SPECIAL REPORTS FOR FEDERAL TBADE COMMISSION. 19

for the few outsiders to compete abroad; in fact, there is no particular
 advantage to be gained by staying out of the combine.
No governmental discrimination—Independent concerns receive
exactly the same treatment from the Government and also from the
Government railroads as to freight rates, rolling stock, ete., as firms
in the combine. ‘This not only applies to the firms of the Steel Verband
 but to all the smaller rings and combinations which are allied
or connected to it. The Government-owned roads treat all alike.
There is no discriminating.
Can Americans successfully compete? —So far as the Steel Verband
 is concerned, controlling “A” and “B” products, competition
from American or any other outside producers would be difficult
but not impossible. The Verband has a number of points to its advantage
 which may be summed up as follows: Steel rails, bedplates,
etc, which are sold to the Government for Government railroads,
are contracted for for two and three years at a time. The last contracts
 in 1913 with the Government of Prussia for the Prussian-Hessian
 railways show a price of 121 marks ($28.79) for steel rails
and 96 marks ($22.84) to 102 marks ($24.27) for various kinds of
shapes and bars. It is hardly possible that the Government would
buy these supplies from a foreign firm even at a reduced price. As
regards selling to manufacturers of more highly finished products,
we have seen above that all these various industries are more or less
strongly organized and that the Steel Verband can exercise a great
pressure upon them by means of the export bounties or refusing to
sell to them at all other products which they need or withdrawing
their exclusive agency rights of sale in certain districts, etc. In
addition, the Steel Verband’s selling costs of only about 8 cents a
ton, as against perhaps twenty-five times this amount in the case of
American firms, gives an additional advantage. Then there is the
advantage of a protective tariff, which, although not extremely high
is sufficient to give protection on products with as small a margin of
profit.

THE COAL SYNDICATE CO.

Name, location, and preliminary remarks—The Aktiengesellschaft
Rheinisch-Westfalisches Kohlensyndikat, Essen a. d. Ruhr (hereafter
called Coal Syndicate Co. or the Syndicate), founded in 1893, opened
an era of big combinations in Germany.
Until the middle of the nineteenth century the coal mines of the
Ruhr district, the principal coal fields of Germany, were under the
control of the local ruler, under the so-called “ Direktionsprinzip.”
In 1850 there were 198 mines with a total annual production of
1,960,000 tons, while in 1910 there were 166 mines with a total output
for the Ruhr coal district of 89,310,000 tons. During this period of
enormous development some of the Government mines and, to a great
extent, the private mines have passed over into large stock companies,
who in turn were united in the Coal Syndicate.
The first combination in the coal industry was the Westphalian
Coke Syndicate (Westfilisches Koks Syndikat), founded on the
16th of September, 1890. In 1891 the briquet makers, who were
beginning to attract attention, founded the Brikett Verkaufsverein.
The final combination in the coal industry was accomplished in 1892