IV. The following principles apply to business contracts which the individual associates have made for October delivery, 1899, and later on their own account, such contracts being made before the time of opening the business of the associaton at the fixed price: (a) Every associate is required on the 1st of October, 1899, to have on hand ready for sale not less than one twenty-fourth of his quota of refined and unrefined brandy. (b) This amount serves to cover those sales at the fixed price which the associate has concluded per date of October, 1899, and later, and is increased whenever these sales are higher than one twenty-fourth of the quota of the associate and are not balanced by purchases of the associate at the standard price for the same or a preceding month. (c) If the sales at the standard price per date of October, 1899, and later exceed the securities for the same fixed in (b), then the associate must obtain the additional amount needed from the association, which charges the same to him at the average price of the year. (d) The sales per date of October, 1899, and later transacted according to the agreements (b) and (c) upon the account of the associates are added to the share of the associates for the business year 1899-1900. (e) The associates can not claim from the association refining premiums and remunerations for the storing, shipping, etc., of the spirit needed to cover these sales. (f) Whenever an associate has made purchases per date of October, 1899, and later at the standard price, which exceed the above-mentioned sales, he must hand over the surplus brandy to the association, which grants him for that the average yearly proceeds of the distilling year of 1899–1900. THE GOVERN PETITION OF THE SPIRITS COMBINATION TO His Excellency THIELEN, BERLIN, November 13, 1899. Royal Prussian Secretary of State and Secretary of Public Works, Berlin: The undersigned society was founded at the beginning of this year, with the object of selling spirituous products of the German distilleries. With this society by far the greater part of German spirits manufacturers have united, in order to secure the systematic and organized marketing of their products. As with intensive agricultural management all agricultural by-industries also gain in importance, the production of spirits is in process of constant growth. While the production of alcohol in 1896-97 amounted only to 307,500,000 liters of pure alcohol, it had increased in 1897-98 to 325,500,000 liters, and in 1898-99 to 382,300,000 liters. As an increase in the consumption of liquors in large quantities is neither to be expected nor to be desired, the efforts of the distillers to avoid a heavy and portentous fall in prices of spirits for the eastern part of our country, or to avoid decrease of production-which would be harmful to agriculture-can only be successful when new markets are opened for this production through the increased utilization of spirits for technical purposes. To promote to a greater extent the sale of spirits for cooking, heating, and lighting purposes, to secure all the conditions necessary to that end, is one of the most important aims of the central agency for the disposal of spirits. From the beginning of its activity it has fixed for the production of unrefined spirits extraordinarily low wholesale prices; and it will make every effort toward having the retailers, on the basis of these low prices, offer to each household and trade the unrefined spirits with only a very moderate profit added. The sacrifices which the united distillers and the central society for the disposal of spirituous products are making to this end are extraordinarily great. But these sacrifices are made in the consciousness that they are necessary for keeping alive one of the most important agricultural industries, and that they are an act of self-help which in such proportions was never before known in German agriculture and industries connected with it. For the realization of these efforts we solicit the cooperation of the Government. The matter in question is not that of special assistance on the part of the Government; what we ask for is an extension in the domain of tariff policy of the practical application of principles which have already been advocated by the deliberative bodies of the royal railroad administration, namely, the permanent tariff commission and the National Railroad Council, and which have constituted for a long time a part of legislative and administrative practice. We beg in this connection to refer most humbly to the fact that the high duties which were imposed by the revenue tax laws upon spirits were entirely removed in so far as concerns the consumption for technical purposes, i. e., the unrefined spirits. Here legislation is fully consistent in its intention, which is to tax liquors used as beverages but not to harm that consumption whose great significance, from an economical and agricultural standpoint, is recognized by all. So far as the carrying out of these legislative measures by the Imperial Government is concerned it must be thankfully acknowledged that nothing has been neglected necessary to comply with the spirit of the laws, but unfortunately the intention, as yet, has not found a practical application in the scale of the railroad tariff. The railroad administration has not as yet fixed different rates for spirits for drinking purposes and spirits for other uses, and it is here that a reform is imperatively needed, because the spirits are subject to the general carload tariff, that is, the highest single rates for carloads. It is at the same time to be taken into consideration that