tion of their canal, the treaties remove the threat of any direct action against the canal with the support or acquiescence of the Panamanian Government. At the same time the treaties could lead to greater reassurance of broad and effective measures to reduce the likelihood of mob action or action by small groups or even individuals against the canal. This is particularly important given the vulnerability of the canal and its water supply to sabotage.

In a real way it might be argued the gravest threat to the canal is political, rather than military, except in the case of a large war. Given a canal arrangement acceptable to Panamanians and other Latin Americans, the security problems would be sharply reduced possibly almost to nil. In an unsettled circumstance with the canal arrangement politically unacceptable to numerous Panamanians or to others with access to the canal area the security problem would be staggering and it would almost certainly defy solution by feasible military means.

Ibid., pp. 84-86.

Under the issue of economic considerations, the Committee pointed out that the new Panama Canal Treaty gave "long overdue recognition" to the fact that the canal was Panama's primary economic resource. Apart from the $10 million payment for services provided for in article III, section 5 of the Panama Canal Treaty, ante, the annual payments under the terms of article XIII (the fixed annuity, the variable annuity or share of tolls, and the surplus if any) would amount to between $50 and $60 million annually during the first five years of the Treaty. Biennial adjustments to the variable annuity after the first five years, being indexed to changes in the U.S. wholesale price index for manufactured goods, would likely increase it to approximately $80 to $90 million annually by the Treaty's termination on December 31, 1999.

The Committee discussed seven economic issues which had been its chief concern: (1) the effect of the Treaty on toll rates and annuities, including the indexation provision in the variable annuity clause; (2) the effect of the Treaty on the U.S. economy; (3) the additional economic package [United States cooperation and assistance to further the general economic development of Panama and enhance its stability]; (4) the value of the property to be turned over to Panama; (5) the effect of the Treaty upon the economy of Panama; (6) the role that Panama's external debt played in the drafting of the economic sections of the Treaty; and (7) the payments to Panama in relation to similar payments to other nations. The Committee viewed the economic provisions of the Treaty and their probable consequences favorably, "on balance." It added:

The economic provisions should not be seen in a vacuum. They are an integral part of the political, social, military and historic issues involved. The overriding economic issue is how best to keep

the canal open for world and American shipping at a reasonable cost. The Committee feels that the new treaty accomplishes this major goal better than the 1903 Hay-Bunau-Varilla Treaty.

Ibid., p. 102.

The additional economic package, ante, was in the form of certain loans and loan guarantees under existing programs to strengthen Panama's ability to contribute to the protection of the Canal.

In its comments upon the Treaties (pt. III of its report), the Committee explained its decision (by a vote of 14 to 1) to support ratification of the Panama Canal Treaties and its judgment that they promised to serve the national interest of the United States. Excerpts follow:

.. Underscoring this judgment is the fact that the treaties now before the Senate are the product of 14 years of negotiations.

The pending Panama treaties are the product of a continuity of shared purpose and reflect the best traditions of a bipartisan foreign policy.

The pending agreements are not the product of any single event or incident, or any particular set of events or set of incidents. Rather, they are the product of the sweep of history and, most recently, the collective judgment of American and Panamanian leaders who committed themselves and their political fortunes to fashioning an up-to-date Panama Canal treaty relationship.

They serve to define and accommodate the mutual interests of the United States and of Panama in the operation, maintenance and defense of an international waterway serving the shipping community and the navies of the world. They serve to resolve a complex political question involving an array of issues and sub-issues ranging from strategic policy to economic considerations; from the interpretation of legal standards to the protection of the rights of American and Panamanian citizens; and from the management and operational details of the Canal itself to the possibility of constructing a third set of locks and the building of a sea level canal.

The documents now before the Senate... represent a collection of political judgments and decisions. They are a composite of compromises running through and across a tangled bundle of interests, both real and imagined . . .

