CONTENTS Opening statement by Senator Durkin_. Text of S. 2782__. LIST OF WITNESSES Altman, Arthur, The Court of King Arthur, New York, N.Y. Frankovich, George R., vice president and executive director, Manufac- 13 14 22 Kohrn, Edward L. and Sermour Globus, Metals and Jewels, Baltimore, 37 42 Pell, Hon. Claiborne, U.S. Senator from Rhode Island_. ADDITIONAL ARTICLES, LETTERS, AND STATEMENTS Frankovich, George R., vice president and executive director, Manufacturing Jewelers & Silversmiths of America, Inc., letter with enclosure of May 18, 1978__ 5 24 OLD AND SILVER LABELING AND ADVERTISING ACT WEDNESDAY, MAY 10, 1978 U.S. SENATE, COMMITTEE ON COMMERCE, SCIENCE AND TRANSPORATION, SUBCOMMITTEE FOR CONSUMERS, Washington, D.C. The subcommittee met at 9:15 a.m. in room 235, Russell Senate Office Building, Hon. John A. Durkin presiding. OPENING STATEMENT BY SENATOR DURKIN Senator DURKIN. Today the Subcommittee for Consumers of the Senate Commerce, Science, and Transportation Committee begins a earing on S. 2782, the Gold and Silver Labeling and Advertising Act. This legislation provides standards for when products can be ermed "gold" or "silver." S. 2782 also regulates the advertising of uch items. Finally, S. 2782 provides the Federal Trade Commission with increased legal powers to regulate the jewelry industry in regard o the representations of gold and silver. The subcommittee in the course of these hearings will also examine he Federal Trade Commission's (FTC) proposed amendments to heir trade practice rules in regard to the labeling of gold and silver. On June 10, 1977, the FTC proposed to amend its guidelines to allow or new standards for gold and silver content in jewelry articles arked or described as "gold" or "silver." Under the present guideines only articles composed throughout of not less than 10 karats ay be marked or described as "gold" or carry a quality mark. And nly articles composed of at least 0.925 may be marked as "silver." The FTC amendments would allow, in limited circumstances, the use f the term gold and silver and related quality marks in connection with articles below these current minimum requirements. The comittee is interested in the progress of this proposal and the FTC's resent views in regard to this matter. [The bill follows:] [S. 2782, 95th Cong., 2d sess.] · BILL To protect consumers from misrepresentative advertising of gold and silver jewelry, and for other purposes Be it enacted by the Senate and House of Representatives of the United States f America in Congress assembled, That this Act may be cited as the "Gold and ilver Labeling and Advertising Act”. ADVERTISING RESTRICTION SEC. 2. The Act entitled "An Act forbidding the importation, exportation, of carriage in interstate commerce of falsely or spuriously stamped articles of merchandise made of gold or silver or their alloys, and for other purposes", ap proved June 13, 1906 (34 Stat. 260; 15 U.S.C. 294) is amended— (a) in the first section thereof by inserting immediately after "said article is encased or enclosed", the following: “, or in any advertising, irrespective of the medium thereof,"; and (b) in section 2 thereof (1) by inserting "(a)" immediately before “In”: and (2) by adding at the end of such section the following new subsection: "(b) No representation as to gold content shall be made unless the article of part of the article represented as being made of gold is at least of 10 kara: fineness.". (c) in section 3 thereof by adding immediately after "coin silver" the following: " 'silver'". Senator DURKIN. The subcommittee is very fortunate to have Sengtor Pell as our first witness. Senator Pell is extremely knowledgeable in regard to these matters and is the author of S. 2782. Senator Pe we look forward to your statement. I do want to commend Senator Pell for bringing this matter to our attention. I think you all know that Senator Pell has been quite concerned and asked me as a member of the Consumer Subcommittee to chair these hearings. I'm very happy to lead off with Senator Pell. STATEMENT OF HON. CLAIBORNE PELL, U.S. SENATOR FROM RHODE ISLAND Senator PELL. I thank you very much, indeed, Mr. Chairman. I particularly thank you for your kindness and graciousness in agreeing to hold this hearing. We all know the demands that there are for hearings on the 3,000-odd bills that get introduced, and I particularly appreciate your kindness in being here and giving us the hospitality of your hear ing room. Your subcommittee, the Consumer Subcommittee, has demonstrated many times over your concern and responsiveness to the prob lems that confront the average consumer in this age of rapidiy changing technology and sophisticated advertising and marketing techniques. And, Senator Durkin, who is presiding at this hearing, has consist ently been in the forefront of those in the Senate who have fought for protection of the American consumer, very often the forgotten man in our national life. Mr. Chairman, the legislation before the committee today is vitaly important, both to purchasers of jewelry and to the jewelry industry as a whole. And because it is important to the jewelry industry, it is als vitally important to the economy of my own State of Rhode Island and to the 30.000 Rhode Islanders who work in the Jewelry industry in our State. The purpose of this legislation is very simple: It is to assure the consumer that jewelry stamped or advertised as gold or silver will. fact, be mostly gold or silver and will have the characteristics of those precious metals. The legislation would not change existing trade prae tices in the jewelry industry, but instead, merely seeks to preserve exist ing time proven jewelry trade practices by incorporating into law existing trade practice regulations of the FTC. |