611.60F30/5–146: Telegram
The Ambassador in Czechoslovakia (Steinhardt) to the Secretary of State
[Received 11:29 p.m.]
670. Re Embassy’s despatch No. 100 dated September 14, 1945 transmitting copies of aide-mémoire of Czechoslovak Government dated September 13, 1945,22 Embassy has now received memorandum from the Czechoslovak Ministry of Foreign Affairs, the text of which follows:
“With reference to the Embassy’s note No. 483 of December 12, 1945,23 the Ministry has the honor to state that Czechoslovakia has already started making preparations for the preliminary international conference on trade and employment at which discussions are to be held regarding the removal of obstacles to international trade.
Despite these preparations the Czechoslovak Government is of the opinion that by an arrangement between Czechoslovakia and the USA the mutual trade between both countries should, for a temporary period, be regulated on the basis of the most-favored-nation clause so that mutual trade should not suffer from the existing nontreaty conditions [Page 192] even in the transitory period until a detailed arrangement as to customs tariff rates is made.
For this arrangement to be made for a transitory period it seems expedient, according to the views of the Czechoslovak Government, that negotiations on the basis of the aide-mémoire of the State Department of 29 June 194524 be abandoned, since the said aide-mémoire contains certain proposals which are to be decided upon at the preliminary international conference on trade and employment. Negotiations relative to these questions would at present time, when economic relations with many countries are still very obscure, still require a certain time. As, however, the Czechoslovak Government greatly desires that at least a temporary agreement providing for mutual commercial relations be arrived at as quickly as possible, the Ministry of Foreign Affairs is of the opinion that through an interchange of notes in accordance with one of the two following alternatives, this aim might be achieved:
Alternative A; (the text has been taken from article XI of the former trade agreement between Czechoslovakia and the USA of March 7, 1938): ‘With respect to customs duties or charges of any kind imposed on or in connection with importation or exportation, and with respect to the method of levying such duties or charges, and with respect to all rules and formalities in connection with importation or exportation, and with respect to all laws or regulations affecting the sale, taxation or use of imported goods within the country, any advantage, favor, privilege or immunity which has been or may hereafter be granted by the USA or by the Czechoslovak Republic to any article originating in or destined for any third country, shall be accorded immediately and unconditionally to the like article originating in or destined for the Czechoslovak Republic or the USA, respectively.’
Alternative B (the usual text worked out by the former League of Nations before the Second World War): ‘The contracting parties agree to grant mutually unconditional and unlimited treatment of the most-favored-nation in regard to customs and duties and all charges connected therewith and the manner of their collection as well as the regulations, formalities and charges to which their customs system might be subject.
By virtue of this agreement the products of the soil and of industry of one of the contracting parties, imported into the territory of the other, shall not be burdened in any case by duties, taxes or charges other or higher, nor by regulations or formalities other or more onerous, than those to which products of the same nature from any other country are or may be subject.
In the same manner, the products of the soil and of industry, exported from the territory of one of the contracting parties and destined for the territory of the other, shall not be subject to duties, taxes or charges, nor to regulations and formalities more onerous, than the [Page 193] same products destined to be exported to the territory of any other country.
All advantages, favours, privileges and exemptions which are or may be granted by one of the contracting parties in the aforesaid manner to products of the soil and of industry coming from any other country or destined to be exported to its territory, shall be applied immediately and without compensation to products of the same nature coming from the other contracting party or destined to be exported to the territory of that party.
Excepted from the engagements formulated in the present agreement are the favors which are or may be granted to adjacent countries in order to facilitate trade across the boundary.’
In the notes suggested (alternative A, B) it should also be stipulated that the arrangement shall remain in force until such time as commercial relations between Czechoslovakia and the USA shall have been regulated in another way, unless it be terminated earlier by 6 months notice.
As regards the agreement concerning exposed motion picture films, reached by the exchange of notes at 18 May, 1938, the Ministry of Foreign Affairs begs—in reply to the Embassy’s note No. 727 of February 25, 1946—25 to refer to the first paragraph of its aide-mémoire No. 32.611/IV–3/45 of September 13, 1945 in which it was stated that the Czechoslovak Government considers this agreement as terminated. Although the Czechoslovak Government cannot alter its standpoint in view of the changes that have taken place in the Czechoslovak production and distribution of films since 1938 and also in view of the fact that the film agreement was made in connection with the trade agreement of March 7, 1938, which has been declared terminated by the Government of USA, it nevertheless wishes that before long an agreement be reached relative to the actual importation of American films under conditions that would be financially as advantageous for the American exporters as any that Czechoslovakia grants to any other country and such importation to be on a scale that would be of advantage to and would satisfy both parties. The Czechoslovak Government has therefore submitted to investigation the latest proposal made by the American side in this matter.
The Ministry of Foreign Affairs would greatly appreciate it if the American Embassy would kindly obtain as soon as possible the standpoint of the State Department with regard to these proposals.”
In connection with the above it is believed that this further supports the position taken in this Embassy’s telegram No. 637 dated April 26, 1946 in reply to Department’s telegram No. 360 dated April 25, 1946.26
- Despatch 100 not printed; for text of the Czechoslovak aide-mémoire of September 13, 1945, see Foreign Relations, 1945, vol. iv, p. 548.↩
- Not printed; it set forth the response of the United States Government to the Czechoslovak aide-mémoire of September 13, 1945. Instructions to deliver the note were contained in telegram 441, December 5, 1945, to Praha, Foreign Relations, 1945, vol. iv, p. 548.↩
- Foreign Relations, 1945, vol. iv, p. 543.↩
- Not printed.↩
- Latter not printed, but see footnote 21, p. 190.↩