§ 183.1

GROUP I

Misrepresentation as to available supply of fuel oil or other industry products.

(a) It is an unfair trade practice for any member of the industry to use, or cause or promote the use of, any false or deceptive representation, in advertisements or otherwise, as to the present or future availability or adequacy of supplies of fuel oil or other industry products to meet the needs of users or prospective users.

(b) Nothing in this section shall be construed as inhibiting an industry member from expressing opinions as to the probable adequacy of supplies of fuel oil or other industry products when such opinions are based on information of authoritative and reliable character which the industry member honestly believes and when, in conjunction with the expressed opinion, the industry member makes disclosure of the source of information on which he is relying and it is

made clear that he is expressing an opinion based on such information.

§ 183.2 Deceptive advertising and misrepresentation.

(a) It is an unfair trade practice for any member of the industry to use, publish, circulate, or cause or promote the use, publication, or circulation:

(1) Of any false or deceptive price quotations, price lists, or terms, or conditions of sale; or

(2) Of any representation which is false or tends untruthfully to indicate, by use of title, designation, or otherwise, that any distributor or dealer has been specifically designated by the manufacturer or wholesale distributor to deal in, handle, install, or service a particular brand of industry product, or that any mechanic or other employee used in connection with the installation of or servicing of an industry product has undergone a course of special training; or

(3) Of any false, misleading, or deceptive statement or representation with respect to the grade, quality, performance, construction, composition, design, model, efficiency, safety, or economy of any industry product, or with respect to the origin, manufacture, or distribution of any industry product, or with respect to the installation or servicing of an industry product; or of any statement or representation which is false, misleading, or deceptive in any other respect.

(b) The provisions of this section shall apply to said false, misleading, or deceptive statements or representations regardless of the medium used for their dissemination, whether by oral or written communication or by radio, newspaper, magazine, trade promotional or advertising literature, or other media, or whether by brand, mark, label, or otherwise.

§ 183.3 Deception as to rebuilt or second-hand products.

(a) It is an unfair trade practice for any member of the industry to sell, offer for sale, advertise, or otherwise represent any product of the industry as being new when such is not the fact.

(b) In the marketing of rebuilt or second-hand products of the industry, or parts thereof, or in the marketing of products containing rebuilt or secondhand parts, it is an unfair trade prac

tice to conceal or fail or refuse to fully and nondeceptively disclose by effective means of identification (such as by tag, label, stamp, or mark firmly affixed to the products, or the immediate containers thereof in which sold and delivered to the consumer, or by invoice, bill or delivery slip accompanying the article and delivered to the purchaser therewith) the fact that such products, or all or certain parts contained therein, are not new, or are used, second-hand, rebuilt, repaired, or refinished after use, such concealment and nondisclosure having the capacity and tendency or effect of misleading the purchasing or consuming public.

§ 183.4 Misuse of word "free,” etc.

It is an unfair trade practice to use the term "free," or any other term of similar import or meaning, to describe, designate, or refer to any industry product or industry service which is not given to the recipient thereof without cost and unconditionally.

§ 183.5 Selling below cost.

(a) The practice of selling or offering for sale industry products and services below the seller's cost, when pursued with wrongful intent of thereby injuring a competitor and where the effect of such practice is to unreasonably restrain trade, tend to create a monopoly, or substantially lessen competition, is an unfair trade practice.

(b) This section is not to be construed as prohibiting all sales below cost, but only such selling below the seller's cost as is resorted to and pursued as a monopolistic practice with the wrongful intent referred to and coupled with the effect of unreasonably restraining trade, tending to create a monopoly, or substantially lessening competition.

(c) The costs referred to in this section are actual costs of the respective seller and not some other figure or average costs in the industry determined by an industry cost survey or otherwise.

§ 183.6 Commercial bribery.

It is an unfair trade practice for a member of the industry to give, or offer to give, or permit or cause to be given, directly or indirectly, 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, any industry product or industry service, or to influence such employers or principals to refrain from purchasing the industry products or industry services of competitors or from dealing or contracting to deal with competitors.

§ 183.7 Use of "loss leaders."

The practice of selling any industry product or industry service below the seller's cost as a "loss leader" to induce the purchase of some other industry product or industry service, the sale of the latter being used to recoup the loss sustained on the "loss leader" product or service so sold, with the capacity, tendency, or effect of misleading or deceiving purchasers, prospective purchasers, or the consuming public, is an unfair trade practice.

