ANTI-TRUST ACT

Timaru Herald, Volume CLV, Issue 22785, 8 January 1944, Page 5

ANTI-TRUST ACT

Violation Alleged

International Cartel Agreements

By Telegraph—N.Z. Press Assn.—Copyright (Rec. 8 p.m.) WASHINGTON. Jan. 6. The Justice Department has filed a civil suit charging the Du Pont de Nemours Chemical Company, the Remington Arms Company and Imperial Chemical Industries, Ltd., with maintaining an international cartel agreement that violates the Sherman Anti-trust

Act. The United States Attorney-General (Mr F. H. Biddle) said that the complaint alleged restraint of trade in the manufacture of chemical products, firearms and ammunition. The complaint also named as defendants high executives of Chemical Industries, including Lord McGowan (chairman) and Lord Melchett (deputy-chairman). The complaint described Du Pont as the largest manufacturer of chemicals in the United States, with total assets of 1.009,000,000 dollars, including 23 per cent stock of General Motors. The Remington Arms Company was thd largest manufacturer of sporting arms and ammunition in the United States, and since 1933 had been controlled by Du Pont.

The complaint described Imperial Chemical Industries as having a virtual monopoly of the chemical industry in Britain. It alleged that some time before 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 except 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 the companies on a non-competitive basis. The profits from South America were divided equally. Canadian Industries, Ltd., jointly owned by both, operated in Canada.

Further, the complaint quoted Lord McGowan’s letter to Lamond 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 Pont and Imperial Chemical Industries. If any legislation or international agreements affect these relations I am sure we will be able to adjust ourselves and so get the continued benefit of our agreement.” Lord McGowan, in a statement in London on the suit, said: “Imperial Chemical Industries or its predecessor companies for the last 40 years has pursued a policy of co-operation with Du Pont. This policy stands on two legs: Firstly, the patent processes agreement under which the two companies disclose to each other the fruits of respective large research organisations in defined fields of chemical science and cross-licence them to each other for use in defined territories; secondly, a joint investment under which the two companies are at present major stockholders in the chemical manufacturing companies of Canada, Argentine and Brazil. I believe this policy of co-operation has been to the public benefit of the United States and the British Empire as well as to the South American countries.”

The Department of Justice also alleged that the German I. G. Farben Industrie had been a member of the alleged conspiracy since 1926, and the parties had at all times since continued to abide by the provisions of this agreement except to the extent that its operations had been interrupted by the present wan