(a) The industry approves the practice of each individual member of the industry independently publishing and circulating to the purchasing trade its own price lists.

(b) The industry approves the practice of making the terms of sale a part of all published price schedules.

§ 84.104 Incomplete coverage of warranties, etc.

The service which a warm air furnace will render to the user is dependent not only upon the quality and the correct size for the use intended, but also upon the method of installation. The issuance of a guaranty against defective material or workmanship, coupled with a guaranty of successful performance, which does not provide definitely for the replacement of defective parts on account of workmanship or material within a stated time, and for replacement if installed in accordance with the standard code approved by the National Warm Air Heating Association, or as altered by municipal ordinances at the residence of the user, and fails to comply with approved standards of performance, is condemned by the industry.

85.103

Fictitious bids.

85.104 Price-cutting bids; "skinning the

job."

Solicitation of favors in bidding.

Solicitation of information with view to price cutting.

Deception in bidding.

"Shopping" as a bidding practice.
Standards of calls for bids.

Identical information to all bidders.
Cost accounting.

Dissemination of credit information.

85.114 Inability to carry out contracts.
85.115 Standardization of specifications.
85.116 Arbitration.
85.117

One-bid policy applicable to pur

chases.

COMMITTEE ON TRADE PRACTICES

85.201 Industry committee.

AUTHORITY: The provisions of this Part 85 issued under secs. 6(g), 5, 38 Stat. 722, 719; 15 U.S.C. 46(g), 45.

SOURCE: The provisions of this Part 85 contained in trade practice rules, Fabricators of Ornamental Iron, Bronze, and Wire, FTC, Dec. 9, 1932, unless otherwise noted.

§ 85.1

GROUP I

Substitution of inferior materials. The practice of using or substituting in structures materials inferior in quality to those specified by the purchasers, without the consent of the purchasers to such uses or substitutions, and with the effect of deceiving or misleading such purchasers, or the use of materials inferior in quality to those required by the applicable governmental laws, rules, and regulations in the territory affected, is an unfair trade practice.

§ 85.2 Illegal methods of manufacture. The practice of using methods of manufacture and erection not in accord

with the applicable governmental laws, rules, and regulations obtaining in the territory affected is an unfair trade practice.

§ 85.3 Sales below cost.

The selling of goods below cost, with the intent and with the effect of injuring a competitor and where the effect may be to substantially lessen competition or tend to create a monopoly or to unreasonably restrain trade, is an unfair trade practice.

$85.5 Inducing breach of contract.

Willfully inducing or attempting to induce the breach of existing contracts between competitors and their customers by any false or deceptive means whatsoever, or interfering with or obstructing the performance of any such contractual duties or services by any such means, with the purpose and effect of unduly hampering, injuring, or embarrassing competitors in their businesses, is an unfair trade practice.

$ 85.6 Substitution of products not conforming to representations.

The practice of shipping or delivering products which do not conform to the samples submitted or representations made prior to securing the orders, without the consent of the purchasers to such substitutions, and with the effect of deceiving or misleading purchasers and the tendency to injuriously affect the business of competitors, is an unfair trade practice.

§ 85.7 Aiding or abetting use of unfair trade practices.

For any person, firm, or corporation knowingly to aid or abet another in the use of unfair trade practices is an unfair trade practice.

§ 85.8 Commercial bribery.

Directly or indirectly to give or permit to be given or offer to give money or anything of value to agents, employees, or representatives of customers or prospective customers or to agents, employees, or representatives of competitors' customers or prospective customers, without the knowledge of their employers or principals, as an inducement to influence their employers or principals to purchase or contract to purchase industry products from the maker of such gift or offer, or to influence such employers or principals to refrain from dealing or contract

ing to deal with competitors, is an unfair trade practice.

§ 85.9 Espionage.

Securing information from competitors concerning their businesses by false or misleading statements or representations or by false impersonations of one in authority and the wrongful use thereof to unduly hinder or stifle the competition of such competitors is an unfair trade practice. GROUP II

§ 85.101 Fraud in bidding.

The practice of bidders or sub-bidders of intentionally leaving out of their bids certain material called for by the plans and specifications, or the failure to make any mention in their bids as to whether certain work is or is not to be erected for the particular price submitted, thereby enabling a bidder, after the bids have been opened, to state, if necessary to secure the bid, that the missing material or the cost of erection was or was not included in his bid, and in this way unfairly to underbid his competitor, is condemned by the industry.

§ 85.102 Delayed sub-bids.

The practice of submitting sub-bids after the general contract has been awarded, where sub-bids have been secured, particularly after the sub-bids on the same work have been opened and the sub-bidders know the amount of the lowest sub-bid on the original bidding, is a fertile field for fraud and chicanery, makes a farce out of the wholesome practice of competitive bidding, and is condemned by the industry.

§ 85.103 Fictitious bids.

The industry approves of the "onebid" policy and condemns fake or fictitious bids made for the purpose of deceiving competitors and securing undue advantage. If plans and specifications are changed and new bids called for after the original bids have been submitted and opened, the same fairness should be obtained as with the original bid.

§ 85.104 Price-cutting bids; “skinning the job."

The practice of lowering one's bid without changes in the specifications justifying same, and without regard to the possibility of being able to comply with the specifications, frequently necessitates "skinning the job," and the use

§ 85.106

Solicitation of information with view to price cutting.

