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NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports.  Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash-
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SUPREME COURT OF THE UNITED STATES
--------
No. 94-623
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VIMAR SEGUROS Y REASEGUROS, S. A., PETI-
TIONER v. M/V SKY REEFER, HER
ENGINES, etc., et al.
on writ of certiorari to the united states court
of appeals for the first circuit
[June 19, 1995]

  Justice Kennedy delivered the opinion of the Court.
  This case requires us to interpret the Carriage of
Goods by Sea Act (COGSA), 46 U. S. C. App. 1300 et
seq., as it relates to a contract containing a clause
requiring arbitration in a foreign country.  The question
is whether a foreign arbitration clause in a bill of lading
is invalid under COGSA because it lessens liability in
the sense that COGSA prohibits.  Our holding that
COGSA does not forbid selection of the foreign forum
makes it unnecessary to resolve the further question
whether the Federal Arbitration Act (FAA), 9 U. S. C.
1 et seq. (1988 ed. and Supp. V), would override
COGSA were it interpreted otherwise.  In our view, the
relevant provisions of COGSA and the FAA are in
accord, not in conflict.

                            I
  The contract at issue in this case is a standard form
bill of lading to evidence the purchase of a shipload of
Moroccan oranges and lemons.  The purchaser was
Bacchus Associates (Bacchus), a New York partnership
that distributes fruit at wholesale throughout the
Northeastern United States.  Bacchus dealt with Galaxie
Negoce, S. A. (Galaxie), a Moroccan fruit supplier.
Bacchus contracted with Galaxie to purchase the
shipload of fruit and chartered a ship to transport it
from Morocco to Massachusetts.  The ship was the M/V
Sky Reefer, a refrigerated cargo ship owned by M. H.
Maritima, S. A., a Panamanian company, and time-
chartered to Nichiro Gyogyo Kaisha, Ltd., a Japanese
company.  Stevedores hired by Galaxie loaded and
stowed the cargo.  As is customary in these types of
transactions, when it received the cargo from Galaxie,
Nichiro as carrier issued a form bill of lading to Galaxie
as shipper and consignee.  Once the ship set sail from
Morocco, Galaxie tendered the bill of lading to Bacchus
according to the terms of a letter of credit posted in
Galaxie's favor.
  Among the rights and responsibilities set out in the
bill of lading were arbitration and choice-of-law clauses.
Clause 3, entitled -Governing Law and Arbitration,-
provided:
      -(1) The contract evidenced by or contained in this
Bill of Lading shall be governed by the Japanese
law.
      -(2) Any dispute arising from this Bill of Lading
shall be referred to arbitration in Tokyo by the
Tokyo Maritime Arbitration Commission (TOMAC) of
The Japan Shipping Exchange, Inc., in accordance
with the rules of TOMAC and any amendment
thereto, and the award given by the arbitrators shall
be final and binding on both parties.-  App. 49.
  When the vessel's hatches were opened for discharge
in Massachusetts, Bacchus discovered that thousands of
boxes of oranges had shifted in the cargo holds, result-
ing in over $1 million damage.  Bacchus received
$733,442.90 compensation from petitioner Vimar Seguros
y Reaseguros (Vimar Seguros), Bacchus' marine cargo
insurer that became subrogated pro tanto to Bacchus'
rights.  Petitioner and Bacchus then brought suit
against Maritima in personam and M/V Sky Reefer in
rem in the District Court for the District of Massachu-
setts under the bill of lading.  These defendants,
respondents here, moved to stay the action and compel
arbitration in Tokyo under clause 3 of the bill of lading
and 3 of the FAA, which requires courts to stay
proceedings and enforce arbitration agreements covered
by the Act.  Petitioner and Bacchus opposed the motion,
arguing the arbitration clause was unenforceable under
the FAA both because it was a contract of adhesion and
because it violated COGSA 3(8).  The premise of the
latter argument was that the inconvenience and costs of
proceeding in Japan would -lesse[n] . . . liability- as
those terms are used in COGSA.
  The District Court rejected the adhesion argument,
observing that Congress defined the arbitration agree-
ments enforceable under the FAA to include maritime
bills of lading, 9 U. S. C. 1, and that petitioner was a
sophisticated party familiar with the negotiation of
maritime shipping transactions.  It also rejected the
argument that requiring the parties to submit to
arbitration would lessen respondents' liability under
COGSA 3(8).  The court granted the motion to stay
judicial proceedings and to compel arbitration; it re-
tained jurisdiction pending arbitration; and at peti-
tioner's request, it certified for interlocutory appeal
under 28 U. S. C. 1292(b) its ruling to compel arbitra-
tion, stating that the controlling question of law was
-whether [COGSA 3(8)] nullifies an arbitration clause
contained in a bill of lading governed by COGSA.-  Pet.
for Cert. 30a.
