SPECIAL REPORTS FOR FEDERAL TRADE COMMISSION, 23

drove the prices so high that the Syndicate introduced the so-called
* Handelskammerparagraph,” which placed a fine of 10 marks
($2.38) per ton on all dealers purchasing direct from the Verband,
who in reselling coal demanded a price which gave a profit out of
proportion to the efforts and risks incurred, according to the opinion
of the Chamber of Commerce at Essen. The Syndicate is determined
not to abuse its position of monopoly.
Dealers’ unions.—As in the case of the Steel Verband, the organization
 of the coal industry in the Coal Syndicate Co. brought about
a corresponding organization of dealers. On April 1, 1906, two
dealers’ unions were founded, the * Gluckauf ” Kohlenhandelsgesellschaft
 in Kassel and the “ Westfalia ” Kohlenhandelsgesellschaft in
Hanover; 1896, the Steenkohlenhandelsvereeniging Utrecht; 1897,
Deutsche Kohlenhandelsgesellschaft Bremen; 1899, Westfilische
Kohlenhandelsgesellschaft Dortmund; 1901, Westfilische-Kohlen &amp;
Koks Verkaufsgesellschaft in Magdeburg ; 1906, Westfilische Kohlenverkaufsgesellschaft
 in Berlin; 1906, Westfalen Kohlenkontor Hamburg;
 1905, Diisseldorfer Kohlenverkaufsstelle Karl Briiggemann;
1908, Société Générale Charbonniére in Antwerp. The dealers’
unions at first were not welcome, but eventually the Coal Syndicate
Co. recognized the value of dealing with them and has gained an
influence in them, inasmuch as the chairman of the board of directors
 of each coal union is an officer of the Coal Syndicate Co. The
result is a strong organization for the distribution of coal.
The Coal Syndicate Co. and coal transportation.—There was no
strain between the dealers and the Syndicate as regards transportation
 so long as the railroads were used, because the State railroads
treat all shippers alike, and no sudden changes of freight rates need
be expected which might upset the price calculations of the dealers.
Water transportation, however, brought in an element of uncertainty,
 because the water transportation companies are numerous
and unorganized. If the prices were to remain reasonably stable,
the transportation question required settlement. The Rhine, which,
with its tributary, the Ruhr, taps the Ruhr district, was used by all
sorts of large and small shipping firms. The larger shipowners on
the Rhine also owned their own mines and were also coal dealers
themselves. These large river ship lines joined the Syndicate on the
condition that the Rhine traffic be consolidated. This was done
April 1, 1904, by forming the Rheinische Kohlenhandels- &amp; Reederei-Gesellschaft
 (the Rhine Coal Dealing &amp; Shipline Co.), usually
referred to in the trade as the “ Kohlenkontor.” The object of this
Coal Office is to buy coal from the Syndicate and send it up the
Rhine and to South Reinking Switzerland, and Vorarlberg and there
sell it on its own account as a coal dealer. The Coal Office does not
own its own coal yards, fleet, and transportation machinery, but
each member is required to place his terminal facilities and barge
fleet, etc., at the disposal of the Coal Office at certain fixed rates. In
this district the coal dealers of purely merchant character were
forced out of business in favor of the Kohlenkontor. Some of these,
however, were assigned to districts as middle men and aided in
distribution to the small local dealers. The Kontor was founded
Lfntly by the Coal Syndicate Co. and four shipowners, namely,
ranz Haniel &amp; Co., Mathias Stinnes, Gebriider Kannegiesser, and
Hugo Stinnes. To-day there are 37 members, with a total annual