the main place for the production of spirits is in the eastern, that of consumption, to a large degree, in the western part of the Empire, and, as a consequence, a great part of the total product must be shipped from east to west and south, and, further, that the unrefined spirits must be considered as a heating and lighting material, the freight rate of which is in sharp contradiction to that of the majority of other heating and lighting materials. Even to petroleum brought in from foreign countries exceptional tariffs are granted in part. As regards freighting, however, spirits are at a disadvantage from the very start as compared with petroleum-the strongest competitor of unrefined spirits in the sphere of heating and lighting. To petroleum arriving from abroad by sea, the great water courses of the interior are available; it can thus be shipped to the most important markets at freight rates which for spirits can hardly ever be thought of. The latter remain essentially confined to railroad freight rates, and the interior water courses can never be used to any considerable degree. This subject has already been most throughly investigated and discussed by the railroad administration, the petition of the union of spirits manufacturers May 15, 1897, for a reduced tariff for unrefined spirits having given rise to this discussion. The union has not as yet brought its request to the desired issue, although, as already mentioned, the national railroad board as well as the permanent tariff commission have recognized the correctness of the claim of the union for a reduced rate on unrefined spirits. We take the liberty in this connection to refer most humbly to the proceedings of the sixty-third session of the permanent tariff commission of September 7, 8, 1897, No. 21, page 288 and further, as well as to the proceedings of the twentyninth session of the railroad board November 19, 1897, No. 36, page 92. In these proceedings we would like especially to emphasize the fact that several speakers, no matter what view they held as to the removal of the tariff, unanimously expressed their conviction as to the importance and great economical value of an increased consumption of spirits applicable in industries. The national railroad board, which at its last session in December, 1898, took up the question of special rates on unrefined spirits, also expressly declared its consent to the reduction of the rates. If, in spite of all this, the reform is delayed, the cause is probably to be sought in the fact that the different interests of the parties concerned have made the Government hesitate in taking any steps toward bringing the reform into existence. The objections were based on the expected change in values which would inevitably result from the reduced rates. The reduction of freight rates in the east at that time might easily have led to a rise in cost price for a group of distilleries and therefore the eastern spirits manufacturers were afraid of a confusion in the buying conditions of individuaal distillers, whereas the western and southern spirits manufacturers were in fear of a depreciation of the value of their products. In addition, at the time when the union of spirits manufacturers made its request, there existed considerable doubt whether the reduced rate on unrefined spirits would lead, in all parts of the country and to a full extent, to a reduction in the sale prices, inasmuch as there was then no organization in existence which had for its purpose to take advantage of any opportunity for the reduction of the selling price which might occur. An end is put to all these fears and doubts through the foundation of a joint selling enterprise. Leaving out of account the distilleries of corn spirits which lie more in the west of Germany and mostly furnish for consumption a product suitable for drinking, considerably more than 90 per cent of the German distilling production participates in the joint selling enterprise. The price relations of different parts of the country to each other are fixed for 9 years. The selling occurs under centralized management, on joint account. Therefore the fears that before led to opposition against the reduced rate exist no longer and they have actually disappeared. There is no doubt at present that all the considerations which a year ago led to opposition have now become superfluous, and we dare say that the distillers, who at that time opposed the reduction of freight rates, are now warm and ardent advocates of it. On the ground of these considerations we petition your excellency to order that the freight on unrefined spirits should be rated according to the standard of Special Tariff III. At the same time we take the liberty to express our confident hope that this request will be granted immediately, at least for Prussia, since there is nothing more in the way of all that heretofore could hinder a decision. We have specially omitted to include in this request spirits which are to be converted into spirits for technical purposes a ter being shipped. All the reasons which exist for the taking off of the tariff from the spirits already suited for technical purposes hold good also for spirits which are to be converted into such, but it must be admitted that special provisions must first be made in order to extend freight-tariff reductions with safety also to that part of the consumption. For this reason we refrain from asking at present for a special rate for spirits which are to be made suitable for technical purposes, and limit ourselves to petitioning for a more prompt introduction of that reduced rate which the National Railroad Council has already approved. Those manufacturers of spirits who before took a stand against our request have, in the meantime, informed the railroad administration by written statements of a direct change of their opinion, or in response to inquiry have answered that they have no longer any objections to make against this petition. CENTRAL SOCIETY FOR DISPOSING OF SPIRITUOUS PRODUCTS (LIMITED), Authorized Agent of the Board of Directors of the Union of German Spirits Manufac turers. APPENDIX IV. OF THE UNITED ARTICLES OF ASSOCIATION AND BY-LAWS [Revised by resolution of the stockholders' meeting of November 3, 1892, January 30, 1895, and Octobe 21, 1899.] TITLE I.