894.512/3–2647
The Department of State to the Swiss Legation
Memorandum
The Department of State acknowledges the receipt of the memorandum from the Legation of Switzerland dated March 26, 1947,70 requesting that the American Authorities use their good offices to obtain a revision of the policy respecting the applicability of certain Japanese taxes to Swiss property in Japan. The memorandum refers to certain communications recently exchanged between the Swiss Diplomatic Mission in Japan and the General Headquarters of the Supreme Commander for the Allied Powers in Tokyo, in which it was ascertained that the enforcement measures of the Capital Levy Law and the War Indemnity Special Measures Laws do not exempt the property of nationals of neutral countries from these measures, whereas property of members of the United Nations is so exempt. It is stated further that according to information supplied to the Swiss Diplomatic Representative in Tokyo, this policy originated in Washington.
The policy to which reference is made, was established pursuant to a decision of the Far Eastern Commission, and not of the Government of the United States. Prior to this decision by the Far Eastern Commission,71 the position taken by this Government with respect to Japanese extraordinary tax laws in relation to non-Japanese individuals and corporations, was that no objection would be taken to the application of such taxes to all property in Japan, regardless of the nationality of the owner. The decision of the Far Eastern Commission was transmitted to the Supreme Commander for the Allied Powers as a basis for instructions to the Japanese Government to exempt property of members of the United Nations from this tax.
In as much as the action, in respect to the exemption of the property of members of the United Nations from the Capital Levy, was taken by the Japanese Diet, pursuant to a policy thus determined by the Far Eastern Commission, the Department of State is taking steps to transmit the memorandum of March 26, 1947 of the Swiss Legation, together with this reply, to the Far Eastern Commission for its consideration. As soon as is possible, the Government of the United States will transmit the comments of the Far Eastern Commission to the Legation of Switzerland.
[Page 209]In respect to the War Indemnities Special Measures Laws, the Japanese Government has exempted claims arising out of losses of the United Nations’ property, and has guaranteed bank deposits of United Nations’ nationals and other persons whose property was seized, confiscated or sequestered, or who were arrested or interned by the Japanese during the war, from losses arising out of the reorganization of Japanese financial institutions, necessitated by the application of the War Indemnities Special Measures Laws. This action was taken to afford protection to those persons who were denied access to and control of their property by the Japanese during the war, and it is considered consistent with the general policy that such property should be preserved and protected pending its return to the legitimate owners.