  The First Circuit affirmed the order to arbitrate.  29
F. 3d 727 (1994).  Although it expressed grave doubt
whether a foreign arbitration clause lessened liability
under COGSA 3(8), 29 F. 3d, at 730, the Court of
Appeals assumed the clause was invalid under COGSA
and resolved the conflict between the statutes in favor
of the FAA, which it considered to be the later enacted
and more specific statute, id., at 731-733.  We granted
certiorari, 513 U. S. ___ (1995), to resolve a Circuit split
on the enforceability of foreign arbitration clauses in
maritime bills of lading.  Compare the case below
(enforcing foreign arbitration clause assuming arguendo
it violated COGSA), with State Establishment for
Agricultural Product Trading v. M/V Wesermunde, 838
F. 2d 1576 (CA11) (declining to enforce foreign arbitra-
tion clause because that would violate COGSA), cert.
denied, 488 U. S. 916 (1988).  We now affirm.

                           II
  The parties devote much of their argument to the
question whether COGSA or the FAA has priority.
-[W]hen two statutes are capable of co-existence,- how-
ever, -it is the duty of the courts, absent a clearly ex-
pressed congressional intention to the contrary, to regard
each as effective.-  Morton v. Mancari, 417 U. S. 535,
551 (1974); Pittsburgh & Lake Erie R. Co. v. Railway
Labor Executives' Assn., 491 U. S. 490, 510 (1989).
There is no conflict unless COGSA by its own terms
nullifies a foreign arbitration clause, and we choose to
address that issue rather than assume nullification
arguendo, as the Court of Appeals did.  We consider the
two arguments made by petitioner.  The first is that a
foreign arbitration clause lessens COGSA liability by
increasing the transaction costs of obtaining relief.  The
second is that there is a risk foreign arbitrators will not
apply COGSA.

                            A
  The leading case for invalidation of a foreign forum
selection clause is the opinion of the Court of Appeals
for the Second Circuit in Indussa Corp. v. S. S. Ran-
borg, 377 F. 2d 200 (1967) (en banc).  The court there
found that COGSA invalidated a clause designating a
foreign judicial forum because it -puts `a high hurdle' in
the way of enforcing liability, and thus is an effective
means for carriers to secure settlements lower than if
cargo [owners] could sue in a convenient forum,- id., at
203 (citation omitted).  The court observed -there could
be no assurance that [the foreign court] would apply
[COGSA] in the same way as would an American
tribunal subject to the uniform control of the Supreme
Court,- id., at 203-204.  Following Indussa, the Courts
of Appeals without exception have invalidated foreign
forum selection clauses under 3(8).  See Union Ins. Soc.
of Canton, Ltd. v. S. S. Elikon, 642 F. 2d 721, 723-725
(CA4 1981); Conklin & Garrett, Ltd v. M/V Finnrose,
826 F. 2d 1441, 1442-1444 (CA5 1987); see also G.
Gilmore & C. Black, Law of Admiralty 145-146, n. 23
(2d ed. 1975) (approving Indussa rule).  As foreign
arbitration clauses are but a subset of foreign forum
selection clauses in general, Scherk v. Alberto-Culver Co.,
417 U. S. 506, 519 (1974), the Indussa holding has been
extended to foreign arbitration clauses as well.  See
State Establishment for Agricultural Product Trading,
supra, at 1580-1581; cf. Vimar Seguros y Reaseguros,
supra, at 730 (assuming arguendo Indussa applies).  The
logic of that extension would be quite defensible, but we
cannot endorse the reasoning or the conclusion of the
Indussa rule itself.
  The determinative provision in COGSA, examined with
care, does not support the arguments advanced first in
Indussa and now by the petitioner.  Section 3(8) of
COGSA provides as follows:
      -Any clause, covenant, or agreement in a contract
of carriage relieving the carrier or the ship from
liability for loss or damage to or in connection with
the goods, arising from negligence, fault, or failure
in the duties or obligations provided in this section,
or lessening such liability otherwise than as pro-
vided in this chapter, shall be null and void and of
no effect.-  46 U. S. C. App. 1303(8).
The liability that may not be lessened is -liability for
loss or damage . . . arising from negligence, fault, or
failure in the duties or obligations provided in this
section.-  The statute thus addresses the lessening of the
specific liability imposed by the Act, without addressing
the separate question of the means and costs of enforc-
ing that liability.  The difference is that between explicit
statutory guarantees and the procedure for enforcing
them, between applicable liability principles and the
forum in which they are to be vindicated.
