974 REPORT ON COOPERATION IN AMERICAN EXPORT TRADE,

its Executive Committee, undertook to study the conditions affecting the foreign
trade. * * * Our investigations regarding the South American situation,’
however, brought forcibly to our attention the many obstacles which stood in
the way of any immediate or ill-considered effort looking toward the establishment
 of an export trade with the countries of South America.
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All these questions and many others lead the Executive Committee to certain
obvious conclusions—first, that if any permanent progress was to be made in
building up this export business it must be as a result of most careful study of
foreign conditions and the establishment of a policy which would prove sound
for the future; in other words, that there was no quick advantage to be gained
by any hasty and unenlightened action. The second conclusion reached was
aqually obvious, namely, that there were very few members of the Association
Individually equipped or individually possessing the resources necessary to
undertake this export trade on any comprehensive plan.
The Executive Committee considered tlre advisability of undertaking a common
 investigation of these foreign conditions, looking to the possibility of establishing
 trade relations through a common and cooperative effort. We believed
that through such an undertaking the Association might prove of immediate
benefit to its members and of ultimate benefit to the industry, as a whole, by
opening up markets at present little known to the chemical manufacturers of
this country. In our early deliberations, however, the question was squarely
raised as to what the effect of our antitrust laws might be on any such undertaking
 as we were contemplating.
» * * Jt ig sufficient that there is very eminent authority for the opinion
that our present laws do prohibit such combinations or agreements. Of course,
if the law does not prohibit such conditions, and this Commission should so
deternine, there would be nothing left to the question. On the other hand,
until such finding has been made, any manufacturer or group of manufacturers,
who undertook to cooperate for the foreign trade, would certainly be acting in
reckless disregard of the consequences.
The Manufacturing Chemists’ Association in the early months of last fall
presented its problems before both the State and Commerce Departments in
Washington. By request the Association prepared a tentative form of a bill
setting forth its ideas as to the character of an amendment necessary to permit
the kind of cooperation contemplated.

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The bill is premised upon the idea that the law should give the absolute, unjualified
 right to American manufacturers to cooperate for the export trade.
The effect of such cooperation, whether it be by agreement, combination, or
association, is to be found primarily in the foreign markets where such agreements,
 combinations, or associations are to be carried out. If the laws of the
foreign country permit such cooperation and if our foreign competitors are
already acting in combination within these foreign markets, we should have the
right to meet that competition on equal terms. In other words, our antitrust
laws should have no extraterritorial effect.

Along the same line, Henry Howard, vice president of the Merrimac
 Chemical Co., of Boston, Mass., and chairman of the Manufacturing
 Chemists’ Association of United States, is quoted :

When the war broke out it seemed to our committee that it was an especially
good time to investigate the question of foreign trade from South America in
‘hemicals, as the supply from Germany was being cut off. The very first
thing which we ran up against was that, under the law, it was very doubtful
If we could form a combination to investigate and push in a comprehensive
way foreign trade in South America. We had the advice of a number of eminent
 counsel, and they advised us that it was not safe to do it. There are
hardly more than twe, or possibly three, of our members of the association
who are large enough to send representatives to South America, and I question
If any of them are large enough to send representatives to more than one or
two countries. In our case there are only, perhaps, three articles that we
manufacture that would find a market in South America. We could not afford
to send a representative, because the cost would more than eat up any profit
that we might get; but we could join in an export association. which would
ne made up of the other members of our association or of other manufacturers