may be determined, nor be less than the equivalent of 75 cents per net registered ton. The toll for each passenger shall not be more than $1.50 (Aug. 24, 1912, c. 390, Sec. 5, 37 Stat. 562; June 15, 1914, c. 106, Sec. 1, 38 Stat. 385).

SEC. 1317. Reservation of right to discriminate in favor of American vessels.— The passage of this chapter shall not be construed or held as a waiver or relinquishment of any right the United States may have under the treaty with Great Britain, ratified the 21st of February 1902, or the treaty with the Republic of Panama, ratified February 26, 1904, or otherwise, to discriminate in favor of its vessels by exempting the vessels of the United States or its citizens from the payment of tolls for passage through said canal, or as in any way waiving, impairing, or affecting any right of the United States under said treaties, or otherwise, with respect to the sovereignty over or the ownership, control, and management of said canal and the regulation of the conditions or charges of traffic through the same (June 15, 1914, c. 106, Sec. 2, 38 Stat. 386; U.S. Code, title 48, p. 1639).

I will insert in the record the proclamation of the President of November 13, 1912, prescribing rates of tolls for vessels passing through the Panama Canal, the rate on merchant vessels carrying passengers or cargo being $1.20 per net vessel ton-each 100 cubic feet of earning capacity, the rate for vessels in ballast being fixed at 40 percent less.

A PROCLAMATION BY THE PRESIDENT OF THE UNITED STATES OF AMERICA

PANAMA CANAL TOLL RATES

I, William Howard Taft, President of the United States of America, by virtue of the power and authority vested in me by the act of Congress, approved August 24, 1912, to provide for the opening, maintenance, protection, and operation of the Panama Canal and the sanitation and government of the Canal Zone, do hereby prescribed and proclaim the following rates of toll to be paid by vessels using the Panama Canal:

1. On merchant vessels carrying passengers or cargo $1.20 per net vessel ton— each 100 cubic feet-of actual earning capacity.

2. On vessels in ballast without passengers or cargo 40 percent less than the rate of tolls for vessels with passengers or cargo.

3. Upon naval vessels, other than transports, colliers, hospital ships, and supply ships, 50 cents per displacement ton.

4. Upon army and navy transports, colliers, hospital ships, and supply ships $1.20 per net ton, the vessels to be measured by the same rules as are employed in determining the net tonnage of merchant vessels.

The Secretary of War will prepare and prescribe such rules for the measurement of vessels and such regulations as may be necessary and proper to carry this proclamation into full force and effect.

In witness whereof I have hereunto set my hand and caused the seal of the United States to be affixed.

Done at the city of Washington this thirteenth day of November, in the year of our Lord one thousand nine hundred and twelve and of the independence of the United States the one hundred and thirty-seventh.

[SEAL]

By the President:

P. C. KNOX,

Secretary of State.

WM. H. TAFT.

I will also introduce the proclamation of the President of November 21, 1913, establishing rules for the measurement of vessels for the Panama Canal.

A PROCLAMATION BY THE PRESIDENT OF THE UNITED STATES OF AMERICA RULES FOR THE MEASUREMENT OF VESSELS FOR THE PANAMA CANAL

I, Woodrow Wilson, President of the United States of America, by virtue of the power and authority vested in me by the act of Congress, approved August 24, 1912, to provide for the opening, maintenance, protection, and opera

tion of the Panama Canal and the sanitation and government of the Canal Zone, do hereby prescribe and proclaim the "Rules for the Measurement of Vessels for the Panama Canal", which are annexed hereto and made a part of this proclamation.

In witness whereof, I have hereunto set my hand and caused the seal of the United States to be affixed.

Done at the city of Washington this twenty-first day of November, in the year of our Lord nineteen hundred and thirteen, and of the independence of the United States the one hundred and thirty-eighth.

[SEAL.]

By the President:

W. J. BRYAN,

Secretary of State.

WOODROW WILSON.

