sion authority over the port-to-port rates, that I did not feel at that time to burden the record with a reiteration, neither do I at this time, and I have yet to hear anybody really advance any view that would go toward giving the commission authority strictly over port-to-port rates. Therefore, it would seem most inadvisable to take away the incentive and the development of water transportation by the individual having sole control over his own busi ness. May I suggest that this short letter be made a part of the record? And thanking you again for your courtesy, I beg to remain, Yours, truly, CHAS. J. AUSTIN. Manager Bureau of Trade and Transportation. STATEMENT OF H. E. MANGHUM, EXAMINER IN CHARGE, DIVISION OF REGULATIONS, UNITED STATES SHIPPING BOARD. Mr. MANGHUM. Mr. Chairman and gentlemen of the committee, I shall endeavor to outline in a brief way the jurisdiction of the United States Shipping Board over common carriers by water and to state the results that have thus far been accomplished in the administration of the regulatory statute. The Federal shipping act of September 7, 1916 (39 Stat. L., 728), in its title setting forth the purposes for which the Shipping Board was created, describes the statute as An act to establish a United States Shipping Board to regulate carriers by water engaged in the foreign and interstate commerce of the United States. The scope of the regulatory jurisdiction of the board is denfined in section 1 and in sections 14 to 33, inclusive, of the act, such jurisdiction extending to the rates, rules, and practices of two classes of common carriers by water, viz, those engaged in interstate commerce on regular routes from port to port on the high seas or the Great Lakes and those engaged in foreign commerce on regular routes, and also to persons carrying on the business of forwarding or furnishing wharfage, dock, warehouse, or other terminal facilities in connection with a common carrier by water. The board has no jurisdiction over tramp steamers or wild carriers. Section 18 of the shipping act provides that Every common carrier by water in interstate commerce shall establish, observe, and enforce just and reasonable rates, fares, charges, classifications, and tariffs, and just and reasonable regulations and practices relating thereto, and to the issuance, form, and substance of tickets, receipts, and bills of lading, the manner and method of presenting, marking, packing, and delivering property for transportation, the carrying of personal, sample, and excess baggage, the facilities for transportation, and all other matters relating to or connected with the receiving, handling, transporting, storing, or delivering of property. Every such carrier shall file with the board and keep open to public inspection, in the form and manner and within the time prescribed by the board, the maximum rates, fares, and charges for or in connection with transportation between points on its own route, and if a through route has been established the maximum rates, fares, and charges for or in connection with transportation between points on its own route and points on the route of any other carrier by water. No such carrier shall demand, charge, or collect a greater compensation for such transportation than the rates, fares, and charges filed in compliance with this section, except with the approval of the board and after 10 days' public notice in the form and manner prescribed by the board, stating the increase proposed to be made; but the board for good cause shown may waive such notice. In pursuance of the provisions of this section the board, shortly after its organization, prepared a set of tariff regulations governing the publication, posting, and filing of maximum rates, fares, and charges by common carriers by water in interstate commerce, which regulations were tentatively approved by the board in July, 1917, and have since been used as a guide by the carriers in filing tariffs. The act does not impose upon water carriers engaged in foreign commerce the duty of filing tariffs. In order to determine which interstate water carriers were subject to the board a circular calling for information respecting their operations was sent out to approximately 800 companies. From the information furnished on this circular it appeared that 67 carriers were subject to the board is so far as filing of tariffs was concerned. With this information in hand the board served upon such carriers an order directing them to prepare and file their tariffs in accordance with the regulations heretofore referred to, and tariffs have been so filed since July, 1917. At the present time 59 interstate water carriers are filing freight tariffs and 45 are filing passenger tariffs with the board. The tentative tariff regulations were distributed to interested shippers and carriers, who made suggestions and criticisms in respect thereto. These criticisms have been analyzed, and Tariff Circular No. 1, containing modifications dictated by such analysis and by the experience of the board during the past two years in handling tariff matters, has been prepared and is now receiving consideration. The provisions of this section authorizing carriers to file increased rates on 10 days' notice, unless such notice be waived by the board, has proved to be eminently satisfactory. With respect to reductions, carriers are allowed to file tariffs on one day's notice. Section 22 of the shipping act grants to any person the privilege of filing with the board a sworn complaint setting forth any violation of the act by a common carrier or