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of the executive branch agencies and maritime industry and maritime labor persons to discuss maritime matters. We have discussed these proposals and will discuss them further before we go to London.

Our objective will be accomplished if we are able to persuade the other governments to amend the SOLAS Convention. This will not be an easy task, and as you pointed out, it will not take effect immediately. However, we made clear at the February meeting of the Maritime Safety Committee that if agreement is reached at the May 2 meeting, we will expect to call for a special meeting of the IMCO Assembly 6 months after the Maritime Safety Committee's report is made available. That is the quickest that is possible. The Assembly must be called by the IMCO Council, and this can be done at an IMCŎ Council meeting which is scheduled for May 16-20.

We have made clear through the Maritime Safety Committee and through our embassies in the countries directly concerned that the U.S. Government attaches great importance to early international action on the fire safety problem.

There is not much I can say today about the reactions of other governments. They have not had time to react to the administration measures. They have, at the last Maritime Safety Committee meeting, indicated concern about the fire safety problem. As Admiral Roland pointed out, we really do not have a reading on the precise reaction of foreign governments to these proposals.

If we are not successful in the negotiations in London, we will study the situation, with the other agencies, in the light of the results of the meeting and consider whether any additional recommendations should be made to the Congress, and what they should be.

We would prefer to handle the matter on an international basis, by international agreement. But in one way or another, we must assure the safety of Americans embarking from our shores.

Let me conclude by again expressing the strong support of the Department of State for the administration's bills. We urge that these bills be enacted as soon as possible. We are going to take a very strong position at the London meeting, and we believe the amendment of the Convention, together with the proposed legislation, will deal effectively with the serious problem we face.

Mr. Chairman, that is the end of my prepared statement. But let me add: As we have earlier told the committee staff, we believe it will be very useful if you personally could come to London with the U.S. delegation for the safety committee meeting, or if you are not able to come, if you can send a senior staff member of the committee. are quite sincere in thinking this would help us.

The CHAIRMAN. Off the record.

(Discussion off the record.)

We

The CHAIRMAN. You favor, generally, the disclosure legislation. I suspect that you don't have any detailed ideas as to how we would do this. It would be up to the Secretary of the Treasury, under the bill, to determine the procedures.

You say that you people in the State Department feel that a ship, even though it might comply with the present SOLAS standards, which are below the American standards in many cases, should have its safety standards disclosed. The American traveling public should,

at least in this disclosure, be told the ship is not up to American standards of safety.

Mr. Loy. Mr. Chairman

The CHAIRMAN. That is a little drastic, but it is the only way that you can tell them.

Mr. Loy. We have not worked out the language. We support this legislation on the assumption, however, that it will effectively tell the passengers something about the level of the safety of the ship that he is going on.

I don't know about the language. We, quite frankly, expect that this will not be the most popular measure with a number of foreign governments, and that there will be serious complaints, and that there will be considerable unhappiness with the administration of this disclosure legislation, even though we expect it to be administered perfectly fairly.

We nevertheless think that the subject matter is so important that we simply have to be prepared to face that.

The CHAIRMAN. I have one further question. Do you agree with the conclusions of the Coast Guard that the SOLAS Convention completely supersedes that section of the code that gives the Coast Guard authority to set standards on foreign-flag vessels?

Mr. MENDELSON. For the most part I would agree with what the Coast Guard testified.

The CHAIRMAN. Which gives us a serious legal problem in this whole business. I think, reading the convention, you could logically come to that conclusion.

Mr. Loy. Yes.

The CHAIRMAN. If you have anything else to add, we will leave the record open. We appreciate your testimony.

Mr. MILLER. If I may speak to your earlier question about requirements of other countries for ships to make cruises, Mr. Chairman, as in the United States they would have to meet the normal customs and safety rules, inspection rules, but they would not be required to have a license in some economic sense, in some balance-of-payments sense, or to subject to any qualification of that character.

