SPECIAL REPORTS FOR FEDERAL TRADE COMMISSION. 61

The Cartel of Velvet Manufacturers prohibits direct sales from the
factory to retailer. In 1909-10 this cartel was renewed until 1915,
and an agreement was made concerning the quotas each member
should carry. The sales of “ Velours du Nord” are not regulated,
the members being permitted to sell to all customers without exclusions.

The Cartel of Velvet Ribbon Manufacturers fixed uniform rates
for cotton-back velvet ribbons. Satin-back ribbons were to be sold
in pieces of 12 meters in all Jnlidies, By a carefully planned scale
of prices covering all the grades and qualities, the prices were so fixed
by this price scale that one manufacturer could not undersell another
by offering alleged inferior qualities at only a few pfennigs cheaper.
Among other agreements a were the forced acceptance and
enforced delivery of all orders, and the prohibition of price reductions.
 All these regulations oblige the cartel members to serve their
customers according to the existing cartel prices and conditions,
without granting any special favors.
The Hatband Cartel has an agreement by which the producers only
sell to wholesalers who are members of the Wholesalers’ Confederation
 or who, at least, are not antagonistic to the confederation. All
sales to retailers are forbidden. The Wholesalers’ Confederation
promises to buy from the cartel alone, with the exception of the Swiss
ribbon factory, whose outside competition could not be avoided.
The Cravat Material Cartel grants a sale premium only to those
customers who agree to deal exclusively with it. It has also arranged
a price scale with wide divisions. The divisions are arranged in
such a manner that goods calculated for one division can not be sold
in the next lower division except at a material loss. Customers of
the cartel are granted 10 per cent discount on these serial prices.
Selling methods abroad.—In 1906 the velvet manufacturers of
Lyons, France, and St. Etienne, Switzerland, had formed a successful
cartel. In 1907 the German cartel underbid it in Paris by granting
better conditions to the customers, whereupon the French cartel approached
 the Germans and finally in 1908 made an agreement with
them by which the Germans were to sell in France at prices approximating
 their calculations for the German market plus duty, and the
Font agreed not to undersell them.
In 1907 a convention was held in Ziirich, in which the German Association
 of Silk Manufacturers and the Swiss, Italian, Austro-Hungarian,
 and French mills took part. It failed because the Swiss were
not willing to bind themselves to observe price agreements.
The Cartel of Cravat Material Manufacturers has been very successful
 in Russia and Scandinavia. It has been able to control these
markets through price scales and cartel discounts much as at home.
These methods could not be carried through in England, because of
the Swiss competition, which would not cooperate. In France and
Italy the cartel made agreements jointly with Austrian concerns also
doing busines there. These agreements had to do with terms of payment
 and cash discounts, but are maintained with difficulty.
Character of competition—Price and quality are the dominant
characters of the competition of these cartels in their different important
 markets.
Central i organization.—Each mill sells its own products.
A good many of these cartels believe that if they undertake to con-