Mr. JOHNSON. Yes, sir.

Mr. TREADWAY. If this provision is adopted, the only thing that will be marked will be the shoe itself?

Mr. JOHNSON. Yes, sir.

Mr. TREADWAY. The package that is handled by the clerk who shows you the shoes, will not be marked as coming from Japan? Mr. JOHNSON. That is correct, sir.

Mr. TREADWAY. As I understand you, to start with, the wholesale case, if we may call it that, would not be marked. And the package that the article is contained in, as I gather from your testimony now, will not be marked either?

Mr. JOHNSON. Containers will not be required to be marked unless it is the custom of the trade to deliver the article in a closed container. For example, take a cake of fine toilet soap. It is ordinarily sold in a sealed wrapper. To require the marking of the soap and not the wrapper would tend to conceal the origin.

Mr. TREADWAY. Let us get back to these rubber shoes.

Mr. JOHNSON. Rubber shoes are usually tried on before they are purchased.

Mr. TREADWAY. One store might take the shoes out of the package and do them up separately when delivering to a customer, whereas another store might give the box with the shoes.

Mr. JOHNSON. Yes, sir.

Mr. TREADWAY. The shoe package will not be marked if this provision goes into effect?

Mr. JOHNSON. That is correct.

Mr. TREADWAY. What is the advantage of that?

Mr. JOHNSON. Because the purchaser looks at the shoes before he buys them. He would see the marking if he wants to determine the origin of the merchandise.

Mr. TREADWAY. Well, I do not agree with you. He has the right to see it on the container.

Mr. JOHNSON. At the present time importations are frequent where only the shoe is marked. It may be made in one place and packed in another foreign place.

The importer is then required to open up this package and it is held in customs custody, delaying customs business, while the package is marked.

Mr. TREADWAY. Then I gather the inference, at least, from your testimony, that the desire on the part of the Treasury is to facilitate importations?

Mr. JOHNSON. To eliminate trade obstructions, which also tends to congest the transaction of customs business.

Mr. TREADWAY. In other words, it is beneficial to the foreigner? Mr. JOHNSON. To foreign trade and to American importers.

Mr. TREADWAY. I thought that was it.

Mr. VINSON. And to the American purchaser in particular?

Mr. JOHNSON. I beg your pardon?

Mr. VINSON. To the American purchaser in particular?

Mr. JOHNSON. Oh, yes; it reduces the cost to the final consumer

and it eliminates the harassment of importers.

Mr. TREADWAY. I can see the purpose of it. I thought that was it all the time. Now you confirm my thought.

But let us get back to your wool illustration of a moment ago. I did not quite understand your explanation of why that person had to spend $10,000, or some sum like that. Will you explain it?

Mr. JOHNSON. He spent $12,000, which was paid to the United States as additional duty, because the goods were not marked when they were imported, although we withheld release until they were marked.

Mr. TREADWAY. I do not know that you make out a case on that illustration. Somebody was trying to break the law and it cost him $12,000 to live up to it. What kind of a case is that?

Mr. JOHNSON. I do not think it can be said that there was any intention to violate the law.

Mr. TREADWAY. Perhaps not.

Mr. JOHNSON. This came from in the neighborhood of Tierra del Fuego, an isolated region in Argentina, from ranches which had not in recent years shipped any wool to the United States and the Argentine exporters did not know how to mark the goods.

Mr. REED. Will the gentleman yield?

Mr. TREADWAY. Certainly.

Mr. REED. Have you had quite vigorous protests from foreign countries sending goods in here, as to these obstructions to their business?

Mr. JOHNSON. Yes, sir; there are some, although there has been no organized protest. The protests usually come from businessmen in the United States who have to pay for the mistakes of others.

Mr. REED. These foreign countries have made protests to your people that this interferes with their business?

Mr. JOHNSON. Yes, but nothing to compare with the domestic protests.

Mr. VINSON. You say that the major protests come from businessmen here in the United States?

Mr. JOHNSON. By far.

Mr. TREADWAY. Interested in the importation of foreign-made goods, certainly.

