Approved Code No. 61-Arnendment No.1 Registry No. 1399-1-16 

NATIONAL RECOVERY ADMINISTRATION 

AMENDMENT TO 

CODE OF FAIR COMPETITION 

FOR THE 

INDUSTRIAL SUPPLIES AND 

MACHINERY DISTRIBUTORS TRADE 

AS APPROVED ON OCTOBER 2, 1934 

WE DO OUR PART 

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WASHINGTON: 1934 

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Approved Code No. 61-Amendment No.1 

AMENDMENT TO CODE OF FAIR COMPETITION 

FOR THE 

INDUSTRIAL SUPPLIES AND MACHINERY 

DISTRIBUTORS' TRADE 

As Approved on October 2, 1934 

ORDER 

APPROVING AMENDMENT TO CoDE OF FAIR CoMPETITION FOR THE 

INDUSTRIAL SuPPLIEs AND MACHINERY DISTRIBUTORs' TRADE 

An application having been duly made fursuant to and in full 

compliance with the provisions of Title I o the National Industrial 

Recovery Act, approved June 16, 1933, for approval of amendments 

to a Code of Fair Competition for the Industrial Supplies and 

Machinery Distributors' Trade, and hearings having been duly held 

thereon, and the annexed report on said amendments containing 

findings with respect thereto, having been made and directed to the 

President; 

NO,iV, 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 6859, dated September 27, 1934, and · otherwise, 

does hereby incorporate by reference, said annexed report and does 

find that said amendments and the Code as constituted after being 

amended comply in all respects with the pertinent frovisions and 

will promote the policy and purposes of said Titl~ o said Act, and 

does hereby order that said amendments be and they are hereby 

approved, and that the previous approval of said Code -is hereby 

amended to include an approval of said Code in its entirety as 

amended, such approval and such amendments to take effect ten (10) 

days from the date hereof, unless good cause to the contrary is 

shown to the National Industrial Recovery Board before that time 

and a subsequent order to that effect is issued. 

NATIONAL INDUSTRIAL RECOVERY BoARD, 

By G. A. LYNCH, Administrati1Je Officer. 

Approval recommended: 

RoBERT L. HousToN, 

Division Administrator. 

WASHINGTON, D. C., 

October 2, 1934. 

88927°----1244-4--.--34 (1) 
REPORT TO THE PRESIDENT 

The P RESIDENT, T Ae White H ouse. 

SrR: Under t he Code o£ Fair Competition £or the Industrial 

Supplies and Machinery Distributors' Trade, as approved on October 

23, 1933, the Code Authority £or said Tr ade has submitted the 

Amendmtmts which are included and attached. 

This is a report on the Hearin~ on the for egoing Amendments, 

conducted at the Carlton Hotel In Washington, D. C., on June 

15, 1934, in accordance with the regulations o£ the National Recovery Administration. 

These Amendments are considered as o£ vital importance to this 

Trade which is making an earnest effort to curtail and prevent 

certain industrial practices and abuses which have become apparent 

during the past few years and which i£ allowed to continue will tend 

to prevent a rapid return o£ industrial recovery in this Trade. 

FINDINGS 

The Deputy Administrator in his final report to us on said Amendments to said Code having found as herein set forth and on the 

basis o£ all the proceedings in this matter; 

We find that: 

(a) The Amendments to said Code and the Code as amended 

are well designed to promote the policies and purposes o£ Title I 

o£ the National Industrial Recovery Act, including the removal 

o£ obstructions to the free flow o£ interstate and foreign commerce 

which t end to diminish the amount thereof, and will provide £or 

the general welfare by promoting the organization o£ industry for 

the purpose o£ cooperative action of labor and management under 

adequate gov·ernmental sanction and supervision, by eliminating 

unfair competitive practices, by promoting the fullest possible utilization o£ the present productive capacity o£ the industries, by avoiding undue restriction o£ production (except as may be temporarily 

required), by increasing the consumption o£ industrial and a~ricultural products through increasing purchasing power, by reducing 

and relieving unemployment, by improving standards o£ labor, and 

by otherwise rehabilitating industry. 

