The South African policy in Namibia causes us considerable concern, particularly in view of South African assurances to the United Nations Secretary General last April. At that time, the South African Foreign Minister stated that his Government would fully respect the wishes of the whole population with regard to the future constitutional organization of Namibia; that all political parties would fully and freely participate in the process leading to selfdetermination and independence; that South Africa had no intention of delaying the act of self-determination and would cooperate with the Secretary General and consult with the people to determine measures to insure the achievement of self-determination; and that South Africa did not envisage individual population groups becoming suddenly independent as separate entities.

Notwithstanding the South African Government's actions, contrary to their assurances, we regret that talks between the United Nations Secretary General and the South African Government have been discontinued by the Security Council. We thought this dialog had begun a process which held promise of achieving in time accommodations which would permit self-determination and independence for the people of Namibia.

We continue to hope that dialog between the United Nations Secretary General and all appropriate parties will be resumed.

In line with our policy of supporting the principles of human rights and self-determination, we have engaged in several undertakings: (1) Since May 1970, we have officially discouraged American investment in Namibia. At that time we announced that ExportImport Bank facilities would no longer be available for trade with the territory and that any further investment there, made on the basis of rights acquired from the South African Government following the termination of the South African mandate in 1966, would not receive U.S. Government protection against claims of a future legitimate government in Namibia.

We have informed all American companies doing business in Namibia of U.S. policy and have requested them to seek to conform their employment policies to the Universal Declaration of Human Rights.

6

(2) The U.S. Government has so far provided scholarships for a total of 41 Namibians to study in American universities. In the past 2 years, we have brought to the United States under our exchange visitor program three prominent Namibians. We plan to continue this program and to invite other prominent Namibians, black and white, to visit the United States.

(3) We are also supporting the United Nations Fund for Namibia. On March 21, the U.S. Government pledged $50,000 to the Fund. Mr. Chairman, the U.S. Government continues to be concerned that those South African policies which appear to bar political activities of oppositionists may result in marshaling support for those who hold that violence is the only recourse.

Our Government will continue to seek every opportunity to support practical efforts which would enable the people of Namibia to exercise peacefully their right to self-determination and independence. Thank you, Mr. Chairman.

Mr. DIGGS. Thank you, Mr. Kaiser.

The text of the Universal Declaration of Human Rights appears on p. 10.

I am going to have all three witnesses testify and then we will go into questions before the witness from the SEC testifies. I would like to make just a few further remarks as to the reason for our calling that agency to participate.

The Securities Act of 1933 requires the registration of the securities by the filing with the Commission of a registration statement. The Act also sets forth certain requirements for the prospectus, which is the statement or communication which offers a security for sale. Accordingly, the basic question here concerns:

(1) the registration statement of securities relating to Namibia; and

(2) the prospectus offering for sale securities relating to Namibia. Namibia is singled out because it is unique. It is the only area in the world where the United Nations and the International Court of Justice with the support of the U.S. Government have found that the administering authority, South Africa, is illegally occupying the territory.

Under the ICJ opinion

Grants, concessions, titles, licenses, privileges or interest of any kind granted by the South African Government in regard to Namibia, Namibian products, goods or property of whatever kind.

all of these things must be deemed invalid.

What we are saying here is that securities relating to grants, concessions, titles, licenses, privileges, or interest of any kind by South Africa in regard to Namibia are predicated on invalidity.

So the question arises, how does the SEC carry out its mandate in regard to the protection of the public in matters relating to Namibia? The third question here deals with a matter reported in the June 1973 edition of "Update," which is going to be included in our appendix.'

Last year, certain stockholders submitted a stockholder resolution proposal regarding the activities of Newmont Mining in Namibia, specifically to commit Newmont to a policy of equal employment opportunity in its worldwide operations.

The SEC, following a submission by Newmont, refused to use its authority to uphold the submission of this stockholder resolution and accepted the argument that Namibian law would not permit equal employment practices. After agitation by concerned parties, the SEC reopened the question and revised its opinion.

This case illustrates, in our view, both the necessity for the State Department to see to it that other agencies are informed on foreign policy and the necessity for the SEC to inform itself on the unique matter of securities relating to Namibia.