Mr. VINSON. Interested in removing obstructions to their business. Mr. JOHNSON. Yes, sir.

Mr. McCORMACK. Will the gentleman yield?

Mr. VINSON. I yield.

Mr. McCORMACK. Referring to section 304-the purpose of this is to amend section 304?

Mr. JOHNSON. Yes, sir.

Mr. McCORMACK. This practically repeals the present law and substitutes this therefor?

Mr. JOHNSON. It is a complete revision.

Mr. McCORMACK. The present law is mandatory. It says:

shall be marked, stamped, branded, or labeled, in legible English words, in a conspicuous place, in such manner as to indicate the country of origin of such article, in accordance with such regulations as the Secretary of the Treasury may prescribe.

In other words, it is mandatory; it shall be marked, stamped, branded, or labeled.

Mr. JOHNSON. Yes, sir.

Mr. McCORMACK. The Secretary of the Treasury may regulations as are necessary to carry out the mandatory the act?

Mr. McCORMACK. Under the proposed amendment, y make it discretionary with the Secretary of the Treasury, is Mr. JOHNSON. No, sir.

Mr. McCORMACK. You start out here and say:

Under such regulations as the Secretary of the Treasury may pre Does not that change the mandatory provision and ma cretionary provision?

Mr. JOHNSON. No, sir; if there is any question about th believe there should be any objection to removing any do

Mr. McCORMACK. The regulations that the Secretary scribe now relate to a mandatory provision of law which m plied with, and the regulations cannot change it; is that so Mr. JOHNSON. That is true.

Mr. McCORMACK. Now, I am only asking for informati the proposed amendment you say:

Under such regulations, as the Secretary of the Treasury may pre article of foreign origin (or its container, as provided in subsection imported into the United States shall be marked

Mr. VINSON. It says "shall be marked."

Mr. McCORMACK. I know, but under such regulations prescribe. That is the way it starts out.

Mr. HESTER. It is the same as in the old law.

Mr. Buck. It simply reverses the English.

Mr. McCORMACK. It does not reverse the English. It br

Mr. JOHNSON. I do not believe so, sir.

Mr. McCORMACK. Are you sure it does not?

Mr. JOHNSON. I am very confident.

Mr. McCORMACK. Are you sure?

Mr. JOHNSON. Yes, sir. The new law will bring about result in that the Secretary is authorized to stiffen the req if anything.

Mr. McCORMACK. Why not draft your language along t the present law and then attach your exceptions thereto going through all of this procedure?

Mr. JOHNSON. We believed that we had done so.

Mr. HESTER. We are happy to defer to your judgmen question, Mr. McCormack.

Mr. McCORMACK. I am not expressing a judgment. I for information. I have not yet formed a judgment on it. Mr. HESTER. We thought that it was the same. It ma We will reconsider it in the light of your criticism. Mr. McCORMACK. I am not criticizing it.

Mr. HESTER. Well, it is constructive criticism,

Mr. McCORMACK. I do not want to be misunderstood. Mr. HESTER. I said it was constructive criticism, You al us constructive criticism.

Mr. MCCORMACK. Now you are flattering me and I am embarrassed. Mr. JENKINS. I think that the illustration that the gentleman gave in a wool case is a very happy illustration from his standpoint when he said that the customs authorities, in handling this wool, would have the advantage, in this way. They would know about the bills of lading, and what the shipping instructions were, and where the wool came from?

Mr. JOHNSON. Yes, sir.

Mr. JENKINS. And I agree with the gentleman that it would probably be a good thing to relieve them of that contingent liability. I can see the same thing with reference to lumber and, for instance, rice that would come in in barrels things like that. But it seems to me that every article that finds its way on a shelf or on a counter, whatever the wrapper it comes in, whether it is a pasteboard box or a cellophane wrapper-that article ought to be marked on the outside, because then it provides a protection to the purchaser. I believe it would not be a wise thing to relieve them of that responsibility. Of course, the ultimate consumer would not know what kind of a package it came in. Sometimes he does not see the package. But whatever the storekeeper thinks it wise to decorate his counter with and his shelves with -I think every one of those articles ought to be marked and the

container.

