RELATIONS OF THE LONDON COMMITTEE WITH THE COMPTOIRS AND THE S. E. A. The Committee approved the terms of a memorandum setting out the position between the London Committee and the Comptoirs and the S. E. A., and it was ageed that copies of this memorandum should be sent forthwith to each of the parties to whom the Minutes of the London Committee are circulated. In order that the views of the Presidents of the Comptoirs might be obtained in regard to this matter, as provided in the memorandum, the E. I. A. representative undertook to arrange for a meeting between the Presidents and the London Committee, and it was suggested that this meeting should be held on Tuesday, 16th May, in London, or, if that date was not suitable to the Presidents, on Monday, 22nd May, in Paris. REVISED QUOTAS AS FROM 20TH APRIL 1939 There was submitted to the Meeting a statement showing the provisional figures for these revised quotas. The statement was left over for later consideration after the members had had an opportunity of examining the figures, copies of the statement to be circulated meantime with the Minutes. It was agreed that the Secretary of the Black and Galvanised Sheets Comptoirs should be asked to submit his figures for the revised Sheet quotas. It was also agreed that the Secretary of the Joint Co-Ordinating Committee should be reminded that the points which were outstandnig in regard to the settlement of the American Group's quota figures for Black and Galvanised Sheets (pages 13-14 of the Minutes) had been referred to that Committee. In regard to future statistics for Sheets, it was agreed that provided the Comptoirs' sales figures were available for ten-day periods, i. e. at the 10th, 20th, and the end of the month, delivery figures on a monthly basis would be sufficient. EXCESS/DEFICIT FIGURES AT 20TH APRIL 1939 A statement of provisional excess/deficit figures at the 20th April 1939 was submitted. The particulars were noted and it was pointed out that the American Group figures had yet to be confirmed. OUTSIDER COMPETITION AND PRICE REDUCTIONS The Committee agreed by a majority (the British and American representatives being in favour and the E. I. A. representative dissenting) that the American Group be authorised to accept a price of $1.90 c. i. f. for 2,300 tons of ship plates for Kockums, Sweden. The American Group also submitted a duplicate offer for 2,400 tons of shipbuilding material for Eriksberg at a price of $1.90 c. i. f. against competition by Hokar. The Committee took the view that the American Group should be asked to make every effort to obtain £9.5.0 per ton c. i. f., but it was agreed, by the same majority as for Kockums, that if that price could not be obtained the American Group be authorised to take the order down to $1.90. It was agreed that the Plate Comptoir should be asked to submit to the Committee full particulars of any authorisations for shipbuilding steel given by them below the established prices since 20th April. It was agreed that the Chairman and the American representative should be furnished with a copy of the Comptoirs' agreement with Coopra in Holland. MERGHANT BARS It was agreed that as the ARGENTINE is not within the sphere of American influence it should be eliminated from the list of WESTERN HEMISPHERE prices which the American Group had submitted to the Comptoir. In regard to the point raised by the Comptoir that the American Group's c. i. f. prices for certain countries in the BRITISH EMPIRE and for RUMANIA were below the Cartel prices, the American representative was requested to arrange for his Group to bring their prices to parity with the British prices for the British Empire, making allowance for any additional duty, and to arrange also for his Group to observe the Cartel price for Rumania. SHAPES (JOISTS, CHANNELS, AND BROAD-FLANGED BEAMS) The American representative stated that his Group were at present looking into the prices which the Shapes Comptoir had queried and would report to the Committee as soon as possible. WIRE RODS The Committee considered the report received from the I. W. R. S. in regard to various matters: (a) Differential for quality In regard to the I. W. R. S. claim that in zones of American influence they would have the right to deduct from the prices quoted by the Americans the extra for Open Hearth (S. M.) quality when in deficit, it was agreed that the I. W. R. S. be advised that the London Committee would have the power to authorize them to deduct the differential for quality in these zones when they are in deficit. (b) Scale of prices submitted by the I. W. R. S. to the American Group The American representative stated that his Group had now agreed to these prices. (c) American sales to Egypt and Holland As regards the point raised by the I. W. R. S. that they had refrained from supplying EGYPT for a long period in order to reserve that market to IWECO, and the request made by I. W. R. S. that the American Group should withdraw from HOLLAND since the I. W. R. S. supplied in that market only Wire Drawers belonging to IWECO, the American representative undertook to discuss the position with M. Brichant in order to see how far the American Group could fall into line with the Comptoir's arrangements. (d) Belgium In regard to a recent shipment by the American Group to BELGIUM, i. e., a home market, the American representative stated that he was at present taking up this matter with his Group in order to avoid a recurrence. (e) South China In regard to the Comptoir's contention that the American Group should not have the right to fix the prices in SOUTH CHINA, as a zone of American influence, it was agreed that it should be pointed out to the Comptoir that the zones of influence were merely a convenient arrangement and did not form part of the terms of the Agreements, and that it was within the competence of the Comptoir to agree prices with the American Group. COOPERATION IN NORTHEAST ASIA The American representative raised the point as to competition between the Groups in this territory. It was agreed that the attention of the Comptoirs should be drawn