(b) Notice in writing of intention to prefer a claim shall be given in reasonable time to the party complained of, signed by or on behalf of the complaining party, and stating the nature and also particulars of the claim. Such notice shall as to any party hereto be deemed properly served if sent by post, prepaid, in a registered letter, duly addressed to the principal office in England of such British or American line and to the principal office on the Continent of such continental line, and shall be deemed to have been delivered in the ordinary course of post. Copies to be sent to the secretary, who has to inform the other parties.

(c) Unless the disputing parties mutually agree to the appointment of a single artibitrator within 14 days from, the date of the aforesaid notice, each party shall, without delay, appoint in writing an arbitrator to act on his behalf, and the two arbitrators so chosen shall appoint an umpire. In case they can not agree upon the umpire, the latter to be nominated by the president of the board of trade, if the arbitration takes place in England, and by the president of the hanseatic court of appeal in case the arbitration takes place in Germany. (d) Should either of the parties fail to appoint an arbitrator within 21 days after notice of the intended reference has been given, and for 7 days after service upon him or them of notice in writing by the other disputing party or parties appointing his or their arbitrator, then the one arbitrator who has been chosen may, if so required by the party or parties who appointed him, proceed to act as sole arbitrator in the reference, whether the party failing to appoint an arbitrator appear before him or not, and the decision of such sole arbitrator shall be final and binding.

(e) The arbitrator or arbitrators shall alone have power to determine whether any claim preferred comes within the terms of this agreement, and also as to which of the parties shall pay the costs of the reference.

(f) The arbitrator or arbitrators shall take into consideration whether from the circumstances disclosed it appears that proved breaches are isolated offenses, or whether they are incidents in a systematic violation of this agreement, and shall impose damages accordingly.

(g) The damages for breach of this agreement shall be imposed by the arbitrator, having due regard to the stipulations in article 20.

(h) Damages shall be payable within eight days from the date of the notification of the award.

(i) Each parth hereto agrees that the amount of any fines or damages to be imposed upon him or them by the arbitrator or arbitrators as above provided shall be treated as the liquidated and ascertained damage for the breach of this agreement complained of and not in the nature of penalty or under any circumstances be regarded otherwise than as the true and ascertained damages resulting from the breach, and each party hereby irrevocably declared himself finally stopped from raising any contrary contention.

(k) The arbitrator or arbitrators shall, notwithstanding they may have made and published an award, have power to reopen and reconsider the same and to hear further evidence and to make a fresh award, provided cause be shown satisfactory to him or them within one week after the award is first made and published; or if the arbitrator or arbitrators see cause to extend the time, then within three weeks of the issue and publication of the said award. The award of the arbitrator takes the place and is equivalent to a legal judgment given by the highest instance of any law court against which all right of appealing is exhausted, and it is expressly understood that all the parties to this present contract relinguish all and every right to employ against the award given any legal means of whatever name or description such legal means may be.

(1) Any disputes arising under this agreement shall be settled according to the law of the country in which the arbitration takes place, wherever the domicile, residence, or office of business of the parties to this agreement may be or may become.

(m) In case of arbitration taking place in England, all and singular the provisions of the arbitration act, 1889, or any statutory modification or amendment thereof for the time being in force, shall be applicable.

(n) In case of arbitration taking place in Germany the German law. will apply, but the manner in which the arbitrator thinks proper to take the evidence of the parties and of the witnesses who may have to be heard, as also the modus which he adopts in ascertaining the facts of the matter at issue, are left entirely to his conscientious decision, and it is expressly understood that he is not bound to the observance of the rules in operation in respect of any legal procedure.

No comment needed.

Commentary to article 24.

ARTICLE 25.

(a) Meetings are convened by the secretary. Such meetings to be held alternately at London and at Cologne, to commence in Cologne.

(b) Regular meetings shall be held on the first Thursday of March and December.

(c) Special meetings shall take place within 21 days if the majority of the lines demand same, within four weeks if demanded by two of the lines, and within five weeks if demanded by only one line.

(d) The subject or subjects to be dealt with in such meetings to be notified by the secretary to all the parties concerned not less than 11 days before the date on which the meeting is to take place.

(e) At meetings thus convened the party or the parties present shall form a quorum irrespective of the number.

(f) Resolutions can not be taken upon any subjects which have not been duly notified to all the parties concerned unless all the parties to this contract are represented at such meetings and agree.

(g) Resolutions on subjects transmitted by the secretary to the lines can also be taken by a vote given in writing, provided no line objects to such manner of voting.

(h) Minutes shall be written at all meetings, the same to be signed at such meetings by all the parties present and minutes so written and signed shall stand as a true record of the proceedings and shall be considered final.

Commentary to article 25.

