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Mr. WEBSTER. I think he said there were 45,000 boats today equipped with a radio.

Mr. HARRIS. Is that it?

Mr. WEBSTER. I think he used the 7,000, though, as the number that would come under this bill.

Mr. HARRIS. Very well.
Mr. WEBSTER. I think that is correct.
Mr. HARRIS. I am glad to get that.
Mr. WEBSTER. Because the 45,000 figure is not in the picture.

Now, if you reduce the formula in any way, say, like gearing it to the Coast Guard formula, that would probably get it down to 3,000. That is another matter.

Now, as to the cost: The cost can range anywhere from, I think, as Congressman Macdonald said yesterday, from $500 upward and you can get to $1,000 for some installations, in order to have a piece of equipment that will go out there and stand the rigors of the job because I want to point out that when you are out there, you do not have a qualified man aboard to do any repair work on that or to take care of it. It is there. If it is out, it is out, and that is the end of it. You do not have anyone like you have on the larger vessels who can get his equipment back in shape again.

So from that point of view, I think the Government should be careful in its specifications to see that it is just as reliable as you can make it and still not go beyond the realm of reason.

Now, I take it that the Commission is going to be reasonable. We have always been reasonable, so far as I know. We have had arguments with shipping and all that, but I think after all is said and done, I think they will always say we have been fair and reasonable. I think the Commission will be in this case; but I do not know, and I cannot tell you the exact figure that may result. Now, some of the equipment on those boats may stay there. There is no doubt of it. Some may have to come off. We may have to give them a period of time to replace equipment. We have done that in the past, let them amortize their equipment over a period of time and at the end of that time they have had to put in new equipment.

Mr. HARRIS. Is that all you have?
Mr. WEBSTER. That is all I have.
Mr. WILLIAMS. Mr. Chairman, I would like to ask a question.
Mr. HARRIS. Mr. Williams?

Mr. WILLIAMS. I presume that the States have laws regulating the operation of this type of craft within the areas of jurisdiction belonging to the States. At what point does the Federal Government take jurisdiction over the operation of these boats for hire? Is it beyond the 3-mile limit, or does the Federal Government take them up to the shore? Would it be proper to prescribe in any legislation that this will apply to boats going beyond the 3-mile limit and leave it up to the States to take care of the matter within the 3-mile zone?

Mr. WEBSTER. Well, looking at it from my experience with the various laws

Mr. WILLIAMS. May I say I am not very familiar with maritime law, but I would like to get your ideas on the subject.

Mr. WEBSTER. I think I am correct in saying that Federal jurisdiction is extended to all United States vessels, as long as that vessel is anywhere in the world.

Now, it may be that that is a very broad statement, but I think I am correct on it.

Mr. WILLIAMS. Would this apply to the renting of skiffs ?
Mr. WEBSTER. Skiffs?
Mr. WILLIAMS. Yes, sir. Fishing boats.
Mr. WEBSTER. If they carry passengers for hire.

Mr. HARRIS. May I say that the language proposed in this bill refers to those navigated in the open sea or on any tidewaters within the jurisdiction of the United States, or adjacent or contiguous to the open sea. Mr. WILLIAMS. It does apply to them?

Mr. HARRIS. It applies to everything in the open sea, as well as the coastal waters.

Mr. WEBSTER. I thought maybe you were bringing up, when you asked about skiffs, that maybe your mind was working toward a very small boat.

Mr. WILLIAMS. Yes.

Mr. WEBSTER. Now, in that case, there is provision in here that gives the Commission very wide latitude in exempting a boat and this authority is spelled out. If it is unreasonable, or unnecessary, or ineffective for the purposes of the act, and I think under that, if it was a boat that you obviously could not install the equipment in, that would apply. There may be cases of that kind where the Commission would have to take a good look at it as to exempting it.

Of course, if they refused to exempt it, that would put the boat out of business.

But those cases naturally all have to be taken up on their merits, as we go along

Now, that problem is involved in enforcement. It puts the burden on the Commission of exempting a boat so that we may have a lot of applications come in here and it may require quite a little examination to see whether or not they should be exempted.

Now, we have the same provision for the big vessels and we have a few of those now and then.

Mr. DOLLIVER. Mr. Chairman, may I ask a question?
Mr. HARRIS. Mr. Dolliver?

