[CHAPTER 447-3D SESSION]

[H. R. 6572]

AN ACT

To amend the Merchant Marine Act, 1936, as amended, to provide for marine war-risk insurance and reinsurance and for marine risk reinsurance, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That title II of the Merchant Marine Act, 1936, as amended, is amended by adding at the end thereof a subtitle to read as follows:

"SUBTITLE-INSURANCE

"SEC. 221. (a) For the purpose of protecting the water-borne commerce of the United States from the impediments and burdens arising from the lack of adequate facilities for the insurance of such commerce, due to extraordinary risks arising under existing war conditions, the Commission is authorized to provide marine insurance and reinsurance against loss or damage by the risks of war and reinsurance against loss or damage by marine risks, as prescribed in this subtitle, whenever it appears to the Commission that such insurance adequate for the needs of the water-borne commerce of the United States cannot be obtained on reasonable terms and conditions from companies authorized to do an insurance business in a State of the United States.

"(b) There shall be in the Treasury of the United States a revolving fund to be known as the marine and war-risk insurance fund (hereinafter referred to as the fund), to be used for carrying out the provisions of this subtitle, and to be constituted of such sums as may be appropriated to such fund and of moneys and receipts credited thereto as herein provided. There are hereby authorized to be appropriated to such fund such sums as may be necessary to carry out the provisions of this subtitle. All moneys received from premiums and from salvage or other recoveries, and all receipts in connection with this subtitle shall be deposited to the credit of such fund. Payments of return premiums, losses, settlements, judgments, and all liabilities incurred by the United States under this subtitle shall be made from such fund.

"SEC. 222. The Commission may insure against loss or damage by the risks of war, property, as follows:

"(a) (1) American vessels (including vessels under construction), (2) cargoes shipped or to be shipped therein: Provided, That in the event of the suspension of the present neutrality law no vessel or its officers and crew, carrying contraband and no cargo of contraband shall be insured under any provision of this Act, (3) their disbursements, and freight and passage moneys, and (4) personal effects of the masters, officers, and crews of such vessels.

"(b) (1) Commercial vessels (including vessels under construction) owned or controlled by the United States or any department or agency thereof, (2) cargoes owned by the Government or in which the Government has an insurable interest, to the extent of such interest, (3) their disbursements, and freight and passage moneys, and (4) personal effects of the masters, officers, and crews

thereof.

"SEO. 223. (a) The Commission may reinsure any company authorized to do an insurance business in any State of the United States on account of marine and marine war risks, including protection and indemnity risks, assumed by any such company, on (1) property or interests as set forth in section 222 (a) and (b) of this subtitle, and (2) masters, officers, and crews of American vessels (including any such vessel owned or controlled by or chartered to the Commission) against loss of life, personal injury, or detention by any government except that of the United States following capture.

(b) The Commission may reinsure, in whole or in part, with companies authorized to do an insurance business in a State of the United States, war risks assumed by the Commission under this subtitle.

"(c) Any department or agency of the United States is hereby authorized to procure insurance from the Commission as provided for in section 222 (b) of this subtitle, except as provided in the Government Losses in Shipment Act, approved July 8, 1937 (50 Stat. 479).

"SEC. 224. Whenever the Commission determines that insurance for masters, officers, and crews of American vessels against loss of life, personal injury, or detention by any government except that of the United States following capture, arising from risks of war, cannot, with the aid of reinsurance provided for under this subtitle, be obtained on reasonable terms and conditions from companies authorized to do an insurance business in a State of the United States, the Commission is authorized to provide such insurance on a basis corresponding to the war risk insurance protection supplied, prior to such determination, for such personnel by companies authorized to do business in a State of the United States.

"SEC. 225. In the event of disagreement as to a claim for losses or the amount thereof, on account of insurance under this subtitle, an action on the claim may be brought and maintained against the United States in the district court of the United States sitting in admiralty in the district in which the claimant or his agent may reside, or in case the claimant has no residence in the United States, in a district court in which the Attorney General of the United States shall agree to accept service. Said suits shall proceed and shall be heard and determined according to the provisions of an Act entitled 'An Act authorizing suits against the United States in admiralty, suits for salvage services, and providing for the release of merchant vessels belonging to the United States from arrest and attachment in foreign jurisdictions, and for other purposes', approved March 9, 1920, as amended (known as the Suits in Admiralty Act), insofar as such provisions are not inapplicable and are not contrary to or inconsistent with the provisions of this subtitle."

