Approved Code No. !-Amendment No. 3 Registry No. 299-25 

NATIONAL RECOVERY ADMINISTRATION 

AMENDMENT TO 

CODE OF FAIR COMPETITION 

FOR THE 

COTTON TEXTILE INDUSTRY 

AS APPROVED ON DECEMBER 29, 1933 

WE DO OUR PAin' 

UNITED STATES 

GOVERNMENT PRINTING OFFICE 

WASHINGTON : 1934 

For sale by the Superintendent of Documents, Washington, D.C. - - • - - - - - Price 5 cen ts 
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• 
Approved Code No. !-Amendment No. 3 

AMENDMENT TO CODE OF FAIR COMPETITION 

FOR THE 

COTTON TEXTILE INDUSTRY 

As Approved on December 29, 1933 

TRADE PRACTICES GOVERNING THE MERCHANDISING 

OF CARDED COTTON YARN 

The Cotton Textile Industry Committee, in accordance with Section VI of the Code of Fair Competition for the Cotton Textile 

Industry, has submitted for my approval the following recommendations as to trade practices governing the merchandising of carded 

cotton yarn : 

"TRADE PRACTICES GOVERNING THE MERCHANDISING OF CARDED COTTON 

YARN 

" 1. Defi;nitions. 

" (a) ' Spinning mill ' is any manufacturer spinning carded cotton 

yarn to be sold as such, whether selling with or without the emplovment of a selling agent. · ~ 

"(b) 'Selling agent' is any person, whether known as a commission hou e, yarn merchant or otherwise, who sells carded cotton 

yarn in the relation of an agent for a spinning mill, who receives 

a commission for his services, assumes the obligation of effecting 

sales in the interest of the spinning mill and guarantees the account 

of the purchaser, the mill being the principal in all transactions and 

being furnished with the names of all prospective purchasers when 

sales negotiations are opened, the guarantee of performance of the 

contract being a matter for special agreement between the spinning 

mill and the selling agent. 

" (c) ' Commission ' is the sum paid or allowed to an agent for 

his services to a spinning mill in the sale of carded cotton yarn. 

" (d) 'Broker' is one who brings together spinning mills and purchasers and receives, on each transaction which the mill completes 

by delivery, a brokerage fee on the price of the order, but does not 

guarantee the account. 

" (e) ' Purchaser ' is anyone who buys carded cotton yarn for his 

own account or for that of an affiliate or subsidiary or parent organization. '

1 2, Spinning mills shall :furnish duly certified report each week 

to the Statistical Bureau of The Cotton-Textile Institute, Inc., 320 

42583°----376-143----34 (1) 
2 

Broadway, New York City, of all sale of carde l cotton yarn during the week immediately prior (except sales made through selling 

agents) , stating same by date of order quantity and description of 

yarn, lelivery specifications, price to be paid, and terms of sale. 

Selling agents hall file sim.ilar report as to all sales made on 

behalf of spinning mills. Statistical reports shall be issued weekly 

by the Institute to all spinners and selling agent. ummarizing uch 

statistical information received. ' 

" 3. No spinning mill, selling directly, shall make any price to a 

purchaser or any allowance to a purchaser in the guise of commis· 

sion, brokerage, dealer' eli count or fee, either directly or indirectly1 

or by any secret rebate, advantage, inducement, compensation, gift 

or otherwi e, by which any purchaser shall, in effect, pay a less price 

than the price which such spinning mill would quote if dealing 

through selling agents. Commission shall be paid only to bona fide 

selling agents registered as such with The Cotton-Textile Institute, 

Inc. 

"4. No selling agent shall, directly or indirectly, by way of commission, discount, fee, secret rebate, advantage, inducement, compensation, gift or otherwise, split or divide with or pass on to the 

purchaser the commission or any part thereof which he receives 

from the spinning mill. 

" 5. Selling agents shall not, directly or indirectly, whether 

through a subsidiary or an affiliate or otherwise, buy stocks of carded 

yarn for their own account or for that of a subsidiary or affiliate or 

parent organization, engage in short selling or guaranteeing prices 

against decline; but a selling ag·ent may sell for his own account any 

yarn which he may be required to take over by reason of his guarantee of a purchaser's account or contract. 

" 6. No spinning mill shall, either directly or through a selling 

agent, guarantee prices against decline, or directly or indirectly abate 

prices on unfinished contracts, except to the extent that costs are 

affected by subsequent Governmental action. 

"7. No spinning mill shall, either directly or through a selling 

agent, grant to any purchaser on any sale of any type of carded yarn 

sold as such more favorable terms of cash discount than 2% discount 

for payment within 30 days or 2% discount up to the lOth proximo, 

as may be elected by the purchaser. All yarn, other than as hereinafter mentioned, shall be sold net weight. Not more than five days' 

grace shall be allowed in any discount period. All sales providing 

for settlement either in any medium other than cash or for longer 

periods of time than those above specified shall be absolutely net. 

On sales of ball warps, chain warps, warps on beams and similar putups such yarn shall be sold on the basis of calculated weight with 2% 

tolerance. The foregoing stipulations in this clause apply only to 

domestic sales. 

"8. In all sales effected by spinning mills, whether directly or 

through a selling agent, there shall be used a 'uniform form of contract', after such form shall have been submitted to the Administrator by the Code Authority and received his approval. 

" 9. No provision herein shall apply in respect to orders placed 

before the effective date of these provisions which remain uncompleted on that date. 
3 

"10. Administration of these provi ion 'GoYerning the l\Ierchandising of Carded Cotton Yarn ' is entrusted to the ' Carded Yarn 

Sub-Committee,' con tituted by the Cotton Textile Indu try Com- mittee, . ubject to the authority and jurisdiction of the latter committee, i. e., the Code Authority for the Cotton Textile Inclu try." 

Pursuant to the authority vested in me by aid Section VI of the 

Code, I hereby approve said recommendation and order that beginning January 1, 1934, they become effective as part of the Code. 

HuGHS. JoHN oN, 

Administrator fo?' I ndustrial R ecovery. 

Approval recommended: 

LEo "\V OLl\IAN, 

NELSON SLATER, 

December t£9, 1933. 

ApproYed Code No. 1-Amendment No. 3. 

Registry No. 299-25. 

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