules of procedure and 

rules to effect compliance with awards and determinations. 

(1) To appoint representatives to serve on any Drug Indu try 

Coordinating Council which may be established to be composed of 

representatives from the various code authorities governing codes 

which are directly related to the Drug Industry, and to act as a 

planning and coordinating agency, and as an agency for the stabilization of employment, for the entire Drug Industry. 

(m) ,vithin one month after the effective date of this Code, to 

appoint a committee to make a study with a view to the establishment, within three months following, of classifications and standard of dimen ioning and quality, containers, weights, measures, 

and labelling for products of the Industry, in cooperation with the 

American Standards Association, the Bureau of Standards of the 

United States Department of Commerce, or any other organization 

which will guarantee both consumer and Government representation 

in the drafting of such standards. • ( n) To make a study of the use by member of the Industry of 

long-term ontracts and to recommend to the Board any additional 

trade practice rules that may be neces ary to control such abuses as 

may be found t o exist in the use of long-term contracts. Such trade 

practice rule shall becom.e operative as a part of this Code upon 

a ppro, al by the Board after such notice and hearing as it may deem 

nece :::ary. 

ARTICLE VII- GENERAL 

SEcTio~ 1. E xcept a may be subsequently et forth in a specific 

or upplementary E xport Code for the Industry, the provi ions of 

this Code now or hereafter adopted with regard to prices, di counts, 

deduction , allowance , extras, comm.is ions or methods and/or 

terms of sale are not to apply to direct export sales. 

SECTION 2. In addition to Articles I to XI, inclusive, of this Code 

the attached Schedule (A, B, C, D and E) are supplementary to 

and con titute part of the Code of Fair Competition for the National Organic Products Industry, and are applicable each to its 

respective Division. 
31 

ARTICLE VIII-1\!IomFICATION 

SECTION 1. This Code and all the provisions thereof are expressly 

made subject to the right of the President, in accordance with the 

provisions of subsection (b) of Section 10 of the Act, from time to 

time to cancel or modify any orde-r, approval, license, rule, or regulation issued under Title I of said Act and specifically, but without 

limitation, to the right of the President to cancel or modify his approval of this Code or any conditions imposed by him on his 

approval thereof. 

SECTION 2. This Code, except as to provisions required by the Act, 

may be modified on the basis of experience or changes in circumstances, such modifications to be based upon a~plication to the 

Board and such notice and hearing as it shall specify, and to become 

effective on approval of the President. 

ARTICLE IX-MONOPOLIES, ETC. 

No provision of this Code shall be so applied as to permit monopolies or monopolistic practices, or to eliminate, oppress, or discriminate against small enterprises. 

ARTICLE X-PRICE INCREASES 

Whereas the policy of the Act to increase real purchasing power 

will be made more difficult of consummation if prices of goods and 

services increase as rapidly as wages, it is recognized that price increases, except such as may be required to meet individual cost, 

should be delayed. But when made, such increases should, so far as 

possible, be limited to actual additional increases in the seller's costs. 

ARTICLE XI-EFFECTIVE DATE 

This Code shall become effective on the second ~1onday after its 

approval by the President. 

Approved Code No. 545. 

Registry No. 613--04. 
SCHEDULE A 

SUPPLEMENTAL PROVISIO ~s APPLICABLE TO THE BOTANICAL DRUG INDUSTRY 

The following supplemental provisions shall apply to the Botanical Drug 

Industry: 

SECTION I-DEFINITIONS 

The term "member of the Division" as used in this Schedule includes, but 

without limitation, any individual, partnership, association, corporation, or 

other type of enterprise engaged in the Botanical Drug Industry, either as an 

employer or on his or its own behalf. 

SECTION II-TRADID PRACTICE RULES 

RuLE 1. Ko member of the Division shall use advertising or selling methods 

or credit terms which have the capacity or tendency to deceive or mislead the 

cu tomer or prospective cu torner. RULE 2. Each member of the Division shall abide by the following terms and 

specifications of sale: 

(a) The cash discount ·hall not exceed one (1) percent, and shall not be 

allowed u nless payment is made within ten (10) days from date of shipment. 

