File No. 195.1/249
The British Embassy to the Department of State
The British Embassy has received information as to the reported purchase of the German ship Dacia, of the Hamburg-American Line, now lying at Port Arthur, Texas, as a result of the outbreak of war, by certain American citizens who have applied for the transfer of the ship to the American flag.
Further information is to the effect that the purchase price is one third the nominal value, the principal purchaser is not by occupation an owner of ships, that he is interested in the metal trade and that the avowed object of the purchase is to dispatch the ship to a German port under the American flag.
The circumstances are no doubt under the consideration of the competent department of the United States Government.
In connection with this matter it becomes the duty of the British Embassy to point out that while it has been the British and American rule, under certain conditions, to accept as valid the transfer of vessels from a belligerent to a neutral flag after the declaration of war, it has also been the rule that such transactions justify the strictest enquiry on the part of the belligerent. This enquiry has been in [Page 675] the past based upon the nature of the purchase, the character and occupation of the purchaser, the composition of the crew, and above all the business on which the ship is engaged before and after the transfer.
These considerations will no doubt be familiar to the State Department but in order to prevent any possible misunderstanding the British Embassy takes this opportunity to point out that His Majesty’s Government must reserve its rights as to the recognition of the validity of the transfer of the flag under these and similar circumstances.
[Received January 5.]