File No. 863.852/299
The Acting Director of the Bureau of Enemy Trade, War Trade Board ( Fuller), to the Counselor for the Department of State ( Polk)
[Received May 23.]
Dear Sir: We are in receipt of an application from Phelps Bros. & Co., of New York City, for license to transmit an amount not exceeding $800,000 to Fratelli Cosulich, Vienna, Austria, for account of the owners of the following ships: Virginia, Erodiade, Borneo, Budapest, Franconia, Himalaia, Campania, Morowitz.
These ships were sold last summer by Phelps Bros. & Co. acting as agents for the Austrian owners, to the Kerr Navigation Co., and we understand that it was one of the terms of the sale that the purchase price was to be remitted to the Austrian owners, and that the Government sanctioned this arrangement.
In addition to the price fixed, it was agreed that if the former Austrian owners released certain covenants restricting the trading limits of these ships, an additional sum of $15 per ton should be paid by the purchaser. Subsequently this release was given by the Austrian sellers, and the above-mentioned sum of approximately $800,000 thereupon became due.
The Shipping Board at first requested that we withhold for the time being the issuance of the license to remit the additional $800,000, because of certain other transactions then pending. To-day, however, we are in receipt of a letter from the Shipping Board stating [Page 457] that it now sees no reason why the license should not be granted. License was sometime ago issued to Phelps Bros. & Co. to remit the original purchase price of these ships to Austria.
Since we are informed that you are familiar with the original arrangement in regard to the purchase of these ships and the remittance of the proceeds, we write to request your recommendation as to the desirability of allowing this further remittance to go forward.
Very truly yours,
By