to Clause 4 (page 22 of the Minutes) of the formula agreed by the Joint Coordinating Committee, in which it was stated that every effort would be made to avoid members competing against each other, and the Committee expressed the view that requests for information should be met as far as circumstances permitted. EXHIBIT S-102A [Memorandum approved at the London Committee Meeting held on 11th May 1939] E. I. A./U. K./U. S. A. AGREEMENT-RELATIONS OF THE LONDON COMMITTEE WITH THE COMPTOIRS AND THE S. E. A. The London Committee, originally formed to exercise statistical and quota control over the E. I. A./U. K./U. S. A. Agreement, has now been given wider powers by the Joint Co-Ordinating Committee in order to make its control effective. The Committee's powers are set out in the following clause, extracted from the supplementary agreement of 18th April 1939, as approved by the Joint Co-Ordinating Committee: "For the period from 20th April 1939, up to and including 31st October 1939, the American and European Groups agree, for all sales, to accept the control of the London Committee for the purpose of eliminating the competition of American outsiders, and ensuring the maintenance of quotas in accordance with the Main Agreement. It is understood that quotations may only be made and orders booked at such prices and under such conditions (other than standard prices and conditions fixed by the Comptoirs) as the London Committee may from time to time authorise. For this purpose the London Committee shall have complete authority under the Joint Co-Ordinating Committee, and the Comptoirs shall be bound to take the necessary steps to ensure that the decisions and recommendations of the London Committee are effectively carried out." The authority of the London Committee under this clause falls into two distinct categories: (a) Statistical and quota control of the E. I. A./U. K./U. S. A. Agreement; (b) The authorisation of any steps necessary to meet American outside competition. It is understood that this applies to all outsider competition. As regards (a), the Committee will examine regularly the statistical position and, according to the position of the American Group, will decide for each product whether they should protect or be protected. In the case of abnormal excesses, either on the part of the American Group or on the part of the European Groups, the Committee, may request complete or partial withdrawal from certain markets by the party in excess. Prices remain, as hitherto, entirely in the hands of the Comptoirs who will agree them with the American Group: in this instance the Committee is only concerned with the price differentials between the parties. The position is different as regards (b). Hitherto the procedure has been for the Comptoirs to fix official prices and for the various Presidents to authorise price reductions wherever necessary to meet outsider competition. This has also been the procedure of the S. E. A., but since each has frequently been conducted independently of the other, the resultant reductions have, to a great extent, involved unnecessary losses. The new procedure, calculated to meet the competition with the minimum of disturbance and loss on normal business, is that, whilst standard prices and conditions will continue to be fixed by the Comptoirs in conjunction with the S. E. A., these prices cannot be departed from without the approval of the London Committee. It should be noted here that in cases of extreme urgency, the S. E. A. and the Presidents of the Comptoirs may authorise special prices, but these must be notified by cable immediately to the London Committee and must be followed at once by letter giving full details of all the circumstances warranting the action taken. Whilst the authority for special prices is now vested in the London Committee for the reasons set out above, it will be necessary for them to maintain the closest possible contact with the Presidents of the Comptoirs. The views of the Presidents of the Comptoirs are now invited as to the extent of the delegation of authority which they consider must be granted to them for the practical conduct of business, and the London Committee will consider these views and define the powers which they will delegate to the Comptoirs. In conclusion, it should be stated that the powers of the London Committee have been framed with the object of enabling them to coordinate rather than usurp the authority of the Comptoirs and the S. E. A. where otherwise these might be likely to conflict. The period for which this authority is vested in the London Committee is a trial period until 31st October, 1939, at the end of which time a review will be made of the results achieved towards elimination of outsiders. It is hoped and expected that coordination on these lines will go far to rectify the present regime under which independent action by the S. E. A. and the Comptoirs is liable to result in mutual competition rather than cooperation. EXHIBIT S-103 [Private & confidential-seventh meeting] E. I. A./U. K./U. S. A. AGREEMENT-MINUTES OF THE MEETING BETWEEN THE LONDON COMMITTEE AND THE PRESIDENTS OF THE COMPTOIRS HELD AT THE COSIBEL OFFICE, 9 RUE DE LA CHANCELLERIE, BRUSSELS, ON MONDAY, 22nd May, 1939, AT 10:45 A. M. Present: Members of the London Committee: Mr. R. M. Peat (in the Chair). M. H. Diaudonné, Continental Group. Mr. Wm. B. Todd, American Group. Presidents of the Comptoirs: M. E. Tonneau, Semis. Herr J. Lamarche, Plates. M. L. Brichant, Wire Rods and Hoop and Strip. In attendance: Herr P. Maulick, German Group. M. Gaudin, Central Bureau, Semis. Mr. H. Craig, British Group. Mr. V. Malcolm, British Group. Mr. R. V. Kennard, American Group. Mr. J. R. Mackay, Peat, Marwick, Mitchell & Co. An apology for absence was submitted on behalf of Mr. Summers, President of the Sheets Comptoir. This joint meeting between the London Committee and the Presidents of the Comptoirs was convened in order to consider and define the terms of collaboration which should exist between the Committee and the various Comptoirs, and the extent of the powers to be delegated