867N.5151/19
The Consul General at Jerusalem (Wadsworth) to the Secretary of
State
No. 1200
Jerusalem, January 22, 1940.
[Received
February 20.]
Sir: With further regard to the subject
noted above34 (and with particular reference to the Consulate
General’s despatch No. 1095 of
[Page 821]
September 21, 1939,35 transmitting copies of the
Palestine “Defence (Finance) Regulations, 1939”, and to the
Department’s telegram No. 1568 of December 8, 6 p.m., 1939, to the
American Embassy in London and relayed to me under date of December
15, 3 p.m., 1939, setting forth the Department’s understanding of
the exemptions to such regulations authorized by the British
Treasury in favor of American citizens living in Palestine) I have
the honor to transmit herewith, as a matter of record:
- 1)
- Copy of a note dated January 2, 1940, addressed to the
Treasurer of Palestine in which I informed him, as the
competent official of the Palestine Government, of the
substance of the Department’s telegram under particular
reference; and
- 2)
- Copy of a note dated January 18, 1940, received from the
Chief Secretary of the Palestine Government informing me,
under instructions from the High Commissioner and at the
request of the British Secretary of State for the Colonies,
“regarding the treatment accorded to American citizens under
the provisions” of the Regulations in question.
While, as was to be expected, the wording of the Chief Secretary’s
note is not identical with that of the Department’s telegram under
reference, I find, upon close comparison of the two, that they
differ in no substantial respect in setting forth the nature of the
exemptions to be accorded to American citizens “who are resident in
Palestine and who do not possess British or Palestinian
nationality.”
It may be noted that, in the similar assurances given the British
Embassy in London regarding the treatment to be accorded American
citizens resident in the United Kingdom, the phrase “American
nationals not possessing British nationality” is used, whereas in
the note addressed to me the exception is extended to cover those
not possessing British or Palestinian nationality. The reason for
this extension, I infer from a comment made to me by the Treasurer
of Palestine, is that the Regulations in question are applied
without distinction to Palestinian citizens and to British subjects
resident in Palestine.
Respectfully yours,
[Enclosure 1]
The American Consul General at
Jerusalem (Wadsworth) to the
Treasurer of the Palestine Government (Johnson)
[Extract]
[Jerusalem,] January 2,
1940.
Sir: Pursuant to my oral undertaking of
December 30, 1939, I have the honor to confirm to you that I am
in receipt of a telegraphic communication
[Page 822]
from my Government describing,
substantially in the following terms, the special treatment
accorded to American citizens, residents of Great Britain, under
the British Exchange Control Regulations:
[Here follows the substance of the telegraphic instructions to
Jerusalem included in the Department’s telegram No. 1568,
December 8, 1939, 6 p.m., to the Chargé in the United Kingdom,
printed on page 819.]
I shall appreciate highly receiving from you an assurance that,
in the application of the Palestine Defence (Finance)
Regulations, 1939, this same special treatment will be accorded
to American citizens residing in Palestine.
Respectfully yours,
[Enclosure 2]
The Chief Secretary of the Palestine
Government (Macpherson) to the
American Consul General at Jerusalem (Wadsworth)
SF/894/39
Jerusalem, 18 January,
1940.
Sir: I am directed by the High
Commissioner to refer to certain enquiries which have been
addressed to His Majesty’s Government in the United Kingdom by
the Embassy of the United States of America, regarding the
treatment accorded to American citizens under the provisions of
the Defence (Finance) Regulations, 1939, and to inform you that
His Majesty’s Principal Secretary of State for the Colonies has
requested that you may be acquainted in the following sense.
2. American citizens who are resident in Palestine and who do not
possess British or Palestinian nationality will be exempted from
declaring securities whether acquired before or after the date
of the coming into force of the Regulations, except securities
acquired subsequent to that date from a person subject to the
Regulations or acquired out of or in lieu of a balance not
exempted from surrender as explained below, save that in the
case of securities acquired from residents: exemption may be
granted provided the full consideration paid is in foreign
currency and is surrendered to the Controller of Foreign
Exchange by the resident seller.
If such an American citizen desires to export securities from
Palestine, permission for export would have to be obtained in
the usual way, and in dealing with applications for such
permission the Controller of Foreign Exchange would require to
be satisfied that the application had been exempted under the
arrangements allowing American citizens to retain their
securities.
[Page 823]
3. American citizens will not be called upon to surrender foreign
currency balances acquired before the date when the Regulations
came into force nor balances acquired after that date provided:—
- (a)
- that the acquisition of these balances has not been in
contravention of other sections of the Regulations, and
in particular has not resulted from sales of sterling or
local currency balances for which permission must be
obtained; and
- (b)
- that balances have not been acquired in the course of
current trade or similar transactions.
4. I am to say that in accordance with the request made in your
letter to the Treasurer of the 2nd January, the Controller of
Foreign Exchange has been instructed to proceed in this matter
on the lines described in paragraphs 2 and 3 above.
5. I am to request that the information contained in this letter
may be regarded as confidential except in so far as it may be
necessary for you to inform American citizens, who may apply to
you, of such portions of it as may seem to apply in each
particular case.
I am [etc.]
J. V. W. Shaw
for Chief Secretary
