File No. 812.63/422

Vice Consul Coen to the Secretary of State

[Extract]
No. 140

Sir: I have the honor to transmit herewith in quadruplicate, a copy of circular Number 31,12 from the office of the Secretary of Fomento, dated February 21, 1917, making new and additional regulations regarding the operations of mines in Mexico as prescribed by the Decree of September 14, 1916. A copy of Article 5 of the Mining Law of Mexico, passed June 4, 1892, under which the great majority of the titles to mining property was taken, and which formed the basis and reason for the immense activity and development of the mining resources of that country between the date mentioned and 1910. It was the faith in the titles, which on their face appear to be in fee simple with a condition subsequent relating to the payment of taxes and referring to the above-quoted law, that led to the immense investment of American capital in the mining industry in Mexico. A translation of Circular No. 30, issued from the Office of the Secretary of Fomento, dated February 16, 1917,13 and referred to in the later Circular of February 21, 1917.

In further regard to these circulars Numbers 30 and 31, I wish to state that the circulars reached Durango on March 12, 1917, and first came to the knowledge of the British Vice Consul on the night of March 15; that they had not yet been published in the Diario Oficial or at least no copies of the official paper had yet reached the City of Durango on March 16; that knowledge of the existence of such regulations reached the City of San Antonio in copies from unofficial newspapers a few days ago and came to my attention only yesterday, yet these provisions are to be complied with in regard to the owners of some mining properties by the 18th of March.

I want to state further that the information requested under Circular Number 31, in cases of some of the larger companies having several hundred claims or properties (fundos), will require a large [Page 1052]clerical force working regularly for several weeks, since copies of all the original maps are demanded, and itemized data which must come from a thorough examination of all the titles and transfers of the properties from the time of their origin under title, must be compiled. I should add that the title papers, the original maps of the claims, and the drawings of the works, both underground and aboveground are in most cases in the United States for safety and security against destruction; and that those papers are in San Francisco, Chicago and New York, or wherever the home offices of the mining companies are located.

I believe, from my knowledge of the situation in the Durango Consular district and from what I can learn from those owning mines in that district, that the great majority have not made the petition requested in the Decree of September 14, 1916; that they did not believe the decree would ever be carried out on account of its absurdity, in so far as it might be of real benefit to the country.

It will follow that a good many million dollars worth of good mining property, some of it companies with investments from ten thousand up to several hundred thousand dollars, will be confiscated almost overnight, because the final determination of confiscation shown by the circular under discussion has not yet reached their notice, and it is required that its provisions be complied with in this class of cases by March 20. Yet notice of the circular did not reach this part of the United States until about that date.

I have [etc.]

Homer C. Coen
[Inclosure—Translation]

mining law of the republic of mexico, passed june 4, 1892, effective july 1, 1892, and repealed by the mining law of november, 1909, which latter became effective january 1, 1910

Laws of a fiscal character of 1892, unless modified by the new law, were not repealed.

Article 5. Legally acquired mining property and that which in the future may be acquired in accordance with this law, shall be irrevocable and perpetual as long as the Federal property tax has been paid in accordance with the regulations of the law by which said tax is established.

  1. See No. 23, March 14, 1917, from Ambassador Fletcher.
  2. See No. 3, February 21, 1917, from Ambassador Fletcher.