In the Committee's opinion, it is all but self-evident that the political judg. ments rendered in the pending treaties will serve better than those rendered 74 years ago. Moreover, the Committee is firmly convinced that the Panama treaties will stand the test of time because they serve the mutual interests of both parties. The political judgments contained in them are balanced, fair and equitable...

In the Committee's opinion, the weight of the evidence was "overwhelmingly in favor of ratification." It summarized the principal considerations, based on the terms of the treaties and supporting testimony of Administration witnesses, which led to that conclusion, as follows: The treaties "give the United States [1] the dominant role in a partnership arrangement for operating the Canal during the remainder of the 20th century" and "[2] primary, day-to-day responsibility for the defense of the Canal until the year 2000." They also give to "[3] the United States unrestricted right to maintain the permanent neutrality of the Canal forever"and to "[4] United States warships and auxiliaries the right to go to the head of the line in the event of a crisis or other emergency situation." The treaties "[5] insure that after the year 2000 foreign troops will never be stationed in Panama." They "[6] promise to have minimal impact on the

United States economy"; and they "[7] fully protect the rights of all Americans connected with the operation, maintenance and defense of the Canal." Lastly, "[8] the treaties give the United States an opportunity to modernize the Canal by adding a third lane of locks, plus an exclusive option to build a new sea level canal through Panama. . . .”

The Committee drew upon testimony of former Secretary of State Kissinger that the treaties provided "an opportunity to advance fundamental American foreign policy interests." It also quoted Secretary Vance's testimony that “any nation's foreign policy is based, in the end, not just upon its interests," but "also... upon the nature and will of its people." He saw the treaties as promoting fundamental, traditional U.S. values-wanting "to live in peace with one's neighbors," wanting "to be strong but to use their strength with restraint," and wanting "all peoples everywhere to have their own chance to better themselves and to live in self-respect."

The Committee added its own thoughts:

The Committee fully agrees with these observations, but also recognizes that the opportunity presented by the treaties is akin to a double-edged sword and points out that:

-Acceptance of the treaties will evidence our firm commitment to the peaceful and equitable settlement of international disputes.

-Acceptance of them will evidence our firm commitment to international cooperation among all nations, big or small, rich or poor, developed or underdeveloped.

-Acceptance of them will evidence our firm commitment to independence and self determination for all nations.

-Acceptance of them will evidence our firm commitment to a foreign policy based on preserving the national interest without sacrificing our nation's principles, values or honor.

These are important commitments. If we do not honor them fully, the sword will cut the other way and our adversaries will exploit the situation to the maximum extent possible.

Ibid., p. 20.

Government-Chartered Vessels

During Senate discussion of the head-of-the-line amendment to article VI of the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal, the question was raised whether "auxiliary vessels," which were also accorded head-of-the-line passage rights, included vessels chartered or leased by a state for a period of time or by the voyage.

The definition of "auxiliary vessels" in Annex A to the Treaty covered "any ship, not a vessel of war, that is owned or operated by a State and used, for the time being, exclusively on government noncommercial service." (In commercial shipping practice, the owner of a vessel under time or voyage charter leases a fully equipped and manned vessel, which the owner operates for the charterer's benefit, whereas when the charterer operates the vessel, that is, takes over complete command, possession, and control, the transaction is known as a bare-boat charter.)

A memorandum prepared by the Office of the Legal Adviser, Department of State, February 16, 1978, indicated that the phrase "operated by a State" in the definition, ante, was intended to cover, and

was so understood, a vessel operated under time or voyage charter on behalf of a state, irrespective of how the actual physical operation of the vessel was carried out. The memorandum read:

MEMORANDUM OF LAW

Subject: Status of Government-Chartered Vessels under the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal.

An inquiry has been made to the transit rights under the Neutrality Treaty of vessels chartered by a state and being used exclusively on government noncommercial service. Paragraph 3 of Annex A of that Treaty defines "auxiliary vessels," which are accorded certain transit rights under the Treaty, as "any ship, not a vessel of war, that is owned or operated by a Government and used, for the time being, exclusively on government noncommercial service." As a matter of international law, that definition includes chartered vessels.