(b) The Code as amended complies in all respects with the pertinent provisions o£ said Title of said Act, including without limitation Subsection (a) o£ Section 3, Subsection (a) o£ Section 7, and 

Subsection (b) o£ Section 10 thereof. 

(c) The amendments and the Code as amended are not designed 

to and will not permit monopolies or monopolistic practices. 

(d) The amendm~mts and the Code as amended are not designed 

to and will not eliminate or oppress small enterprises and will not 

operate to discriminate against them. 

(2) 
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(e) Those engaged in other steps or the economic process have 

not been deprived of the right to be heard prior to approval of 

said amendments. 

For these reasons, we have approved these amendments. 

Respectfully, 

OcTOBER 2, 1934. 

NATIONAL INDUSTRIAL RECOVERY BoARD, 

By G. A. LYNCH, Acl1ninistrative Officer. 

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MIEND~1:ENT TO CODE OF FAIR COMPETITION FOR 

THE INDUSTRIAL SUPPLIES AND MACHINERY DISTRIBUTORS' TRADE 

Amend Article V, by deleting the present Section 1 (b) and in1serting a new Section 2, Section 3, Section 4 as follows: 

SEc. 2. It being :found necessary in order to support the administration of this Code and to maintain the standards of fair competi1 tion established hereunder and to effectuate the policy of the Act, 

'the Code Authority is authorized : 

(a) To incur such reasonable obligations as are necessary and 

proper for the foregoing purposes, and to meet such obligations out 

1 of funds which may be raised as hereinafter provided and which 

shall be held in trust for the purposes of the Code; 

(b) To submit to the Administrator for his approval, subject to 

such notice and opportunity to be heard as he may deem necessary (1) 

an itemized budget of its estimated expenses for the foregoing purposes, and (2) an equitable basis upon which the funds necessary to 

support such budget shall be contributed by members of the Trade; 

(c) After such bp.dget and basis of contribution have been approved by the Administrator, to determine and obtain equitable 

contribution as above set forth by all members of the Trade, and 

to that end, if necessary, to institute legal proceedings therefor in 

its own name. 

SEc. 3. Each member of the Trade shall pay his or its equitable 

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

regulations pertaining thereto issued by the Administrator. Only I members of the Trade complying with the Code and contributing 

\to the expenses of its administration as hereinabove provided, unless 

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.duly exempted from making such contributions, shall be entitled to 

participate in the selection of members of the Code Authority or to 1

receive the benefits of any o:f its voluntary activities or to make use 'of any emblem or insignia of the National Recovery Administration. 

1 SEc. 4. The Code Authority shall neither incur nor pay any obli-

\gation substantially in excess of the amount thereof as estimated in 

•its approved budget, and shall in no event exceed the total amount 1 contained in the approved budget, excBpt upon approval of the Ad-

!ministrator; and no subsequent budget shall contain any deficiency 

[item for expenditures in excess of prior budget estimates except 

those which the Administrator shall have so approved. 

/ Amend Article V, Section 2, by deleting the figure " 2 " and substitute therefor the figure "5 ". 

Amend Article VI by adding Sections 13 and 14 as follows: 

SEc. 13. When a member of the Trade desires to dispose of obso-

']ete, closeout, or discontinued items, and to offer such merchandise 

for sale at prices less than his customary prices, he shall file with 

(4) 
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the Regional Committee in the area in which he is located, a state- ment showing the quantity, sizes, and complete description of the 

merchandise so offered for sale, and the reasons for such sale. On 

such sales, all invoices for merchandise so sold shall plainly display 

the following words, "Special Closeout Prices". Failure to observe this rule or increasing such stock during liquidation at the 

special prices is an unfair method of competition. Any distributor 

finding himself in this position shall first offer the surplus of merchandise to the manufacturer thereof, and failing to dispose of such 

merchandise by this method shall offer same to the members of the 

Trade in the regional group. 

SEc. 14. The issuing of credit or making of cash settlement beyond 

the recoverable value of any goods accepted by any member of the 

Trade in exchange for or as part payment for any products of this 

Trade. 

Approved Code No. 61-Amendment No. 1. 

Registry No. 1399-1-16. 

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