"SEC. 226. (a) The Commission in the administration of this subtitle is authorized to adjust and pay losses, compromise and settle claims whether in favor of or against the Government, and to pay the amount of any judgment rendered in respect of any suit or settlement agreed upon in respect of any claim. The determinations of the Commission with respect to adjustments, compromises, settlements, and payments hereunder shall not be subject to review by any other executive or accounting officer of the Government.

(b) The Commission is authorized to prescribe such forms and policies, to change or modify such forms and policies as may be necessary or appropriate under the circumstances, and to fix and adjust, as may be required by circumstances, the rates and changes of rates of insurance provided for in this subtitle.

"(c) The Commission is authorized and directed to prescribe such rules and regulations as may be necessary or appropriate to carry out the provisions of this subtitle. The Commission is authorized, in administering the provisions of this subtitle, to exercise its powers, perform its duties and functions, and make its expenditures, in accordance with commercial practice in the marine insurance business.

"(d) The Commission, without regard to the laws, rules, or regulations relating to the employment of employees of the United States, may appoint and prescribe the duties of such number of experts in marine insurance as the Commission may deem necessary in carrying out the provisions of this subtitle. The Commission, with the consent of any executive department, independent establishment, or other agency of the Government, including any field service thereof, may avail itself of the use of information, services, facilities, officers, and employees thereof in carrying out the provisions of this subtitle. "(e) The Commission shall include in the annual report to Congress a detailed statement of all activities and of all expenditures and receipts under this subtitle for the period covered by such report. "(f) When used in this subtitle the term 'American vessels' means vessels registered, enrolled, or licensed under the laws of the United States.

66

"SEC. 227. Nothing in this subtitle shall be deemed to affect the rights of seamen under any provision of existing law.

"SEC. 228. All the provisions of this subtitle shall expire by limitation March 10, 1942, or sooner upon a proclamation by the President that the extraordinary condition upon which it is predicated is passed."

Approved, June 29, 1940.

[CHAPTER 566-3D SESSION]

[S. 2111]

AN ACT

To amend the Act entitled "An Act granting additional quarantine powers and imposing additional duties upon the Marine Hospital Service", approved February 15, 1893, as amended.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the fourth paragraph of section 2 of the Act entitled "An Act granting additional quarantine powers and imposing additional duties upon the Marine Hospital Service", approved February 15, 1893, as amended (U. S. C., 1934 edition, title 42, sec. 82), is amended by striking out the words "adjacent thereto".

Approved, July 10, 1940.

[CHAPTER 644-3D SESSION]
[H. R. 10100]

AN ACT

To establish the composition of the United States Navy, to authorise the construction of certain naval vessels, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the authorized composition of the United States Navy in under-age vessels as established by the Acts of May 17, 1938 (52 Stat. 401), and June 14, 1940, Public Law Numbered 629, Seventy-sixth Congress, is hereby further increased by one million three hundred and twentyfive thousand tons, as follows:

(a) Capital ships, three hundred and eighty-five thousand tons; (b) Aircraft carriers, two hundred thousand tons;

(c) Cruisers, four hundred and twenty thousand tons; (d) Destroyers, two hundred and fifty thousand tons

(e) Submarines, seventy thousand tons: Provided, That each of the foregoing increases in tonnages for capital ships, aircraft carriers, cruisers, destroyers, and submarines may be varied upward or downward in the amount of 30 per centum of the total increased tonnage authorized herein so long as the sum of the total increases in tonnages of these classes as authorized herein is not exceeded.

SEC. 2. The President of the United States is hereby authorized to construct such vessels, including replacements authorized by the Act of March 27, 1934 (48 Stat. 503), as may be necessary to provide the total under-age composition authorized in section 1 of this Act.

SEO. 3. There is hereby authorized to be appropriated, out of any money in the Treasury of the United States not otherwise appropriated, such sums as may be necessary to effectuate the purposes of this Act, including not to exceed $150,000,000 for essential equipment and facilities at either private or naval establishments for building or equipping any complete naval vessel or portion thereof herein or heretofore authorized, $65,000,000 for essential equipment and facilities for the manufacture of ordnance material or munitions at either private or naval establishments, and $35,000,000 for the expansion of facilities for the production of armor at either private or naval establishments. The authority herein granted for essential equipment and facilities, and for the expansion of facilities, shall include the authority to acquire lands at such locations as the Secretary of the Navy with the approval of the President may deem best suited to the purpose, erect buildings, and acquire the necessary machinery and equipment.

SEO. 4. The allocation and contracts for construction of the vessels herein authorized shall be in accordance with the terms and conditions provided by the Act of March 27, 1934 (48 Stat. 503), as amended.