APEX ASKS MARAD TO APPROVE SHIP SALES

APEX ASKS MARAD TO APPROVE SHIP SALES

Apex Resources Inc., Lake Success, N.Y., is seeking approval from the Maritime Administration to sell six U.S.-flag vessels, some under subsidy, to Liberty Shipping Group, a new West Coast-based company with links to operators of a dozen foreign-flag bulk carriers.

Apex is seeking the various permissions required for the complex sale on behalf of its involved subsidiaries.The vessels that Liberty would acquire are the Beaver State, a 90,000- deadweight-ton subsidy-built tanker, and five Korean-built essentially dry

bulk carriers, the Archon, Arion, Aspen, Altair and Aurora, the first three of which also can carry containers.

Liberty is a new partnership to be controlled by Schnitzer Investment Corp., Portland, Ore., a subsidiary of Schnitzer Steel Products Co.

The partners in Liberty are Schnitzer Investment and Philip J. Shapiro, the general counsel of Apex, or an entity to be formed by him, according to the application.

Marad must give its approval both to the transfer of ownership in subsidized operating companies, which is happening here, and where foreign- flag shipping operations are maintained.

Many of the stockholders in Schnitzer Steel are also stockholders of Pacific Coast Shipping Co. . . . and its wholly owned subsidiary, Trans- Pacific Shipping Co., which together operate 12 bulk carriers, under 35,000 tons each, in trades primarily between the U.S. West Coast and Asia, Canada and Brazil, hauling forest products, scrap steel, new steel, cotton, urea and various grains, the application said.

The applicant said no changes are contemplated by Liberty in the essential operations or management of the vessels, and they will continue to operate primarily in the preference trades.

Liberty was said to be intent on moving aggressively to attempt to penetrate the foreign commercial trades as well, but such a move is impossible without the aid of ODS (operating differential subsidy), which it would acquire through purchase of the subsidy contracts held by Apex's Aeron Marine Shipping Co. and American Shipping Inc.

Liberty wants permission to operate under subsidy any and all of the vessels it will acquire without restriction for a maximum of 730 voyage days a year.

As for protecting other U.S.-flag operators from competition from a subsidized carrier with foreign-flag service, the application stressed that there are no U.S.-flag vessels competing in, or even contemplating entry into, the carriage of forest products, new and scrap steel, cotton, urea and other such products moving to Asia, Brazil and Canada.

Apex pointed out that one of the purposes of Section 804 of the 1936 Merchant Marine Act was to encourage foreign-flag operators to come to the U.S. flag. Subsidy was the key incentive, but the Reagan administration has halted that.

And with the subsidy program expiring, that important aim of the 1936 law - to bring foreign ships under U.S. flag - will not be served by requiring Pacific Coast and Trans-Pacific to withdraw from the foreign trades, the application added.

Marad also was assured that the strict corporate separation of Liberty

from Pacific Coast and Trans-Pacific will preclude the danger of subsidy diversion to foreign-flag operations.

Liberty intends to compete in the foreign commercial trade in addition to the cargo preference trade, thus increasing the U.S.-flag presence in a trade in which it is now virtually invisible, and the vessels will carry goods 'vital to American industry,' as specified in the law, Apex added.

Apex said it hoped to close the sale of Archon, Altair, Aspen and Arion as soon as possible with Beaver State to follow in June or July.

Making the sale of Aurora final, Apex added, will have to await the expiration of the long-term charter of that vessel in October.