other person subject thereto, and provides that the board, after full hearing, may make an order relating to any such violation, whether upon a sworn complaint or in a proceeding instituted by the board on its own motion. In order to make definite the procedure to be followed in respect to such complaints, the board, in August, 1917, promulgated rules of practice in proceedings under the Federal shipping act, and such rules have been consistently observed. To date six formal complaints have been filed and one general investigation has been held. Two of these complaints have been adjusted, thus obviating the necessity of holding formal hearings. Two more will probably be adjusted in the very near future. And the other two are awaiting action of the Interstate Commerce Commission in respect to the application of their railroad owners to continue the operation of the boat lines under the Panama Canal Act, that act providing, in effect, that after July 1, 1914, it shall be unlawful for any railroad company to operate any carrier by water unless authorized by the Interstate Commerce Commission, and that in the latter event the rates and practices of the water carrier shall be filed with and subject to the commission. The ation alluded to grew out of protests filed against proposed to be effected by the Alaska and Pacific. between the State of Washington and point in Alaska. Hearings were held at Seattle and at five points in Alaska. A tentative report has been prepared and served upon the parties, the 'conclusion of which report was that the rates were not shown to be unreasonable. A petition to reopen the case, in view of changed conditions resulting from cessation of the war, has been filed on behalf of certain parties and is now receiving consideration by the board. Section 15 of the shipping act imposes upon all common carriers by water in interstate and foreign commerce, or other persons subject to the act, such as forwarders, the obligation of filing with the board copies or complete memoranda of all agreements or conferences with other carriers or other persons subject to the actfixing or regulating transportation rates or fares; giving or receiving special rates, accommodations, or other special privileges or advantages; controlling, regulating, preventing, or destroying competition; pooling or apportioning earnings, losses or traffic; allotting ports or restricting or otherwise regulating the number and character of sailings between ports; limiting or regulating in any way the volume or character of freight or passenger traffic to be carried; or in any manner providing for an exclusive, preferential, or cooperative working arrangement. The term "agreement" in this section includes understandings, conferences, and other arrangements. The provisions of this section were called to the attention of carriers and other persons subject to the act by means of a circular issued by the board in the summer of 1917, instructing carriers and other persons subject to the act to file with the board agreements of the character set forth. To date 142 carriers' contracts and 35 conferences and conference agreements have been filed: 75 steamship companies have filed concurrences in these conferences and conference agreements. Generally speaking, the agreements on file are necessary working arrangements and violate neither the spirit nor the letter of the statute. In addition to the formal complaints heretofore mentioned, letters of protests or objections to the rates or practices of carriers have been received from time to time. Upon receipt of such letters, they are docketed as informal complaints, and the board, through correspondence and informal conferences, endeavors to adjust the matter complained of. To date 142 informal complaints have been filed. With respect to 17 of them the differences between the parties were irreconcilable and the complainants were advised that if they desired to pursue the matter further they could avail themselves of the privilege of filing formal complaints: 120 complaints were adjusted upon a basis satisfactory to all parties, thus leaving out of the total number filed only five complains now pending. It will be seen from the preceding statement that there has been little cause for complaint on the part of shippers against the rates and practices of interstate water carriers since they have been under the regulatory jurisdiction of the Shipping Board. The relation between the shippers and carriers has been decidedly harmonious and they have cheerfully cooperated with the board in the adjustment of complaints and the administration of the regulatory act. It is significant that most of the interstate water lines subject to the regulatory jurisdiction of the board are comparatively small companies, more than 50 per cent of them being capitalized at less than $200,000 and operating less than five vessels each. As I read the Esch bill, the effect of its passage will be to divest the Shipping Board of its jurisdiction over common carriers by water in interstate commerce and to invest the Interstate Commerce Commission with a very broad jurisdiction over, not only such water carriers, but also terminals and terminal facilities of every character, whether owned by railroads, water carriers or others. It will give the commission a more complete control over water carriers than has ever been entrusted to the Shipping Board, and will transfer much of the board's present jurisdiction over contracts respecting terminal facilities, by reason of which many contracts now filed with the board by interstate