  The liability imposed on carriers under COGSA 3 is
defined by explicit standards of conduct, and it is
designed to correct specific abuses by carriers.  In the
19th century it was a prevalent practice for common
carriers to insert clauses in bills of lading exempting
themselves from liability for damage or loss, limiting the
period in which plaintiffs had to present their notice of
claim or bring suit, and capping any damages awards
per package.  See 2A M. Sturley, Benedict on Admiralty
11, pp. 2-2 to 2-3 (1995); 2 T. Schoenbaum, Admiralty
and Maritime Law 10-13 (2d ed. 1994); Yancey, The
Carriage of Goods: Hague, COGSA, Visby, and Hamburg,
57 Tulane L. Rev. 1238, 1239-1240 (1983).  Thus, 3,
entitled -Responsibilities and liabilities of carrier and
ship,- requires that the carrier -exercise due diligence to
. . . [m]ake the ship seaworthy- and -[p]roperly man,
equip, and supply the ship- before and at the beginning
of the voyage, 3(1), -properly and carefully load, handle,
stow, carry, keep, care for, and discharge the goods
carried,- 3(2), and issue a bill of lading with specified
contents, 3(3).  46 U. S. C. App. 1303 (1), (2), and (3).
Section 3(6) allows the cargo owner to provide notice of
loss or damage within three days and to bring suit
within one year.  These are the substantive obligations
and particular procedures that 3(8) prohibits a carrier
from altering to its advantage in a bill of lading.
Nothing in this section, however, suggests that the
statute prevents the parties from agreeing to enforce
these obligations in a particular forum.  By its terms, it
establishes certain duties and obligations, separate and
apart from the mechanisms for their enforcement.
  Petitioner's contrary reading of 3(8) is undermined by
the Court's construction of a similar statutory provision
in Carnival Cruise Lines, Inc. v. Shute, 499 U. S. 585
(1991).  There a number of Washington residents argued
that a Florida forum selection clause contained in a
cruise ticket should not be enforced because the expense
and inconvenience of litigation in Florida would -caus[e]
plaintiffs unreasonable hardship in asserting their
rights,- id., at 596, and therefore -`lessen, weaken, or
avoid the right of any claimant to a trial by court of
competent jurisdiction on the question of liability for . . .
loss or injury, or the measure of damages therefor'- in
violation of the Limitation of Vessel Owner's Liability
Act, 499 U. S., at 595-596 (quoting 46 U. S. C. App.
183c).  We observed that the clause -does not purport
to limit petitioner's liability for negligence,- id., at
596-597, and enforced the agreement over the dissent's
argument, based in part on the Indussa line of cases,
that the cost and inconvenience of traveling thousands
of miles -lessens or weakens [plaintiffs'] ability to
recover.-  499 U. S., at 603 (Stevens, J., dissenting).
  If the question whether a provision lessens liability
were answered by reference to the costs and inconve-
nience to the cargo owner, there would be no principled
basis for distinguishing national from foreign arbitration
clauses.  Even if it were reasonable to read 3(8) to
make a distinction based on travel time, airfare, and
hotels bills, these factors are not susceptible of a simple
and enforceable distinction between domestic and foreign
forums.  Requiring a Seattle cargo owner to arbitrate in
New York likely imposes more costs and burdens than
a foreign arbitration clause requiring it to arbitrate in
Vancouver.  It would be unwieldy and unsupported by
the terms or policy of the statute to require courts to
proceed case by case to tally the costs and burdens to
particular plaintiffs in light of their means, the size of
their claims, and the relative burden on the carrier.
  Our reading of -lessening such liability- to exclude
increases in the transaction costs of litigation also finds
support in the goals of the Brussels Convention for the
Unification of Certain Rules Relating to Bills of Lading,
51 Stat. 233 (1924) (Hague Rules), on which COGSA is
modeled.  Sixty-six countries, including the United
States and Japan, are now parties to the Convention,
see Department of State, Office of the Legal Adviser,
Treaties in Force: A List of Treaties and Other Interna-
tional Agreements of the United States in Force on
January 1, 1994, p. 367 (June 1994), and it appears that
none has interpreted its enactment of 3(8) of the Hague
Rules to prohibit foreign forum selection clauses, see
Sturley, International Uniform Laws in National Courts:
The Influence of Domestic Law in Conflicts of Interpre-
tation, 27 Va. J. Int'l L. 729, 776-796 (1987).  The
English courts long ago rejected the reasoning later
adopted by the Indussa court.  See Maharani Woollen
Mills Co. v. Anchor Line, [1927] 29 Lloyd's List L. Rep.
