Foreign Relations of the United States, 1952–1954, Germany and Austria, Volume VII, Part 1

611.62A/4–1553: Telegram

No. 184
The Acting Secretary of State to the Office of the United States High Commissioner for Germany, at Bonn¹

secret

Washington, April 15, 1953—6:51 p.m.

4927. Reference Department telegram 4845 to Bonn repeated London 6660, Paris 5136,² and Department telegram 4867 to Bonn repeated London 6698, Paris 5162.³ Following is summary discussions which took place with German experts during Chancellor’s visit. Request you follow up scrap question discussed paragraph 6 below.

1. Treaty Friendship, Commerce and Navigation. Agreement was reached technical level on draft of short treaty reviving 1923 Treaty. Draft approved by Chancellor and being cleared on United States side.

2. Germans requested allocation substantial and specific volume off-shore procurement to producer Federal Republic. They were told that this could not be done. Full explanation manner in which off-shore procurement requirements developed and contracts placed was given German Delegation. At conclusion discussion Germans seemed satisfied that principal obstacle to expansion off-shore procurement Germany, once tax exemption problem settled, is limitation on German production military items under Industrial Controls Agreement.⁴ German Delegation said Federal Republic prepared in principle grant exemption for off-shore procurement from indirect taxes including turnover tax and hoped agreement on subject could be reached shortly. Relationship of problem to planning for arms production by European Defense Community was also pointed out to German Delegation. Believe discussion useful in clearing up misconceptions on German side regarding off-shore procurement and feeling United States discriminating against Germany.

3. End-Item Aid. Copy Nash statement referred to in Department telegram 4845 given German experts from Blank ministry and general United States approach to end-item aid explained.⁵ They were told United States aid supplements efforts by recipients and that in planning aid for German European Defense Community contingents we expected receive information regarding what European Defense Community would be able provide. We pointed out some detail relationship this question to work of European Defense Community Interim Commission. Germans said they understood we were disappointed in failure Interim Commission to go forward more rapidly in planning. They felt that work would advance rapidly once French had ratified and thought that more could be done immediately particularly if United States pressed for action.

4. Trade-marks and Copyrights. Department arranged for German experts to meet with Office Alien Property officials who explained factual situation which cleared away German misconceptions this subject. Germans appreciated fact that we could offer no relief regarding trade-marks sold United States interests. Concerning vested but not sold trade-marks we requested Germans submit list such marks which they felt were significant factor in developing German exports to United States. Germans agreed prepare such list. We were not prepared discuss copyrights since we not informed Germans wished raise subject. We stated copyrights were uniformly vested and that Office Alien Property presently held approximately 650,000 vested copyrights, but we prepared consider German views.

5. Von Maltzan raised with Linder question Vereinigte Stahlwerke trading companies referred to Chancellor’s January 28 letter (AG SEC (53) 82)⁶ and urged formation one independent company. Linder replied question had been carefully studied by Allied High Commission and that in absence new facts warranting reconsideration German request Department not in position request reopening this issue. Later von Maltzan given letter signed by Linder confirming this position.⁶

Our concern on the draft law regarding decartelization and Federal Government’s proposal terminate freedom trade and professions in United States Zone was expressed to German experts but not raised with Chancellor (Bonn telegram 4486⁷).

6. In further discussions with von MaltzanRiddleberger followed up question German inability give satisfactory assurances regarding scrap shipments to Hungary and agreement of Adenauer have problem re-examined by experts as reported paragraph 3 reference telegram. Von Maltzan stated question would have to be pursued Bonn.

7. Germans said that development German synthetic rubber being held back by:

1) Small volume German production. They asked that authorized production in Germany be expanded. In response to question they said they did not know whether applications for licenses to increase productive capacity had been filed with Mutual Security Board. No further discussion this aspect of subject.

2) Lack of access to technical data on most recent American developments. They asked United States Government permit export of data to Germany. At meeting April 13 with Macy, Director, Office International Trade, Commerce, von Maltzan informed export licenses had been granted Goodrich, authorizing disclosure technical data to Huels.

8. Germans requested that United States guarantee new United States capital invested in Germany against political risk. They were told no authority for such guarantee existed in American law and it seemed doubtful United States business would wish Government engage in guarantees other than those against loss due to nationalization and convertibility of earnings. Germans indicated they did not consider guarantees on either these points necessary to stimulate United States investment in Germany.

Smith

1. Drafted by Margolies and Reinstein, and cleared, inter alia, with Morris. Repeated to Paris for Bruce and SRE and to London.
2. See footnote 1, Document 178.
3. See footnote 1, Document 180.
4. A report on the meeting, held Apr. 10, at which the OSP program was explained to the German Delegation was transmitted to Bonn in airgram A–1549, Apr. 15. (762A.5 MSP/4–1553)
5. For Nash’s statement, see the annex to GPT MIN–2, Document 179.
6. Not found in Department of State files.
6. Not found in Department of State files.
7. Telegram 4486 reported various developments on the draft decartelization law which was at that time under consideration by the Economic Committee of the Bundestag. (862A.054/4–353)