-Name, location, and object of the company. SECTION 1. The stock company established by the present articles bears the name United Pencil Factories. It has its location in Nuremberg, and is of unlimited duration. SEC. 2. The object of the undertaking is the construction, acquisition, operation, alienation of pencil manufacturing establishments and other institutions of all sorts, or the participation in such enterprises in any form whatever, and in connection therewith the acquisition and alienation of real estate. TITLE II.-Capital, shares, and shareholders. SEC. 3. The capital amounts to 3,750,000 marks, divided into 3,750 shares of 1,000 marks each, running in the name of the holder [i. e., transferable without registration]. The increase or decrease of the capital may be brought about by a resolution of the stockholders' meeting, but only by a majority of three-fourths of the capital voting on the question. The stockholders' meeting determines the amount of the separate emissions of shares, as well as the minimum price at which the shares are to be issued. SEC. 4. The amortization of shares is permissible. TITLE III.-Administration. SEC. 5. The organs of the company are: A. The president or executive committee (Vorstand). B. The board of directors or council of supervision (Aufsichtsrath). C. The general stockholders' meeting (Generalversammlung). A. Executive committee. SEC. 6. The executive committee, which may consist or one or several persons, is appointed and removed by the board of directors. The appointment of the members of the executive committee may be revoked at any time, but without affecting their claims on the basis of the contract of employment. The board of directors may also name authoritative representatives (Stellvertreter) for the members of the executive committee, and may also designate certain of its own members as such alternates; but the latter shall be so designated only for a period determined in advance, which may not exceed 6 months in duration. SEC. 7. The board of directors fixes the duration as well as other conditions of employment of members of the executive board, especially the compensation to be paid and the rates of premium, in the contract of employment. The board also prescribes the duties of the executive committee by a series of regulations, as well as by instructions to be given on the subject. The members of the executive committee must furnish a security deposit in shares, to be determined by the board of directors in the contract of employment. SEC. 8. The executive committee represents the company in its outside dealings and conducts its business in accordance with the provisions of these articles, of the contract of employment, and of the regulations established by the board of directors as well as instructions given by it. The executive committee appoints and discharges officers and other employees of the company, so far as this is not, by the present constitution or by the regulations, conditional upon the consent or the board of directors. SEC. 9. In order that the signature of the company may be valid, provided only a single member of the executive committee is established, it requires his signature with his own hand or that of an authoritative representative, or of 2 managing clerks (with power of attorney-Procuristen); in case several members of the executive committee are established, the signatures of either 2 members of the committee or their representatives, or the signatures of 1 member and of 1 representative of a member, or of 1 managing clerk, or the signatures of 2 managing clerks are necessary. SEC. 10. The executive committee has to secure the consent of the board of directors(1) For the acquisition, the alienation, or the incumbrance of real estate, as well as of collaterals. For the establishment or removal of branch institutions. For the making of rental contracts, so far as they extend beyond 3 years or involve a sum exceeding 5,000 marks per year. (4) For the borrowing of money. (5) For building or rebuilding, as well as for purchases and repairs, so far as the cost of the latter exceeds the amount of 10,000 marks. (6) For the appointment or removal of officers of the company who are given full power to represent the company, either in general or in regard to a designated branch of the business, either individually or in connection with others, as well as of officers or employees who receive a regular yearly salary of 3,000 marks or more. B. Board of directors. SEC. 11. The board of directors consists of not less than 5 nor more than 9 members, who are to be elected by the stockholders' meeting. The election of the board of directors takes place yearly. If a member of the board of directors withdraws before the end of his term of service a new election is required at the next regular meeting of the stockholders, provided by his withdrawal the number of members would fall to 3. A member elected in such a case holds office for the term of the member withdrawing. |