payments of the purchase price, the board shall require, as part of such terms and conditions, that the purchaser of the vessel shall keep the same insured (a) against loss or damage by fire, and against marine risks and disasters, and war and other risks if the board so specifies, with such insurance companies, associations or underwriters, and under such forms of policies, and to such an amount, as the board may prescribe or approve; and (b) by protection and indemnity insurance with such insurance companies, associations, or underwriters and under such forms of policies, and to such an amount as the board may prescribe or approve. The insurance required to be carried under this section shall be made payable to the board and/or to the parties as interest may appear. The board is authorized to enter into any agreement that it deems wise in respect to the payment and/or the guarantee of premiums of insurance.

Sec. 10. That the board may create out of net revenue from operations and sales, and maintain and administer, a separate insurance fund, which it may use to insure in whole or in part, against all hazards commonly covered by insurance policies in such cases, any interest of the United States (1) in any vessel, either constructed or in process of construction and (2) in any plants or materials heretofore or hereafter acquired by the board or hereby transferred to the board.

Sec. 11. (a) That the board may set aside, out of the revenues from sales, including proceeds of securities consisting of notes, letters of credit, or other evidences of debt, taken by it for deferred payments on purchase money from sales by the board, whether such securities are to the order of the United States or the United States Shipping Board or the United States Shipping Board Emergency Fleet Corporation, either directly or by indorsement, until the amounts thus set aside from time to time aggregate $125,000,000. The amount thus set aside shall be known as the construction loan fund. The board may use such fund to the extent it thinks proper, upon such terms as the board may prescribe, in making loans to aid persons citizens of the United States in the construction by them in private shipyards or navy yards in the United States of vessels of the best and most efficient type for the establishment or maintenance of service on lines deemed de

sirable or necessary by the board, provided such vessels shall be fitted and equipped with the most modern, the most efficient, and the most economical engines, machinery, and commercial appliances; or in the outfitting and equipment by them in private shipyards or navy yards in the United States of vessels already built, with engines, machinery, and commercial appliances of the type and kind mentioned.

(b) The construction loan fund shall be a revolving fund. All repayments on loans from the fund shall be credited to the fund; interest on such loans, however, shall be paid into the Treasury of the United States as miscellaneous receipts. The proceeds of sales (including proceeds of evidences of debt for deferred payments on such sales) of any vessel or vessels in which since June 6, 1924, the board has had internal-combustion engines installed as the main propulsive power, shall be transferred and credited to the extent necessary to restore to the fund any and all amounts transferred therefrom under the provisions of Section 12 of the Merchant Marine Act, 1920, as amended by the Act of June 6, 1924.1

Sec. 12. That all vessels may be reconditioned and kept in suitable repair and until sold shall be managed and operated by the board or chartered or leased by it on such terms and conditions as the board shall deem wise for the promotion and maintenance of an efficient merchant marine, pursuant to the policy and purposes declared in Sections 1 and 5 of this Act; and the United States Shipping Board Emergency Fleet Corporation shall continue in existence and have authority to operate vessels, unless otherwise directed by law, until all vessels are sold in accordance with the provisions of this Act, the provision in Section 11 of the "Shipping Act, 1916," to the contrary notwithstanding.

Sec. 13. That the board is further authorized to sell all property other than vessels transferred to it under Section 4 upon such terms and conditions as the board may determine and prescribe.

Sec. 14. That the net proceeds derived by the board prior

1 As amended March 4, 1927-retroactive to and effective June 5, 1920; but this section was further

amended by the Merchant Marine Act of 1928, Appendix 5.

to July 1, 1921, from any activities authorized by this Act, or by the "Shipping Act, 1916," or by the Act specified in Section 2 of this Act, except such an amount as the board shall deem necessary to withhold as operating capital, for the purposes of Section 12 hereof, and for the insurance fund authorized in Section 10 hereof, and for the construction loan fund authorized in Section 11 hereof, shall be covered into the Treasury of the United States to the credit of the board and may be expended by it, within the limits of the amounts heretofore or hereafter authorized, for the construction, requisitioning, or purchasing of vessels. After July 1, 1921, such net proceeds, less such an amount as may be authorized annually by Congress to be withheld as operating capital, and less such sums as may be needed for such insurance and construction loan funds, shall be covered into the Treasury of the United States as miscellaneous receipts. The board shall, as rapidly as it deems advisable, withdraw investment of Government funds made during the emergency under the authority conferred by the Acts or parts of Acts repealed by Section 2 of this Act and cover the net proceeds thereof into the Treasury of the United States as miscellaneous receipts.