Mr. DOLLIVER. Mr. Webster, I just want to see if I can summarize your views on this.

As I understand it, the Commission is rather favorable to this type of legislation and will rely upon the committee and the Congress to decide whether the limitations are there.

Mr. WEBSTER. That is correct, and you were not here, I do not believe, when I said this, and I would like to repeat it for your benefit, sir.

Mr. DOLLIVER. Yes, I was late.

Mr. WEBSTER. The Congress told this Commission back in 1937 and 1938 to make a study of the Great Lakes and inland waterways on this very broad subject and we submitted a report to Congress under date of December 16, 1940. We did not use the same formulas in our recommendation, the Commission did not, but it was the same problem.

Time has passed since then and the formula that was recommended in 1940 may not be appropriate today.

I simply point that out to show that the subject has been under consideration and discussion and for various reasons has never been

taken up.

Therefore, the Commission is glad to see that something is being done along this line and probably should have been done before.

Mr. DOLLIVER. Actually, this proposed legislation does not apply to the inland waterways or the Great Lakes.

Mr. WEBSTER. Not the Great Lakes, but it applies to all tidewaters. Mr. HARRIS. It would apply to the Chesapeake Bay.

Mr. WEBSTER. It does not take in the inland lakes of any kind. It takes in tidewater.

Mr. DOLLIVER. May I make this further inquiry? Do you think there is a realm there for appropriate legislation along this line in connection with navigation of craft for hire on the Great Lakes or other inland waterways?

Mr. WEBSTER. I will bring you up to date on that, sir.

We have a treaty with Canada that is now about a year or so old that covers the entire Great Lakes situation.

Mr. DOLLIVER. I see.

Mr. WEBSTER. It is in very good shape. Both Canadian vessels and our vessels are on a par when it comes to the use of the radio for safety purposes, and that was ratified by the Senate and is now law. So that is taken care of.

Mr. DOLLIVER. You would not recommend any legislation in that field, then?

Mr. WEBSTER. No, sir; that is all taken care of.
Mr. DOLLIVER. Thank you very much, Mr. Chairman.
Mr. Harris. If there is nothing else, you might proceed to the next
bill.

Mr. WEBSTER. Let me see what is the next.
Mr. HARRIS. Well, while we are on this subject, H. R. 7249.

Mr. WEBSTER. Mr. Chairman, in 7249 the Commission transmitted its comments and unfortunately right at this minute I haven't got the forwarding letter, but I have a copy of the comments.

They were adopted by the Commission on September 28, 1955, and I have a copy of the comments which I will give to the reporter for the purpose of putting into the record.

Mr. HARRIS. Very well, they will be received and go into the record at this point.

Mr. WEBSTER. I have no other comments than these. If you wish, I will read them.

Mr. HARRIS. It is a very short statement and that might be the quickest way. We are being rushed for time in connection with all of these matters that we have up for consideration.

Mr. WEBSTER. I know you are. I will read it. H. R. 7248 would provide a specific sanction of a maximum fine of $10,000 or imprisonment for not more than 10 years, or both, for transmitting false distress signals by radio, which is now prohibited by section 325 (a) of the Communications Act. Such sanction, as proposed, would make the offense for such transmission a felony.

The Communications Act of 1934, section 501, as originally enacted made all offenses against the act, including violations of section 325 (a), punishable by a fine of not more than $10,000 or imprisonment of not more than 2 years, or both.

As such, this was a felony. Section 501 was amended in 1954 by legislation proposed by the Commission, Public Law 314. This amend

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ed section provides for a fine of not more than $10,000 or imprisonment of not more than 1 year, or both, for first offenders. This makes initial offenses, including violations of section 325 (a) a misdemeanor.

The Commission felt that initial offenses should be punished as misdemeanors because enforcement of section 501 was being made unnecessarily difficult by the fact that United States attorneys were reluctant to prosecute and juries were reluctant to convict, as a felon, a person guilty of a first violation.

However, the crime involved here is one of the most reprehensible violations of the Communications Act. The commission of such a crime has a serious impact on the safety of life and property both on the sea and in the air. Because of this, the crime should be treated with such seriousness as is commensurate with its effect upon the safety of life and property. In view of this, the Commission has no objection to H. R. 7249.

