act-1941-0-344•Pennsylvania Act 1941-344 — "UNFAIR SALES ACT"
Act text
"UNFAIR SALES ACT"
Act of Aug. 11, 1941, P.L. 900, No. 344 Cl. 12
AN ACT
Defining and prohibiting unfair sales, providing remedies for
violations thereof, and establishing penalties therefor.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Whereas, The practice of selling certain items of merchandise
at cost or less than cost in order to attract patronage is
generally a form of deceptive advertising and an unfair method
of competition in commerce, and,
Whereas, Such practice causes commercial dislocations,
misleads the consumer, works back against the farmer, directly
burdens and obstructs commerce and diverts business from dealers
who maintain a fair price policy, and,
Whereas, Bankruptcies among merchants who fail because of the
competition of those who use such methods result in
unemployment, disruption of leases and nonpayment of taxes and
loans and contribute to the inevitable train of undesirable
consequences, including economic depression, now therefore,
Section 1. This act shall be known and designated and may be
cited as the "Unfair Sales Act".
Section 2. (1) When used in this act the term "cost to the
retailer" shall mean the invoice cost of the merchandise to the
retailer or the replacement cost of the merchandise to the
retailer, whichever is lower, less all trade discounts, except
customary discounts for cash, advertising allowances,
promotional allowances, display allowances and any other
allowances for services rendered and any other commission or
remuneration received for services performed on behalf of any
governmental agencies, to which shall be added (a) freight
charges not otherwise included in the invoice or the replacement
cost of the merchandise, (b) a mark-up to cover in part the cost
of doing business, which mark-up in the absence of proof of a
lesser cost, shall be not less than four per cent of the total
cost at retail outlet.
(2) When used in this act the term "cost to the wholesaler"
shall mean the invoice cost of the merchandise to the wholesaler
or the replacement cost of the merchandise to the wholesaler,
whichever is lower, less all trade discounts, except customary
discounts for cash, advertising allowances, promotional
allowances, display allowances and any other allowances for
services rendered and any other commission or remuneration
received for services performed on behalf of any governmental
agencies, to which shall be added (a) freight charges not
otherwise included in the invoice or the replacement cost of the
merchandise and (b) a mark-up to cover in part the cost of doing
business, which mark-up in the absence of proof of a lesser cost
shall be not less than two per cent of the total cost at the
wholesale establishment.
(3) Where two or more items are advertised, offered for sale
or sold at a combined price, the price of each item named shall
be governed by the provisions of subsection (1) or (2) of
section two respectively.
(4) The terms "sell at retail", "sales at retail" and
"retail sale" shall mean and include any transfer for a valuable
consideration made in the ordinary course of trade or in the
usual prosecution of the seller's business of title to
merchandise to the purchaser for consumption or use other than
resale or further processing or manufacturing. The above terms
shall include any transfer of such merchandise where title is
retained by the seller as security for the payment of such
purchase price.
(5) The terms "sell at wholesale", "sale at wholesale" and
"wholesale sales" shall mean and include any transfer for a
valuable consideration made in the ordinary course of trade or
the usual prosecution of the seller's business of title to
merchandise to the purchaser for purposes of resale or further
processing or manufacturing. The above terms shall include any
such transfer of merchandise where title is retained by the
seller as security for the payment of the purchase price.
(6) The term "retailer" shall mean and include every person,
partnership, corporation or association other than a
manufacturer (not operating a retail business or trade) engaged
in the business of making sales at retail or performing the
retail function within this State: Provided, That, in the case
of a person, partnership, corporation or association other than
a manufacturer (not operating a retail business or trade)
engaged in the business of making sales both at retail and at
wholesale, such terms shall be applied only to the retail
portion of such business.