Sec. 15. That the board shall not require payment from the War Department for the charter hire of vessels owned by the United States Government furnished by the board from July 1, 1918, to June 30, 1919, inclusive, for the use of such department.

Sec. 16. That all authorization to purchase, build, requisition, lease, exchange, or otherwise acquire houses, buildings or land under the Act entitled "An Act to authorize and empower the United States Shipping Board Emergency Fleet Corporation to purchase, lease, requisition, or otherwise acquire, and to sell or otherwise dispose of improved or unimproved lands, houses, buildings, and for other purposes," approved March 1, 1918, is hereby terminated: Provided, however, That expenditures may be made under said Act for the repair of houses and buildings already constructed, and the completion of such houses or buildings as have heretofore been contracted for or are under construction, if considered advisable, and the board is authorized and directed to dispose of all such properties or the interests of the United States in

all such properties at as early a date as practicable, consistent with good business and the best interests of the United States.

Sec. 17. That the board is authorized and directed to take over on January 1, 1921, the possession and control of, and to maintain and develop, all docks, piers, warehouses, wharves and terminal equipment and facilities, including all leasehold easements, rights of way, riparian rights and other rights, estates and interests therein or appurtenant thereto, acquired by the President by or under the Act entitled "An Act making appropriations to supply urgent deficiencies in appropriations for the fiscal year ending June 30, 1918, and prior fiscal years, on account of war expenses, and for other purposes," approved March 28, 1918.

The possession and control of such other docks, piers, warehouses, wharves and terminal equipment and facilities or parts thereof, including all leasehold easements, rights of way, riparian rights and other rights, estates or interests therein or appurtenant thereto which were acquired by the War Department or the Navy Department for military or naval purposes during the war emergency may be transferred by the President to the board whenever the President deems such transfer to be for the best interests of the United States.

The President may at any time he deems it necessary, by order setting out the need therefor and fixing the period of such need, permit or transfer the possession and control of any part of the property taken over by or transferred to the board under this section to the War Department or the Navy Department for their needs, and when in the opinion of the President such need therefor ceases the possession and control of such property shall revert to the board. None of such property shall be sold except as may be hereafter provided by law.

Sec. 18. That Section 9 of the "Shipping Act, 1916," is amended to read as follows:

"Sec. 9. That any vessel purchased, chartered, or leased from the board, by persons who are citizens of the United States, may be registered or enrolled and licensed, or both registered and enrolled and licensed, as a vessel of the United

States and entitled to the benefits and privileges appertaining thereto: Provided, That foreign-built vessels admitted to American registry or enrollment and license under this Act, and vessels owned by any corporation in which the United States is a stockholder, and vessels sold, leased, or chartered by the board to any person a citizen of the United States, as provided in this Act, may engage in the coastwise trade of the United States while owned, leased, or chartered by such

a person.

"Every vessel purchased, chartered, or leased from the board shall, unless otherwise authorized by the board, be operated only under such registry or enrollment and license. Such vessels while employed solely as merchant vessels shall be subject to all laws, regulations, and liabilities governing merchant vessels, whether the United States be interested therein as owner, in whole or in part, or hold any mortgage, lien, or other interest therein.

"It shall be unlawful to sell, transfer or mortgage, or, except under regulations prescribed by the board, to charter, any vessel purchased from the board or documented under the laws of the United States to any person not a citizen of the United States, or to put the same under a foreign registry or flag, without first obtaining the board's approval.

"Any vessel chartered, sold, transferred or mortgaged to a person not a citizen of the United States or placed under a foreign registry or flag, or operated, in violation of any provisions of this section shall be forfeited to the United States, and whoever violates any provision of this section shall be guilty of a misdemeanor and subject to a fine of not more than $5,000, or to imprisonment for not more than five years, or both."

Sec. 19. (1) The board is authorized and directed in aid of the accomplishment of the purpose of this Act—

(a) To make all necessary rules and regulations to carry out the provisions of this Act;

(b) To make rules and regulations affecting shipping in the foreign trade not in conflict with law in order to adjust or meet general or special conditions unfavorable to shipping in the foreign trade, whether in any particular trade or upon