interplay of opinion between the members of the committee, the Government representatives are better able to reach sound conclusions. The presence of trade association executives can seriously disturb the atmosphere which is so important and so difficult to maintain in these meetings. Often association members, and even more often those members of the committee who are not members of the association, are reluctant to speak out frankly in the executive's presence. Even when he does not dominate the meeting, the executive can easily create the impression that the association and its members somehow enjoy a preferred position with the Government. While in theory the association executive can make himself the champion of small business, in practice the small concern is less likely to be a trade association member, particularly in the production field, and is more likely to be antagonistic to an association, than is the large corporation. While there may be exceptions, ordinarily I can see no basis for saying that the presence of an association executive in committee meetings would give small business any added protection whatever. Furthermore, in many instances two, three, four, and more trade associations are organized and active in an industry. Each is vying with the other for members and for status in the industry. If the paid executive of one association attends an industry advisory committee meeting, the executives of the other associations in that industry will also want to attend. Such multiple attendance, inevitably accompanied by intraindustry maneuvers associated with competition among the trade associations, injects into the committee meetings an attitude and atmosphere that can seriously impair their effectiveness. 5. The factual data available through trade associations varies considerably, depending upon the industry and the association involved. Some associations possess much useful information. Others, for various reasons, are in no position to present comprehensive information regarding their industries. The National Production Authority makes every effort to seek the factual data available through trade associations. This is generally accomplished by direct contact between the appropriate industry division within the Authority and the proper trade association. Our officials are encouraged to seek the information, help, and advice which are available from all organized nongovernmental groups in order to learn the effect which our orders have on the industrial and business communities. Paid trade-association executives, representatives of other groups, and individual businessmen are free at all times to meet with appropriate officials in our industry divisions for the purpose of discussing problems, presenting information, and expressing their views regarding our activities. It is in this way that trade associations can be most helpful. It should be pointed out that the National Production Authority often requires, as a basis for its decisions and actions, factual data that is not available through existing organizations and can be obtained only by going directly to members of industry. Such data is obtained in accordance with the Federal Reports Act of 1942. 6. The National Production Authority is consulting with the Antitrust Division of the Department of Justice with respect to the establishment and use of industry advisory committees generally and, in fact, is presently engaged in consultations concerning the precise wording of a proposed revised version of General Program Order No. 6, issued by the National Production Authority, entitled "Rules Applicable to Meetings with Groups of Industry Representatives." Consultation on this subject has not been had to any substantial degree with the Federal Trade Commission. As requested in the final paragraph of your letter, I am enclosing copies of the following: General Program Order No. 6, Rules Applicable to Meetings with Groups of Industry Representatives. Form IAC-2, Request for Formation of Industry Advisory Committee. Form IAC-3, Proposed Membership of Industry Advisory Committee. Form IAC-4, Summary of Representativeness of Proposed Committee. Form IAC-5, Request for Meeting of Industry Advisory Committee. Memorandum dated February 16, 1951, from Administrator to heads of all bureaus and offices of the National Production Authority relating to the estab lishment and use of industry advisory committees. If you should desire any further information kindly let me know. MANLY FLEISCHMANN, Administrator. SLT I DITES FOR SLITEM LIVET OF GROUPS OF INDUSTET REPRESENT aTWEN norma For Tereure-If a meeting is caled merey for the purpose of ConsiLE OF oraming advice or miormation of some specialized Recimica. proben or for the purpose of prelimmary discussions of other problems ar fonierence THE be nic n accordance with Seat 101 - To Vrl a coup viner i no eressati representative of the maustry. luforma rotjerentes so may be calmed at the request of a group not represented by AL InGURE ACTisory Committee for such purposes. The nording of such a col ference should not be considered as & substrtune for the submission of proposed regulations and orders to the ful Industry Advisory Committee as required by Sector 5.07 CE Tast Groups - There are three situations in whet so-called “task grOUPS” Wil De USPC The rules governing their organization and procedure are as follows: F a special proben. requires a considerate amount of time and ef ort, or requires regular actie from industry representatives & tɑse group nig De sejected by the Division Director as a sub-committee of the Industry Advisory Committe auc tik particular matter referred to them. in writing. The functions of such grout must be advisory only and they are not permitted 10 art of agree to act independently except in making recommendations to the Nationa. Production Authority. Such meetings must be conducted by a government representative in the manner specified in Section 2.02. OUTse. 2. Occasionally a special problem wil require continuous work of an industry group in preparing a recommendation for government action. Under such circumstances, if the work car best be conducted at some piace other than Washington, and it is not conveniem to have a government respresentative present, a task force may be organized with the consent of the Office of Industry Advisory Committees, and the Office of the Genera. r A jetter of instructions must be prepared stating the precise task to be accomplished the members of the group and the fact that their functions are soient to prepare a recommendation for government action. The jetter must in all cases state that under no circumstances wil the task force be authorized to require information from members of industry who are not members of the task force. The procedure here outlined, may be foliowed only When the task group's mission can be substantially completed in one months time and the group then discontinued. It will be authorized primarily to permit the formulation of teennica information and data required by the government as a guide to proposed action. 