(7) The term "wholesaler" shall mean and include every
person, partnership, corporation or association other than a
manufacturer (not operating a retail business or trade) engaged
in the business of making sales at wholesale or performing the
wholesale function of supplying any retailer or retail outlet
with merchandise for retail sale within this State: Provided,
That, in the case of a person, partnership, corporation or
association other than a manufacturer (not operating a retail
business or trade) engaged in the business of making sales both
at wholesale and retail, such terms shall be applied only to the
wholesale portion of such business.
(8) Every person, partnership, corporation or association
other than a manufacturer (not operating a retail business or
trade) engaged in the business of making sales at retail as
defined in this act within this State, which, in addition to
such business, shall purchase merchandise for sale at retail
from manufacturers, packers, processors, growers or producers
thereof, without resort to a wholesaler as such, shall be taken,
deemed and construed for the purpose of this act to be engaged
in business both as a wholesaler and retailer as defined in this
act, and, as such, shall be subject to both the retail and
wholesale mark-up provisions of this act.
Section 3. It is hereby declared that advertisement, offer
to sell or sale of any merchandise, either by retailers or
wholesalers, at less than cost as defined in this act with the
intent of unfairly diverting trade from or otherwise injuring a
competitor or with the result of deceiving any purchaser or
prospective purchaser, substantially lessening competition,
unreasonably restraining trade or tending to create a monopoly
in any line of commerce is an unfair method of competition
contrary to public policy and in contravention of the policy of
this act.
Section 4. Any retailer who shall, in contravention of the
policy of this act, advertise, offer to sell or sell at retail
any item of merchandise at less than cost to the retailer as
defined in this act, or any wholesaler who shall, in
contravention of the policy of this act, advertise, offer to
sell or sell at wholesale any item of merchandise at less than
cost to the wholesaler as defined in this act, or any person,
partnership, corporation or association engaged in business both
as a wholesaler and retailer as defined in this act who shall,
in contravention of the policy of this act, advertise, offer to
sell or sell any item of merchandise at less than cost, subject
to both the retail and wholesale mark-ups provided by this act,
shall be guilty of a misdemeanor, and, upon conviction thereof,
be sentenced to pay a fine of not less than fifty dollars ($50)
nor more than two hundred dollars ($200) and costs of
prosecution, and, in default thereof, shall undergo imprisonment
for not more than thirty (30) days. Each advertisement, offer to
sell or sale shall constitute a separate violation of the
provisions of this act and shall subject the offender to the
penalties hereby prescribed. Proof of any such advertisement,
offer to sell or sale by any retailer or wholesaler in
contravention of the policy of this act shall be prima facie
evidence of a violation of this act.
Section 5. In addition to the penalties provided in this
act, the courts of this State are hereby invested with
jurisdiction to prevent and restrain violations of this act, and
any person, partnership, corporation or association shall be
entitled to sue for and have injunctive relief in any court of
competent jurisdiction against any loss or injury by reason of a
violation of this act.
Section 6. The provisions of this act shall not apply to
sales at retail or sales at wholesale (a) where merchandise is
sold in bona fide clearance sales, if advertised, marked and
sold as such; (b) where perishable merchandise must be sold
promptly in order to forestall loss; (c) where merchandise is
imperfect or damaged or is being discontinued and is advertised,
marked and sold as such; (d) where merchandise is sold upon the
final liquidation of any business; (e) where merchandise is sold
for charitable purposes or to relief agencies; (f) where
merchandise is sold on contract to departments of the government
or governmental institutions; (g) when the price of merchandise
is made in good faith to meet competition; (h) where merchandise
is sold by any officer acting under the order or direction of
any court; (i) where tools, equipment and materials used by
employes in their trade or business or appliances and products
which are used therein and are or may be beneficial to the
safety, health and working conditions of such employes are sold
to employes of the seller.
Section 7. If any section, sentence, clause or provision of
this act shall for any reason be held invalid or
unconstitutional, the validity of the remaining parts hereof
shall not be affected thereby.
Section 8. All acts and parts of acts inconsistent with the
provisions of this act are hereby repealed.
Section 9. The provisions of this act shall become effective
sixty (60) days after final enactment.
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