File No. 832.85/37

The Ambassador in Brazil ( Morgan) to the Secretary of State


President of Brazil yesterday issued a decree placing all German merchant vessels anchored in Brazilian ports under the Brazilian flag and directing that they be prepared for sea as soon as possible. The vessels in Rio de Janeiro harbor have already been appropriated, and others under control of Lloyd Brasileiro Company which is under the direction of Ministry of Finance. Appropriation and transfer of flag effected without opposition. Appropriation of vessels in other ports under way.