169 (C. A.) (Scrutton, L. J.) (-[T]he liability of the
carrier appears to me to remain exactly the same under
the clause.  The only difference is a question of proce-
dure-where shall the law be enforced?-and I do not
read any clause as to procedure as lessening liability-).
And other countries that do not recognize foreign forum
selection clauses rely on specific provisions to that effect
in their domestic versions of the Hague Rules, see, e.g.,
Sea-Carriage of Goods Act 1924, 9(2) (Australia);
Carriage of Goods by Sea Act, No. 1 of 1986, 3 (South
Africa).  In light of the fact that COGSA is the culmina-
tion of a multilateral effort -to establish uniform ocean
bills of lading to govern the rights and liabilities of
carriers and shippers inter se in international trade,-
Robert C. Herd & Co. v. Krawill Machinery Corp., 359
U. S. 297, 301 (1959), we decline to interpret our
version of the Hague Rules in a manner contrary to
every other nation to have addressed this issue.  See
Sturley, supra, at 736 (conflicts in the interpretation of
the Hague Rules not only destroy aesthetic symmetry in
the international legal order but impose real costs on
the commercial system the Rules govern).
  It would also be out of keeping with the objects of the
Convention for the courts of this country to interpret
COGSA to disparage the authority or competence of
international forums for dispute resolution.  Petitioner's
skepticism over the ability of foreign arbitrators to apply
COGSA or the Hague Rules, and its reliance on this
aspect of Indussa, supra, must give way to contemporary
principles of international comity and commercial
practice.  As the Court observed in The Bremen v.
Zapata Off-Shore Co., 407 U. S. 1 (1972), when it
enforced a foreign forum selection clause, the historical
judicial resistance to foreign forum selection clauses -has
little place in an era when . . . businesses once essen-
tially local now operate in world markets.-  Id., at 12.
-The expansion of American business and industry will
hardly be encouraged,- we explained, -if, notwithstanding
solemn contracts, we insist on a parochial concept that
all disputes must be resolved under our laws and in our
courts.-  Id., at 9.  See Mitsubishi Motors Corp. v. Soler
Chrysler-Plymouth, Inc., 473 U. S. 614, 638 (1985) (if
international arbitral institutions -are to take a central
place in the international legal order, national courts
will need to `shake off the old judicial hostility to
arbitration,' and also their customary and understand-
able unwillingness to cede jurisdiction of a claim arising
under domestic law to a foreign or transnational tribu-
nal-) (citation omitted); Scherk v. Alberto-Culver Co., 417
U. S., at 516 (-A parochial refusal by the courts of one
country to enforce an international arbitration agree-
ment- would frustrate -the orderliness and predictability
essential to any international business transaction-); see
also Allison, Arbitration of Private Antitrust Claims in
International Trade: A Study in the Subordination of
National Interests to the Demands of a World Market,
18 N. Y. U. J. Int'l Law & Politics 361, 439 (1986).
  That the forum here is arbitration only heightens the
irony of petitioner's argument, for the FAA is also based
in part on an international convention, 9 U. S. C. 201
et seq. (codifying the United Nations Convention on the
Recognition and Enforcement of Foreign Arbitral
Awards, June 10, 1958, [1970] 21 U. S. T. 2517),
T. I. A. S. No. 6997, intended -to encourage the recogni-
tion and enforcement of commercial arbitration agree-
ments in international contracts and to unify the
standards by which agreements to arbitrate are observed
and arbitral awards are enforced in the signatory
countries,- Scherk, supra, at 520, n. 15.  The FAA
requires enforcement of arbitration agreements in
contracts that involve interstate commerce, see Allied-
Bruce Terminix Cos. v. Dobson, 513 U. S. ___ (1995),
and in maritime transactions, including bills of lading,
see 9 U. S. C. 1, 2, 201, 202, where there is no
independent basis in law or equity for revocation.  Cf.
Carnival Cruise Lines, 499 U. S., at 595 (-forum-selec-
tion clauses contained in form passage contracts are
subject to judicial scrutiny for fundamental fairness-).
If the United States is to be able to gain the benefits of
international accords and have a role as a trusted
partner in multilateral endeavors, its courts should be
most cautious before interpreting its domestic legislation
in such manner as to violate international agreements.
That concern counsels against construing COGSA to
nullify foreign arbitration clauses because of inconve-
nience to the plaintiff or insular distrust of the ability
of foreign arbitrators to apply the law.

