1940: Federal Trade Commission

The Federal Trade Commission was organized March 16, 1915, under the Federal Trade Commission Act, approved Sept. 26, 1914. This Act was amended March 21, 1938. The Commission is an administrative tribunal exercising quasi-judicial and investigatory functions, the more important of which are these: (1) to prevent unfair methods of competition and unfair or deceptive acts or practices in interstate and foreign commerce; (2) to make fact finding investigations at the direction of Congress, the President, the Attorney General, or upon its own motion; (3) to report facts in regard to alleged violations of the anti-trust laws; (4) to administer the Export Trade Act by which is permitted the organization of associations to engage exclusively in export trade; and (5) to prevent price discriminations and other practices in violation of the Clayton Act, as amended by the Robinson-Patman Act.

The Federal Trade Commission is composed of five commissioners appointed by the President and confirmed by the Senate. The term of office is seven years. As of Dec. 31, 1940, the membership of the Commission was as follows, all having served through the year: Hon. Ewin L. Davis of Tennessee, Chairman; Hon. Garland S. Ferguson of North Carolina; Hon. Charles H. March of Minnesota; Hon. William A. Ayres of Kansas; and Hon. Robert E. Freer of Ohio. The chairmanship rotates each calendar year, Commissioner March becoming chairman Jan. 1, 1941.

The Commission's chief objective in the administration of the various acts under its jurisdiction is to eliminate the practices which such acts prohibit. These include combinations or conspiracies in restraint of trade through price fixing or other unlawful agreements, unfair methods of competition, unfair or deceptive acts or practices and unlawful price or related discriminations. The identity of complainants is never disclosed by the Commission nor does it give publicity to the preliminary investigations of alleged violations which it makes. Such investigations may result in stipulations to cease and desist, or in closings or the issuance of formal complaints by the Commission. Formal complaints may result in dismissals, closings, or orders to cease and desist by the Commission. The respondent may apply to the Circuit Court of Appeals for review of an order or the Commission may apply to the Court for enforcement of the order.

Enacted by Congress Oct. 14, 1940, to become effective July 14, 1941, the 'Wool Products Labeling Act of 1939' is to be administered by the Commission. The Act declares the sale or distribution in commerce within the meaning of the Federal Trade Commission Act, or the manufacture for such sale or distribution, of any wool product which is misbranded within the meaning of the Labeling Act, to be unlawful and an unfair method of competition and an unfair and deceptive act or practice under the Federal Trade Commission Act. In addition to the specific powers conferred upon the Commission for the administration of the Act, the Commission is authorized to act under all applicable terms and provisions of the Federal Trade Commission Act in the enforcement of the Wool Labeling Act.

During the year the Commission began, as a continuing project, the collection and publication of financial statistics for a group of important industrial corporations operating in each of many of the principal industries of the United States. As published, financial data for concerns of a single industry are combined into one brief report and include balance sheet and surplus items, itemized costs of goods sold, net profit, other income, various deductions, including interest and discount on long-term debt and income and excess profits taxes, final net income and certain operating ratios. By the close of the year reports for the fiscal year 1939 had been issued for twenty-two industries, with many more industries to be included in the 1939 series.

Inquiries into the distribution cost accounting methods of industry and the costs and methods of distribution were in progress at the close of the year.

The Commission, on its own initiative or upon application, may hold for any industry a trade practice conference, the object of which is the adoption by that industry, with the Commission's approval, of rules for the prevention of unfair methods of competition and other unfair trade practices. Participation in such conference by the industry's members is voluntary. The following industries, among others, held such conferences during the year: automobile, beauty and barber equipment and supplies, hosiery, linen, luggage, ripe olive, tuna fish and watch case.