(a) Prohibited discriminatory prices, or rebates, refunds, discounts, credits, etc., which effect unlawful price discrimination. It is an unfair trade practice for any member of the industry engaged in commerce, in the course of such commerce, to grant or allow, secretly or openly, directly or indirectly, any rebate, refund, discount, credit, or other form of price differential (whether in the form of product installation or maintenance services or otherwise), where such rebate, refund, discount, credit, or other form of price differential, effects a discrimination in price between different purchasers of goods of like grade and quality, where either or any of the purchases involved therein are in commerce, and where the effect thereof may be substantially to lessen competition or tend to create a

1 As used in this section, the word "commerce" means "trade or commerce among the several States and with foreign nations, or between the District of Columbia or any Territory of the United States and any State, Territory, or foreign nation, or between any insular possessions or other places under the jurisdiction of the United States, or between any such possession or place and any State or Territory of the United States or the District of Columbia or any foreign nation, or within the District of Columbia or any Territory or any insular possession or other place under the jurisdiction of the United States."

monopoly in any line of commerce, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination or with customers of either of them: Provided, however:

(1) That the goods involved in any such transaction are sold for use, consumption, or resale within any place under the jurisdiction of the United States;

(2) That nothing contained in this paragraph shall prevent differentials which make only due allowance for differences in the cost of manufacture, sale, or delivery resulting from the differing methods or quantities in which such commodities are to such purchasers sold or delivered;

(3) That nothing contained in this paragraph shall prevent persons engaged in selling goods, wares, or merchandise in commerce from selecting their own customers in bona fide transactions and not in restraint of trade;

(4) That nothing contained in this paragraph shall prevent price changes from time to time where made in response to changing conditions affecting either (i) the market for the goods concerned, or (ii) the marketability of the goods, such as, but not limited to, actual or imminent deterioration of perishable goods, obsolescence of seasonal goods, distress sales under court process, or sales in good faith in discontinuance of business in the goods concerned.

(b) Prohibited brokerage and commissions. It is an unfair trade practice for any member of the industry engaged in commerce, in the course of such commerce, to pay or grant, or to receive or accept, anything of value as a commission, brokerage, or other compensation, or any allowance or discount in lieu thereof, except for services rendered in connection with the sale or purchase of goods, wares, or merchandise, either to the other party to such transaction or to an agent, representative, or other intermediary therein, where such intermediary is acting in fact for or in behalf, or is subject to the direct or indirect control, of any party to such transaction other than the person by whom such compensation is so granted or paid.

(c) Prohibited advertising or promotional allowances, etc. It is an unfair trade practice for any member of the industry engaged in commerce to pay or contract for the payment of advertising

or promotional allowances or any other thing of value to or for the benefit of a customer of such member, in the course of such commerce, as compensation or in consideration for any services or facilities furnished by or through such customer in connection with the processing, handling, sale, or offering for sale of any products or commodities manufactured, sold, or offered for sale by such member, unless such payment or consideration is available on proportionally equal terms to all other customers competing in the distribution of such products or commodities.

(d) Prohibited discriminatory services or facilities. It is an unfair trade practice for any member of the industry to discriminate in favor of one purchaser against another purchaser or purchasers of a commodity bought for resale, with or without processing, by contracting to furnish or furnishing, or by contributing to the furnishing of, any services or facilities connected with the processing, handling, sale, or offering for sale of such commodity so purchased upon terms not accorded to all purchasers on proportionally equal terms.

(e) Inducing or receiving an illegal discrimination in price. It is an unfair trade practice for any member of the industry engaged in commerce, in the course of such commerce, knowingly to induce or receive a discrimination in price which is prohibited by the foregoing provisions of this section.

(f) Purchases by schools, colleges, universities, public libraries, churches, hospitals, and charitable institutions not operated for profit. The foregoing provisions of this section relate to practices within the purview of the Robinson-Patman Antidiscrimination Act, which act and the application thereunder of this section are subject to the limitations expressed in the amendment to such Robinson-Patman Antidiscrimination Act, which amendment was approved May 26, 1938, and reads as follows:

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That nothing in the act approved June 19, 1936 (Public, Numbered 692, Seventy-fourth Congress, second session), known as the RobinsonPatman Antidiscrimination Act, shall apply to purchases of their supplies for their own use by schools, colleges, universities, public libraries, churches, hospitals, and charitable institutions not operated for profit. (52 Stat. 446; 15 U.S.C. 13c)

§ 183.9 Guarantees, warranties, etc.