                            B
  Petitioner's second argument against enforcement of
the Japanese arbitration clause is that there is no
guarantee foreign arbitrators will apply COGSA.  This
objection raises a concern of substance.  The central
guarantee of 3(8) is that the terms of a bill of lading
may not relieve the carrier of the obligations or diminish
the legal duties specified by the Act.  The relevant
question, therefore, is whether the substantive law to be
applied will reduce the carrier's obligations to the cargo
owner below what COGSA guarantees.  See Mitsubishi
Motors, supra, at 637, n. 19.
  Petitioner argues that the arbitrators will follow the
Japanese Hague Rules, which, petitioner contends, lessen
respondents' liability in at least one significant respect.
The Japanese version of the Hague Rules, it is said,
provides the carrier with a defense based on the acts or
omissions of the stevedores hired by the shipper,
Galaxie, see App. 112, Article 3(1), (carrier liable -when
he or the persons employed by him- fail to take due
care), while COGSA, according to petitioner, makes
nondelegable the carrier's obligation to -properly and
carefully . . . stow . . . the goods carried,- COGSA 3(2),
46 U. S. C. App. 1303(2); see Associated Metals &
Minerals Corp. v. M/V Arktis Sky, 978 F. 2d 47, 50
(CA2 1992).  But see COGSA 4(2)(i), 46 U. S. C.
1304(2)(i) (-[N]either the carrier nor the ship shall be
responsible for loss or damage arising or resulting from
. . . [a]ct or omission of the shipper or owner of the
goods, his agent or representative-); COGSA 3(8), 46
U. S. C. App. 1303(8) (agreement may not relieve or
lessen liability -otherwise than as provided in this
chapter-); Hegarty, A COGSA Carrier's Duty to Load
and Stow Cargo is Nondelegable, or Is It?: Associated
Metals & Minerals Corp. v. M/V Arktis Sky, 18 Tulane
Mar. L. J. 125 (1993).
  Whatever the merits of petitioner's comparative
reading of COGSA and its Japanese counterpart, its
claim is premature.  At this interlocutory stage it is not
established what law the arbitrators will apply to
petitioner's claims or that petitioner will receive dimin-
ished protection as a result.  The arbitrators may
conclude that COGSA applies of its own force or that
Japanese law does not apply so that, under another
clause of the bill of lading, COGSA controls.  Respond-
ents seek only to enforce the arbitration agreement.
The district court has retained jurisdiction over the case
and -will have the opportunity at the award-enforcement
stage to ensure that the legitimate interest in the
enforcement of the . . . laws has been addressed.-
Mitsubishi Motors, 473 U. S., at 638; cf. 1 Restatement
(Third) of Foreign Relations Law of the United States
482(2)(d) (1986) (-A court in the United States need not
recognize a judgment of the court of a foreign state if
. . . the judgment itself, is repugnant to the public policy
of the United States-).  Were there no subsequent
opportunity for review and were we persuaded that -the
choice-of-forum and choice-of-law clauses operated in
tandem as a prospective waiver of a party's right to
pursue statutory remedies . . . , we would have little
hesitation in condemning the agreement as against
public policy.-  Mitsubishi Motors, supra, at 637, n. 19.
Cf. Knott v. Botany Mills, 179 U. S. 69 (1900) (nullifying
choice-of-law provision under the Harter Act, the
statutory precursor to COGSA, where British law would
give effect to provision in bill of lading that purported
to exempt carrier from liability for damage to goods
caused by carrier's negligence in loading and stowage of
cargo); The Hollandia, [1983] A. C. 565, 574-575 (H. L.
1982) (noting choice of forum clause -does not ex facie
offend against article III, paragraph 8,- but holding
clause unenforceable where -the foreign court chosen as
the exclusive forum would apply a domestic substantive
law which would result in limiting the carrier's liability
to a sum lower than that to which he would be entitled
if [English COGSA] applied-).  Under the circumstances
of this case, however, the First Circuit was correct to
reserve judgment on the choice-of-law question, 29 F. 3d,
at 729, n. 3, as it must be decided in the first instance
by the arbitrator, cf. Mitsubishi Motors, supra, at 637,
n. 19.  As the District Court has retained jurisdiction,
mere speculation that the foreign arbitrators might
apply Japanese law which, depending on the proper
construction of COGSA, might reduce respondents' legal
obligations, does not in and of itself lessen liability
under COGSA 3(8).
  Because we hold that foreign arbitration clauses in
bills of lading are not invalid under COGSA in all
circumstances, both the FAA and COGSA may be given
full effect.  The judgment of the Court of Appeals is
affirmed, and the case is remanded for further proceed-
ings consistent with this opinion.

                                      It is so ordered.

  Justice Breyer took no part in the consideration or
decision of this case.