. . . . . . . . . . . . . .
[Enclosure]
The American Minister (Jay) to the Rumanian Minister for Foreign Affairs
(Duca)
Bucharest, June 6,
1924.
No. 64Mr. Minister: I have the honor to refer to
my Note No. 36 of March 29th12 in which I brought to Your Excellency’s
attention the anxiety felt by the Legation in respect to certain
provisions of a draft of a mining law, the enactment of which the
Rumanian Government was understood to have in view.
Your Excellency was good enough recently to furnish me with copies of
the new draft13
which has now been submitted by the Royal Government to Parliament
and to inform me verbally of your conviction
[Page 608]
that the modifications therein introduced will
have removed the grounds for the Legation’s apprehensions.
My Government has made a careful study of the draft of the proposed
mining law, including the latest modifications, with special
reference to its effects on American interests, and I am authorized
to communicate to Your Excellency their views on this subject.
While in no way desirous of intervening in matters of Rumanian
domestic legislation, the Legation deems it proper, under its
instructions, to point out in a friendly spirit certain articles of
the proposed law which seem to furnish grounds for just concern.
Article 33 (formerly 36), although apparently now modified so as to
postpone the enforced nationalization of foreign owned petroleum
companies in Rumania from five to ten years, still does not seem to
provide for foreign interests so affected adequate assurance against
virtual confiscation as a result of the application of this measure.
Moreover, Articles Nos. 237 and 241 provide for the review by the
courts of leases of oil lands, but do not appear to establish any
satisfactory principles guaranteeing the respect of rights already
acquired. Furthermore, according to Article 99, the confirmation of
such rights is made contingent on the confiscation of the plant,
without due compensation in all cases, on the termination of the
lease.
Article No. 195 providing for the acquisition by the State of pipe
lines and depriving private companies of this branch of exploitation
in connection with their enterprises, also Article 81 imposing on
foreign owned companies, forcibly nationalized, a régime of 75% of
Rumanian officials and employees who will, necessarily, not
represent the capital invested in the companies,—give rise to
serious apprehension as to the possibility of foreign capitalists
continuing in the future, under the proposed system, profitably to
operate the plants which their funds and initiative have created and
developed.
I may go so far [as?] to say that the American petroleum operators in
Rumania inform me that they fear that the proposed legislation, if
strictly enforced, would ultimately force out of existence, with
heavy financial loss, because of the foregoing and other similar
provisions, all foreign owned petroleum companies now operating in
the country. Such a consequence, aside from any question of equity,
would scarcely seem to be in keeping with the assurances given by
the Rumanian Government on various occasions in the past when it has
encouraged, and even solicited, the investment of foreign capital in
the founding and promotion of industrial enterprises in this
country.
I avail myself [etc.]