Each line demanding a meeting in doing so has to communicate to the secretary the subjects which the line proposes for discussion. Each line can propose additions to these subjects, provided such additions are forwarded to the secretary so as to be in his possession at least five days before the meetings.

ARTICLE 26.

(a) It is understood that in all cases in which resolutions have to be taken in respect to existing differences of opinion as to the terms and conditions of this present contract as also in the case of all decisions by the lines or by the arbitrator, not only the tenor, but also more especially the spirit of this present contract is to be taken into consideration.

(b) For this purpose there have been appended to the various articies commentaries with expositions and it is understood that same are to be considered to their full extent to form an integrant part of this present contract.

ARTICLE 27.

(a) This present contract has been concluded for the period from March 1, 1908, to February 28, 1911, and shall after this latter date continue from year to year unless due notice be given to the secretary not later than on December 1 of the intention of terminating same at the end of the next February, namely, in the first instance on December 1, 1910.

(b) The withdrawal of any line from the present contract releases the other lines from all obligations except, from the obligation to pay the compensation accounts incurred under this contract up to the date of such withdrawal, unless the latter agree among themselves to continue the present contract under the same or under altered terms and conditions.

No comment needed.

Commentary to article 27.

ARTICLE 28.

In these presents, unless there be something in the subject or contents inconsistent therewith:

"Year"

means a calendar year.

"Weeks" means the period for the 1st-7th, 8th-15th, 16th-23d, 24th to the last day of the month.

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"In writing
means by telegraph, by writing, or by print word.
"Lines " means parties to this contract.

"Notifications and communications" means in writing, never verbally; notifications and communications count from the day they have been dispatched.

"Vote" means open, not secret.

For the I. M. M. Co. and other than the Red Star Line:

Subject to the reservation that if the Canadian Pacific Railway Steamship lines do not accept the percentage proposed for them-i. e., the basis of 1906 and 1907 combined-for the east-bound pool, nothing in this agreement shall be binding on the Allan Line Steamship Co.

For the Allan Line Steamship Co. (Ltd.):

The Canadian Pacific Railway agree to become a party to the above contract as far as east-bound business is concerned and to accept 4.60 per cent as their share of the total east-bound traffic, as per article 1, inclusive their own carryings, but exclusive Cunard Line's Fiume service. If Cunard Line's Fiume service is included and if shared by all lines the Canadian Pacific Railway share of 4.49 per cent will be accepted.

The Canadian Pacific Ry. Co. (Atlantic Steamship Lines):

The Continental Lines propose that the Cunard Line, Fiume-Triest service, joins the Atlantic Conference for all non-Italian passengers on basis of their average carryings 1906 and 1907.

EXHIBIT B.

[Speech of Hon. William E. Humphrey, of Washington, in the House of Representatives, Thursday, June 16, 1910.]

FOREIGN SHIPPING CONFERENCES, POOLS, AND RINGS.

To-day 90 per cent of our foreign trade, amounting to $3,500,000,000 annually, is carried by foreign ships, belonging to conferences, pools, and combines. Between these ships there is no competition. They fix freight rates by agreement. They combine to destroy any line outside of the conference. They give special rates and other advantages to the Standard Oil Co., the Steel Trust, and the harvester combine. The rate that every passenger must pay and the rate that every pound of freight must pay between here and Europe and between here and South America is fixed in advance in Jena, Germany. This foreign ship combine is the most gigantic trust in the world. The commerce of the United States is absolutely at its mercy.

The House being in Committee of the Whole House on the state of the Union and having under consideration the bill (H. R. 26730) making appropriations to supply deficiencies in appropriations for the fiscal year 1910, and for other purposes

Mr. HUMPHREY, of Washington, said:

Mr. CHAIRMAN: Day before yesterday I introduced a resolution calling for an investigation of certain foreign shipping rings, conferences, pools, and combinations; also to ascertain whether or not any American lines belonged to these combinations.

I have here before me this morning one of the most remarkable publications, in my judgment, that has ever been printed. It is called Report of the Royal Commission on Shipping Rings, and is the report of a special commission appointed by the order of the King of England to investigate the plans and methods of the various shipping "rings," conferences," and "combinations" throughout the world.

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Why the existence of this publication has heretofore been practically unknown, and why it is that the newspapers and magazines of this country have said little or nothing about it is beyond my explanation, beyond my understanding.

For several years I have suspected, from various items of information received from investigations and from newspapers, especially foreign publications, that the great ocean lines of vessels, both steam and sail, running to and from this country, were in combination; that between all the principal lines of the world there was an understanding; that there was no competition; and that freight rates were fixed by agreement between the various lines.

The evidence taken before this royal commission and published in these volumes which I have here establishes fully all these facts.

