SOVIET MARITIME ACTIVITIES IN LINER TRADES OF THE 
UNITED STATES 
(By Robert G. Adam and Marvin H. Witteveen ') 
FOREWORD 
This report on the activities of the Soviet merchant fleet operating 
in the liner trades of the United States was prepared by members 
of the staff of the Federal Maritime Commission in response to a 
request by The Honorable Ernest F. Hollings, Chairman of the Na- 
tional Ocean Policy Study of the Senate Committee on Commerce. 
Our objective in this study has been confined to the Commission’s 
area of responsibility involving the regulatory aspects of U.S.-Soviet 
maritime activities. No attempt has been made to include a general 
discussion of the Soviet merchant marine nor the operating results 
of the U.S.-U.S.S.R. Maritime Agreement: These are areas of study 
falling under the jurisdiction of other agencies or more appropriately 
to be examined by individual scholars. 
The Commission staff members responsible for the preparation of 
this study have attempted to report on the growing Soviet maritime 
presence in the U.S. liner trades and to explore some proposals to 
deal with the phenomenon of third-flag carriers operating in our sea 
lanes. The authors wish to mention the valuable contribution of 
Dorothy K. Webb for her diligent statistical research efforts. 
INTRODUCTION 
The U.S. liner trade is essentially an open trade without restrictions 
to entry or exit. Groups of carriers organized as shipping conferences, 
establish agreed upon rate levels for member carriers and operate 
on most of the major trade routes. Carriers, however, are not required 
to join these cartels. Freedom of entry into high-volume markets can 
lead to overcapacity. Where overcapacity exists, it is not uncommon 
for non-conference operators to offer rates substantially below con- 
ference levels to attract cargoes; and under these conditions, con- 
ference carriers may be tempted to offer rebates or to engage in 
other types of illegal practices to meet non-conference competition. 
On U.S. routes, Soviet carriers are operating under a policy of 
offering frequent sailings at reduced rates to penetrate our trades. 
They tend to offer lower rates on attractive cargo to maximize hard 
currency earnings from shipping revenues. 
The Soviets are adopting such American innovative concepts as 
containerization, LASH, and roll on/roll off ships to develop a stronger 
and more viable merchant marine. It has been estimated that the 
U.S.S.R. will have a container fleet in excess of 50 ships by 1980; 
1The authors are on the research staff of the Federal Maritime Commission. 
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