Foreign Relations of the United States, 1952–1954, China and Japan, Volume XIV, Part 2

694.95B1/4–2852

No. 564
Memorandum by the Assistant Secretary of State for Far Eastern Affairs (Allison) to the Secretary of State¹

confidential

[Washington,] April 28, 1952.

Subject:

• Forthcoming Interview with the Korean Ambassador, Dr. Yu Chan Yang.

Dr. Yu Chan Yang, the Korean Ambassador, has recently returned from Tokyo, where he has been head of the Korean delegation to negotiate a Treaty of Friendship with the Japanese Government.² Dr. Yang has requested an appointment with you on April 29, at which time it is expected that he will wish to discuss the progress of these negotiations.

Preliminary discussions looking toward the negotiation of a Korean-Japanese Treaty of Friendship were opened at Tokyo on October 20, 1951, under the exercise of good offices by SCAP, who furnished an observer.³

Formal negotiations were commenced at Tokyo on February 15, 1952, on the basis of the following agenda:

1. Establishment of diplomatic relations.

2. Status of residents in Japan of Korean ancestry.

3. Settlement of claims between Korea and Japan.

4. Fishing rights.

5. Transfer of marine cables.

6. Establishment of a basis for subsequent negotiation of a Treaty of Commerce and Navigation.

The formal negotiations have been conducted without the presence of an American observer. Initial progress was fairly smooth and agreement was achieved on items 1 and 2 of the agenda without undue difficulty. With respect to items 3 and 4, however, increasingly serious disagreement has developed.

With regard to claims, the Japanese having offered monetary settlement or settlement-in-kind for vessels having Korean registry as of August 9, 1945 in an amount of one billion yen. The Koreans have not as yet formally accepted this offer. The Korean delegation has put forward a demand for the liquidated assets of branch properties in Japan of former Japanese-owned corporations having headquarters in Korea, on the ground that such assets were vested under United States Military Government Ordinance 33 to be turned over to the Korean Government. The Japanese have introduced what can be considered in the nature of a counter-claim for private Japanese property in Korea, which the Koreans regard as renounced by the Treaty of Peace with Japan.

Formally, the claims issue turns on the construction of Article 4 of the multilateral Treaty of Peace, (Tab A).⁴ Article 4 (a) provides that the disposition of property and claims between Japan and authorities administering renounced territories shall be the subject of special arrangements between Japan and such authorities, subject, however, to paragraph 4(b). By paragraph 4(b), Japan recognizes the validity of dispositions of Japanese property made by or pursuant to United States Military Government directives. In the Department’s opinion, the Japanese are precluded from asserting claims to property in Korea, but are entitled to have the loss of such property taken into account in connection with the special arrangements contemplated by paragraph 4(a). Also, the Department has taken the position that the property in Japan of Korean corporations which were beneficially Japanese-owned was not within the jurisdiction of the United States Military Government in Korea and has not become the property of the Republic of Korea. Hence, with minor exceptions the mutual waiver of claims would appear to be an equitable solution.

The Koreans, however, have insisted upon the unilateral withdrawal of the Japanese claims before proceeding further with the negotiations. By letter, dated March 25, 1952, Dr. Yang requested an interpretation by the Department of Article 4(b) of the Treaty, to assist the refutation of Japanese claims. A reply has been prepared which supports the Korean position but goes on to indicate that the loss of Japanese property in Korea is relevant to the consideration of Korean claims under paragraph 4(a). Copies of this exchange of correspondence are attached for reference (Tab B).⁵

The fisheries question has also been a matter of great contention. The Korean position was initially that the so-called MacArthur Line established by SCAP, limiting the area in which Japanese fishing boats could operate, should be written into the Japanese Peace Treaty. The United States did not acquiesce in this request and the Line has now been abolished. The Korean Government then issued a unilateral declaration purporting to establish Korean jurisdiction over extensive high seas areas surrounding the peninsula for fishing control purposes.⁶ This declaration has received no support either from the United States or other foreign nations.

We have urged upon both sides the desirability of negotiating a fisheries agreement based upon the principle of conversation and not upon an attempt to delimit high seas areas from which fishermen of either nation should be excluded. In so doing, it has been pointed out that fishing treaties which have recently been negotiated by the United States are based upon the conservation principle. The United States-Japanese-Canadian Treaty is an example. Furthermore, the Japanese Government presumably would be willing to follow the conservation principle in the current negotiations with Korea and, in fact, has now expressed willingness for the present unilaterally to restrict fishing operations of its nationals in waters of mutual Japanese-Korean concern in accordance with this principle. The Japanese are also willing to defer the fisheries issue for later negotiation apart from the treaty.

