ILLEGAL CARTEL ALLEGED

Evening Star, Issue 25067, 7 January 1944, Page 2

ILLEGAL CARTEL ALLEGED

BIG ARMS INDUSTRY ARRAIGNED CIVIL SUIT BY JUSTICE DEPARTMENT (Ree. 12.15 p.m.) WASHINGTON, January G. The Justice Department has tiled a civil suit charging du I'oht de Neniours, the Remington Arms Company, and Imperial Chemical Industries Ltd. with maintaining an international cartel agreement violating the Sherman Antitrust Act. • Attorney-General Biddle said the complaint alleged restraint of trade in the manufacture of chemical products, firearms, and ammunition. 'JLhe complaint also named as defendants the high executives thereof, including Lord McGowau, Lord Melchett, president and deputy-chairman of Imperial Chemical Industries. The complaint described du Pout as the largest manufacturer of chemicals in the United States, with total assets of 1,000 million dollars, including 23 per cent, of the stock of General Motors. It Bald Remington was the largest manufacturer of sporting arms and ammunition in the United States, and since 19&5 was controlled by du Pout. He also described Imperial Chemical Industries as having a virtual monopoly of the chemical industry in Britain. The complaint alleged that some time prior to 1920 du Pont and Imperial Chemical Industries reached an understanding for the elimination of competition in the sale of explosives throughout the world. Du Pont was allocated the United States and Central America, and Imperial Chemical Industries was allocated the rest of the world, excepting Canada, Newfoundland, and South America, Both companies agreed to refrain from manufacture in, or export to each other's exclusive markets, while Canada, Newfoundland, and South America were shared by both companies on a nonconnpetitive basis. The South American profits were divided equally. Canadian Industries Ltd., jointly owned by both, operated in Canada. The complaint quoted Lord MeGowan's letter to Lammot du Pont in 1933. in which he said no prospective political or legislative action on the part of Governments is permitted to influence the relations between du Pout and Imperial Chemicals Industries. "If any legislation or international agreements affect these relations, 1 am sure we will be able to adjust ourselves so as to get continued benefit of our agreement."

Lord McGowau in a statement in London on the anti-trust suit said: " Imperial Chemical Industries or the predecessor companies for the past 40 years have pursued a policy of co-opera-tion with du Ponts. This policy stands on two legs; first, a patent processes agreement under which the two companies disclose to each other the fruits of their respective large research organisations in defined fields of chemical science, and cross-license them to each other for use in defined territories; secondly, the joint investment under which the two companies are at present the major stockholders in chemical manufacturing companies in Canada, the Argentine, and Brazil. I believe tliis policy of co-operation has been of public 'benefit to the United States and the British Empire as well as the South American countries. '