(a) Guarantees which afford purchasers or users substantial and adequate protection, and are fully and fairly stated or disclosed and scrupulously adhered to by the guarantor, are desirable and recommended. It is an unfair trade practice to use or cause to be used any guarantee which is false, misleading, deceptive or unfair to the purchasing or consuming public.

(b) Under this section guarantees of the following type or character shall not be used:

(1) Guarantees containing statements, representations, or assertions which have the capacity and tendency or effect of misleading and deceiving in any respect;

or

(2) Guarantees which are so used or are of such form, text, or character as to import, imply, or represent that the guarantee is broader than is in fact true, or that the guarantee covers the entire heating system or particular parts thereof which are not in fact covered, or will afford more protection to purchasers or users than is in fact true; or (3) Guarantees in which any condition, qualification, or contingency applied by the guarantor thereto is not fully and nondeceptively stated therein, or is stated in such manner or form as to be deceptively minimized, obscured, or concealed, wholly or in part; or

(4) Guarantees which are stated, phrased, or set forth in such manner that although the statements contained therein are literally and technically true, the whole is misleading in that purchasers or users are not made sufficiently aware of certain contingencies or conditions applicable to such guarantee which materially lessen the value or protection thereof as a guarantee to purchasers or users; or

(5) Guarantees which purportedly extend for such an indefinite or unlimited period of time or for such a long period of years as to have the capacity and tendency or effect of thereby misleading or deceiving purchasers or users into the belief that the product has or is definitely known to have greater degree of serviceability or durability in actual use than is in fact true; or

(6) Guarantees which have the capacity and tendency or effect of otherwise misrepresenting the performance, serviceability, durability, or lasting qualities of the product, such as, for example, a guarantee extending for a certain

number of years or other long period of time when the ability of the product to last, endure, or remain serviceable for such period of time has not been established by actual experience or by competent and adequate tests definitely showing in either case that the product has such lasting qualities under the conditions encountered or to be encountered in the respective locality where the product is sold and used under the guarantee; or

(7) Purported guarantees in the form of documents, promises, representations or other form which are represented or held out to be guarantees when such is not the fact, or when they are service contracts of the type which are not guarantees, or when they involve any deceptive or misleading use of the word "guarantee" or term of similar import:

or

(8) Guarantees issued, or directly or indirectly caused to be used, by any member of the industry when or under which the guarantor fails or refuses to scrupulously observe his obligations thereunder or fails or refuses to make good on claims coming reasonably within the terms of the guarantee; or

(9) Guarantees which in themselves or in the manner of their use are otherwise false, misleading, or deceptive.

(c) This section shall be applicable not only to guarantees but also to warranties, to purported warranties and guarantees, and to any promise or representation in the nature of or purporting to be a guarantee or warranty. § 183.10 Coercing purchase of an in

dustry product or industry service as a prerequisite to the purchase, lease, or loan of another industry product or industry service.

The practice of coercing the purchase of one or more industry products or industry services as a prerequisite to the purchase, lease, or loan of one or more other industry products or industry services, when the effect may be substantially to lessen competition or tend to create a monopoly or unreasonably to restrain trade, is an unfair trade practice. § 183.11 Defamation of competitors or disparagement of their products or services.

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 dis

As used in the regulations in this part, the terms "industry product" and "peat" shall be understood as having the following meanings:

(a) Industry product. Any product marketed for use as a soil conditioner, or for any agricultural or horticultural purpose, which is composed, or is represented as being composed, wholly or in part of peat; also, any product marketed for any such purpose which is composed, or is represented as being composed, wholly or in part of a humus or muck derived from peat.

(b) Peat. Any partly decomposed vegetable matter which is accumulated under water or in a water-saturated environment through decomposition of mosses, sedges, reeds, tule, trees, or other plants.

§ 185.2

Improper designation of product as "Peat."

It is an unfair trade practice for any member of the industry to sell, offer for sale, advertise, brand, label, or otherwise designate or represent as "Peat", any product which is not in fact composed predominantly of peat to the extent that at least 75 percent1 of the product is composed of peat, with such other materials as may be present in the content,

1 The percentage to which reference is here made is to be understood as a weight percentage determined on the basis of the product being substantially free of moisture.