courts (case law) have therefore governed in such instances. Recently the courts have upheld the rights of trade associations to enforce agreements with their members who failed to live up to selling price provisions by selling below fixed prices.

In Canada, the "Dominion Trade and Industry Commission Act" assented to on July 5, 1935, provides in Section 14 for the approval of agreements between persons for the regulation of prices provided these agreements were not in undue restraint of trade or detrimental to the public interest. This section is no longer in force in that country, the Judicial Committee of the Privy Council having declared it unconstitutional on January 29, 1937.

The Legislative Assembly of the Province of British Columbia passed "An Act Respecting the Sale of Commodities by Retail" by which producers may fix the price at which their commodities are to be sold at retail. Exception is made in certain instances which are specified in Section 8 of the Act, as follows:

"This Act shall not apply to sales by a retailer to his own servants or employees for their own use, or to sales by a Sheriff, or by judicial process; or to sales of damaged goods sold at a price proportionately reduced because of such damage and not merely reduced in evasion of this Act; or to any general sale of commodities in a store or premises where the retailer is actually retiring from business or moving to other premises; or to any other general sale at a price reduced because of some special conditions or circumstances which in the opinion of the Court is not made for the purpose of defeating the provisions of this Act and is not contrary to its intent and purpose."

Violation of the provisions of this law will subject those found guilty to a penalty not exceeding five hundred dollars.

Argentina has no law which would require the wholesaler or retailer to maintain prices set by the manufacturer. However, not long ago, some thought was given to the desirability of including a provision on the subject in a proposed amendment to the trade mark law. The change, if adopted, would punish by a fine of 1000 to 4000 pesos the unauthorized sale of manufactured products identified by a registered trade mark at a price lower than the minimum price fixed by the producer except in those instances where (1) there is a liquidation of the stock or cessation of the business, (2) the goods have been damaged and the public has been so notified, (3) there is a public auction ordered by a a public auction ordered by a court or other competent authority.

In Australia, while there is no law respecting the subject, the manufacturers and wholesalers have an association (Markenschutzartikel Verband) through which they have been able, in a number of instances, to prevent the sale of goods below a fixed price.

Belgium, also, has not legislated specifically in the matter but the manufacturer may enter into a contract, the validity of which can only be

determined by the court.

Should he fail in this respect, the only other recourse is to refuse to sell to such retailers.

The Supreme Court of Czechoslovakia several years ago, in decisions numbers 11,004 and 11,537, prohibited the underselling of "branded merchandise (Markenware). The court called attention to the provisions of Paragraph 1 of the unfair competition law (No. 111, July 15, 1927) which reads:

"Whoever, in his business relations, is in conflict with the good morals of competition by acting so as to do damage to his competitors may be sued in order to abstain from such action and forced to remove the defective condition caused by him; if, however, he knew or was obliged to know that his action was capable of doing damage to his competitors, he may also be sued for damages."

The sale of goods in Denmark below the price indicated on the container, label or wrapper was prohibited under the provisions of Paragraph 13 of the law of March 29, 1924. However, when the law was revised in 1926 that provision was omitted and since then persons who are parties to agreements to maintain prices may sell goods as they desire. In such instances the only recourse open to the manufacturer is to refuse to sell to such persons in the future.

In France, it seems that a manufacturer may, by agreement with his customers, stipulate the price at which the article is to be resold and obtain redress in the event the agreement is violated. It is also probable that the manufacturer of goods nationally advertised at a fixed price could prevent a person not a party to the contract from selling below that price.

There is no legislation on resale price maintenance in Germany. The subject comes within the control of cartels and industrial organizations, many of which have established a defined practice in relation thereto.

In Greece, although there is no specific law which deals with this subject, a manufacturer who has entered into a contract with his customer may obtain demages in a suit against the customer who sells at prices below those stipulated.

The Netherlands, likewise, has no specific statute but, as in Greece, damages may be obtained for violation of provisions of a contract with respect to resale prices.

Much has been said both in support of and in opposition to the subject and to attempt to do more than touch upon a few of the highlights as those referred to above would require more space than is allowed here.

THE DIVISION OF COMMERCIAL LAWS IS PREPARED

TO SUPPLY YOU WITH INFORMATION ON FOREIGN COMMERCIAL LAW

Comparative Law Series - February 1938

46

DIGEST OF LAWS AFFECTING COMMERCE, 75TH CONGRESS 2ND SESSION

By

Leo G. Koepfle, Division of Commercial Laws

The National Housing Act amendments of 1938 (Public No. 424) was approved by the President on February 3, 1938. National Housing Administration is authorized to insure financial institutions against losses which they may sustain as a result of loans and advances of credit, and purchases of obligations representing loans and advances of credit made by them prior to July 1, 1939 for the purpose of financing alterations, repairs, and improvements upon urban, suburban, or rural real property. Amounts up to $2,500 may be borrowed for the erection of new structures. The facilities afforded under Title I are intended primarily for those citizens who live on farms, or in rural areas or in the marginal zone surrounding the larger cities where the standards established by the mutual mortgage insurance system are not applicable.

