from brought an action to have the agreement annulled. The Commerce Court of St. Petersburg declared the cartel agreement invalid. The case was appealed, but later the parties settled it out of court. It was stated, further, that criminal prosecution was contemplated by the Ministry of Justice.

To what extent the courts have made practical application of these laws is not known but, in any case, the Russian Government has in several instances given encouragement to the formation of cartels. It appears, moreover, that in Russia the decisions of the courts are not legal precedents, but follow administrative policy.

REGULATION OF SUGAR INDUSTRY.-On account of the disorganized condition of the sugar-refining industry, due to excessive production and the export of sugar at extremely low prices, which in turn threatened an important source of public revenue, the Russian Government, by a law of November 20, 1895, instituted an elaborate system of Government regulation. This policy was adopted, apparently, for the purpose of so regulating the domestic production as to prevent a demoralization of the sugar industry, and to afford by indirect means a bounty on the exportation of sugar. According to the existing tariff laws of certain countries, Government bounties on sugar exported subjected such sugar to discriminatory treatment in the countries of importation."

The Russian Government determined, first, how much sugar would be required for consumption in the domestic market, and then divided this quantity among the several factories in the following manner: Each factory was to have a minimum quantity of 60,000 poods, regardless of its output, and the rest of the quantity required for domestic consumption was divided among them in proportion to the previous output of each. The total quantity allotted for domestic consumption was subject to a so-called normal excise tax. The factories were also required to keep a reserve stock of sugar to be used for domestic consumption in case the Government should find it desirable to increase the quantity to be sold under the normal tax. Such sale might be ordered in case the domestic price exceeded a normal level of prices determined by the Government. The surplus sugar above the quantity fixed for domestic consumption and for the obligatory reserve had to be exported or carried over to the following year, because if sold in the domestic market it would be subject to a double excise tax, which was prohibitory. The export sugar was exempt from all taxation, while a practically prohibitory import tax was established so that very little foreign sugar was imported.

1 Preyer: Die russische Zuckerindustrie, Leipzig, 1908, p. 49. A translation of this law is given in Exhibit F of this report. (See p. 789.)

It may be noted that the system established by the Russian Government under the law of Nov. 20, 1895 was held by the Supreme Court of the United States to provide in effect a bounty within the meaning of the tariff laws of the United States. Downs v. United States, 187 U. S., 496 (1902).

30035-16-19

The right to sell sugar in the domestic market under the normal tax could be transferred from one factory to another, and as certain factories were more advantageously situated for the export trade, they frequently sold this right with respect to certain quantities of sugar to other factories which were thus enabled to sell corresponding quantities in the domestic market in addition to their regular allotments. The value of such rights so transferred depended chiefly on the current difference in the domestic and export prices, and this amount was generally regarded as being substantially a bounty on the exportation of sugar.

As the domestic prices were high, it was an advantage to export sugar even at a loss, or to produce sugar and carry it over to the next year, because the total production of a factory in one year was the basis for determining how much it could produce and sell in the domestic market in the following year. In a practical sense, the chief defect of the law was that there was too much incentive given to increase production.

The law was modified May 12, 1903, to prevent a too rapid increase in production by fixing the total quantity apportioned to each factory, so that an actual increase in production would not entitle it to an increase in the quota for domestic consumption.1

In 1907 Russia became a party to the Brussels International Sugar Convention, under special conditions, i. e., preserving its customs and excise tax system, but limiting its export to a fixed quantity, except overland to oriental markets.2

Subsequent legislation indicates that import duties on sugar were lowered and export drawbacks suspended in order to keep domestic sugar prices below the prescribed limits. Recently the Government apportioned the total quantity of sugar exported among the various refiners.'

Section 23. Roumania.

Legislation in Roumania is chiefly of interest in connection with special regulations made concerning the petroleum industry. The Penal Code, in article 351, contains a prohibition against interference with free competition in public auctions, which is similar to article 412 of the French law. (See p. 272.) The most important provisions of the civil law regarding the validity of contracts appear to be nearly the same as those of France and Italy; articles 5, 948, 966, 968, and 1008 of the Roumanian Civil Code are nearly identical

6

1 Preyer: Die russische Zuckerindustrie, Leipzig, 1908, p. 73.

? Journal des Fabricants de Sucre, 21 janvier, 1914.
*Decree of Apr. 15, 1910: Sobranie Uzakonenii, 1910, ch. 681.