and foreign carriers and persons carrying on the business of forwarding or furnishing wharfage, dock, warehouse or other terminal facilities will be subject to, and must be filed with, the commission instead of with the board. Moreover, in all cases of doubt as to which body would have jurisdiction over a specific matter, by virtue of section 33 of the shipping act providing that the act shall not be construed to affect the power or jurisdiction of the Interstate Commerce Commission, nor to confer upon the board concurrent power or jurisdiction over any matter within the power or jurisdiction of such commission, the board would have to yield to the commission. Without attempting to predict what will be done in respect to this bill, and particularly in respect to water carriers, I wish only to state that the experience of the board has demonstrated that the regulation of water transportation is a very serious matter and calls for liberal rules and sympathetic treatment in order to encourage the development and operation of interstate water lines. That is all I have to say, Mr. Chairman. The CHAIRMAN. We have present Judge Alexander and Mr. Edmonds, of the Merchant Marine and Fisheries Committee of the House; and, in view of their large experience and knowledge in shipping matters, we will be glad to hear from them. STATEMENT OF HON. J. W. ALEXANDER, MEMBER OF THE COMMITTEE ON THE MERCHANT MARINE AND FISHERIES OF THE HOUSE OF REPRESENTATIVES. Mr. ALEXANDER. Mr. Edmonds and myself have been selected by the Committee on the Merchant Marine to voice the opposition of that committee to the further extension of the powers of the Interstate Commerce Commission to water-borne traffic. It is not my purpose to discuss the question involved here in detail, but in outline to very briefly give you the history of the shipping act, which embodies the views of the Committee on the Merchant Marine and Fisheries, as regards the regulation of water-borne traffic. The House of Representatives, in the Sixty-second Congress, passed a resolution, H. R. 587, under which the Committee on the Merchant Marine and Fisheries was empowered to investigate shipping combinations, it then being the thought that all regular lines engaged in coastwise and foreign commerce were in some form of combination. The sum of $25,000 was appropriated to defray the expenses of that investigation. With the consent of the committee, I employed Dr. S. S. Huebner, of the University of Penn sylvania, as our expert, and Dr. Huebner and I had direct control and direction of the investigation, of course subject to the approval of the committee. The investigation continued over a period of about two years. It was very thorough; it extended to every trade area in the world. We were empowered to send for persons and papers, administer oaths; and, through our ambassadors and ministers and consular agents, we obtained valuable and accurate information as regards the practices of other countries. We sent out a questionnaire to every railroad company in this country in any way interested in or connected with water transportation. Those questionnaires were returned under oath. As a result, it was shown, as I recall it now-I have not had a chance to go over this matter and refresh my mind with it-that about 92 per cent of the lines engaged in regular traffic in our coastwise traffic were either owned or controlled by the railroads, and practically all the regular lines engaged in overseas trade were in some form of combination. As the result of our investigation, we made a report in the Sixtythird Congress, which embodied our recommendations relating to water carriers engaged in foreign trade and recommendations relating to water carriers engaged in domestic trade, which will be found in volume 4 of our report, beginning on page 145; and it would be worth while if the committee would read that report. Mr. HAMILTON. You found that the coastwise business was very largely controlled by monopolies and combinations? Mr. ALEXANDER. The regular lines? Mr. HAMILTON. Yes. Mr. ALEXANDER. Yes, sir. Mr. HAMILTON. And they apportioned the ports among themselves, as I remember it? Mr. ALEXANDER. Yes, sir. Following that report, I prepared a bill, with the assistance of our expert, embodying our views of what should be enacted by Congress in the way of the regulation of water-borne commerce. I introduced that bill, and it was pending before the committee when the shipping act was introduced by me, the original shipping act. I first introduced what was known as the ship-purchase bill in August, 1914, just after the beginning of the war in Europe. In the following year, 1915, I introduced the bill now known as the shipping act; and it was in connection with that bill, and carrying out the recommendations of the committee as regards the regulation of water-borne traffic, that we incorporated in it substantially the recommendations of the committee as contained in our report to the Congress. When I originally introduced the bill to regulate our water-borne commerce, it provided that the powers of the interstate commerce commission should be extended to and cover water transportation, not only on our inland waterways and the Great Lakes, but in coastwise and foreign trade; but this other governmental agency having been proposed in the meantime-the Shipping Board-we vested in the Shipping Board the powers which we had originally recommended should be vested in the Interstate Commerce Commission. Mr. DENISON. When was the Shipping Board created? Mr. ALEXANDER. The act was passed in 1916. |