CASEIN ROYALTIES

New Zealand Times, Volume XLIV, Issue 10293, 30 May 1919, Page 6

CASEIN ROYALTIES

NEW ZEALAND COMPANY

GENERAL MANAGER EXPLAINS THE POLICY.

Giving evidence yesterday bofcru the Industries Committee of the Louse ot Kepresantatives Mr O. Hoist, general manager of tho New Zealand Cast-in Co., Ltd., said th» statements made by witnesses at previous sittiugs.of the commute naight on some points have created a wrmg impression as to the policy of tno comuany. in lutt, ue stated, an agreement had been made in Jaei-bourne with a Hani., uurg tirm for the use of its process' foi prouuemg casein, and an expert camv out to instruct tJiu company in tbt uoo or tho patent. Xlie expert applied 101 tno patent rights in this country, aiiu tuose rights weie held jointly by the New Zejlaud Company and tno Hamburg Company. The New Zealand Company, alter the outbreak of the war. applied tor the cancellation of the rights of the Gorman *irni. and this was granted. The Mr Neilson who had brought tlie process out to New Zealand was a Dane bv birth, but a German by naturalisation. The patent had for years past been available for use without the payment of royalties, and the New JSealund Company had no wish to' ti;-de in the patent rights, but merely desired to secure a reasonable return for the business it had built up. His company, he added, had ottered to sell its assets at a valuation to the cooperative <tairv lactones, but the factories asked. as an alternative, to be allowed to use the process in payment of a royaltv and to dispose of their produce through an independent agency. Tho company asked a royalty of J."2 10s a ton. The company bad spent a good deal of money in opening up a market in London, and appointed as their selling agents Messrs Joseph Nathan and Co., who had been verr useful i& securing the market. This the Taranaki i-ji,.-panv objected to; but in reply to that objection it was pointed out that thsre was onlv' a . limited number of buyers, and that an increase in the number of selling-agents must result in a decrease of price. Eventually the royalty of M2 10s a ton was imposed, and the New Zealand Casein Company maintained that it was not an exorbitant charge. The patent laws of the Dominion, remarked the witness, gave ample protection again-'t exorbitant royalties. Further, there ivai no need for the payment of a royaltv if any company approached the New Zealand Company with a reasonable proposal, which would ensure the growth <>f the industry and the cor.scivation of the New Zealand Company's inferests. The company was prepared to consider any reasonable proposal from tho Department of Agriculture, and claimed that it had dons valuable work in starting the industry. . Ho denied that it was acting in restraint of trade. For seven voars it had -endeavoured to establish and develop the industry, and by asking for royalties in the present instance it was merely taking steps tc defend its own interests. Replying to Mr J. T. M. Hornsby, M.P.. a member of the committee, the witness stated th.it if the casein was not sold throuch Messrs Nathan and Co. the royalty was increased from £Z 10s to £5 per ton.

Mr Hornsby: .Yon compel them to deal through a certain firm. Mr Holsh stated that the New Zealand Casein Compnnv had a contract with a certain firm, which had better facilities than anv other firm for dealing with casein.

Mr Hornsbv: "Who is ths chairman of directors of your company? Mr Hoist rpolied that the chairman of directors was Mr F. J. Nathan. He conld not understand, he added, the object of the movement on the part of tho Taranaki people to muliiply the number of authorised sellers. It would only result in a reduction of the price. The companv had contracted with Nathan and Co. to sell all its product through that firm.