Mr. JOHNSON. I do not think there is much question about that when the container is one that is sealed. But if it is the kind that the customer destroys when he opens it to look at the article itself, as in the case of the rubber-soled shoes, or a doll, or toys of various kinds, marking the container seems to serve no purpose other than to increase the cost of the goods to consumers.

Mr. JENKINS. Here is the trouble about that. They may conform to the requirement of being marked in a conspicuous manner, but in some cases that is very difficult. Take the case of a doll. You could not put the marking on the face of the doll baby. That would be the most conspicuous place. The marking would have to be in an inconspicuous place.

Mr. JOHNSON. It is often on the feet.

Mr. JENKINS. It looks to me that we ought not, merely out of the desire to save these importers the necessity of being confronted with a situation such as in the wool case, which is an extreme case there are lots of others that are not like that-waive these responsibilities. What does the gentlemen think about that? The gentleman gets the idea that I have in mind?

Mr. JOHNSON. Yes, sir.

Mr. JENKINS. Does this bill run counter to what I am trying to illustrate?

Mr. JOHNSON. I do not think so. I think your fears are not wholly justified by our own experience with imports.

Mr. JENKINS. Here is another thing. The gentleman knows this: Any company or any organization that wishes to keep secret its identity, wants to do so because of some advantage to itself. For instance, if Japan were proud of her products and wanted to broadcast to the world that they were producers of a certain article, they would see to it that those articles were properly advertised. But they keep their markings well hidden; they make their inscriptions not easily decipherable, because they know that the American people do not

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want to buy their articles, if they can avoid doing so; if they can buy something else that is just as good.

Mr. JOHNSON. I may point out that one of the requirements of the proposed law, as well as the existing law, is that the markings be conspicuous. Now, concealed markings are not acceptable markings. It is just as though the marking were not there, so far as the administration of the act is concerned.

Mr. JENKINS. Here is what I am driving at. The whole philosophy of marking these goods is because it is to our benefit to have them marked, and it is done with the idea that it is of some benefit to the ultimate consumer.

Mr. JOHNSON. Yes; to the ultimate consumer in the United States. Mr. JENKINS. If that is the case, let us not lean over too far backward in our endeavor to be fair, in order to enable these people to avoid marking these containers that are exhibited in the stores where the people buy.

Mr. THURSTON. Does the gentleman yield?

Mr. JENKINS. I yield.

Mr. THURSTON. Is there any statutory or administrative provision which would exclude imports that are made under deception or fraud to avoid the trade name of some given article produced here in our own country?

Mr. JOHNSON. We have, under the trade-mark laws, a prohibition of the importation of articles with marks which simulate American registered trade-mark goods. There is a tariff provision also in section 526 of the Tariff Act of 1930.

Mr. THURSTON. Do these changes or modifications in any way affect our pure-food laws, so far as the requirements for labeling meat as having been inspected are concerned?

Mr. JOHNSON. Absolutely not. This relates only to marking to indicate the country of origin.

Mr. REED. Mr. Chairman, I just want to ask one question. Did the Customs Bureau initiate this bill or did you receive a communication from the Secretary of State asking that these changes be made? Mr. JOHNSON. No, sir.

Mr. REED. What do you mean by that?

Mr. JOHNSON. The recommendations for these amendments originated in the Bureau of Customs of the Treasury Department.

Mr. McCORMACK. Pursuing my inquiry of a moment ago, there is no question but that under the present law the Secretary of the Treasury cannot by regulation provide that articles imported shall not be marked. In other words, the injunction there is a compulsory one, is it not?

Mr. JOHNSON. With certain exceptions stated in the statute.

Mr. McCORMACK. There are certain exceptions stated in the statute, but that is compulsory?

Mr. JOHNSON. Yes, sir.

Mr. McCORMACK. He can make such regulations to carry out what the Congress has stated in this particular section?

Mr. JOHNSON. That is quite so.

Mr. McCORMACK. But he cannot by regulation permit them to omit the markings, stampings, brandings, or labelings unless it comes within the exception; is that true?

Mr. JOHNSON. That is true.