[Extract.]

Mr. Clay to Mr. Seward.

No. 153.]

Sir: I have the honor to acknowledge the receipt, at the legation, of your despatches, Nos. 151 and 152, respectively, dated July 17th and 23d.

The negotiations which were set on foot in the latter part of last month between Austria and Italy, through the mediation of the Emperor of France, resulted in the acceptance by Italy of an armistice on the following conditions: 1. The military uti passidetis to be maintained. 2. The ultimate abandonment of Venetia by Austria, and the question of its annexation to the Italian kingdom submitted to a vote of the people. 3. A rectification of frontiers reserved for ulterior negotiation.

The incorporation of this last point, understood to cover the question of the Italian Tyrol, was doubtless due to the firmness of Baron Ricasoli, and was at the time regarded as a partial triumph of the policy of the new minister president over that of General La Marmora, who is popularly believed to be too subservient to French influence in Italian affairs. When these conditions were presented [Page 114] for final approval to Austria, who in the meantime had signed the preliminaries of peace with Prussia, the uti passidetis clause was declared unacceptable. The French Emperor then released the Italian government from the obligations it had assumed, and the King was left to treat directly with his enemy.

In this new phase of the difficulties the recommencement of hostilities seemed imminent. Austria was heavily re-enforcing her troops in the south from the army now set free at Vienna, and the Italian army, thus threatened, was withdrawn from its advanced posts in the southern Tyrol and Friul, and concentrated on a line of defence behind the Tagliamento. But the effect of these movements was to leave the situation free from the obstacles to an agreement. The Italian troops no longer occupied territory to which Austria had not already engaged with Prussia to cede her claims, and negotiations were reopened. In a conference day before yesterday at Cormons between officers of the two armies, an armistice was agreed to on the general basis of the actual uti passidetis—all other questions left for settlement at the final negotiations of peace. It is probable Austria wall consent to a rectification of the Venetian frontier so as to include a strip of the Trent country, for adequate compensation; and this may be made by the Italian government convenient ground on which to shift any indemnity Austria may demand on evacuating the fortresses of the Quadrilateral.

The belief that Italy has obtained as favorable terms, after the elimination of the French mediation, as she could have obtained before, will go far towards allaying the popular irritation which was caused by the announcement of the Austrian cession of Venice to France.

I have the honor to be, very respectfully, your obedient servant,

GREEN CLAY, Chargé d’ Affaires ad interim.

Hon. William H. Seward, Secretary of State, Washington, D. C.