I assume that the committee will not desire to have the complete rules inserted in the record, so I am just giving the proclamations, but the rules are available here and a copy of a letter of President Wilson to the Secretary of War dated February 15, 1915, making effective the opinion of the Attorney General that the term "net registered tonnage as used in the act of Congress, must be interpreted to mean the net tonnage of a vessel as measured under the rules prescribed by the statutes of the United States, and directing that the toll rates shall be $1.20 per net registered ton as registered by the Panama Canal rules so applied "that whereby such measurement when multiplied by $1.20, a greater sum is produced_than would be procured by multiplying by $1.25-the net registered tonnage under the United States rules-such excess shall not be demanded or collected.

THE WHITE HOUSE, Washington, February 15, 1915.

MY DEAR MR. SECRETARY: There has been brought to our attention the effect of applying the Panama Canal rules of measurement to vessels of commerce in regard to the amount of tolls reckoned in accordance therewith. Attention has been particularly directed in this respect to the matter of so-called "deck loads." I have sufficiently considered the subject matter with you and the Attorney General to determine upon that which I think should be done now. the Congress shall alter the existing law upon the subject there will perhaps be opportunity to deal with it more completely and satisfactorily; but until that course is taken the way herein suggested seems to me the best one to meet the existing situation.

If

The Panama Canal Act, as amended by the act of June 15, 1914, provides as follows:

"SEC. 5. That the President is hereby authorized to prescribe, and from time to time change the tolls that shall be levied by the Government of the United States for the use of the Panama Canal; Provided, That no tolls, when prescribed as above, shall be changed, unless six months' notice thereof shall be given by the President by proclamation. * * Tolls may be based upon gross or net registered tonnage, displacement tonnage, or otherwise, and may be based on one form of tonnage for warships and another for ships of commerce. The rate of tolls may be lower upon vessels in ballast than upon vessels carrying passengers or cargo. When based upon net registered tonnage for ships of commerce the tolls shall not exceed $1.25 per net registered ton, nor be less than 75 cents per net registered ton, subject, however, and so forth. * * If the tolls shall not be based upon net registered tonnage, they shall not exceed the equivalent of $1.25 per net registered ton as nearly as the same may be determined, nor be less than the equivalent of 75 cents per net registered ton. The toll for each passenger shall not be more than $1.50. * *

In pursuance of this there was issued a proclamation fixing tolls at $1.20 per ton for vessels of commerce when carrying cargo, and providing therein that the rules and regulations to carry this into effect would be issued by the Secretary of War. There was subsequently issued a second proclamation which specified the rules which should be used in measuring vessels passing through the Panama Canal, and which took the place of the rules and regulations which were, under the first proclamation, to be issued by the Secretary of War.

Upon the whole matter being referred to the Attorney General by me, he renders an opinion in which, among other things, he decides that the term "net registered tonnage as used in the act of Congress must be interpreted to mean the net tonnage of a vessel as measured under the rules prescribed by the statutes of the United States. He does not think it can be interpreted to mean net registered tonnage as measured under the special rules provided for the Panama Canal. As a result of this he decides that if the toll rate established at $1.20 per net registered ton, when multiplied by the tonnage as ascertained by the Panama Canal rules, exceeds the amount produced by multiplying the net registered tonnage as measured by the rules prescribed in the United States statutes, by $1.25 (the amount named in the statute), the excess thus produced is uncollectible. It therefore follows that insofar as the present proclamations and rules, either as to deck loads or otherwise, would result in collecting at the rate of $1.20 per net registered ton more than would be produced by multiplying by $1.25 the net registered tonnage as measured by the United States statute rules, they lay down a course of conduct unwarranted by the Panama Canal Act.

Of course, it is desirable to remedy this situation, and I direct that it be remedied in the following way:

That you, as Secretary of War, issue rules and regulations with respect to the tolls, so that no tolls shall be demanded or collected upon any vessel of commerce which shall aggregate more than $1.25 upon the net registered tonnage as measured under the statutes of the United States.

That the toll rate shall remain as at present-$1.20 per net registered ton as measured by the Panama Canal rules-so applied, however, as just above stated, that where, by such measurement, when multiplied by $1.20, a greater sum is produced than would be procured by multiplying by $1.25 the net registered tonnage under the United States statute rules, such excess shall not be demanded or collected.

Your rules also, of course, should be drawn so as to produce as similar result with respect to the minimum that may be charged.

Sincerely yours,

Hon. LINDLEY M. GARRISON,

Secretary of War.

WOODROW WILSON.