The CHAIRMAN. Of course, we don't do much of that, do we?
Mr. MILLER. No, sir; we do not.

The CHAIRMAN. I have no illusion that if we did do some of this: for instance, if we showed up in foreign countries conducting a cruise and said, "Here is an American ship, we will take your nationals," I have no doubt that they would make it difficult.

Mr. Loy. That is true but we would have the protection of our treaties of friendship.

The CHAIRMAN. But they would accept the American safety certificate because every country in the world knows that we have the highest standards in the world, and we do inspect our ships.

Mr. Loy. That's correct.

The CHAIRMAN. Thank you very much.

The committee will recess until tomorrow at 9:30 instead of 10, so that we can hear Admiral Harllee, Mr. Shapiro, and others.

(Whereupon, at 12:46 p.m., the subcommittee was recessed to reconvene at 9:30 a.m., Thursday, April 21, 1966.)

SAFETY OF LIFE AT SEA

THURSDAY, APRIL 21, 1966

U.S. SENATE,

COMMITTEE ON COMMERCE,

SUBCOMMITTEE ON MERCHANT MARINE AND FISHERIES,

Washington, D.C.

The committee met at 10:05 a.m., in room 5110, New Senate Office Building, Hon. Warren G. Magnuson (chairman of the committee) presiding.

The CHAIRMAN. All right. The committee will come to order.

Yes; we didn't get to hear all of the witnesses we had scheduled and I appreciate their patience those that were scheduled and couldn't be heard so we will hear from them first.

The first witness is Admiral Harllee, Chairman of the Federal Maritime Commission. Glad to hear from you, Admiral.

STATEMENT OF REAR ADM. JOHN HARLLEE, U.S. NAVY (RETIRED), CHAIRMAN, FEDERAL MARITIME COMMISSION, ACCOMPANIED BY COMMISSIONER ASHTON C. BARRETT, LEROY F. FULLER, SPECIAL ASSISTANT TO THE CHAIRMAN; AND JAMES E. MAZURE, DIRECTOR, BUREAU OF DOMESTIC REGULATIONS

Admiral HARLLEE. Accompanying me are Commissioner Ashton C. Barrett, also my special assistant, Mr. Leroy Fuller, and my former special assistant Mr. James Mazure, two of the finest maritime attorneys in the business.

The CHAIRMAN. We are glad to have them here. We need good legal advice on this matter.

Admiral HARLLEE. Thank you.

Mr. Chairman, with your permission I would like to submit my entire statement for the record, but in view of your extreme familiarity with the material in the first two or more pages, I would like to begin with reading the testimony at the top of page 3.

The CHAIRMAN. We will put your statement in the record in full. Admiral HARLLEE. It is clear from the legislative history of the Shipping Act and subsequent amendments thereto that Congress was primarily interested in the practices of common carriers and other persons as they relate to the carriage of cargo rather than passengers. However, Congress did consider the passenger problem and, in addition to section 15, the sections which relate to passengers are section 14. 14(a), 16 first, and section 17.

These sections have to do with discrimination, prejudice and unfair practices; but do not include authority to disapprove a fare unless

discriminatory. The Commission has had no occasion to invoke these sections with regard to passengers.

Because we do have a statutory responsbility under the above sections from some aspects of passenger travel, the Commission has kept informed generally on passenger trade.

The CHAIRMAN. Let me ask you this for the record. On a cruise which is a special sailing, naturally, do they submit in advance a fare schedule to the Commission?

Admiral HARLLEE. They do not, Mr. Chairman, unless they have a conference agreement which calls for them to do so. However, in this cruise trade, they do not have conference agreements. They do in the transatlantic trade.

The CHAIRMAN. Well, when you say you can't disapprove of a fare unless discriminatory, if they don't submit a fare how would you know whether it was discriminatory or legal or not?

Admiral HARLLEE. In the case of the transatlantic liners, the agree ments, conference agreements call

The CHAIRMAN. You are familiar with all of the conference agreements, naturally?