3. When it is proposed to form a task group for similar purposes to those specified in Section 2.03-2, but it is anticipated that their activities wil. continue for a period longer than one month, the proposa. will be reviewed by the Office of the Genera. Counsel and, if approved, will be submitted to the Department of Justice for clearance. interplay of opinion between the members of the committee, the Government representatives are better able to reach sound conclusions. The presence of trade association executives can seriously disturb the atmosphere which is so important and so difficult to maintain in these meetings. Often association members, and even more often those members of the committee who are not members of the association, are reluctant to speak out frankly in the executive's presence. Even when he does not dominate the meeting, the executive can easily create the impression that the association and its members somehow enjoy a preferred position with the Government. While in theory the association executive can make himself the champion of small business, in practice the small concern is less likely to be a trade association member, particularly in the production field, and is more likely to be antagonistic to an association, than is the large corporation. While there may be exceptions, ordinarily I can see no basis for saying that the presence of an association executive in committee meetings would give small business any added protection whatever. Furthermore, in many instances two, three, four, and more trade associations are organized and active in an industry. Each is vying with the other for members and for status in the industry. If the paid executive of one association attends an industry advisory committee meeting, the executives of the other associations in that industry will also want to attend. Such multiple attendance, inevitably accompanied by intraindustry maneuvers associated with competition among the trade associations, injects into the committee meetings an attitude and atmosphere that can seriously impair their effectiveness. 5. The factual data available through trade associations varies considerably, depending upon the industry and the association involved. Some associations possess much useful information. Others, for various reasons, are in no position to present comprehensive information regarding their industries. The National Production Authority makes every effort to seek the factual data available through trade associations. This is generally accomplished by direct contact between the appropriate industry division within the Authority and the proper trade association. Our officials are encouraged to seek the information, help, and advice which are available from all organized nongovernmental groups in order to learn the effect which our orders have on the industrial and business communities. Paid trade-association executives, representatives of other groups, and individual businessmen are free at all times to meet with appropriate officials in our industry divisions for the purpose of discussing problems, presenting information, and expressing their views regarding our activities. It is in this way that trade associations can be most helpful. It should be pointed out that the National Production Authority often requires, as a basis for its decisions and actions, factual data that is not available through existing organizations and can be obtained only by going directly to members of industry. Such data is obtained in accordance with the Federal Reports Act of 1942. 6. The National Production Authority is consulting with the Antitrust Division of the Department of Justice with respect to the establishment and use of industry advisory committees generally and, in fact, is presently engaged in consultations concerning the precise wording of a proposed revised version of General Program Order No. 6, issued by the National Production Authority, entitled "Rules Applicable to Meetings with Groups of Industry Representatives." Consultation on this subject has not been had to any substantial degree with the Federal Trade Commission. As requested in the final paragraph of your letter, I am enclosing copies of the following: General Program Order No. 6, Rules Applicable to Meetings with Groups of Industry Representatives. Form IAC-2, Request for Formation of Industry Advisory Committee. Form IAC-3, Proposed Membership of Industry Advisory Committee. Form IAC-4, Summary of Representativeness of Proposed Committee. Form IAC-5, Request for Meeting of Industry Advisory Committee. Memorandum dated February 16, 1951, from Administrator to heads of all bureaus and offices of the National Production Authority relating to the establishment and use of industry advisory committees. If you should desire any further information kindly let me know. MANLY FLEISCHMANN, Administrator. RULES APPLICABLE TO MEETINGS WITH GROUPS OF INDUSTRY REPRESENTATIVES SECTION 1. PURPOSE 01. The purpose of this order is to prescribe the rules applicable to meetings of representatives of the National Production Authority with groups of industry representatives as set forth in the Defense Production Act of 1950, and Department of Commerce Order No. 114 applicable to meetings of industry representatives with National Production Authority officials. 02. The restrictions put upon such meetings are intended to assure the National Production Authority the benefits of a true cross section of industry opinion for its assistance in the development and administration of the defense program and to assure to industry protection from prosecution under the antitrust laws under the rules promulgated by the Attorney General. 03. The provisions of this order are not to be construed as prohibiting individual citizens or groups of citizens from seeking discussions with employees of the National Production Authority. SECTION 2. DEVICES FOR SECURING ADVICE OF GROUPS OF INDUSTRY REPRESENTATIVES 01. Industry Advisory Committees. If a meeting is called for the purpose of considering problems affecting an entire industry, or a segment thereof, or involving questions upon which views or recommendations of several segments of the industry are desirable, it shall be held with a representative group selected from the industry and constituted as an industry advisory committee in accordance with Section 3. below. 02. Informal Conferences. If a meeting is called merely for the purpose of considering or obtaining advice or information on some specialized technical problem or for the purpose of preliminary discussions on other problems, an informal conference may be held, in accordance with Section 4, below, with a group which is not necessarily representative of the industry. Informal conferences also may be called at the request of a group not represented by an Industry Advisory Committee for such purposes. The holding of such a conference should not be considered as a substitute for the submission of proposed regulations and orders to the full Industry Advisory Committee as required by Section 3.05. .03 Task Groups.