711.21/515: Telegram
The Secretary of State to the Minister in Colombia (Philip)
Department’s Nov. 8 noon in which reference was made to your October 29 noon. …
In conference with the Colombian Minister today he explained that it was naturally not easy for the Colombian Congress to approve of the Colombian’s Government entering into the new proposed subsoil agreement which would make it impossible for the Colombian Congress to legislate in the matter, but that in his opinion the pending law which the Colombian Congress plans to pass is to safeguard private interests already acquired. Once this is done it would appear that Colombian Government might enter into agreement which would safeguard oil rights to be acquired in [Page 763] the future and during the life of the agreement render it difficult for a succeeding Colombian Congress to repeal or change the law so that it would become confiscatory in character.
Please report on the progress of legislation now in process of formation in the Colombian Senate and cable text of vital portions. Until fully advised, the Department is not in a position to comment on the acquisition of private and public oil lands by contract rather than by denouncement. Inform Department whether oil operators on the ground regard acquisition by contract as nationalization, if not, explain difference between contract and denouncement. Is Department correct in assuming that your reference to ownership in perpetuity of petroleum deposits under privately owned lands, should their sub-soil deposits be developed within twenty years, refers to private lands acquired after passage of the pending law?
Our Senate’s insistence, as stated before, is to safeguard vested rights already acquired. Our Government would be pleased to have Colombia enter into a new sub-soil agreement favorable to foreign investors which will be applicable to private and public lands to be acquired in future. If Colombia could be made to understand the enormous advantage to her future development of having such an agreement to define in advance the treatment the foreign investor would receive she would welcome such an agreement because it would mean the probable production of vast wealth to the benefit of Colombia and her people.