I will submit also for the record a copy of the opinion of the Attorney General addressed to the Secretary of War, dated November 25, 1914, expressing the opinion that maximum and minimum tolls collectible were to be determined by net registered tonnage of vessels as determined under the statute of the United States.

The Honorable The SECRETARY OF WAR.

NOVEMBER 25, 1914.

SIR: I have the honor to acknowledge the receipt of your letter of September 25, 1914, asking, by direction of the President, my opinion as to whether or not portions of the President's proclamation, providing for payment of tolls on deck loads of vessels passing through the Panama Canal, are in violation of the Panama Canal Act.

The pertinent parts of the act are as follows:

That the President is hereby authorized to prescribe and from time to time change the tolls that shall be levied by the Government of the United States for the use of the Panama Canal: Provided, That no tolls, when prescribed as above, shall be changed, unless 6 months' notice thereof shall have been given by the President by proclamation.

Tolls may be based upon gross or net registered tonnage, displacement tonnage, or otherwise, and may be based on one form of tonnage for warships and another for ships of commerce. The rate of tolls may be lower upon vessels in ballast than upon vessels carrying passengers or cargo. When based upon net registered tonnage for ships of commerce the tolls shall not exceed $1.25 per net registered ton. If the tolls shall not be based upon net registered tonnage, they shall not exceed the equivalent of $1.25 per net registered ton as nearly as the same may be determined, nor be less than the equivalent of 75 cents per net registered ton. The toll for each passenger shall not be more than $1.50 (37 Stat. 560, 562).

* * *

By proclamation of the President, dated November 13, 1912, the following rates of toll were prescribed:

1. On merchant vessels carrying passengers or cargo, $1.20 per net vessel ton-each 100 cubic feet-of actual earning capacity.

2. On vessels in ballast without passengers or cargo, 40 percent less than the rate of tolls for vessels with passengers or cargo. * *

The proclamation also contained the following clause:

The Secretary of War will prepare and prescribe such rules for the measurement of vessels and such regulations as may be necessary and proper to carry this proclamation into full force and effect.

It appears that the Secretary of War did not prepare such rules and regulations. The President, by proclamation dated November 21, 1913, however, prescribed the "rules for the measurement of vessels for the Panama Canal." Article VII of these rules provides:

If any ship carries stores, timber, cattle, or other cargo in any space upon an open deck not permanently covered or in spaces exempted under article IV, section 1, paragraphs (a) and (b) of these rules, all tolls and other charges payable on the vessel's net tonnage shall be payable upon the vessel's net tonnage (as defined below in arts. X and XII) increased by the tonnage of the space occupied (at the time at which the tolls or other charges become payable) by the goods carried upon deck and not permanently covered or closed in. The deck space occupied by the goods thus carried shall be determined at the time of the application of the vessel for passage through the Canal and shall be deemed to be the space limited by the area occupied by the goods and by straight lines enclosing a rectangular space sufficient to include the goods. The tonnage of the space occupied by the goods shall be ascertained in the manner prescribed below by article IX, rule 1, for the measurement of poops or other closed-in spaces.

Nothing in this article shall in any manner affect the provisions of articles II, III, and IV.

The questions presented, therefore, under the act and proclamations, are, whether the tolls prescribed by the President were authorized by the statute, and, if so, whether the rules for the measurement of vessels, promulgated in the second proclamation, amounted to a change in tolls without the requisite 6 months' notice or were merely complementary to the provisions of the first proclamation, left incomplete by the failure of the Secretary of War to prescribe such rules.

66

The act provides that "Tolls may be based upon gross or net registered tonnage, displacement tonnage, or otherwise." The basis adopted by the President was net vessel ton-each 100 cubic feet-of actual earning capacity." This basis, made definite and specific by the rules for the measurement of vessels, is in pari materia with the bases mentioned in the act and comes within the letter and spirit of the wide discretion vested in the President by the use in the act of the words "or otherwise." The only express limitation to this broad power is that, "If the tolls shall not be based upon net registered tonnage, they shall not exceed the equivalent of $1.25 per net registered ton as nearly as the same may be determined, nor be less than the equivalent of 75 cents per net registered ton."

Prior to the passage of the Panama Canal Act, Congress had prescribed by statute what should constitute the net registered tonnage of a vessel (R.S. 4153).

