New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-01-08
SHIP TRUST
CONTROLS BY REBATES
Independents Tell House Com.
mittee of Being Barred from
South American Trade.
IMPORTER ADMITS CHARGE
New York Coffee Dealer Testi-
fies His Company Now Re-
ceives Rebates from the
Conference Lines.
IErom The Tribune Bureau.l

| From The Tribune Bureau.l
! Washington. Jan. An investigation
of the so-called shipping trust alleged
TO dominate 90 per cent Of the oversee
traffic OF the United States, was begun
to-day by the House Committee on Mer-
chant Marine and Fisheries. which has
| obtained $4,000 TO pursue the watery tran
Of the shipping combination. In opening
the hearings. Chairman Alexander an
nounced that for the next ten days the
| committee purpOsed TO devote It's chief
attention To that part Of the trust operat-
ing between American and Brazilian
ports.
Sidney Storey. of New orleans. a ship
| owner who tried 10 establish an indie
pendent line between New Orleans and
Brazil told the investigators that his at
| tempt had been failure because the In
dependent ships "came back empty" Mr..
| Storey said South American shippers Were
awaiting emancipation from the thraldom
of the European lines, but Independents
J had little chance. The commerce between
the United States and Brazil. he asserted.
| would never be fully developed until the
shipping monopoly was throttled
Joseph Purcell. of Hard. Rand q Co.
of New York. one of the largest coffee
importing firms In the United States, tes-
titled that his company was receiving
10 per cent rebate on coffee shipped from
| Brazil He said his company could not
afford To ship by other lines because of
the uncertainty Of transportation when
the coffee crop is moving" Mr.. Purcell
testified that three OF the conference lines
the Lamport & Holt. the Prince and
the Hamburg South American-handlcd
the business OF his firm. The deferred re-
bates. he declared. were payable at in
tervals after the shipments were handled.
Others Hint at Rebates.
! Mr. Purcells statement came as the
climax Of Il days testimony limiting az
the existence of such Relating system
! !. J. Slechta. New York agent FOR the
/ Lloyd Brazileiro Line. owned and operat-
ed by the Brazilian government between
New York and Brazil had just testified
/ that his company during the last siX
/ years. IN trying 10 compete with the con-
! ference lines had lost 100000. lie FUR
/ Their swore that his company had been
! able 10 get the trade of only one big
| coffee importer. the Arbucklos. and. In
| his opinion. the only explanation Tor this
was the existence Of a deferred rebatiug
! system. lie acknowledged he had no
| positive knowledge OF such a system.
! Sidney Storey had also said he sus-
| pected deferred rebates was the cause OF
/ his inability 20 procure freight
Mr. Purcell testified that the rebate sys-
! TEN was started in lH0'. and. with modi-
/ acations made In 1900 or 1910. existed to-
day The contracts were signed in Brazil
and the printed forms for claims for re-
| bates were sent 10 the London agencies
! for allowance. Ills competitors. Mr. Pur-
cell said. got the same rebates II they
! signed the contracts.
The witness said that he believed the
rates were reasonably just. because the
! contracts allowed the shippers 20 charter
q vessel TO carry the coffee II such
charter could he procured AZ 10 cents "A
bag less than the conference rate avail
! able.
| Mr.. Slechta had told the committee that
the conference lines had raised the rate
since October. 1912. from 40 cents TO -
cents q bag. but that an Offer by his line
| 10 Hard & Rand To carry their coffee for
2s cents bag had been declined.
! When Chairman Alexander asked Mr..
Purcell to explain this. the witness testi-
! fed that had the offer been accepted his
concern would have lost its deferred re-
/ bate only To get service that Tor regu-
larity and efficiency would not be salts
| factory
In addition. the conference lines wonll
have refused TO carry your coffee from
Brazil To Europe" suggested Representa-
tive Thayer.
They could have done that II We had
broken our contract" was the reply.
III YOU and your competitors pay the
same freight rate and the rate per bag
was q cents a bag higher. you would
charge the q cents up to the consumer,
would YOU not?" asked Representative
Stephens.
I'VE would try TO make him pay It. but
sometimes We do not succeed" was the
reply
Mr. Purcell said he was satisfied with
| the service the conference lines We're CIV
! ing him. but denied that he preferred to
see the independent lines driven out OF
| business lest "A competitor get a lower
rate He added that his firm seldom
| chartered vessel, because II was neceS-
sary to bring such large shipments In
event OF a charter. and. further, that sell
dom could they get "A chartered vessel FOR
| ten cents less than the conference price.
| Mr.. Alexander asked the witness II he
had any legislation to suggest
! NO said Mr.. Purcell, unless you gen
| tlemen think rebating is Illegal"
! Tho Witness added that he would pre-
| ART EXHIBITIONS AND SALES.