than that required under the due process proceedings. This is a perfect example of a form being created out of fright and as a means of overprotection against isolated violators. This one form placed such a burden on small businesses that many of them gave up shipping entirely, and even large companies were at a loss to know how to comply. NCITD has, from the start, regarded this form as completely unnecessary and as a result of the severe criticism of it, AID has now designed a much simpler form to serve the same purpose, while, at the same time, looking into the possibilities of other alternates that would make the form unnecessary. In this case, an unnecessary document of extreme burdensome proportions has been in effect for over a year, it may soon be modified and simplified, but the processes of getting rid of it are too slow.

After much work with the AID officials, they have agreed that Form 285, The Certificate and Agreement Regarding Concerted Pricing, is really obsolete and should be eliminated. Likewise, we believe that Form 283: Certificate Concerning Commission and Service Payments, is no longer necessary, and we have suggested ways of capturing its information on form 282, which is the suppliers certificate. In essence, therefore, out of the four paperwork burdensome forms, 11, 285, 283, and 282, our suggestions have been constructively pointed at getting rid of all of them, except 282, and using existing commercial documents for all other policing. If this were done, we are advised by our membership, that the shipping burdens on AID programs would be tremendously lightened and many more small businesses would be encouraged to try to participate.

Additionally, our statement covers several important recommendations to change AID procedures by completely eliminating marking requirements, the compulsory small business advertising requirements, the right of charter party review, the observance of the component rule, and the widespread duplication of documents. Also, a program to raise AID minima and to lessen the burden of processing small value orders is being encouraged.

In the prepared statement submitted earlier, in each one of these several categories there is an outline of what we have suggested to the AID people as to how these things can be accomplished.

We believe that the suggestions that we have made on each of these items would insure successful administration of AID objectives and would further relax burdens on industry, particularly small industry. Of the many ineffective procedures, the requirement of small business advertising is one of the most inefficient. A check of many small businesses and we heard this over and over again today-has indicated that present procedures operating through the small business memorandum does not produce satisfactory results for the small businessman. Many of his attempts to follow up leads published in small business memorandums produce no replies, no job, no orders, and no cooperation from AID. We have suggested that importers be permitted to advertise on a voluntary basis but that the requirement be dropped and that bidders or potential bidders handle their request for information regarding importers direct with AID.

In summary, our appearance before your committee seeks the support of Congress in urging the Agency for International Development to give greater concentration to three things: (1) eliminating

all AID documentary forms except form 282, and redesigning that on a streamline and simplified basis, keeping in mind the practicability of using commercial documents instead of special AID forms. (2) The elimination of many of the special procedures and policies as outlined in our testimony and (3) the greater use of industry advice in the future before any new AID documents are created, in order that those who must bear the burden of such documents have a chance to suggest better ways of accomplishing the same objectives. Paperwork and documentation are very costly to prepare and to process, regardless of whether this work is done by computers or by pencil. The $6 billion paperwork burden represents not only a terrific expense but, in addition, a handicap to transportation services and a holdup of shipments too involved to be accurately measured. The less chance a shipper has of being able to solve these technical documentation problems, the less interest he has in seeking new and broader overseas markets. This is a real problem that faces the small businessman. It is imperative, therefore, that if the small businessman is to be encouraged to get back into the AID shipping programs or any other international trade expansion, something must be done to eliminate his paperwork to give him the needed encouragement.

As part of our public relations in telling the story of the burdens of this paperwork, we had prepared for the annual meeting of our members here in Washington 2 weeks ago several posters, one of which I have given to counsel, which shows a wall of various types of documents with all the various interested parties batting their heads against this trying to get over, to see through it, run around it, and various things. You will notice in the foreground the party that we have been talking about today, the small businessman, has apparently hit the wall for the last time because he is flat on his back out cold. Perhaps a picture being worth a thousand words, I should stop with that.

Mr. ROBINSON. With your permission I would ask the chairman to make this poster a part of the record or at least a part of the subcommittee files.

Mr. BAYLIS. I think it is highly appropriate that we add a pictorial record to this.

Mr. ROBINSON. Do you have any questions?

Mr. FINN. I just wanted to thank you for being here, Mr. Baylis. I think it is very valuable to hear from an organization such as yours, with the expertise it has in trying to simplify these forms, and to hear your suggestions.

More specifically, I heard you say that AID has agreed that form 285 should be eliminated. Does that mean it is now eliminated?

Mr. BAYLIS. We received word just a week ago that effective with new letters of credit opened after June 17, 1969, form 285 would no longer be required.

Mr. FINN. Has there been any progress on the other simplifications you have proposed?