4 Ibid., 1912, pt. 1, ch. 2024.

Codicele Penal.

Codicele Civile.

in phraseology with articles 6, 1108, 1131, 1133, and 1172, respectively, of the French Civil Code (see p. 272), and need not be given in detail here. The Roumanian Civil Code in article 998 has a provision applicable to unfair competition, which is also practically identical with article 1382 of the French law. (See p. 273.)

APPORTIONMENT OF DOMESTIC SALE AND PRICE REGULATION OF PETROLEUM. Several powerful oil companies, largely controlled by German banks, through combination, had at times fixed the prices of illuminating oil in the domestic market, while another company owned by Standard Oil interests apparently threatened to seize the whole domestic business by cutting prices. Whichever of these parties won, the immediate effect on the small Roumanian refiner, as well as the final result to the public, was viewed with apprehension by the Government, and in 1908 a law was passed for the legal apportionment of domestic sales of illuminating oil and the regulation of domestic prices.1

The original apportionment of the domestic sales was in general based on rated annual capacity of crude-oil consumption, but the refineries which had a capacity of less than 40,000 tons and more than 10,000 tons were given 200 per cent in addition, while those having a capacity of less than 10,000 tons were given 400 per cent in addition. The Finance Ministry each year determines the total domestic requirement of illuminating oil and informs each refinery of the quantity allotted to it for the year. Additional quantities of oil may be produced for export or for storage under strict Government control. Refineries not equipped to refine illuminating oil of required quality are forbidden to produce any.

The maximum domestic selling prices are fixed by the Government, on the basis of the average price of crude oil, and in addition 3.50 to 4.50 lei (francs) for refining cost and profit. The price may be changed every three months, and the refineries notified thereof by the council of ministers.

Heavy penalties of fine and imprisonment are provided for refiners who break the law, especially after the first offense, and for officials who are guilty of aiding them therein.

Provision is also made for the establishment by the Government of local reservoirs or tanks to lease to small refiners at a rental of 10 per cent of the investment cost to cover interest and amortization.

This law was amended in 1910 by making seven instead of three classes of refiners and giving to the small producers very much larger quotas in proportion to their capacity.

Law concerning the apportionment of the total requirements of illuminating petroleum among the refineries of the country; Law of Apr. 10, 1908 (o. s.). Summarized from German translation in Denkschrift über das Kartellwesen, Berlin, 1908, IV. Teil, pp. 151-154. A translation of this law is given in Exhibit G of this report. (See p. 794.)

Daily Consular Reports, Aug. 17, 1910, p. 524.

Section 24. Turkey.

1

The Penal Code of Turkey contains in article 238 a provision against interfering with free competition in auctions similar to article 412 of the French Penal Code. (See p. 272.) Article 239 of the Turkish Penal Code, which prohibits combinations to effect changes in the prices of commodities or securities is nearly identical in verbiage with articles 419 and 420 of the French Penal Code (See p. 269). The penalties are doubled for combinations affecting breadstuffs and potables, fuel and other objects of primary necessity.

Section 25. Greece.

PENAL CODE.-There are several provisions of the Penal Code 2 which are of interest in this connection.

Article 407, which is similar to article 419 of the French Penal Code, is as follows:

ART. 407. Whoever with the intention to discredit moneys not withdrawn from circulation, or to change their legally determined value, or with the intention to increase the price of wares, public securities, or other objects offered for sale above the ordinary price formed through free commerce, or to depress under the same, or to hinder the sale of such articles, or to compel a definite price, knowingly spreads false reports or facts, if this occurs in consequence of an agreement made among several, shall be punished with imprisonment up to six months and with a fine of fifty to one thousand drachmas, otherwise with imprisonment up to two months and a fine of from twenty to two hundred drachmas.