The international law on this point was discussed by the 1958 U.N. Conference on the Law of the Sea in connection with article 9 of the Convention on the High Seas (H.S.C.) and article 22 of the Convention on the Territorial Sea and the Contiguous Zone (T.S.C.). Article 9 of H.S.C. provides:

"Ships owned or operated by a State and used only on noncommercial service shall, on the High Seas, have complete immunity from the jurisdiction of any state other than the flag state."

Article 22 of T.S.C. provides:

"1. The rules contained in subsection A and in Art. 18 shall apply to government ships operated for noncommercial purposes. "2. With such exceptions as are contained in the provisions referred to in the preceding paragraph nothing in these articles affects the immunities which such ships enjoy under these articles or other rules of international law."

As can be seen, Art. 9 (H.S.C.) expressly extends to vessels owned or operated by a state and used only on government noncommercial service. The negotiating history of that provision makes clear that the phrase "or operated" was intended to include vessels chartered by a state.

The pertinent issues were also discussed in the First Committee in conjunction with the status of "government ships operated for noncommercial purposes", governed by Art. 23 of the draft, which corresponds to Art. 22, para. 1 of the final Convention.

In the discussion several amendments were discussed, inter alia, a proposal by the U.K. (A/Conf. 13/C.1/L.37) and a proposal by Argentina, Chile and Mexico (A/Conf. 13/C.1/L.155).

The Three Power proposal defined "government ships operated for noncommercial purposes" as

(a) Ships operated for purposes of a civilian character;

(b) Ships operated, directly or indirectly, for auxiliary purposes of a military character.

The U.K.'s proposal was objected to because it included ships considered to be war vessels and was ultimately withdrawn at the 41st Meeting.

The Three Power amendment was objected to by the U.S. because "it created more problems than it solved". The U.S. delegate pointed out that "tankers and other craft were often chartered as supply vessels for warships; they were manned by civilian crews, and were unarmed. It was difficult to imagine any reasons why such ships should be assimilated to warships". As a result of the action in the Second Committee, the proposal was withdrawn at the 48th Meeting of the First Committee and the ILC draft adopted on the understanding that chartered vessels were covered by the ILC draft. In the plenary meetings Art. 23 was adopted as Art. 22 (1) of the Territorial Sea Convention.

The Nineteenth Plenary Meeting added Article 22(2) which specifies that the provisions of the Convention other than articles 14-18 do not affect immunities which government ships operated for noncommercial purposes enjoy under other rules of international law.

The entire debate makes it clear that for the purpose of passage rights "government vessels used for noncommercial purposes" include vessels "operated by governments for noncommercial purposes under time or voyage charter."

As the foregoing indicates, it is well established in international law that vessels owned or operated by a State and used exclusively for government noncommercial purposes include vessels under time or voyage charter to the government of a State. The definition set forth in paragraph 3 of Annex A was drafted with this principle of international law in mind so as to assure that the transit rights afforded by the Treaty to "auxiliary vessels" would clearly extend to vessels under time or voyage charter.

Dept. of State File No. P79 0158-1773; Cong. Rec., Vol. 124, No. 35, p. S3503 (daily ed., Mar. 13, 1978).

See, further, Whiteman, Digest of International Law, Vol. 4 (1965), pp. 633-640.

88

Ports

See this Digest, Chapter 6, § 5, pages 825-827.

89

Marine Environment

Ocean Pollution Research and Development and Monitoring

The National Ocean Pollution Research and Development and Monitoring Planning Act of 1978, Public Law 95-273, approved May 8, 1978 (92 Stat. 228: 33 U.S.C. 1701 et seq.), contained the following statement of findings and purposes:

SEC. 2. FINDINGS AND PURPOSES.

(a) FINDINGS.-The Congress finds and declares the following: (1) Man's activities in the marine environment can have a profound short-term and long-term impact on such environment and greatly affect ocean and coastal resources therein.