¹ “It has been stated that about 200 containerships on the main trade routes will replace some 847 conventional ships by the end of 1974.” Chester, A. Henry, underwriter for Lloyd's of London, quoted in Seatrade (04 1973), p. 65Google Scholar.

² There is a definite distinction between ‘international’ and ‘multinational’ firms although the terms are commonly used interchangeably. Some outstanding characteristics of MNC's, quite apart from their large sales, are that they operate in many countries (shipping operates between countries); they are likely to engage in research and development in these countries; and their ownership, as well as management, is typically multinational. An international company, by contrast, is simply one which derives most, or a large share, of its revenues from international sales. (See Stahl, Sheldon, “The Multinational Corporation: A Controversial Force,” Monthly Review, 06 1976Google Scholar , Federal Reserve Bank of Kansas.)

³ UNCTAD (1975), Review of Maritime Transport 1974, (No. E.75.11.D.13)

⁴ “Convention on a Code of Conduct for Liner Conferences,” April 6. 1974; UN Doc. TD/CODE/1 I/Rev. 1 (1974). Of 84 countries attending 72 voted for the convention, 7 against, and 5 abstained.

⁵ According to Norwegian Shipping News (September 19 and October 10, 1975) the observed development patterns of merchant marines indicate at least four distinct stages of development. First, a liner fleet is established and expanded. Second, operations with tanker and bulk carrier fleets begin, leading to the third stage which is participation in cross-trades. The final stage would be vertical and horizontal integration of shipping with other transport as well as non-transport activities. Except for the oil exporting countries which have begun directly with tanker and bulk operations, most less developed countries are in the first stage. Hence there is little reason to expect delays in the ratification of UNCTAD's Convention on liner conduct.

⁶ Although the less developed countries' capacity is mainly in liner shipping, they have a great potential in bulk carriage because a large share of the world's seaborne trade in bulk commodities originates in these countries. The realization of the potential, however, may hinge on the implementation of cargo preference policies for these commodities. The extension of the UNCTAD Convention to cover bulk carriage can, therefore, only be a matter of time.

⁷ About 35 percent of the fleet is owned by the oil companies, and another 45 percent is normally on long-term charter.

⁸ What actually constitutes pollution is largely a matter of definition. “When we say that something is polluted, we are in fact making a value judgment about the quantity or quality of foreign matters present which may vary with social and economic circumstances.” “Identification and Control of Pollutants of International Significance,” UN Doc. A/conf. 48/4, quoted in Barros, J. and Johnston, J. M., The International Law of Pollution (New York: The Free Press, 1974).Google Scholar

The most widely accepted definition is that of the United Nations Group of Experts on the Scientific Aspects of Marine Pollution (GESAMP):

“The introduction by man, directly or indirectly, of substances or energy into the marine environment (including estuaries) resulting in such deleterious effects as harm to living resources, hazards to human health, hindrance to marine activities including fishing, impairment of quality or use of sea water, and recution of amenities.” (UN Doc. A/7750, Part 1, p. 3; Nov. 10, 1969).

⁹ Porricelli, J. D. and Keith, V. F., “Tankers and the U.S. Energy Situation: An Economic and Environmental Analysis,” Marine Technology (10 1974)Google Scholar. Estimates on oil pollution vary. The following sources (all appearing in the National Resources Journal) and their bibliographies may be consulted: Bradley, P. G., “Marine Oil Spills: A Problem in Environmental Management,” 07 1974Google Scholar. Joyner, C. C. and Joyner, N. D., “Global Eco-management and International Organizations: the Stockholm Conference and Problems of Cooperation,” 10 1974Google Scholar . Haidy, M., “International Control of Marine Pollution,” Natural Resources Journal (04 1971)Google Scholar .

¹⁰ Camu, P., “Canadian Policy for Pollution Control in the Marine Industry,” Proceedings, 3rd International Conference on Pollution Control in the Marine Industries, 1973. International Association for Pollution Control (Washington, D.C.: IAPC, 1973)Google Scholar .

¹¹ Kimon, P. M., Kiss, R. K., Porricelli, J. D., “Segregated Ballast VLCCs: An Economic and Pollution Abatement Analysis,” Marine Technology (10 1973)Google Scholar . In this study, the authors use a range of 45–60 percent, but make clear that these ratios are for illustrative purposes only.

¹² This comprehensive approach reflects the tenor of the “Action Plan” adopted at the UN Conference of the Human Environment held in Stockholm in 1972. That plan set as an objective the total elimination of all oil pollution at sea, while other marine pollution was to be effectively controlled. Implementation of the new convention, together with the 1972 Convention on the Dumping of Wastes and Other Matter at Sea will accomplish that objective.

See recommendation 86 (e) of the Marine Pollution section of the “Stockholm Recommendation on Identification and Control of Pollutants of Broad International Significance,” reproduced in Barros and Johnston, p. 318.

¹³ The convention comes into force twelve months after its ratification by fifteen states representing at least 50 percent of the world's merchant shipping.

¹⁴ For a detailed summary of the convention and a comparison of its provisions with those of the 1954 Convention, see Benkert, W. M. and Williams, D. H., “The Impact of the 1973 IMCO Convention on the Maritime Industry,” Marine Technology (01 1974)Google Scholar . For a discussion of other hazardous cargoes, see Brown, E. D., “International Law and Marine Pollution: Radioactive Waste and Other Hazardous Substances,” Natural Resources Journal, 04 1971Google Scholar .

