811.801/513½

The British Ambassador (Lindsay) to the Assistant Secretary of State (Bundy)

Dear Bundy : The Fighting Ship Bill having now been redrafted by its promoters and renumbered H. R. 10674,12 I am sending you the enclosed Memorandum to put on record that the objections which I had previously urged against H. R. 8874 apply with equal force to the Bill in its new form.13 It was favourably reported to the House I understand on April 6th.

[Page 935]

I also enclose, in case it should be of interest to you, a copy of a letter addressed by the Agent for the Trans-Atlantic Passenger Conference to Mr. Mooney, summing up what transpired at the abortive Conference between the Lines, which sought to reach a compromise.

Yours sincerely,

R. C. Lindsay
[Enclosure 1]

The British Embassy to the Department of State

On February 15th His Majesty’s Embassy addressed to the State Department a memorandum on the subject of two bills—H. R. 8874 and H. R. 8875, dealing with tourist cruises and fighting ships. H. R. 8874 sought to extend the definition of a fighting ship, the use of which is declared illegal by the United States Merchant Marine Act so as to make it cover ships used so as to produce excessive and unwarranted competition with American ships in any particular trade.

A new bill has now been introduced by Mr. Davis—the orginator of the Fighting Ship Bill—No. H. R. 10674. His Majesty’s Embassy understand that this bill is intended as a substitute for the original Fighting Ship Bill. Though its wording is different from the latter its legislative effect would appear to be identical and the objections to the original bill set forth in the Embassy’s above-mentioned memorandum of February 15th apply with equal force to the new Bill H. R. 10674. His Majesty’s Embassy understand that this Bill was favourably reported by the House Committee on April 6th.

[Enclosure 2]14

Mr. Joseph Mayper of the Trans-Atlantic Passenger Conference to Mr. Franklin D. Mooney, Chairman of the Committee of American Steamship Lines

Dear Sir: The foreign flag Lines interested in cruises and services from United States Atlantic ports to the West Indies and other nearby ports, regret exceedingly to learn that the meetings which their committee has been holding with your committee of the American flag Lines interested in similar services, and which have been continuing since March 15, have been terminated without having reached a cooperative working agreement—due, primarily, to the insistence of the American flag Lines that no cruise of less than a certain number of days’ duration shall be operated by any foreign [Page 936]flag Line, even though the cruise vessel calls at a foreign port, and even though such port, as is frequently the case, is a port of the country whose flag the cruise vessel flies. So that there should be no misunderstanding regarding the position taken by these foreign flag Lines, they have requested me to confirm the statement already informally presented to your committee at our last joint meeting.

Reports of the hearings held before Committees of the Senate and House of Representatives on certain pending bills as well as statements appearing in the public press, had indicated that certain of the American flag Lines felt that they had a grievance against the foreign flag Lines in that, while none of the activities of the foreign flag Lines were claimed to be illegal, it was alleged that they were in some respects unfair.

Particular reference had been made to so-called “cruises to nowhere,” calls by cruise ships at Port Everglades, Florida, and winter services to Havana by trans-Atlantic ships in competition with the regular services of the Ward Line.

The purpose of the joint meetings was to determine exactly what were the points at issue and whether or not some understanding or agreement could be arrived at between all the Lines concerned which would be mutually acceptable.

As a result of the numerous meetings held, it was developed that there were, as a matter of fact, six main items which the American Lines felt must be dealt with:—First, cruises to nowhere; Second, calls at Florida or other United States Atlantic Coast ports by cruise ships; Third, Havana winter direct services; Fourth, short cruises; Fifth, calls at Porto Rico by foreign flag cruise ships, and Sixth, that in the case of port to port passengers between the United States Atlantic and West Indies port or between two West Indies ports carried by cruise ships, where there was an established American flag service, the foreign flag Lines to agree in principle to charge a differential rate over the rate charged by such American flag services.

All of these points called for a concession by the foreign flag Lines and no consideration was offered in exchange by the American flag Lines.