All this does, sir, is to change the act so that in this particular set of circumstances, this is sending out a false distress signal, it becomes a felony instead of a misdemeanor. Everything else remains the same.

Mr. HARRIS. Very well.

Mr. DOLLIVER. Do you have any comments on the last paragraph of that bill on page 2 which reads:

2 (b) No broadcasting station shall rebroadcast the program or any part thereof of another broadcasting station without the express authority of the originating station.

Does the Commission have any comments on that?

Mr. WEBSTER. That is the present law and that is simply copied in in order to have completeness.

I have no comments on it. I mean, it is not necessary.
Mr. HARRIS. That is a part of the present legislation.
Mr. WILLIAMS. It is not a part of this bill.
Mr. WEBSTER. That is right.

Mr. HARRIS. I am advised that Mr. Dorn, the author of the bill, would like to come in later and testify in behalf of it and, of course, he will be granted that privilege.

Are there any further questions of this witness on this bill? If not, you might move on to the next one, which is H. R. 4939.

Mr. WEBSTER. Others will testify now, Mr. Harris, on various phases.

Mr. HARRIS. Do you have any particular comments on any of those bills, Mr. Commissioner?

Mr. WEBSTER. No, sir.
Mr. HARRIS. Very well.
Mr. CowgILL. My name is Harold G. Cowgill.

Mr. HARRIS. You are Chief of the Common Carrier Bureau of the Federal Communications Commission.

Mr. COWGILL. That is right, sir.
Mr. HARRIS. You may proceed.

Mr. CowgILL. Before proceeding, may I explain that we distributed a statement which we found had been slightly altered by reason of the Senate reporting out a similar bill over there, so I would like to read some variations from that statement, which you may have before you.

Mr. HARRIS. Do you contemplate reading your statement?
Mr. COWGILL. I would contemplate reading the statement.

On behalf of the Commission, I wish to make a statement in support of H. R. 4939, relating to the Commission's regulatory authority over communications common carriers.

H. R. 4939 contains four amendments to the Communications Act which have been proposed by the Commission and which relate to our regulation of common carriers, the companies furnishing interstate and foreign communication service for hire by telephone and telegraph.

These proposals represent a part of the Commission's continuing program to simplify the act and Commission regulations thereunder by eliminating nonessential procedural steps and to devote the time and effort thereby saved to more effective regulation in the fields where it is needed.

The four amendments proposed are to sections 212, 219 (a), 221 (a) and 410 (a) of the Communications Act, respectively.

Section 212 relates to authority for a person to hold the position of officer or director of more than one carrier. This section now makes it unlawful for any person to hold the position of officer or director in more than one carrier subject to the act unless such holding shall have been authorized by order of the Commission upon due showing that neither public nor private interests will be adversely affected thereby.

This provision is designed to prevent any abuses that might stem from “interlocking directorates” and it is a highly desirable authority in the regulation of public utilities.

However, the all-embracing language of this section makes it applicable to dual holdings within an integrated communications system under common ownership and control, as well as to interlocking relations between separate systems or companies to which the section must have been primarily intended to apply.

Nearly all the applications we receive under section 212 are from officers or directors of one company of a commonly-owned or controlled system.

Our experience has been that the dual holding of positions under these circumstances produces no adverse effect upon either public or private interests and we therefore feel that this is a detail of carrier management which can and should be left to the carrier itself. The unnecessary filing and processing of applications of this kind merely adds to the work of the carriers and this Commission.

Our proposed amendment is designed to give the Commission discretion to eliminate such applications from persons who hold positions as officer or director in more than one carrier where such carriers are affiliated, within the terms of the amended section.

The need for an amendment of section 219 (a) of the act arises partly out of an apparent ambiguity in the existing language and partly out of the development and growth of certain new types of limited or specialized common carriers in the communications field concerning the operation of which a lesser degree of annual information is necessary.

The first sentence of section 219 (a) gives the Commission discretionary authority to require common carriers to submit annual reports of financial, statistical and other information.

The second sentence is inconsistent, however, because it speaks in mandatory terms and prescribes a long list of data which shall be included in such annual reports. The material listed in this section is desirable in the comprehensive annual reports required from large car

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