In general, the negotiations on each side have been marked by suspicion and by recrimination. One of the major problems is, of course, the natural Korean distrust of the Japanese, and the Koreans are most concerned over any claims from this powerful neighbor which they consider to be extravagant. Much of this acrimony unfortunately has been aired in the press or in public statements, particularly on the part of Korean officials including the President, the Foreign Minister, and even Dr. Yang himself, as head of the Korean delegation (Tab C).⁷ The effect of this has been to create an emotional atmosphere in which it has been increasingly difficult to reach any compromise solution.

Officers of the Department have on frequent occasions attempted to dissuade the Korean Government through its Embassy in Washington from these outbursts, but with little success. As a matter of policy, we have instructed our missions in Tokyo and Pusan to use their good offices informally with each side in an effort to moderate the differences which have arisen and to assist in the conclusion of an equitable treaty. At the same time, however, it has been considered unwise for the United States to intervene openly in the negotiations, despite Korean anxiety that we do so, since it is believed that if the treaty is to have permanent value its terms must be arrived at through independent negotiation, free from outside pressure on either Government.

The Department has recommended to our missions in both countries that they suggest to the respective governments the holding in abevance of the claims and fisheries issues for later negotiation, and the prompt conclusion of a treaty disposing of the remaining issues, most of which have now been resolved. It is important in the interests of the stability of the Pacific area that Korea and Japan take this major step forward in developing a sound and friendly relationship.

Recommendations

In your discussion with Dr. Yang, it is recommended that:

(1) You stress the vital importance both to Korea and to the stability of the Far East of the early conclusion of a treaty which places Korean-Japanese relations on a sound and equitable basis.

(2) You point out the necessity for a certain degree of flexibility and willingness to compromise on each side, and the importance of continuing the negotiations in an atmosphere of greater understanding. Dr. Yang’s attention might be called in a forceful manner to the great damage which intemperate statements on his part and on the part of other high officials of his government are causing to any prospects for the satisfactory conclusion of this important treaty, and he might be informed that we are making the same representations to the Japanese.

If specific discussion arises as to methods of making progress, it might be suggested to Dr. Yang in the case of the unresolved claims issue that in the interests of moving ahead with the treaty each side withdraw its claims to property in the territory of the other or, alternatively, that negotiation on this issue be deferred to a later date. With regard to fisheries, the suggestion might be made that this issue also be left for further discussion outside of the framework of the present negotiations.

1. Drafted by Arthur B. Emmons, III, Acting Officer in Charge of Korean Affairs.
2. The negotiations had been suspended on Apr. 25.
3. For a summary of this phase of the talks, see Emmons’ memorandum of a conversation held on Dec. 12, 1951, between Ambassador Yang and Allison, in Foreign Relations, 1951, vol. vii, Part 1, p. 1311.
4. Not printed.

5. Not printed. The draft U.S. reply reads in part:

   “The United States is of the opinion that by virtue of Article 4(b) of the Treaty of Peace with Japan and the relevant directives and acts of the United States Military Government in Korea all right, title and interest of Japan and of Japanese nationals in property within the jurisdiction of the Republic of Korea have been divested. Accordingly, in the opinion of the United States, valid claim to such assets or to an interest therein cannot be asserted by Japan. The disposition of such assets, which Japan has recognized as valid in Article 4(b) of the Treaty, is relevant, however, in the opinion of the United States, in the consideration of the arrangements contemplated by Article 4(a) of the Treaty.”

   The note was delivered without change on Apr. 29. (See the memorandum of conversation, infra.)

   In a memorandum to Johnson dated Apr. 17, McClurkin had in part stated: “The Mission at Tokyo has informed us that they believe the Japanese claims are largely for bargaining purposes to counter the Korean claims and that they have, several times, informed representatives of the Japanese Foreign Office of the inadvisability of making such claims and thus exacerbating Korean-Japanese relations.” (694.95B1/4–1252)

6. The boundary of this area became known as the “Rhee Line”.
7. Not found attached.