Office of the Historian

893.6363 Manchuria/182: Telegram

The Ambassador in Japan (Grew) to the Secretary of State

Tokyo, April 26, 1935—5 p.m.
[Received April 26—8:50 a.m.]

93. Department’s 67, April 24, 7 p.m.

1.
After consultation today between representatives of the American and British Embassies and oil companies, including Parker, the oil companies decided to adopt the following procedure, subject to confirmation from their head offices and approval of the two Governments.
(a)
As the monopoly under the ordinance is not authorized to purchase anything other than the physical properties of former oil merchants, the oil companies will offer to sell plant and equipment, employing the form provided for the purpose.
(b)
They will not include the stocks in the offer but will attempt to withdraw these from Manchuria.
(c)
They will attach to the offer a statement to the effect that the value of the properties cannot be separated from the value of the business as a whole and as a going concern; they will state the value of the business, giving details, and ask to be reimbursed for the total sum.
(d)
They propose to file this offer and claim with the Finance Department of the Manchukuo government but ask that the Embassies simultaneously file copies with the Japanese Government, with reference to those parts of our respective representations affirming the responsibility of the Japanese Government.
2.
This Embassy perceives no objection to this proposed procedure and requests instructions including form and general phraseology of presentation.
3.
The British Embassy likewise approves of the procedure but suggests that care be taken to avoid giving the Japanese any opportunity to escape a sense of responsibility in the matter.
4.
The local representative of the Shell interests who has no authority to decide upon procedure, is referring the plan to London.

To Peiping by mail.

Grew