Article 436 prohibits interference with competition at auctions:

ART. 436. Whoever at public auctions hinders free competition through force or threats, or intentionally removes or keeps a bidder away through gifts or promises, shall be punished with imprisonment up to three months.

Besides these prohibitions regarding serious offenses there are three provisions, articles 585, 586, and 671, regarding "minor offenses" for which the penalties are generally less severe. The first of these contains prohibitions similar to those of the ancient English statutes against engrossing, regrating, and forestalling. (See p. 2.)

ART. 585. Whoever seeks to keep another from access to the markets; whoever overbids the prices asked by the sellers, whoever seeks to force other buyers or sellers from the market; dealers in victuals and middlemen, who buy up on the way victuals destined to the market or in order to remove them from free commerce and to draw them exclusively to themselves, make secret agreements with the sellers, must pay fines of from 10 to 200 drachmas.

ART. 586. Tradesmen entitled to sell victuals who without lawful causes of hindrance do not provide themselves with the prescribed supplies, conceal the same in case of demand from the authorities, refuse to deliver against payment to any buyer. or agree to dispose of certain victuals only at definite times, in certain order, or at prices above the rates fixed by the authorities, are punished by a fine of from 30 to 300 drachmas.

1 Das türkische Strafgesetzbuch, German translation by E. Nord, Berlin, 1912.
Strafgesetzbuch des Königreiches Griechenland (1834). (Official translation.)

It is further provided in article 587 that if the offenses prohibited in articles 585 and 586 are committed in periods of public disorder penalties of arrest shall be imposed in addition to fines.

Only the first paragraph of article 671 is given below; the second paragraph relates to the disposition of defective goods.

ART. 671. Whoever through curtailment in measure or weight, or through deficient quality of salable articles, or through excessive demand in price or wages violates the rules of any existing rate regulation, incurs a fine of from 30 to 300 drachmas.

SPECIAL LAWS.-The production of currants and the manufacture of wine therefrom is one of the most important economic activities of Greece. The fruit is also used for other purposes, including the making of alcohol. Unsatisfactory conditions led to the establishment of a special bank in 1899 which centralized in a large measure the purchase and sale of currants. For the further amelioration of the currant trade a law was passed on June 21, 1904, forbidding the extension of currant plantations. On July 17, 1905, a law was passed establishing a company called the "Privileged Company for Promoting the Production and Commerce in Currants," which ratified an agreement between the executive branch of the Government and two banks concerning the regulation of the currant trade, and provided the legislation necessary to enforce the provisions of the agreement. This company was established with a capital stock of 20,000,000 francs and a 20-year concession terminable after 10 years by Government purchase. It is required to advance money to the producers on their crops in order to prevent currants being dumped at low prices and also to purchase at the end of the campaign all currants offered to it at minimum prices, fixed according to quality. Various other privileges and obligations were attached to the company's charter. It was also provided that alcohol for commercial use might be produced only from currants or grapes. By a law of March 27, 1910, the overproduction of currants was met by providing for a systematic destruction of inferior currant vines, compensation being made to the owners.' Section 26. Brazil.

The laws of Brazil are of interest, particularly with respect to the provisions made in the customs laws and in the special laws regarding the valorization of coffee.?

1 For general information on this subject see Basiliu: Griechenland, Jahrbuch für vergleichende Rechtswissenschaft und Volkswirtschaft, 1910, pp. 1597-1598, and Struck: Zur Landeskunde von Griechenland, 1912, pp. 103-104, and for details respecting the Privileged Company see Société Priviligiée pour Favoriser la Production et le Commerce du Raisin de Corinthe, Statuts, Conventions et Lois, Athènes, 1905.

It also appears that the Brazilian Government a few years ago made arrangements which recently expired whereby exclusive privileges were conferred with respect to the mining and the exportation of mining monazite sand, a material used in the manufacture of gas mantles. Deutsches Handels-Archiv, 1908, I. Th. p. 277; Ib. II. Th. p. 495; J. P. Krusch, Die Versorgung Deutschlands mit metallischen Rohstoffen, Leipzig, 1913.