(b) The net term of payment shall not exceed thirty (30) days from date 

of sh ipment. (c) No guarn.ntee or protection in any form shall be given a customer against 

decline in the selling price of any product. 

( d) Crude and milled botanical products, except for delivery within their 

metropolitan districts, shall be sold on a delivery basis of ex-dock and exwarehou e, or f. o. b. carrier. 

( e) Each sales contract shall contain a definite expiration date, and a specific variation not to exceed fifteen (15) percent between the minimum and 

maximum quantity. 

RuLEJ 3. No member of the Division shall secretly offer or make any payment 01· a llowance of a r ebate, r efund, commission, credit, unearned discount, 

or excess allowance, whether in the form of money or otherwise, nor shall any 

member secretly offer or extend to any cu tomer any special service or privilege not extended to all customers of the same class, for the purpose of influencing a sale. RULE 4. Allowances fo r weights of all containers shall be in accordance with 

provisions of the official Tares of the New York Board of Trade. 

(32) 
SCHEDULE B 

SUPPLEMENTAL PROVISIONS APPLICABLE TO THE ESSENTIAL OIL INDUSTRY 

Th-e following supplemental provisions shall apply to the Essential Oil 

Industry : 

SECTION I-DEFINITIONS 

The term "member of the Division" as used in this Scheclule, includes, 

but without limitation, any individual, partnership, association, corporation, 

or other type of enterprise engaged in the Ess ntial Oil Industry, either as an 

employer or on his or its own behalf. 

SECTION II-TRADE PRACTICE RITT.ES 

RuLE 1. No member of the Division shall use advertising or selling methods or 

credit terms which have the capacity or tendency to deceiYe or mislead the 

customer or prospective customer. 

R ULE 2. No member of the Division shall withhold from or insert in nny 

quotation or invoice any statement that makes it inaccurate in any mat dal 

particular. 

RuLE 3. No member of the Divi ion shall brand or mark or pack any com- modity in any manner which tends to deceive or mislead purchasers \Yith 

respect to the brand, grade, quality, quantity, origin, size, material content, 

or preparation of such commodity. · RULE 4. No member of the Division shall use advertising or other representation which refers inaccurately in any material particular to any competitors 

or their commodities, prices, values, credit terms, policies, or services. 

RULE 5. No member of the Division shall give, permit to be given, or directly 

offer to give, anything of value for the purpose of influencing or r ewarding 

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 ngent, 

or the repre ented party, without the knowledge of such employer, principal, 

or party. This provision. shall not be corn trued to prohibit free and general 

distribution of articles commonly u ed for advertising except so far as such 

articles are actually -used for commercial bribery as hereinaboYe defined. 

RULEJ 6. No member of the Division shall make any unauthorized use of 

any copy, counterfeit, or colorable imitation of the trade mark, label, or identifying name or device of the products of another, so as to deceive or mislead 

purhasers or prospective purchasers. 

RULE 7. No rnemb r of the Division shall secretly offer or make any pay- ment or allowance of a rebate, refund, commis ion, credit, unearned discount or 

excess allowance, whether in the form of money or otherwise, nor shall any 

member secretly offer or extend to any customer any special service or privi- lege not extended to all customers of the same class, for the purpose of influencing a sale. RULE 8. Each member of the Division shall abide by the following terms and 

spec-ifica tions of sale. 

(a ) No member of the Industry shall \Yillfully induce or attempt to induce 

the breach of existing contracts between com1 etitors and their customers by 

any false or deceptive means, or interfere with or obstruct the performance 

of any such contractual duties or services by any such means, with the purpose 

and effect of hampering, injuring or embarrassing competitors in their business. 

(b) o guarantee or protection in any form shall be given a customer 

against decline in the selling price of any product. 

(c) Each member of the Division shall use a contract form which states 

delivery specifications, price, style and size of container, delivery Point, and 

terms of sale. 

(33) 
34 

(d) The ca ·h discount shall not exceed one (1) percent, and , ball not be 

allowed unless payment is made within ten (10) days from date of shipment. 