^l5 New ships are those contracted for after 1975, those whose keels are laid after June 30, 1976, or those delivered after 1979. For old ships, the rules apply three years after the convention comes into force.

¹⁶ Benkert and Williams.

¹⁷ There are-no fixed rules as to what the ballast capacity should be to ensure safety. See Kimon, Kiss, and Porricelli. Commonly quoted figures are: 35 percent carrying capacity loss for a 70,000 tonner, and 30 percent loss for a ship of 260,000 tons. See Lee, R. S., “International Efforts for Marine Pollution Control,” Proceedings, 4th International Conference on Pollution Control in the Marine Industries, 1974 (Washington, D.C.IAPC, 1974)Google ScholarPubMed .

¹⁸ Kimon, Kiss and Porricelli, indicate construction cost increases in the range of 5 to 27 percent, and an increase in the required freight rates between one and 27 percent. The variations depend on the assumptions used regarding ship sizes, voyage length and route, tax rate, and operational variables. Lee, op cit., mentions a cost increase of 10 percent.

In a purely rational economic sense, the investments made in changed ship construction, because of the pollution measures called for by the convention, should be equal to the value of the resulting decrease in pollution. Such a calculation, although intriguing, is a very difficult conceptual and methodological problem and does not appear to be particularly meaningful for this paper.

¹⁹ “Idle Tankers for Slop Reception Facilities,” Fairplay International Shipping Journal (London), 01 8, 1976Google Scholar .

²⁰ For a survey of the convention's possible impact on US shipping, sec Capone, R. A., “United States Laws and the Convention on a Code of Conduct for Liner Conferences: A Catalogue of Conflicts and Dilemmas.” Virginia Journal of International Law, Winter 1975Google Scholar . (The quotation is from the Code's Article 47 quoted by Capone).

²¹ Some economic consequences of national merchant marines are discussed in Abrahamsson, B. J., “A Note on Shipping and the Balance of Payments,” Malayan Economic Review (04 1970)Google Scholar .

²² Barros and Johnston, p. 72.

²³ This paragraph draws substantially from Benkert and Williams. The quotation appears in their article and comes from IMCO Assembly Resolution A.237 (VII). Compare also with footnote 12 of this paper.

²⁴ See Robinson, G. S., “Evolution of the Law of the Seas–Destruction of the Pristine Nature of Basic Oceanograph Research,” Natural Resources Journal (07 1973)Google Scholar .

²⁵ See footnote 8 of this paper.

²⁶ For the many existing efforts in this area, see Hardy, M., “International Control of Marine Pollution,” Natural Resources Journal (04 1971)Google Scholar .

²⁷ See the Convention on the High Seas and the Convention on the Territorial Sea and the Contiguous Zone, both adopted in 1958 and coming into force in 1962 and 1964 respectively.

²⁸ There are many proposals for extending coastal states' authority over marine pollution. A current trend is to assign to coastal states the responsibility for certain functions in designated areas of the oceans. One such function is marine pollution; other concepts are the regimes of the contiguous zone, the continental shelf, fishing zones, and the exclusive economic zones, See Barros, and Johnston, , Part III, and Friedheim, R. L., Understanding the Debate on Ocean Resources, Vol. 6, No. 3 (1968069), Monograph Series in World Affairs (Denver: University of Denver, 1969)Google Scholar. See also footnote 32 of this paper. Any area where the coastal state controls marine pollution will hereafter be referred to as territorial waters.

²⁹ R. R. Hemminghaus and D. E. Cornett, “Ocean Tanker Pollution Prevention Experience,” Proceedings, 4th International Conference… IAPC.

³⁰ Smith, R. W., “Oceanborne Shipment of Petroleum and the Impact of Straits on VLCC Transit,” Maritime Studies and Management (10 1973)Google Scholar .

³¹ UN Document A/Conf. 62/WP. 8/Parts I, II, III, May 7, 1975.

³² Ibid., Part II, particularly Articles 2, 14–16, 21–23, 38–44.

A sensitive issue which may still crop up in coming negotiations is that of innocent passage of VLCC's and ships carrying other hazardous substances. One solution would be to tie the definition of what constitutes “hazardous” cargo to the characteristics of the ships, rather than the cargo itself. That is, cargo which in itself might be considered hazardous would not be so classified if the carrying ship were constructed to render the cargo harmless. This would be the case, for instance, if a ship were so constructed that even in the event of substantial damage to the ship, the cargo could be contained or controlled. The discussions about double bottoms and double skin ships, as well as the provisions in the 1973 IMCO Convention regarding limits on the hypothetical outflow from damaged tankers are illustrative of this idea. While demands for such ships are not new, and have long been tied to attempts to minimize accidental oil spills, the suggestion made here is that such ships can have an important bearing on the broader issue of innocent passage, which is, in turn, of crucial importance for the ability of nations to trade freely across the oceans.

³³ Ibid. Article 16 (h).

³⁴ Ibid., Part III, Article 20.

³⁵ See An Act to Prevent Pollution of Areas of the Arctic Waters Adjacent to the Mainland and Islands of the Canadian Arctic, 1970. The Act came into effect in 1972.

³⁶ Op cit., Part III, Articles 25–39.