Memorandum by Mr. John L. Ohmans of the Division of River Plate Affairs79
Ambassador Messersmith’s Despatch 2612 of May 29 Regarding Argentine Shipping Discriminations80
The Embassy has been informed that as of May 27 shipping berth discrimination in favor of Argentine vessels was abolished by order of the Port Administrator. This evidently was the result of several [Page 267] conversations the Ambassador had with the Foreign Minister.81 The Ambassador emphasizes that one of the principal difficulties in the port situation has been the lack of adequate and wise administration. Despite the fact that a commission has been appointed to study the ship handling the Embassy does not anticipate too great immediate results.
The berth discrimination feature was discussed with Mr. Dodero who agreed that the Argentine measures were unfair but pointed out that Argentine shipping in ports like New York is in a disadvantageous position. Dodero was told it was up to him to make appropriate arrangements with New York port authorities. The Ambassador believes that the bulk of the American shipping complaints has been made by the Moore-McCormack Line which is anxious to maintain its dominant position in the U.S.–River Plate trade.
At the Ambassador’s suggestion a meeting of the American shipping companies was held in the Embassy to discuss the various problems affecting American shipping interests. It was evident that the companies themselves have been inactive in bringing their various complaints to the attention of Argentine authorities. The Ambassador pointed out to the company representatives that he, as well as his British and Swedish colleagues, feels that the companies must make more adequate approaches to Argentine authorities before formal steps can be taken.
The Embassy is of the opinion that flag discrimination and other shipping discriminations such as the income tax on foreign freight profits are objectionable and undesirable. However, the Ambassador feels that before we can make any formal protest to the other Governments with respect to alleged discriminations or proved discriminations we must be able to come with clean hands. In this respect he cites the provisions of Public Law 17 which require merchandise purchased with Export Import Bank funds to be carried in American bottoms.
The Ambassador emphasizes that other major countries interested in shipping are not disturbed about the situation in the same measure as Moore-McCormack has pressed in on our Government. He suggests that the justification of the 35% surcharge on freight rates might be a useful subject of study.
A memorandum82 attached to the despatch presents the position of the American shipping companies in the River Plate trade in some detail. It shows that Moore-McCormack has 50 ships in the trade.
It asserts that the Centro de Navigatión Transatlántica is a shipping organization representing local as well as foreign shipping interests, [Page 268] although there are actually very few local companies represented. All American companies are members.
With regard to the new income tax affecting shipping profits, Mr. Clarendon, the local Moore-McCormack representative stated that the tax if applied would amount to 1 million pesos for 1946 for his company.