(e) Tl1e net term of payment shall not exceed thirty (30) days from date of 

shipment. 

(f) No member of the Division shall ship upon consignment except as may 

be permitted by the Board. RULE 9. Any natural impmity in or sophistication of a product of ,,hich 

a member of the Division knows or bas reason to know or could reasonably 

determine shall be clearly set forth on the label and invoice for said product. 

RuLE 10. No member of the Division shall make any contract of sale r elating 

to imported products and/or products of the Industry which are manufactured 

from imported raw materials or are a blend of imported and domest ic products 

which is to endure for a period longer than six ( 6) months. 
SCHEDULE 0 

SUPPLEMENTAL PROVISIONS APPLICABLE TO THE SPIR.IT AND OIL SOLUBLE GUM 

INDUSTRY 

The following supplemental provisions shall apply to the Spirit and Oil 

Soluble Gum Industry: 

SECTION I-DEFINITIONS 

The term "member of the Division" as used in this Schedule, includes, but 

without limitation, any individual, partnership, association, corporation, or 

other type of enterprise engaged in the Spirit and Oil Soluble Gum Industry, 

either as an employer or on his or its own behalf. 

SECTION II-TRADE PRACTICE RULES 

RULE 1. No member of the Division shall use advertising or selling methods 

or credit terms which have the capacity or tendency to deceive or mislead the 

customer or prospective customer. 

RULE 2. No member of the Division shall withhold from or insert in any 

quotation or invoice any statement that makes it inaccurate in any material 

particular. 

RULE 3. No member of the Division shall brand or mark or pack any commodity in any manner which tends to deceive or mislead purchasers with 

respect to the brand, grade, quality, quantity, 01igin, size, material content, 

or preparation of such commodity. 

RULE 4. No member of the Division shall use advertising or other representation which refers inaccurately in any material particular to any com- petitors or their commodities, prices, values, credit terms, polices, or ser vices. RULE 5. No member of the Division shall give, permit to be given, or 

directly offer to give, anything of value for the purpose of influencing 01• 

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 article are actually used for commercial bribery as hereinabove defined. 

RULE 6. No member of the Division shall secretly offer or make any payment or allowance of a relJ.ate, refund, commission, credit, unearned discount 

or excess allowance, whether in the form of money or otherwise, nor shall a 

member 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. 

RULE 7. Each member of the Division shall abide by the following terms 

and specifications of sale: 

(a) No guarantee or protection in any form shall be given any customer 

against decline in the selling price of any product. 

(b) The cash discount shall not exceed one (1) percent, and shall not be 

allowed nnless payment is made within ten (10) days from date of shipment. 

(c) The net terms of payment sha ll not exceed thirty (30) days from date 

of shipment. 

( d) Each member of the Division shall use a contract form which states 

delivery specifications, price, style, size of container, delivery point, and terms 

of sale. 

(e) No member of the Division shall make any contract of sale relating to 

imported products and/or products of the Industry which are a blend of 

imported and domestic products which is to endure for a oeliod longer than 

six (6) months. 

(35) 
SCHEDULED 

SUPPLEME TAL PROVISIONS APPLICABLE! TO THE! WATER: SOLUBLE GUM INDU STRY 

The following supplemental provisions shall apply to the Water Soluble Gum 

Industry: 

SECTION I-DEFI ITIONS 

The term "member of the Division " as used in this Schedule, includes, but 

without limitation, any individual, partnership, association, corporation, or 

other type of enterprise engaged in the Water Soluble Gum Industry, either as 

an employer or on his or its own behalf. 

SECII'IOX II-TRADE] PRAC'I'IOE RULES 

RULE 1. No member of the Division shall use advertising or selling methods 

or credit terms which have the capacity or tendency to deceive or mislead the 

customer or prospective customer. 

RuLE 2. No member of the Division shall withhold from or insert in any 

quotation or in-voice any statement that makes it inaccurate in any material 

particular. 

RULE 3. No member of the Division shall use advertising or other representation which refers inaccurately in any material particular to any competitors or 

their commodities, prices, values, credit terms, policies or services. 