To induce or attempt to induce an architect, contractor, or builder to reveal to a bidder the amounts and conditions of any bid received on a competitive job, with a view of giving the favored concern an opportunity to meet or cut below the lowest bid, whether the favored concern was one of the original bidders or not, is condemned by the industry. § 85.107 Deception in bidding.

To mislead or deceive any bidder as to the amounts and conditions of other bids or with any other false information for the purpose of inducing him to cut his own is condemned by the industry.

§ 85.108 Unethical acquisition of bid

information.

Surreptitiously obtaining information relative to competitors' bids in the preparation of one's own bid is condemned by the industry.

§ 85.109 "Shopping" as a bidding practice.

It is a frequent practice for ornamental iron, bronze, and wire contractors to submit bids to general contractors who in turn use the lowest acceptable price from the several trades in making up their bids on a general contract. Many general contractors after securing the general contract then re-open the bidding for the same operation, commonly known as "shopping," which practice involves deception and misrepresentation, lowering the standard and quality of ornamental iron, bronze and wire installation and building construction. Such practice is condemned by the industry.

§ 85.110 Standards of calls for bids.

The industry favors the adoption of the following rules for calling for bids:

(a) In all cases where competitive bids are requested no one should be invited to bid to whom the contract would not be willingly awarded in the case his bid is the most acceptable in itself.

(b) Where accurate estimates are desired for information only, a reasonable fee or fees should be paid to the parties preparing them.

(c) Plans and specifications should be sufficiently complete to enable competent bidders to estimate accurately the amount of material and labor required.

(d) Invited bidders, provided they actually submit bids, should not be required to pay for the use of plans and specifications.

(e) A reasonable time should be allowed for preparation of estimates. § 85.111 Identical information to all

bidders.

Where a bidder requests an interpretation of some feature of the plans and/or the specifications from the buyer or his representative before submitting his bid, which would materially affect the cost of the work, the same information should be submitted to all other bidders by the buyer or his representatives. § 85.112 Cost accounting.

It is the judgment of this industry that an accurate knowledge of cost is indispensable to intelligent and fair competition, and the adoption of accurate methods of cost finding and estimating is recommended by the industry.

§ 85.113 Dissemination of credit in

formation.

§ 87.1

GROUP I

Misrepresentation in general.

The making or causing or permitting to be made or published any false, untrue, or deceptive statement by way of advertisement or otherwise concerning the grade, quality, quantity, substance, character, nature, origin, size, or preparation of any product of the industry having the tendency and capacity to mislead or deceive purchasers or prospective purchasers, is an unfair trade practice.

§ 87.2 Inducing breach of contract.

Willfully inducing or attempting to induce the breach of existing contracts between competitors and their customers by any false or deceptive means whatsoever or interfering with or obstructing the performance of any such contractual duties or services by any such means, with the purpose and effect of unduly hampering, injuring, or embarrassing competitors in their businesses, is an unfair trade practice.

§ 87.3

Defamation of competitors.

The defamation of competitors by falsely imputing to them dishonorable conduct, inability to perform contracts, questionable credit standing, or by other false representations, or the false disparagement of the grade or quality of their goods, with the tendency and capacity to mislead or deceive purchasers or prospective purchasers, is an unfair trade practice.

§ 87.6 Commercial bribery.

Directly or indirectly to give or permit to be given or offer to give money or anything of value to agents, employees, or representatives of customers or prospective customers or to agents, employees, or representatives of competitors' customers or prospective customers, without the knowledge of their employers or principals, as an inducement to influence their employers or principals to purchase or contract to purchase industry products from the maker of such gift or offer, or to influence such employers or principals to refrain from dealing or contracting to deal with competitors is an unfair trade practice.

§ 87.8 Enticing employees.

Willfully enticing away the employees of competitors with the purpose and effect of unduly hampering, injuring, or embarrassing competitors in their businesses is an unfair trade practice.

§ 87.9 Espionage.

Securing information from competitors concerning their business by false or misleading statements or representations or by false impersonations of one in authority and the wrongful use thereof to unduly hinder or stifle the competition of such competitors is an unfair trade practice.

§ 87.10 Consignment selling.

The shipment of goods on consignment with the intent and with the effect of injuring a competitor, and where the effect may be to substantially lessen competition or tend to create a monopoly or to unreasonably restrain trade is an unfair trade practice.

§ 87.11 Removal of

identifying mark.

manufacturer's

ticularly such material as is removed from the original factory containers, and the electrical wholesale industry hereby records its approval of the labeling or identifying, in accordance with accepted standards of the industry, of all products of the industry in such manner as to establish the grade, quality, and quantity of the products. § 87.102

Repudiation of contracts.

Contracts, either written or oral, are business obligations which should be performed in letter and spirit. The repudiation of contracts by sellers on a rising market, or by buyers on a declining market, is equally reprehensible, and is condemned by the industry.

§ 87.103 Cost accounting.

It is the judgment of the industry that each member should install a proper and accurate method for determining his costs.

§ 87.106 Unwarranted return of merchandise.

The unwarranted return of merchandise, not due to error on the part of the shipper, creates waste and loss and increases the cost of doing business, and such practice is condemned by the industry.

§ 87.107 False invoicing.

Withholding from or inserting in the invoice statements which make the invoice a false record, wholly or in part, of the transaction represented on the face thereof, is condemned by the industry.