1941: Federal Trade Commission

The Federal Trade Commission was organized March 16, 1915, as a result of the passage of the Federal Trade Commission Act Sept. 26, 1914.

The Commission is a quasi-judicial and administrative body whose chief duties are (1) to prevent in interstate and foreign commerce unfair methods of competition, unfair or deceptive acts or practices and price discrimination; (2) to find and report facts relating to industrial corporations and their activities, either in aid of legislation or in regard to alleged violations of the antitrust laws; (3) to administer the Export Trade Act, whose purpose is to promote foreign trade through organization of associations which may engage only in export trade; and (4) to administer the 'Wool Products Labeling Act of 1939,' which declares the sale or distribution in interstate commerce, or the manufacture for such sale or distribution, of any wool product which is misbranded within the meaning of the Act, to be unlawful and an unfair method of competition and an unfair and deceptive act or practice under the Federal Trade Commission Act.

When violations of the acts administered by the Commission are alleged, preliminary investigations are frequently necessary in order to determine whether such allegations shall be docketed as applications for complaint. When an application for complaint is docketed, a thorough investigation is made, following which the matter may be closed, an agreement by the respondent to stipulate to cease and desist from any unlawful practices may be reached, or a formal complaint may be issued. During the fiscal year ended June 30, 1941, 532 stipulations to cease and desist from various practices were accepted by the Commission while the matter was in this informal stage. During the same period 357 formal complaints were issued by the Commission. These complaints alleged, among other things, combination to fix and maintain prices, combination and conspiracy in restraint of trade, misrepresentation in advertisements, labels and so forth and discrimination in prices. Upon trial of a complaint, the Commission may sustain the charges and issue an order to cease and desist, it may dismiss the complaint, or it may close the case without prejudice. During the fiscal year in question the Commission issued 348 orders to cease and desist.

The Wool Labeling Act became effective July 14, 1941. The Commission, prior to that date, under the authority of the Act, formulated the rules and regulations necessary to carry out its provisions and subsequently, in the administration of the Act, assisted those affected by it to meet its requirements in the interest of fair competition and consumer protection. Applications have been submitted to the Commission from numerous industries requesting that products of their manufacture be exempt from provisions of the Wool Products Labeling Act for the reason that the textile content of such products are insignificant or inconsequential. Decisions have been rendered by the Commission during the year 1941, both granting and denying such applications.

Trade practice conference proceedings were completed by the Commission for six industries during the fiscal year ended June 30, 1941. The purpose of these conference is the establishment, subject to the Commission's approval, of rules to prevent unfair methods of competition and other unfair trade practices or trade abuses.

Forty-five export trade associations organized under the Export Trade Act had papers on file with the Commission at the beginning of the calendar year 1941. Three of these associations withdrew during the year and nine new ones were formed, with a net total of 51 operating at the close of the year.

The Commission's continuing project of collecting reports from the more important industrial corporations engaged in interstate commerce and compiling therefrom the significant facts regarding business conditions and financial results for 1939 resulted by June 30, 1941, in published reports for 76 industries including 780 corporations. The aggregate sales of these 780 corporations represented approximately 64 per cent of the total value of products as reported by the United States Bureau of the Census for the corresponding groups of manufacturers. A general inquiry also was under way through much of the calendar year 1941 into a comparison of savings in costs of selling and delivering foods in quantities to the buyer's warehouse and the price concessions made to the buyer on such sales.

The investigational activities of the Commission during the second half of the calendar year were largely devoted to the ascertainment of facts and information for the Office of Price Administration and the Office of Production Management. These inquiries variously covered such data as costs, prices, profits, investments and production and distribution practices. Among the industries included were lumber, rubber tires and tubes, household furniture, bread and other bakery products, paperboard and milk and milk products. For the same purpose, financial and other information was collected from the manufacturers of iron and steel castings, bolts and nuts, business machines, industrial machinery, merchant pig iron and by-product coke, from producers of lead, zinc, asbestos, cadmium and antimony and from warehouse distributors of iron and steel products. Also, an extensive investigation has been completed for the Office of Production Management with respect to the extent of compliance with or violation of priority orders issued by that Office concerning one of the principal industries of the nation.