R ULEJ 4. Each member of the Division shall abide by the following terms and 

specifications of sale: 

(a) The ca h discount shall not exceed one (1) percent, and shall not be 

allowed unless payment is made within ten (10) days from date of shipment, 

in United States funds. 

(b) The net terms of payment shall not exceed thirty (30) days from date of 

shipment, in United States funds. 

(c) No guarantee or protection in any form shall be given any customer 

against decline in the selling price of ,any product. 

(d) Each member of the Division shall use a contract form which states 

delivery specifications, price, style and ize of container, delivery point, and 

terms of sale. ( e) Except for deliveries within their metropolitan trading areas, all members 

of the Division shall make -all shipments F. 0. B. cars point of shipment. 

RULE 5. No member of the Division shall secretly offer or make any payment 

or allowance of a r ebate, refund, commission, credit, unearned discount or excess 

allowance, whether in the form of money or otherwise, nor shall any member 

ecretly offer or extend to any customer any special service or privilege not 

extended to all customers of the same cla ·s, for the purpose of influencing a 

sale. 

RuLFJ 6. No member of the Division shall make any contract of sale relating 

to imported products and/or products of the Industry which are a blend of 

imported and domestic products which is to endure for a period longer than 

six ( 6) months. 

(36) 
SCHEDULE ID 

SUPPLEMENTAL PROVISIONS APPLICABLE TO THE VANII.LA BEAN INDUSTRY 

The following supplemental provisions shall apply to the Vanilla Bean 

I ndustry: 

SECTION I-DEFINITIONS 

The term " member of the Division " as u ed in this Schedule includes, but 

without limitation, any individua l, partnership, association, corporation, or 

other type of enterprise engaged in the Vanilla Bean Indu try ither as an 

employer or on his or its own behalf. 

SECTION II-TR.ADE PRACTICE RULES 

Ruui 1. No member of the Division shall use advertising or selling methods 

or ere lit terms which have the capacity or tendency to deceive or mislead 

the customer or prospective customer. 

RULE 2. No member of the Division shall withhold from or insert in any 

quotation or invoice any statement that makes it inaccurate in any material 

particular. RULE 3. No member of the Division shall brand or mark or pack any com- modity in any manner which tends to cleceiYe or mislead purcba ·ers with 

r espect to the brancl, grade, quality, quantity, origin, size, material content, 

or pr paration of such commodity. 

RULE -1. No member of the DiYision shall use advertising or other repre. entation which refers inaccurately in any material particular to any competitors 

or their commodities, prices, values, credit terms, policies, or ervices. RULE 5. No member of the Division shall secretly offer or mak any payment 

or allowance of a r ebate, refund, commis. ion, credit, unearned discount or 

excess allowance, whether in the form of money or otherwise, nor shall any 

member secr etly offer or extend to any customer any special service or privilege 

not extended to all cu tomers of the same class, for the purpose of influencing 

a sale. RULE G. Ea ·h member of the Divi ion . hall abide by the following terms an 1 

specifi ·ations of sale: 

(a) The cash discount hall not exceed one (1) percent, and shall not be 

allo,Yed unless payment is made within ten (10) days fr om elate of shipment, 

unless it takes louger than ten (10) days to make deli\"eries, and in such case 

tlle cash discount period shall not exceed thirty ( 30) days. (b) The net terms of payment sl1all not exceed thirty (30) days unless, 

it takes longer than ten (10) days to make deliveries, and in such case the 

net terms of payment . ha ll not exceed forty-five (45) days. 

(c) No guarantee or protection in any form shall be given any customer 

ngainst decline in the selling price of any product. 

( d) Merchandise, exc 0 pt for cleli,ery within metropolitan limits, shall be 

sold only upon a delivery basis from home offi ce of seller, ex-clock, ex-warehouse, or F . 0. B. carrier. (e) Each member of the Division shall use a contract form which states 

cleli very specifi cations, price, style and size of container, delivery point, and 

terms of sale. 

RULE 7. No member of the Division shall make any contract of sale relating 

to importecl product and/or products of the Industry which are a blend of 

imported ancl domestic products which is to endure for a period longer than 

six (6) months. 

(37) 

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