by the London Committee to the Comptoirs to facilitate the practical conduct of business. The following decisions were made: PLATES Until otherwise agreed by the London Committee the power to authorise special prices for all Groups shall be vested in the Central Bureau, which will take all steps necessary to meet outside competition. The Central Bureau will furnish to the American representative and to the London Committee for each ten-day period a complete list of all business taken and will furnish full particulars daily of all business authorised at special prices. The American representative will furnish to the London Committee and to the Comptoir for each ten-day period a complete list of the business taken by his Group. SEMIS Until otherwise agreed by the London Committee, the power to authorise special prices shall, for ALL COUNTRIES (apart from the free territory of NORTH EAST ASIA), be vested in the President of the Comptoir, who will take all steps necessary to meet outside competition. In the case of the countries in which the American Group are interested (which are understood to be GREECE, CANADA, MEXICO and CHILE) the American Group will apply to the President of the Comptoir when they desire to quote a special price to meet outside competition and will agree the special prices with him. For the countries in which the American Group are interested the Comptoir will report to the American representative and to the London Committee for each ten-day period the business taken, by countries, and will furnish full particulars daily of all business authorised at special prices. The American representative will, on this part, report to the Comptoir and to the London Committee for each ten-day period, by countries, the business taken by his Group. 96347-50-ser. 14, pt. 4b- -16 For the other countries the Comptoir will report to the London Committee the business taken in each ten-day period, with particulars of all business authorised at special prices. SHAPES (JOISTS, CHANNELS AND BROAD-FLANGED BEAMS) Until otherwise agreed by the London Committee, the power to authorise special prices shall, for ALL COUNTRIES (apart from the free territory of NORTH EAST ASIA), be vested in the President of the Comptoir, who will take all steps necessary to meet outside competition. In the case of the countries in which the American Group are interested (which are understood to be GREECE, ITALY, BRAZIL, MEXICO, COLOMBIA, CHILE, PERU, VENEZUELA, CUBA, PANAMA, and SOUTH AFRICA) the American Group will apply to the President of the Comptoir when they desire to quote a special price to meet outside competition and will agree the special prices with him. For the countries in which the American Group are interested the Comptoir will report to the American representative and to the London Committee for each ten-day period the business taken, by countries, and will furnish full particulars daily of all business authorised at special prices. The American representative will, on his part, report to the Comptoir and to the London Committee for each ten-day period, by countries, the business taken by his Group. For the other countries the Comptoir will report to the London Committee the business taken in each ten-day period, with particulars of all business authorised at special prices. MERCHANT BARS Until otherwise agreed by the London Committee, the power to authorise special prices shall, for ALL COUNTRIES (apart from the free territory of NORTH EAST ASIA), be vested in the President of the Comptoir, who will take all steps necessary to meet outside competition. In the case of the countries in which the American Group are interested (which are understood to be GREECE, RUSSIA, BOLIVIA, BRAZIL, CHILE, PERU, VENEZUELA, COLOMBIA, CUBA, GUATEMALA, PANAMA, SALVADOR, and SOUTH AFRICA) the American Group will apply to the President of the Comptoir when they desire to quote a special price to meet outside competition and will agree the special prices with him. For the countries in which the American Group are interested the Comptoir will report to the American representative and to the London Committee for each ten-day period the business taken, by countries, and will furnish full particulars daily of all business authorised at special prices. The American representative will, on his part, report to the Comptoir and to the London Committee for each ten-day period, by countries, the business taken by his Group. For the other countries the Comptoir will report to the London Committee the business taken in each ten-day period, with particulars of all business authorised at special prices. TUBE STRIP OTHER HOOP AND STRIP Until otherwise agreed by the London Committee, the power to authorise special prices shall, for ALL COUNTRIES (apart from the free territory of NORTH EAST ASIA), be vested in the President of the Comptoir, who will take all steps necessary to meet outside competition. In the case of the countries in which the American Group are interested (which are understood to be GREECE, CANADA, BRAZIL, CHILE, & MEXICO) the American Group will apply to the President of the Comptoir when they desire to quote a special price to meet outside competi tion and will agree the special prices with him. For the countries in which the American Group are interested the Comptoir will report to the American representative and to the London Committee for each ten-day period the business taken, by countries, and will furnish full particulars daily of all business authorised at special prices. The American representative will, on his part, report to the Comptoir and to the London Committee for each ten-day period, by countries, the business taken by his Group. For the other countries the Comptoir will report to the London Committee the business taken in each ten-day period, with particulars of all business authorised at special prices. Reference was made to an order for 500 tons for KARACHI which was believed to have been taken by one of the S. E. A. members at 15/- per ton below the appropriate price. As it was now alleged that the order had been taken by the |