We are, even now, engaged in passing a bill intended to prevent monopoly and other kindred evils practiced by the railroads that will protect the people from unjust discrimination. The whole country is interested in this legislation; the public has been brought to the verge of hysteria on this question by the press; the yellow magazines and muckrakers have reveled in it; yet in these volumes of this investigation of the foreign shipping "rings" is told a story of pooling, rebating, discrimination, and of combination to raise prices and to prevent competition far more interesting and more shameful than has ever been written by the most sensational magazine writer.

But not a word of this story, so far as I know, has ever been printed in any of the newspapers or magazines of America. Why is this true? It is all contained in public documents of England, accessible to everyone.

Had a single little insignificant railway line in America been guilty of a single one of the many practices admitted to be the common method of all of these great shipping “rings,” the press of this country would have emblazoned it from one end of the land to the other. We grow hysterical over domestic trusts and corporations, but we endure with supreme complacency these same evils when they are perpetrated under a foreign flag, by foreigners, at our expense, for the benefit of foreign countries.

FOREIGN TRADE.

The foreign commerce of this country for the year 1910 will approximate $3,500,000,000. Of this vast sum, more than 90 per cent will be carried by foreign ships at an agreed price fixed, not between the shipper and the shipowner, but a price arbitrarily fixed by the different shipping lines themselves, without consultation and without any regard whatever as to the wishes or the desires of the shipper. More than 90 per cent of that vast amount of products will be carried by foreign ships between which there is not the slightest

competition, but between which there is a mutual agreement and understanding as to the rates that shall be charged upon both freight and passenger traffic. Mr. GARRETT: Mr. Chairman, will the gentleman yield to me for a question ? Mr. HUMPHREY of Washington. Yes.

Mr. GARRETT. The testimony to which the gentleman has referred is in reference to the South American lines, is it not? Mr. HUMPHREY of Washington. No.

throughout the world.

The testimony is as to shipping lines

Mr. GARRETT. The gentleman has been referring to testimony taken before the committee on investigation.

Mr. HUMPHREY of Washington. Oh, no; I am referring to testimony taken before "the royal commission on shipping rings,” of England, that investigated the fact as to "shipping rings" throughout the world.

Mr. GARRETT. I beg the gentleman's pardon.

Mr. COOPER of Wisconsin. What is the date of that report?

Mr. HUMPHREY of Washington. The report was filed May 18, 1909.

Mr. KITCHIN. I ask simply for information. Is the American shipowner in this pool, too?

Mr. HUMPHREY of Washington. I have no direct evidence of that, but I have information that convinces me that they are.

Mr. KITCHIN. This is a world combination.

Mr. HUMPHREY of Washington. I think American ships are in it also.
Mr. HARDY. Will the gentleman yield for just another question?

Mr. HUMPHREY of Washington. Yes.

Mr. HARDY. Is it not a generally known fact that the rates of shipping by way of coastwise vessels from New York, say to Galveston, are from two to five times the rate on the same class of goods from Liverpool to Galveston by foreign ships?

Mr. HUMPHREY of Washington. I do not know whether that is true or not. Personally, I do not believe it.

Mr. HARDY. I would like to be permitted

Mr. HUMPHREY of Washington. You can state it on your own authority; but I do not intend to be placed in the attitude of admitting it.

Mr. HARDY. On my authority I state that I have information that such is the fact.

Mr. HUMPHREY of Washington. All foreign ships running between here and Europe, between here and South America, between here and South Africa, and between here and the Orient are formed into different combinations, conferences, or pools. These conferences are grouped according to ports, and all lines running over the same route or that would in any way come in competition are formed into one conference. These conferences fixes the traffic rate for the different lines that compose them. They agree that there shall be no competition between the lines in the conference. Further than this, each line agrees that if any outside line attempts to enter the trade all the conference lines will combine and destroy it. It is further provided, however, that if a new line is found to be too strong to be driven out then this line shall be taken into the conference.

All these conferences practice what they call the "deferred" system of rebates. That is, after a period of from 6 to 18 months these lines pay to their customers a rebate of from 5 to 20 per cent, provided, however, that these customers have done everything that they require of them. These rebate contracts are usually in writing and many samples of them are published in these volumes. The lines require that the shipper must not, either directly or indirectly, patronize any line outside of the conference; he must send freights from the port designated by the conference, in the amount designated; he must not send freight to another port, even if he patronizes the same ship, no matter how much cheaper it may be for him; and he must not refuse to continue to patronize the conference lines if they raise freight rates, even if this be done without his notice and without his consent.

To do any of these things causes the shipper to lose his rebate. These conferences justify all these methods because, as they say, it is necessary to do this to "fix" the shipper. To the average American mind, certainly the shipper who is in their clutches is not only "fixed," but, like the fellow's monkey, he is in a "hell of a fix."

By this method these foreign shipping combines have "fixed" the trade between here and the South American countries until South American countries buy from us only about 5 per cent of what they import. In 1908 the imports