—There are three situations in which so-called "task groups" will be used. The rules governing their organization and procedure are as follows: 1. If a special problem requires a considerable amount of time and effort, or requires regular advice from industry representatives, a "task group" may be selected by the Division Director as a sub-committee of the Industry Advisory Committee and the particular matter referred to them in writing. The functions of such group must be advisory only and they are not permitted to act or agree to act independently except in making recommendations to the National Production Authority. Such meetings must be conducted by a government representative in the manner specified in Section 2.02. 2. Occasionally a special problem will require continuous, work of an industry group in preparing a recommendation for government action. Under such circumstances, if the work can best be conducted at some place other than Washington, and it is not convenient to have a government respresentative present, a task force may be organized with the consent of the Office of Industry Advisory Committees, and the Office of the General Counsel. A letter of instructions must be prepared stating the precise task to be accomplished, the members of the group and the fact that their functions are solely to prepare a recommendation for government action. The letter must in all cases state that under no circumstances will the task force be authorized to require information from members of industry who are not members of the task force. The procedure here outlined may be followed only when the task group's mission can be substantially completed in one month's time and the group then discontinued. It will be authorized primarily to permit the formulation of technical information and data required by the government as a guide to proposed action. 3. When it is proposed to form a task group for similar purposes to those specified in Section 2.03-2, but it is anticipated that their activities will continue for a period longer than one month, the proposal will be reviewed by the Office of the General Counsel and, if approved, will be submitted to the Department of Justice for clearance. SECTION 3. PROCEDURE FOR ESTABLISHING AND USING INDUSTRY ADVISORY COMMITTEES .01 Proposal of a New Industry Advisory Committee.-The establishment of an industry advisory committee may be proposed by the director of an industry division. Such proposal shall be made to the Director of the Office of Industry Advisory Committees and shall be accompanied by a memorandum setting forth: 1. The purposes for which the industry advisory committee is to be established. 2. The name (including first names and initials), address, business connection and position held by each committee member proposed. 3. A statement, together with necessary supporting information, that the committee, in the opinion of the industry division head, is representative of the industry. In this connection, the Defense Production Act of 1950 requires that, "such business advisory committees shall be appointed as shall be appropriate for purposes of consultation in the formulation of rules, regulations, or orders, or amendments thereto issued under authority of this Act, and in their formation there shall be fair representation for independent small, for medium, and for large business enterprises, for different geographical areas, for trade association members and nonmembers, and for different segments of the industry;". 4. The date and time of the first meeting of the committee, the government representatives to be requested to attend the meeting and an agenda for such meeting. 5. The memorandum of proposal shall have attached: (a) the nomination of the government presiding officer who shall be designated by the industry division director and (b) a clearance memorandum from the Office of Small Business. The Office of Small Business memorandum shall be considered as evidence that the Office of Small Business has reviewed the proposed membership of the industry advisory committee and, in the opinion of the Office of Small Business, such committee affords fair representation to independent small business enterprises. If the industry division director and the Office of Small Business fail to agree on the question of such fair representation, the matter shall be referred to the Office of Industry Advisory Committees for a decision. .02 Approval of a New Industry Advisory Committee. If the Office of Industry Advisory Committees is satisfied that the committee is representative, the committee shall be established by the Director of the Office of Industry Advisory Committees. In order to make the committee as representative as practicable, the Director of the Office of Industry Advisory Committees may change the membership of a proposed committee either by adding names to or eliminating names from the proposed list; in such event, he shall advise the government presiding officer of the changes to be made in order to enable the latter to express his views with respect to such changes. Generally, members shall be designated for limited terms to permit rotation of membership where this is feasible or desirable. .03 Meetings of Industry Advisory Committees.— 1. Invitations: All invitations to and notices of meetings of any industry advisory committee shall be issued to members or others by the Office of Industry Advisory Committees upon the receipt of a request for a meeting, together with an agenda from the government presiding officer. Only those thus invited shall attend meetings. 2. Refusals: In case any invitations are refused, the government presiding officer shall propose such additional members as are necessary to complete the membership of the committee. If such additional members are approved by the Director of the Office of Industry Advisory Committees, he shall invite them to serve on the committee. 3. Additional Members and Vacancies: Whenever the government presiding officer believes an additional member should be appointed to a committee or that a vacancy should be filled, he may propose a new member. If such additional members are approved by the Director of the Office of Industry Advisory Committees, he shall invite them to serve on the committee. New members shall not be selected in any manner which would give inadequate representation to any part of the industry. 4. Place of Meeting: No meeting shall be held outside Washington unless specific written authorization of the Director of the Office of Industry Advisory Committees and of the General Counsel is first obtained. The division director should direct all requests for meetings outside Washington to the |