SUIT FILED

Wairarapa Times-Age, 8 January 1944, Page 3

SUIT FILED

UNDER U.S. ANTITRUST ACT AGAINST AMERICAN & BRITISH FIRMS. ATTACK ON INTERNATIONAL CARTEL. (Bv Telegraph-Press Association—Copyright) WASHINGTON, January 6. The Justice Department has filed a civil suit charging du Pouf de Nemours and Company, the Remington Arms Company and Imperial Chemical Industries, Ltd., with maintaining an international cartel agreement, violating flic Sherman Anti-Trust Act. The Attorney-General, Mr Biddle, said that the complaint alleges restraint of trade in the manufacture of chemical products, firearms and ammunition. The complaint also names as defendants high executives of the companies concerned, including Lord McGowan and Lord Melchett, president' and deputy-chairman of Imperial Chemical Industries respectively. The complaint describes the du Pont Company as the largest manufacturer ol chemicals in the United States, with assets totalling 1000 million, dollars, including 23 pei’ cent, of the stock of General Motors. It says that the Remington Arms Company is the largest manufacturer of sporting arms and ammunition in* the United States, and that since 1933 it has been controlled by the du Pont Company. It also describes Imperial Chemical Industries'as having a virtual monopoly of the chemical industry »in Britain.

ALLEGED MONOPOLY

The complaint alleges that some time prior to 1920 the du Pont Company and Imperial Chemical Industries reached an understanding, for the elimination of competition in the sale of explosives throughout the world. The du Pont Company was allocated the United States and Central America and Imperial Chemical Industries were allocated the rest of the world except Canada, Newfoundland and South America. Both companies agreed to refrain from manufacture in or the export to each other’s exclusive markets, while Canada, Newfoundland and South America were shared by both companies on a non-competitive basis. The South American profits were to be divided equally. Canadian Industries Ltd., jointly' owned by both companies, operated in Canada. The complaint quoted a letter by Lord McGowan to Mr Lammot du Pont, chairman of the board of the du Pont Company in 1933, in which he said no prospective political or legislative action on the part of Governments was permitted to influence the relations between the du Pont Company and Imperial Chemical Industries. “If any legislation or international agreements affect these relations,” he said, “I am sure we will be able to adjust ourselves so as to get the continued benefit of our agreement.” The Department of Justice also alleged that I. G. Farbenindustrie, the German chemical firm, had been a member of the alleged conspiracy since 1926, and the parties 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 war. LORD McGOWAN’S STATEMENT. In a statement in London on the anti-trust suit, Lord McGowan said: “Imperial Chemical Industries or its predecessor companies for the past 40 years has pursued a policy of co-oper-ation with the du Pont de Nemours Company. 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; and, secondly, joint investment under which the two companies are at present the major stockholders in chemical manufacturing companies in Canada. Argentina, and Brazil. I believe this policy of co-operation has been to the public benefit in the United States and the British Empire, as well as the South American countries.”

The Washington correspondent of the “New York Times” recalls that Lord Strabolgi in July, 1943, demanded that the House of Lords investigate the operations of Imperial Chemical Industries. whose head, Lord McGowan, defended the cartel system of corporate foreign trade agreements as the backbone of the chemical industry. Informed circles believe that the present suit may be considered, to be the United States’ answer to a question asked by many people in Britain: Will America insist on competition in the world markets after the war?