Mr. BAYLIS. AID form 11, which I referred to, the Certificate of Commodity Eligibility, is extremely burdensome because the shippers under AID have to file application for eligibility before anything can be set in motion to make the shipment, or even to get it into productive stages, if it is not a shelf item. The form was introduced because one or two Members of Congress a year or so ago ran across cases where commodities that obviously were not eligible under the AID financing had found their way into two or three markets overseas. One of them was a large shipment of champagne glasses, and they question the wisdom of spending tax money on that, but it turned out that it was going to someplace, I believe it was Haiti or Jamaica, where they are so dependent for the economy on tourism and a hotel had burned down and a new one was replacing it with substantial AID support. This was just part of the furnishings. But that and similar cases caused Congress to admonish AID to preclear everything.

Simultaneously with that they had some cutbacks and brought home from around the world a large number of their own personnel who were no longer then in the various countries where they could see that the import license of the country was in proper order and that the commodity was properly described. So to do this, and without asking whether or not there was a better way of doing it, they put this extremely difficult to understand two-page form 11 out on a Friday night and made it effective the following week. Since then they have just flooded their offices in Washington with preclearance paperwork, because this is an essential before any other action can take place.

Recognizing that general licensing or certification of accredited commodities could serve the same purpose, we are taking it in stages, and have now asked AID to circulate a suggested very abbreviated draft, and we hope after that to have form 11 discontinued entirely. We have suggested in the testimony what is known as a program of direct reimbursements. Where there is any doubt whatsoever, the receiving country pays from its own funds first, to be reimbursed by AID financing only after AID has then had a chance to check it. That will put the checking back where it belongs, instead of on the businessman, the exporter. Mr. FINN. That is all I have. Thank you.

Mr. ROBINSON. What would 282 do, the one that still remains?

Mr. BAYLIS. 282 is the basic document. That is the supplier's certificate, which is almost like a bill of lading. We have suggested to them that they do not even need 282, because you could show a copy of the bill of lading which not only has valuation but full commodity description for transportation purposes.

However, realizing they probably would not give up their only basic supplier certificate document, we have suggested that everything else be included on that, and taken directly from the bill of lading.

Mr. ROBINSON. Does this 282 appear in the rules and regulations of AID Regulation No. 1?

Mr. BAYLIS. Yes.

Mr. ROBINSON. At the tail end?

Mr. BAYLIS. I have, if you would like to make them part of the record, copies of all four of the documents that I have referred to.

Mr. ROBINSON. Suppose you leave them with us, and we will ask the chairman for his ruling on that, either to make it a part of the record or to keep it in the subcommittee file.1

1 The forms referred to may be found in the subcommittee's files.

Mr. BAYLIS. The 282 is the yellow sheet. That is the only one that we have considered as having any future validity at all.

Mr. ROBINSON. Would you have any objection as far as your campaign to eliminate prolific paper profusion, which is very admirable, and which I am sure many Members of the Congress share with you and the committee, the effort to streamline the procedures, especially eliminating the burden on small business, if in this 282 form there was a self-certification box to be checked as to whether a supplier and his producer, or his producer as the case may be, is either small or large business for the purpose of procurement?

Mr. BAYLIS. No, not if this can be done accurately and from a practical standpoint without further burdening documentation. We would also suggest, as long as they keep 282, and as another means of getting rid of 11, he certify to the fact that the commodity is what is described, is eligible under AID financing to the best of his knowledge.

For instance, another thing that caused 11 to be brought in almost in the middle of the night was shipment of battery additives to Vietnam. When they got there in tanks, they found it was just sea water. Mr. ROBINSON. I remember that.

Mr. BAYLIS. That caused quite a ruckus, but there again, as I say, it was actually instituted out of fright rather than sitting down to consider the load it was putting on an already overburdened business economy, and discussing it with the business people to find better ways of doing it.

When this started about 13 months ago, the AID people were very, very reluctant even to talk about anything dealing with these documents. But now they may be shifting because the cooperation is faster and more direct.

We certainly want to be helpful to them, and that is why we have gone to great length with meetings with them, and in our written testimony not merely to criticize these very burdensome forms but also to specifically outline what can be done to replace the forms as well as these policies of the componentry and the marking and the charter party review and the others.

Mr. ROBINSON. You have been very helpful to the subcommittee, and I am sure that your statement will be appreciated and due consideration given to it by the members of the committee.

Mr. BAYLIS. I appreciate the opportunity to appear before you.
Mr. ROBINSON. Thank you, Mr. Baylis.

(Whereupon, at 2:40 p.m., July 10, 1969, the subcommittee recessed, to reconvene subject to the call of the Chair.)