In fixing the maximum and minimum rates of toll, it will be presumed that Congress acted with reference to the existing laws of the United States and used the term "net registered tonnage as defined by statute. Furthermore, Congress evidently intended to fix precise limits to the President's authority, yet no definite maximum and minimum would have been provided if any other than the statutory meaning were given to the term, since there was no universal standard net registered ton, but, on the contrary, the expression meant to each nation a different amount, all nations having their own peculiar rules, differing among themselves and from those of the United States.

Congressman Adamson, Chairman of the Interstate and Foreign Commerce Committee, in reporting the bill to the House, apparently used the expression "net registered tonnage with the significance given it in the statutory definition (vol. 48, Cong. Rec., pt. 7, p. 6582).

In addition to the maximum allowed for vessels, $1.25 per net registered ton, as measured by the United States rules, or, in case of a vessel not so measured, as nearly as the same may be determined", the act authorizes a maximum toll of $1.50 for each passenger.

Independently of the question of notice, therefore, there can be no doubt but that the tolls fixed by the President are authorized by the statute, provided the amounts resulting from the operation of the rules fall within the maximum and minimum provided in the statute.

If, however, in a particular instance the tolls exceed such maximum, they would be unauthorized and illegal to the extent of the excess, but only as to same, for the legal and illegal elements are severable and easily ascertainable. The maximum of $1.25 per net registered ton, as measured by the United States rules, would thereupon become by operation of the statute the proper toll to be collected and alone may be demanded.

If the tolls prescribed by the President fall below the minimum of 75 cents net registered ton, then such minimum becomes the legal toll and must be collected.

The fact that the basis adopted by the President differs from that used by Congress in prescribing the maximum and minimum tolls to be collected is immaterial.

Under the two proclamations tolls are fixed upon a tonnage, not commodity, basis. There may result some inequality from the operation of the rules for the measurement of vessels, but this would be true of any system for fixing tolls that might be devised, and would not amount to an unreasonable discrimination between vessels or commodities.

The first proclamation was not intended to and did not completely and definitely fix tolls for the Canal, but there still remained something else to be done the promulgation by the Secretary of "such rules for the measurement of vessels and such regulations as may be necessary and proper to carry this proclamation into full force and effect." The Secretary failing to prepare such rules, the President, months before any tolls were collected or the Canal opened, completed the unfinished task of prescribing tolls by promulgating in the second proclamation the necessary rules and regulations. The two proclamations were complementary and together constituted but a single exercise of the power of the President to prescribe tolls for the Canal. Consequently no question concerning the requirement "that no tolls, when prescribed as above, shall be changed, unless 6 months' notice thereof shall have been given by the President by proclamation" is involved.

In my opinion, therefore, the tolls fixed by the President are legal, whether including deck loads or not, wherever the total comes within the maximum and minimum provided by congress; but where it falls without these limits, if greater than the maximum, the excess is illegal, and only an amount equivalent to $1.25 per net registered ton may be charged; if less than the minimum, the deficiency must be made good, and an amount equivalent to 75 cents per net registered ton must be collected.

Respectfully,

(Signed) T. W. GREGORY, Attorney General.

I believe that covers the laws and regulations governing the subject to the present time.

Mr. LEA. Any questions?

As I understand it, roughtly speaking, there are three classes of vessels that are subject to tolls: The laden and unladen, and the

other vessels.

Mr. SMITH. The laden, unladen, and other vessels; yes.

Mr. LEA. Roughly speaking, what are included in those other vessels? Has that term been defined?

Mr. SMITH. The term has not been fully defined. It would probably include such floating craft as dredges, tugs, yachts, a floating dry dock, and so forth. I think the Governor is the one who could answer that question rather than myself.

Mr. LEA. So as to, roughly speaking, understand it, I understand that the Panama rules prevail, but modified by the rules and regulations of the United States.

Mr. SMITH. That is correct. The limit is fixed by the registry, rules of measurement, under the United States statutes, as applied formerly by the Commissioner of Navigation, now, I believe, the Assistant Director of the Bureau of Navigation. I think that is his title at the present time.

Mr. LEA. The Panama Canal rules were prescribed by order of the President, originally.