Admiral HARLLEE. But these call for them. They happen to call for them to submit these fares. Now, in the case of the cruise trade, to which I think your question is directed, it would be on a complaint basis.

The CHAIRMAN. I was going to say that. In other words, there would have to be someone who would come, I suppose maybe a competitor, make a complaint about a scheduled rate or a published fare which might be in the newspaper, asking people to take the trip. Admiral HARLLEE. Yes, Mr. Chairman.

The CHAIRMAN. Have you had any complaints about these fares! Admiral HARLLEE. Yes, we have had a few complaints about them. As a matter of fact, to be precise, we have had 31 complaints and these relate to a number of subjects. However, there were very few of them which related to fares. They generally relate to comfort and to false advertising and eight of them have related to safety.

The CHAIRMAN. We should get this clear now, because there is a lot of public confusion about the role of the Commission as against the Maritime Administrator and the Advisory Board and these other factors.

If an American citizen had a complaint about a cruise in which they were on or on which they intended to go on, the proper place to deposit that criticism for a look-see would be the Maritime Commission. I that correct?

Admiral HARLLEE. That would be a good place to start, Mr. Chairman. We would have to transmit it to the Coast Guard if it related to safety.

The CHAIRMAN. If it related to safety, you would transmit it to the Coast Guard, but if it related to other factors on the cruise, whether it be fare or comfort or not going to the ports they said or what ever i might be, they could deposit that or make the complaint to the Mar time Commission?

Admiral HARLLEE. Yes, Mr. Chairman.

The CHAIRMAN. But if it was safety, you would look at it, naturally, you would be interested, but you would then turn it over to the Coast Guard for them to make an investigation.

Admiral HARLLEE. Yes, Mr. Chairman.

The CHAIRMAN. All right.

Admiral HARLLEE. That covers this next paragraph I had, then. Going to the following one

The CHAIRMAN. I didn't know you had that in there.

Admiral HARLLEE. I had a little bit of it, not much.

I will now comment on the proposed bill, which has been introduced as S. 3251. Section 2 would require that each owner or charterer of a vessel having berth or stateroom accommodations for 50 or more passengers and embarking passengers at U.S. ports, satisfy the Federal Maritime Commission as to his financial responsibility for liability he may incur for death or injury to any person (including passenger or crew member).

The bill is limited to vessels having berth or stateroom accommodations for 50 or more passengers because there appears to be no present need for regulating such vessels as overnight fishing boats, ferryboats, and day cruisers.

The vessel classification of 50 or more passengers is identical to that contained in the so-called Sprinkler Act (46 U.S.C. 464) requiring sprinklers on certain vessels.

Financial responsibility could be established by policies of insurance, surety bonds, qualifications as a self-insurer, or other evidence of financial responsibility, or a combination thereof.

The required financial responsibility would be based upon the number of passenger accommodations aboard the largest vessel operated by a particular carrier in our passenger service. That is the largest vessel of an individual steamship line.

The amount of financial responsibility would be calculated on a sliding scale basis as follows:

$20,000 for each passenger accommodation up to and including 500;

Plus $15,000 for each additional passenger accommodation between 501 and 1,000;

Plus $10,000 for each additional passenger accommodation between 1,001 and 1,500;

Plus $5,000 for each passenger accommodation in excess of 1,500. The purpose of this financial responsibility requirement is to insure that adequate assets or insurance are available to pay judgments for damages for death or injury to any person (including passenger or crew member).

The amount would be available to pay any judgment, whether in an amount more or less than $20,000 for the individual. For example, assuming 100 passenger accommodations on a particular vessel, the required amount of financial responsibility would be $2 million.

If a fire or other disaster occurred on board resulting in the death of, or injury to, five passengers, and the vessel owner or charterer was found liable in the amount of, let's assume, $200,000 for each death or injury, $1 million in damages would be paid.

It is not restricted to $20,000 a person. That is the means of calculating total pool or funds.

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