A far greater concern here also is this: Pronouncements by the State Department as to the U.S. Government policy are essentially meaningless unless they are communicated in the most appropriate way to the attention of other agencies of Goverrment so that these agencies can act consistently with the pronouncements in their own areas of competence.

This is a matter the subcommittee intends to pursue, for otherwise our stated foreign policy must appear to be a sham.

With that introduction, we will now hear from Mr. Hocker.

7 See appendix at p. 215.

STATEMENT OF RALPH C. HOCKER, ASSOCIATE DIRECTOR, DIVISION OF CORPORATION FINANCE, SECURITIES AND EXCHANGE COMMISSION

Mr. Hocker was appointed to the staff of the Registration Division (now the Division of Corporation Finance) in 1939, and has served in progressively more responsible positions in that Division. He was promoted to the position of Branch Chief in 1956, to Assistant Director in 1961, and was reassigned to the position of Associate Director in 1969. Mr. Hocker received his B.S. degree in 1937 from the University of Oklahoma and his M.A. degree from the Fletcher School of Law and Diplomacy in 1939.

Mr. HOCKER. Thank you, Mr. Chairman.

I am Ralph Hocker, one of the Associate Directors of the Commission's Division of Corporation Finance. With me here this afternoon are Mr. Carl Bodolus, the Chief of the Office of International Corporate Finance, and Mr. Philip Farnsworth, one of the branch chiefs of the Division of Corporate Finance.

I am pleased to be here to respond to your questions. I do not have a prepared statement.

If I may, I would like to refer to two or three specific matters which I believe are pertinent to the inquiry here this afternoon. One is the activities of the SEC in carrying out the national policy as announced by the State Department with respect to investments in Namibia.

I would point out that the SEC administers a disclosure statute, and while the Commission is in a position to exercise persuasion it does not have specific legal authority to prohibit the activities which may not appear to be consistent with the announced national policy. I do wish to mention that in one specific instance in 1972 there came before the Securities and Exchange Commission a proposal to sell securities relating to an enterprise to be carried on in Namibia. The name of this venture was Gemstone Miners Ltd. It was a proposal to raise money in this country to engage in the mining of amethysts in Namibia.

The staff of the Securities and Exchange Commission made the persons behind this venture aware of the Government's policy to discourage investments in the country. It made the State Department aware of the proposed venture.

I have a copy of the State Department's representations directly to the promoters of the venture as well as to the SEC.

Mr. DIGGS. Do you have this so we can include it in the record? Mr. HOCKER. Yes, sir. We will leave those with your staff.8

The result of this total consideration by the Department of State and the SEC resulted in the venture being abandoned and a proposed financing did not go forward.

I might say that this is the only example that I have been able to find of proposed financing interests having to do with the exploitation of investment opportunities in Namibia. I am aware that certain of the publicly owned companies in this country do have economic interests in Namibia and I will now approach the area where the SEC has some contact with this matter.

The announced national policy makes clear that additional investments in Namibia are to be discouraged. It does not apparently require

See appendix at p. 227.

divestiture or termination of existing interests in that country. Under these circumstances, certain of the American companies find themselves carrying on operations in Namibia. More specifically, I know of two companies, Newmont Mining Co. and Getty Oil Co.

The staff of the Commission has had contact with these matters in the context of proposed shareholders resolutions submitted pursuant to the Commission's rules with respect to the solicitation of proxies pursuant to the Securities and Exchange Act of 1934.

In general our rules provide that under the specified conditions shareholder proposals must be included in management's proxy materials.

For both of these companies in past years there have been proposals (1) that the companies cease their operations in Namibia; (2) last year in Newmont there was a proposal relating to fair employment practices to be carried on by Newmont in its Namibian operations. Newmont, you may be aware, has approximately a 35-percent interest in Tsumeb Mining Co. Last year the instance to which you refer related to a proposal having to do with so-called fair employment practices or roughly equal pay for equal work, a proposal which the staff first felt might be omitted under the rules.

After reconsideration and after becoming more familiar with the State Department's pronouncement of January 1973 having to do with fair employment practices in South Africa, the staff changed its position as you have recited, Mr. Chairman.

