195 Code/20
The Danish Minister (Wadsted) to the Secretary of State
Sir: I have the honor to address myself to you in the following matter.
The Danish Minister for Foreign Affairs has directed me to invite your attention to the proposed General Shipping Code which is now before the National Recovery Administration for consideration. I beg to enclose a copy of “Proposed Code of Fair Competition for the Shipping Industry as revised for a public hearing on January 31, 1934”,6 submitted at the said hearing which hearing I understand is to be considered as the final one. Although not being fully aware whether this draft has been approved by the National Recovery Administration as the final text to be presented for the approval of the President I may take the liberty in my following remarks, touching some of the essential points, to refer to this draft:
1) Article III contains a general provision to the effect that the Code “shall apply to (a) all owners, operators, and agents of all vessels of all flags engaged in foreign and domestic commerce of the United State …” and would consequently apply to Danish vessels.
2) The Code, as drafted, imposes on foreign vessels the labor provisions contained in Section 7 of Title I. of the National Industrial Recovery Act with reference to the right of employees to organize and bargain collectively through representatives of their own choosing etc. (Art. V., Sec. 1. (1)).
3) It provides that employers shall comply with the maximum hours of labor, minimum rates of pay, and other conditions of employment, approved or prescribed by the President (Art. V., Sec. 1. (3)).
4) The draft Code further provides that no minor under the age of 16 years shall be employed in any class of labor (Art. V., Sec. 2).
These labor provisions under 2) –4) would seem to apply to Danish shipowners and to Danish seamen engaged under the provisions of Danish law on board Danish vessels. The provisions mentioned under 3) with regard to hours of labor, rates of pay etc. may, perhaps, lack somewhat in clarity. In Art. V., Sec. 3, specific rules are stated regarding seamen on American vessels but in the following clause it [Page 684] is “provided that the minimums and conditions contained in Schedule A … shall be incorporated in divisional Codes of the Divisions and Subdivisions of Group I” which Group embraces both American and foreign vessels. Art. VII, Sec. 2. (a) requires the members of each Division and Subdivision to adopt supplemental Codes and also provides that those Codes may “prescribe … rules and regulations … and may provide for the regulation of any other matter with which the Division or Subdivision may be especially concerned”. This provision would seem to cover the wages of foreign seamen.
5) The draft Code does not contain any specific definition of the words “rules and regulations” in Art. VII, Sec. 2. (a), but those words have been defined in previous drafts as follows:
“‘Rules and Regulations’ may include, among other things, provisions covering matters of service frequency, limitations of tonnage, duplication of services, and excess competition, if approved by the Code Authority”. (See draft submitted Sept. 25, 1933,7 Sec. 2 (a)).
As the Code is now drafted, it would seem that under the broad terms of Art. VII, Sec. 2 (a) all of these matters could still be regulated for foreign ships, if the Code should be finally approved.
6) The supplemental Codes mentioned in Art. VII, Sec. 2 (a) “may prescribe minimum rates, fares and charges”. It would seem that under Art. Ill this provision would apply to all foreign vessels and that such “minimum rates, fares and charges” could thus be fixed for passengers and cargo loaded abroad as well as in the United States.
Under the authority of Sec. 3 (a) of the National Industrial Recovery Act the President may approve Codes for fair competition which will be binding not only upon such members of the “industry” —in the present case, “shipping”—who may voluntarily have assented to the Code but also on such members who may not have done so. As a consequence it would seem that a Code, once approved, has for all practical purposes to those members of the industry, who have not consented to it, the same effect as an Act passed by Congress and approved by the President.
The Danish Government has followed with the greatest interest the efforts of the American Government to restore prosperity by the different Acts passed during the last year, but it has assumed that this legislation, in particular the “National Industrial Recovery Act” and the Codes approved under its authority, would apply only within the jurisdiction of the United States. The proposed Shipping Code, if approved, would, however, seem to extend in its operation outside of American jurisdiction, inasmuch as it contains provisions, enumerated [Page 685] above, which would necessarily have effect upon Danish ships engaged in trade with the United States, far beyond its boundaries. Moreover, the said provisions, if imposed upon owners of Danish vessels, without their voluntary consent, would appear not to be in accordance with lights secured by treaty and generally recognized principles of international law granting free access to ports for purpose of international trade.
My Government has viewed with concern the serious consequences that the approval of a Code, such as drafted, would involve for Danish shipping with the United States, and referring to the considerations outlined above I have the honor acting upon the instructions of the Danish Minister for Foreign Affairs to request that, through your good offices, the attitude of the Danish Government towards the proposed Shipping Code be brought to the early attention of the appropriate branch of the American Government with a view that such Shipping Code as may be approved be so worded as to eliminate foreign (Danish) vessels.
I avail myself [etc.]