740.00119 EW/12–1745: Telegram
The Ambassador in France (Caffery) to the Secretary of State
[Received December 22—7 a.m.]
7216. From Angell No. 161. French, and Yugoslavian Delegations each submitting a memorandum to the Conference with proposals on treatment of United Nations’ property interests in German industry. These proposals are in part similar to those of Belgian and Netherlands memorandum (mytel from Angell No. 102, December 178). After lengthy discussions of these three memoranda, agreement was reached by a number of interested Delegations (mytel No. 155, December 1479). The following should be noted in reference to the agreed draft:
- 1.
- It was adhered to by all United Nations with substantial property interests in Germany other than the United States and United Kingdom. Both Waley and I took the position that the various questions involved must be considered on a quadripartite basis in ACR (Allied Commission on Reparations). (Mytel from Angell No. 112, December 6.80)
- 2.
- It was recognized that plants in which United Nations have a property interest could be used for reparation purposes when necessary for reasons of security.
- 3.
- It was suggested that property in which a United Nation has a substantial interest (over 48%) should, insofar as possible, be excluded from removals.
- 4.
- If a plant in which a United Nation has a property interest is removed it was stated that equitable compensation should be granted to United Nation concerned as a charge on the German economy.
The provisions of this memorandum leave entirely unsolved the question as to whether a United Nation property interest in a plant removed from Germany shall be maintained, either through a failure to charge the amount of the property interest to the reparations account of the nation which receives the plant, if it is allocated to the nation which has the property interest, or through some form of compensation if the plant is allocated to another nation. Interpretations of this memorandum, particularly item 5, vary greatly.
Markedly dissimilar positions taken by the Yugoslavs and the Belgo-Dutch were in some manner compromised in this memorandum which was prepared in the Drafting Committee on which the United States and the United Kingdom, for obvious reasons, were not represented. [Page 1477] This memorandum received very little discussion in meetings of the heads of delegations and Item 5 was not clarified. In conversation with members of the Belgian Delegation it appears that, in their understanding, a charge against the Belgian reparations share will not be made, if a plant in which Belgium has a substantial property interest is removed and allocated by IARA (Inter-Allied Reparation Agency) to Belgium. The meaning of the words “as a charge on the German economy” is obviously subject to widely different interpretations.
The question of a charge to reparation share must finally be resolved either by ACR or by IARA. Decision on this point has only been postponed. Nevertheless some progress was made through this memorandum which, in most respects, is not in conflict with the policy stated in Repmem 15.81
There will be no reference to this question in the final act proper. The agreed memorandum will be included in Annex III of the Final Act, and, like restitution, will be put in the form of a request to the United States and the United Kingdom to bring the views expressed to the attention of their appropriate authorities. [Angell.]