The potters herald. [volume] (East Liverpool, Ohio) 1899-1982, 1950-03-09
Trade Commission
Official Defends
Cartel Deals

V0s kGt 0G0kO
Washington (LPA) - Chairman
Celler of the House Monopoly In
vestigating Committee has sub
mitted to the Federal Trade Com
for investigation testi-
mony by one of its key officials in
cartel deals between Am
erican export associations and for
eign cartels are lawful.
Celler acted after Allen c..
Phelps, who heads the ETC Export
Trade Division and presumably is
in charge Of policing the export
associations formed by American
companies under the Webb-Pom-
creme law exempting them from
the antitrust laws, testified before
the House Committee.
Phelps shocked CeIler by saying
he felt that under the Webb-Pom-
creme Law export associations
could make cartel deals. He con-
tended that was the purpose of
Congress in passing the law.
Celler pointed out that the for
eign policy Of the U. S. was against
cartels and quoted former Sena-
tor Pomerene, one Of the authors
of the law, as saying it did not
authorize divisions of territory
abroad, which is one of the objects
of cartels.
Phelps replied that the law SEEM
ed TO say export associations were
free TO joint in cartels-that the
law put the interests of American
"above the interests of
the foreign buyer or the foreign
:"
Later John Stedman, an anti
trust official Of the Justice De-
testified the FTC had
never applied the Webb-Pomerene's
penalty of s100 against export as
sociations which fail to report to
the ETC. He said the FTC also had
never issued a cease and desistI
order against an export associa-
ton.
Phelps said he did not like to be
put in the position of defending
cartels, but he did not know what
our foreign policy was in regard
TO cartels.
Phelps contended American ex-
port associations had made only
Is cartel deals, and none was in
effect today. Celler pointed out
that a Federal Court recently con-
victed the alkali export association
Of belonging to such a cartel.
Phelps said that cartel was form
ed in 1880 and it has only been
since 1910 that their legality was
questioned.
Asked why he had never referred
any of the cartel deals to the JUS
ice Department for prosecution,
Phelps said the export association
lad always complied with the law
n filing reports with the FTC. |
Celler then read an ETC report
charging the steel export associa-
ion had failed to comply with the
aw in filing its cartel deal, and
another ETC report denouncing a
sulphur cartel deal.
Phelps said he did not "sub-
scribe" to those reports by the
agency which employs him. He con-
ended the Webb-Pomerene law
permitted any deals that did not |
lffect competition in this country
md he had found no evidence that
hose did.
Il take it you do not agree with |
he findings and recommendations
# the FTC?" Celler asked. i
81 do not agree with those par
icular conclusions which you read"
he witness replied.
Celler then read another ETC re-
'ort charging cartel deal between
American producers of phosphate
nd the foreign cartel gave the
omestic producers "particalIyl
protection against COM
etition from abroad.
Celler said it was "very serious"
or American exporters to be en-
aging in cartel deals when theyI
yere against our foreign policy. He
uoted Winthrop G. Brown, dir
ctor of the Office of international
'rade Policy of the State Depart
lent, as saying sit is an import
Mt part Of u. S. economic foreign
olicy to press for the elimination
cartel arrangements which block
ne expansion of multilateral, COM
etitive, international trade"
Phelps insisted again that so far
S he knew there were no cartel
eals today. He added: "At least b
e ask them every year in their (