Ambassador Meyer to the Secretary of State.
St. Petersburg, April 28, 1905.
Sir: I beg leave to report that when presenting to the minister of foreign affairs my letter in relation to the discriminating duties imposed by the minister of finance in June, 1901, copy of which I inclosed in my dispatch dated April 17, No. 7, I suggested that there would be much time saved if I could take this matter up directly and informally with Mr. Timiryazeff, privy councilor and assistant to the minister of finances, pending official reply of the foreign office. The suggestion was readily accepted by Count Lamsdorff, as he confessed the subject was a technical one with which he was not familiar.
In my first interview with Mr. Timiryazeff the whole subject was discussed in a general way. According to his views, Russia has two grievances:
The first, one of principle, i. e., that a duty should not be changed without consultation of both countries when they are carrying on their trade subject to the clause of the most-favored-nation tariff treatment.
Secondly, the contention that Russian sugar received a bounty.
In the latter case I pointed out that the action of the Government of the United States was not actuated by any thought of retaliation, nor attended by any element of discrimination against Russian commercial interests, the board of appraisers having decided that an assessment of countervailing duties must be put on imports of Russian beet sugar in pursuance of the mandatory provision of section 5 of the United States tariff act, approved July 24, 1897. It is, however, if I might be allowed to say so, a regrettable fact that the tariff measures adopted by the Russian Government in relation to American commerce have been avowedly retaliatory and discriminating.
Mr. Timiryazeff called to my attention that the action of Mr. Witte, minister of finance, increasing the duty on certain products of American manufacture, was published February 15, 1901:
About two or three weeks later of the same year, the minister of finance of the United States, by a circular, explained to the collectors of the port, in reply to their inquiry about the amount of duty to be paid for paraffine, when imported from England into the United States, that in conformity with article 626 of the custom tariff of the United States, naphtha and its products are duty free. But as the English petroleum is apparently made from Russian, and, according to the Russian custom tariff, naphtha and its products brought into Russia pay duty—by reason of this, the above-mentioned article is to be considered as naphtha of Russian origin, manufactured in England, and hence imported into the United States, and, as an article of import from Russia, is to be charged with duty in the same proportion as naphtha imported into Russia.
All invoices of naphtha imported into the United States are to be duly supplied with United States consular certificates warranting the place and country of their origin.
I then replied that, although I had not the tariff of 1897 on our files in the embassy, I was sufficiently familiar with it to state that this regulation applied equally to any country which imposes a duty on petroleum or its products exported from the United States. His answer was, “That is oppressive, and not based on an economic system.”
At my second interview (both interviews having been carried on in a most friendly manner) Mr. Timiryazeff assured me that in a conversation with a compatriot of mine he had expressed himself as being [Page 804]willing to try and find some way of removing the extra duties on American products, and thus stimulating mutual commercial intercourse. He had not, however, intended to imply that the United States would not have to remove any duties. The privy councilor presented me with two copies of the Russian-German treaty of July, 1904. He suggested that possibly we could draw up a commercial treaty that would be satisfactory to both countries. I assured him that the possibilities of making a commercial treaty in the United States at the present time were very vague. Mr. Timiryazeff then intimated that it might be arranged by a simple exchange of notes; that he realized the present discriminating customs duties upon certain American products of manufacture were not only a detriment to American trade, but, as I pointed out, worked to the advantage of certain other countries and to the disadvantage of Russia, by making it impossible for her, at times, to buy in the cheapest market.
His wish, he said, was to build a bridge, no matter how light, that we might cross in order to come together. If the United States would make small concessions, Russia would make great ones. He felt confident that the full benefit of most-favored-nation tariff treatment could be restored to all imports from the United States, if such a clause as Article 6 on page 3 of the Russian-German treaty could be agreed upon. Russia would then recognize the right of the American Government to impose an additional tax upon sugars exported from Russia and imported into the United States, as shown in the protocol on page 10 of the Russian-German treaty (the Brussels convention not applying to the United States).
Mr. Timiryazeff again referred to the duty on paraffine as being an order of the Secretary of the Treasury and not a decision of the board of appraisers, and could therefore be rescinded. I stated that, while not familiar with the case, it was my personal opinion that it was mandatory under provisions of section 626 of the United States tariff act approved July 24, 1897.
In all probability, no official reply will be made to my note addressed to the foreign office until I report to Count Lamsdorff the result of my pourparlers with Mr. Timiryazeff. Before doing so, I await your instructions.
I have, etc.,