Under Title II of the Act the total maximum annual carrying charge for an FHA insured mortgage will be 5 percent. This will include five percent interest and one-half percent mortgage insurance premium. In the case of newly constructed homes securing mortgages not exceeding $5,400 and meeting certain other conditions the premium rate will be one-fourth of one percent, making the total total annual carrying charge to the borrower five and one-fourth percent. The elimination of the annual service charge and the reduced cost of the mortgage insurance will represent a maximum saving of approximately one percent per annum to home builders and buyers on newly constructed houses carrying mortgages of $5,400 or less. On newly constructed houses appraised at $6,000 or less, the minimum permissible down payment or equity requirement is reduced from 20 to 10 percent. On newly constructed houses appraised at $10,000 or less, the insurable limit will be ninety percent of the appraised value up to $6,000 plus 80 percent of the appraised value above $6,000. On all other homes housing from one to four families, the insurable mortgage limit will remain at 80 percent of the appraised value, but not in excess of $15,000 under any circumstances.

The program is designed to assist families of moderate means to obtain decent and adequate housing on the most favorable terms in the history of the country.

Origin of Life Insurance in The Netherlands.

A benefit in the form of a usufruct of the land which a husband left in trust for the widow existed in the Netherlands during the Middle Ages. With the development of the Guilds, there was usually a stipulation in the articles of association as to defraying the funeral expenses of the members. Later on, not only members of the Guild, but anyone, by payment of a fee into the Guild Treasury, was permitted to reap the benefit of this form of insurance.

Development of Life Insurance. About 1670, Johan de Witt published a work on annuities entitled "Waardije van Lijfrenten naar Proportie van Losrenten" (Value of Annuities in Proportion to Redeemable Interests) which was followed by a compilation of mortality tables. The theory of life insurance was the subject of works by Christiaan Huygens, the founder of the scientific theory of probabilities, as well as by Hudde, Struyck, Kersseboom, De Graaf, Van der Burch, Duyn, Gallas, Van Swinden, Lobatto, Stamkart, Von Baumhauer, Samot, Landre, Van Geer, Van Pesch and Van Dorsten. Notwithstanding these various publications, the actual business of life insurance did not have the same development as in many other were established, however, various funds for the care

countries.

of widows and orphans, but even these disappeared.

It was not until 1807, that the first Netherlands Life Insurance Company was established by Anton Hartsen Corneliszoon, with the collaboration of the famous professor of the Athaeneum at Amsterdam, van Swinden. This company, known as the Hollandsche Societeit van Levensverzekeringen (Holland Society for Life Insurances), is still doing business in Holland and continued to be the only insurance company in this country until 1850, when several foreign companies established offices here. These foreign companies were not prohibited from using modern mortality and actuarial tables, which gave them the advantage of being able to sell life insurance for lower annual premiums. The local company was bound, under two Royal Decrees of 1830 and 1833 to use mortality tables which were out of date and which called for higher premiums.

Development of Life Insurance in The Netherlands since 1880. A decision of the Supreme Court of Judicature in the Netherlands in effect annulled the two Royal Decrees referred to in the previous paragraph and from that time may be dated the development of Netherland life insurance. In fact, some of the Netherland companies established branches in foreign

countries.

There was a total of 90 life insurance companies in the Netherlands by 1900. From 1895 to 1905, 40 new companies were established. For the population of the country, the number of life insurance companies was becoming excessive. The amount of life insurance in force was estimated

at 1,250,000,000 guilders; the value of annuities was estimated at twenty million guilders.

The World War hurt the life insurance business. In 1920, the amount of life insurance in force was estimated at two billion guilders and in 1928, 2,801,000,000 guilders.

The following tables show, according to the official statistics, the amount of life insurance in force and the capital value of annuities at the end of 1935 and the end of 1936; this table refers to the 66 local companies.

Eleven foreign companies also operate in the Netherlands. These have a total insured capital of about fl.89,000,000 divided up as follows:

After 1880, when the Royal Decrees of 1830 and 1833 were in effect set aside by a judicial decision, the only law covering life insurance companies was certain paragraphs of the Civil Code but in practice they were never applied. Regulations Regulations covering limited liability companies and cooperative societies in the Commercial the Commercial Code were also applicable to insurance companies. Neither were these ever invoked and the insurance companies were without any effective governmental supervision.

In 1883, 1897 and 1912, bills to regulate life insurance companies were introduced but were never enacted into law. However, in 1920, after the failure of one of the largest life insurance companies, a bill was introduced which finally became law of April 29, 1921, regulating life insurance companies. The law which is still in effect and which is the basic law for life insurance companies today, was enacted on December 22, 1922 (known as the Netherland Life Insurance Law of 1922). The administration of this law is placed in the hands of the "Verzekerings

1 "Volksverzekering" or so-called "people's insurance" is an insurance for funeral expenses. In order to obtain the insured capital of the annuities, the annual amount to be paid out is multiplied by ten.