Mr. Chairman, these are the matters which come to my mind immediately as being relevent to the matters before you. I will be pleased to respond to any questions you may have.

Mr. DIGGS. Thank you.

We will now hear from Mr. Johnston before we go to any questions.

STATEMENT OF WILLIAM JOHNSTON, PRESIDENT, EPISCOPAL CHURCHMEN FOR SOUTH AFRICA

William Johnston was a founding member of Episcopal Churchmen for South Africa in June, 1956. Born in Kentucky, he moved to New York City where he has lived since, except for a three-year period of service in the U.S. Army. After working for a publishing firm, with an export shipping company and in the headquarters of the Episcopal Church, he became a full-time worker for ECSA. He has visited Namibia, South Africa and neighboring countries on two occasions-in 1962 and 1965.

He is active in the tenant movement in New York, and is president of Episcopalians for The Poor and vice-chairman of the East Side Tenants Union, Mr. JOHNSTON. Thank you, Mr. Chairman.

Mr. Chairman, the headline in the February 11, 1974, Windhoek Advertiser, the English language newspaper in Namibia's chief city, reads ominously: "Interrogation Under Act on Terrorism Has Started."

The story refers to the detention of Mr. David Meroro, national chairman of the South-West Africa Peoples Organization of Namibia, and nine companions under terms of the Terrorism Act of South Africa.

The first Terrorism Act trial in Pretoria, South Africa, in 1967 and 1968, during which 37 Namibians belonging to SWAPO faced a foreign court, is fresh in the minds of many. So, too, is the knowledge of the torture administered to those men and to others at the hands of South Africa's security police under "interrogation."

The Advertiser article ends up with a quote from another youth league member: "For each of us apprehended, a hundred are waiting to take his place."

This is Namibia at the moment-the forces of a foreign usurper acting with the equipage of weaponry and terror of the 20th century police state against a population whose watchword is freedom. The scene is familiar in history. We had something similar, though perhaps not as squalid an oppressor, here in the United States 200 years ago. Namibia is the direct responsibility of the United Nations, the lawful authority in that land, although prevented from full exercise of its authority because of the defiance of South Africa.

The Council for Namibia, set up by the General Assembly in 1967after its revocation by overwhelming vote, the United States concurring, of South Africa's mandate has been struggling to effect its administration over Namibia and help the Namibian people to achieve independence.

The council this year acquired a commissioner, Mr. Sean MacBride, former secretary-general of the International Commission of Jurists and Chairman of Amnesty International, a man of wisdom, courage, and experience.

Now is the time to throw all the confidence and firmness of our great Nation behind him. Mr. MacBride has conceived a program which deserves the immediate and committed attention of all members of the United Nations-South Africa included. The text of this program is appended; it is both realistic and practical. It deserves particular commitment from the United States of America.

The U.S. responsibility toward Namibia goes back to the role played by an American President in the formation of the League of Nations, predecessor to the United Nations, and to the conception of a mandate system whereby certain countries would be protected by the world community from stronger and annexation-minded neighbors.

South-West Africa, as Namibia was then known, became a responsibility of the world community after World War I, and I believe we Americans today are duty bound to strengthen that slender shield which was a formative dream of Woodrow Wilson's.

Such a commitment will take an act of will. Although the United States has generally voted right and has voiced support of the United Nations and belief in independence for Namibia, there appears to one well outside Government that there is pronounced drift. You have had expert testimony on areas that our Government should be prodded on. A signal one is support for the United Nations and the Council for Namibia.

American firms operating in and partners in operations in Namibia, while rapidly depleting that country's mineral resources without the consent of and without much benefits for its inhabitants, are paying taxes to the illegal regime in Pretoria. Isn't it high time to call them to account?

The organization which I represent attempted in 1972 to bring this issue before the annual shareholders' meetings of American Metal Climax, Inc., and Newmont Mining Corp.-the two together control Tsumeb Corporation, Ltd., Namibia's largest producer and employer in the base metals field-with a resolution calling for the corporations' recognition of the United Nations' lawful authority