While the discussions were necessarily tentative and subject to approval and ratification by the Principals of the representatives of the foreign flag Lines in New York, it was agreed by those representatives to recommend to their Principals the acceptance forthwith of five of the six demands made by the American Lines. These were:— [Page 937]

1.
Discontinuance of cruises to nowhere.
2.
Discontinuance of calls by cruise ships at Florida or other United States Atlantic Coast ports.
3.
Elimination of calls by cruise ships at Porto Rico.
4.
Discontinuance of direct one-way business between New York and Havana.
5.
Agreement in principle to charge a higher rate, the exact amount to be mutually agreed upon, in the case of port to port passengers on cruise ships.

The only question remaining was the demand for a restriction on cruises by foreign flag Lines, even though they touch at a foreign port. The American flag Lines proposed that no cruises shall be permitted, even though a foreign port is touched, of less than a certain number of days’ duration. It was also proposed by the American flag Lines that no foreign flag ships shall make a cruise on which the first port of call is Havana, irrespective of what other ports may be touched subsequently and notwithstanding the latter’s agreement not to carry passengers one way, that is, that all passengers will make the full cruise and be returned to New York in the same ship. It was further demanded that when Havana is the last port of call for a West Indies cruise ship, a number of other ports must be touched first, and the cruise is to be of two weeks’ or more duration.

As noted above, the foreign flag Lines were and are still prepared to recommend acquiescing in the demands of the American flag Lines in five of the six points at issue but, after full consideration, they feel it is unreasonable and impracticable to attempt to arbitrarily place restrictions on legitimate cruises touching at foreign ports irrespective of their length or the number of ports of call.

With regard to week-end cruises (to foreign ports) it is the very definite opinion of the foreign flag Lines that these do not compete with or draw” business from any regular American service. An entirely new class of passenger is attracted—the two important factors being the short time involved and the cheap rate. The majority of these cruises are from four to five days’ duration including a weekend, so that people are away from business one and a half or possibly two business days only, and investigation has developed that this time factor is a governing one in the great majority of cases. These people would not take a trip to Halifax, Bermuda or Nassau, for example, by a regular service with a stay between ships. It is further felt that these short cruises encourage many people who never before have taken a sea trip, to do so, and will awaken a desire in them for sea voyages and that subsequently they will take longer trips by regular services.

As regards calls at Havana by cruise ships, it must be borne in [Page 938]mind that while other “West Indies ports have attraction, the main attraction in the West Indies is undoubtedly Havana. Very few, if any, West Indies cruises could be successful if a call at Havana were not included.

The complaint was that the putting on of a direct service for one-way passengers between New York and Havana during the winter months only, by trans-Atlantic steamers, when the season was at its height, was unfair to the Ward Line, as the volume and the quality of the business throughout the year, including the summer months, was not such as to justify the maintenance of ships of a similar type, regularly in that service. Without touching on the right of any ship to trade between two ports of different nations, which right has not, we believe, been questioned, this complaint has been met, so far as these discussions are concerned, by the undertaking of the foreign flag Lines to recommend that any foreign flag New York-Havana service during the winter, and even one-way business by cruise ships between New York and Havana, be discontinued.

In a spirit of friendly business cooperation the foreign flag Lines were and still are quite willing to enter into an agreement with the American flag Lines on cruises and services to the West Indies as to fares and their maintenance, differentials, agency commissions, rules and practices to govern the trade, responsibilities of charterers, arbitration of disputes, etc., so that vessels in these trades can be operated on an equitable business basis for all Lines concerned.

The foreign flag Lines have endeavoured to deal with the situation with the utmost fairness and consideration but beyond the foregoing they do not feel that they can go, or that they could fairly be asked to go.

As suggested by us just before our joint conference terminated this afternoon, we are writing to the principals abroad setting forth the present situation in detail, and if they have any further suggestions we shall be glad to communicate with you again.

Very truly yours,

Joseph Mayper
  1. Introduced on March 19, by Mr. Ewin L. Davis, Chairman of the Committee on Merchant Marine, Radio, and Fisheries. See Congressional Record, vol. 75, pt. 6, p. 6514.
  2. Except for Italy, all the countries that lodged formal representations against H. R. 8874 and H. R. 8875 and S. 3501 and S. 3502 (i.e., Great Britain, the Netherlands, Sweden, France, Germany, Canada, and Italy) likewise expressed objections to H. R. 10674.
  3. Filed separately under 811.801/517.