711.60p12A/12

The Chargé at Riga (Sussdorff) to the Secretary of State

No. 5683

Sir: Referring to Mr. Coleman’s Confidential despatch No. 5523, of August 28, 1928, transmitting an unsigned memorandum from [Page 969] Mr. Balodis, Latvian Minister for Foreign Affairs, concerning the views of the, Latvian and Estonian Governments regarding drafts of the Treaty of Arbitration and of the Treaty of Conciliation between Latvia and the United States, and to the Department’s telegram No. 60, of October 20, 4 p m, 1928, in answer to this Memorandum, and confirming my telegram No. 90, of November 6, 12 noon, 1928, I now have the honor to report that I have taken up this matter again with the Latvian Foreign Office along the lines set forth in the Department’s telegram under reference and that the American Consul at Tallinn has taken up the matter with the Estonian Government under instructions from the Legation.

In this connection, I now have the honor to report that Mr. Olins, Chief of the Western Section of the Latvian Foreign Office, informed me on October 30, 1928, that in his opinion, the arguments now advanced by the American Government would probably be sufficient to remove Latvia’s objections. Mr. Olins requested, however, that the Legation ask the Department to furnish the Latvian Government with a list of the countries which have already signed Arbitration and Conciliation Treaties with the United States.

In a letter, dated October 30, 1928, copies of which are enclosed herewith, Mr. Carlson, American Consul at Tallinn, reports that Mr. Schmidt, Secretary-General of the Estonian Foreign Office, informed him on October 29 that “he did not see how the American Government’s latest arguments could change the Estonian view-point as set forth in Mr. Balodis’ memorandum.” Mr. Schmidt then explained Estonia’s reasons for proposing the amendments in question. These reasons are very clearly set forth in Mr. Carlson’s letter.

In view of the objections advanced by the Estonian Government to signing the treaty of Conciliation and the treaty of Arbitration with the United States in their present form, I should appreciate further instructions from the Department.

I have [etc.]

Louis Sussdorff, Jr.
[Enclosure]

The Consul at Tallinn (Carlson) to the Chargé at Riga (Sussdorff)

Sir: The receipt is acknowledged of the Legation’s communication of October 25, 1928, enclosing copies of correspondence with regard to the treaty of arbitration and the treaty of conciliation between Esthonia and the United States, the conclusion of which is now under consideration.

The information contained in the above communication was imparted to Mr. Schmidt, the Esthonian Assistant Minister for Foreign Affairs, on October 29, 1928.

[Page 970]

Mr. Schmidt was told that the Department desired that as many of the above treaties with foreign countries as possible should be signed before December 3, 1928, in order that they might be ready for submission on that date to the United States Senate for its advice and consideration. He was also informed of the Department’s wish that the treaties with Latvia and Esthonia should be uniform with those which have already been signed with other countries.

Mr. Schmidt gave assurances in behalf of the Esthonian Foreign Office, of the desire of the Estonian Government to enter into negotiations with the United States with the view of bringing about the conclusion of the above treaties.

He stated, however, that the treaties had been discussed by Esthonia and Latvia, and that it had been decided that they could not be accepted unless certain amendments thereto had been made, so as to cover conditions which are peculiar to these two countries.

Mr. Schmidt said that these amendments had been communicated to the American Legation at Riga by the Latvian Foreign Minister, Mr. Balodis.

At this point the arguments of the Department with regard to the proposed amendments were communicated to Mr. Schmidt, who, after having taken them into very careful consideration, said that he would not see how these arguments could very well change the Esthonian point of view. He then explained Esthonia’s reasons for proposing the amendments in question.

The first of these refers to the article in the draft of the arbitration treaty which makes provision for the settlement of disputes between the contracting parties either by The Hague Court of Arbitration or by some other competent tribunal. In the memorandum submitted to the Legation by Foreign Minister Balodis, on August 20, 1928, the reference to this matter is limited to the procedure to be followed for constituting the competent tribunals which are mentioned above. Mr. Schmidt had nothing to say on this point. His remarks were confined solely to the effect which the fact that Estonia is not a member of The Hague Court of Arbitration would have on the application of the treaty in question.

Questions referred to The Hague Court, he said, would be settled by judges selected from lists prepared by the above Court. The United States, being a member of the Court, would be able to place its own judges in this list. Estonia, not being a member, could not do this. Hence Estonia would be at a disadvantage as compared with the United States.

[Page 971]

For this reason, Estonia could not very well accept the proposed arbitration treaty until an amendment had been included to offset this disadvantage.

Speaking of the proposed amendment to the draft treaty of conciliation, Mr. Schmidt explained that this was based entirely on Estonia’s relations with Soviet Russia and, especially, to the non-aggression pact negotiations which Estonia has been carrying on with Soviet Russia for almost two years. Estonia’s objections to the non-aggression pact with the U. S. S. R., center in the proposals made by the latter country with respect to the selection of a “super-arbiter” in cases of disputes. These, according to Mr. Schmidt, are almost identical with those now being made to Estonia in the draft treaty of conciliation under consideration.

For more than two years Estonia has consistently declined to accept the Soviet suggestions as to the selection of a super-arbiter on the grounds that by reason of the absence of exact terminology as to the procedure to be followed in the selection of the super-arbiter, Estonia could not be certain that this position would always be filled by a neutral judge.

Mr. Schmidt admitted the correctness of the Department’s argument which reads as follows: “It is believed that a situation would not arise in which the two Governments would be unable to agree on an acceptable national of a third State.”

However, Estonia could not very well grant to the United States an arrangement which it has declined to concede to Soviet Russia.

The question centers around one of the most vital points in Estonia’s present foreign policy, said Mr. Schmidt. The Estonian Government must exercise very great care in this matter, and must not permit itself to be placed in a position where it is subject to attack on the part of Soviet Russia on the chargé of lack of consistency in its foreign policies.

Mr. Schmidt assured the Consulate that the Estonian Government would be most happy to enter into relations with the United States Government along the lines outlined in the draft treaties under consideration, but that this could not well be done until the amendments suggested by Estonia had been given due consideration.

The Consulate did not endeavor to urge Mr. Schmidt to accept the Department’s points of view. Mr. Schmidt was informed that the reasons he had advanced would be communicated to the American Legation at Riga.

Very respectfully yours,

Harry E. Carlson