Papers Relating to the Foreign Relations of the United States, The Paris Peace Conference, 1919, Volume X

Paris Peace Conf. 180.0501/25

Supreme Economic Council: Twenty-fifth Meeting Held at the Ministry of Commerce [on 30th June, 1919, at 10 a.m.]

June 30, 1919, 10 a.m.

The Supreme Economic Council held its Twenty-fifth Meeting on Monday 30th June 1919, at 10 a.m. under the Chairmanship of Lord Robert Cecil.

The Associated Governments were represented as follows:—

United Kingdom:	Mr. Wise,
	Sir Wm. Goode,
	Mr. Waley,
	Mr. Barrie.
United States:	Mr. Hoover,
	Mr. Gordon,
	Dr. Taylor,
	Mr. Dulles,
	Mr. Riley.
France:	M. Clémentel (part time),
	M. Loucheur,
	M. Claveille,
	M. Vilgrain,
	M. Seydoux,
	M. Celier (part time).
Italy:	Signor Crespi,
	Commendatore Attolico.
Belgium:	M. Jaspar,
	M. de Cartier de Marchienne,
	Lieut. Col. Theunis.

240.

The Minutes of the Twenty-fourth Meeting were approved.

241. Allied Economic Co-operation After Peace.

With reference to Minutes 216 and 238, memoranda from the American (217) and French Delegates (218) dated 22nd [sic] and 28th June respectively were submitted.

In this connection the following decision reached by the Council of Heads of States at their Meeting on 28th June was reported:—¹

“That in some form international consultation in economic matters should be continued until the Council of the League of Nations has had an opportunity of considering the present acute position of the economic situation, and that the Supreme Economic Council should be requested to suggest for the consideration of the several Governments the methods of consultation which would be most serviceable for this purpose.”

It was agreed that the Committee on Policy should consider and report to the Council as soon as possible upon the best means of carrying into effect the decision of the Council of Heads of States and that the Committee should meet in Paris or London as might be more convenient.

242. Removal of Blockade on Germany.

(i) A Minute of the 31st Meeting of the Blockade Section held on 25th June (219) embodying proposals for the termination of the restrictions upon trade with Germany was submitted and approved.

(ii) The instructions (220) given by the Council of Heads of States to the Blockade Section^1a to the effect that the arrangements for rescinding restrictions upon trade with Germany should be based upon the assumption that the Blockade will be raised immediately on the receipt of information that the Treaty of Peace has been ratified by Germany, were noted.

(iii) In connection with the above decisions the position, as regards censorship and the execution of the Brussels Agreement, was considered.

It was agreed:—

(a) As regards censorship, that a communication in the following sense should be sent by the Delegates present, to the representatives of their respective Governments on the Council of Ten:—

“The Supreme Economic Council desires to have instructions from the Council of Ten as to the removal of the censorship. It is the personal view of the majority of the members of the Supreme Economic Council that the censorship should be removed co-incidently with the removal of the blockade which, as indicated in the note from the Council of Heads of States of 26th June, should be raised upon the ratification of the Treaty of Peace by Germany.

The Supreme Economic Council would be glad to receive instructions upon this matter.”

(b) As regards the execution of the Brussels Agreement, and the other Agreements entered into with Germany under the Armistice, that the Sub-Committee on Germany should be instructed to examine the position and inform the Council what action, if any, will be necessary in connection therewith, in the event of the blockade on Germany being raised.

243. Blockade of Hungary.

With reference to Minute 225 a letter dated 26th June (221) reporting that the Council of Heads of States had decided to authorize the raising of the Blockade on Hungary as soon as Hungary has complied with the requirements of the Allied and Associated Governments, was noted and referred to the Blockade Section.

244. Allied Economic Policy in Russia.

The Council had before them memoranda from all the Sections regarding the extension of the operations of the Supreme Economic Council to include Russia, as follows:

(a) Food	(198)2
(b) Communications	(209)3
(c) Finance	(222)
(d) Shipping	(223)
(e) Raw Materials	(224)

It was agreed that a special Sub-Committee should be appointed to consider in detail the memoranda put forward by the Sections, and co-ordinate the proposals made therein and that the Delegations should appoint their representatives on the Sub-Committee as soon as possible.

245. Railway Assistance to Bulgaria.

A Minute from the Communications Section (225) regarding the allocation of responsibility for assisting in improving the railway transport facilities in Bulgaria, was considered.

It was agreed that, as no urgent demands for assistance had been received, the matter did not call for immediate action by the Council. There was no objections, however, to the Italian Government despatching liaison officers to be attached to the French Military Mission in charge of the Bulgarian railways.

246. Use of Ex-Enemy Tonnage.

(i) Note from the Belgian Delegates (226) regarding the port of discharge of German vessels carrying foodstuffs purchased by Germany in the Argentine through the Agency of the Compañía Mercantil, was submitted and referred to the Allied Maritime Transport Executive for examination and report.

(ii) A Note from the Belgian Delegates (227) referring to the decision reached by the Council at the Meeting held on the 12th May with regard to the allocations to Belgium for management of a number of German ships, was considered.

It was agreed to refer the note to the Allied Maritime Transport Executive for action in consultation with the Belgian representatives, on the understanding that in the event of a disagreement the matter was to be submitted to the next Meeting of the Council.

(iii) Proposals (228) put forward by the British Delegates regarding the allocation and management of ex-enemy tonnage until the final ownership is decided in pursance of the terms of the Treaty of Peace, were considered.

It was agreed:—

(a) that, in view of the anticipated early visit of the principal Delegates to London, it should be proposed to the Allied Maritime Transport Executive that a special meeting should Be held on their arrival to discuss these problems.

(b) that it should be recommended to the Allied Maritime Transport Executive that when ex-enemy tonnage is being re-allocated for management, the division should be made as far as possible, on the basis of the terms of the Treaty of Peace as regards the final disposition of the boats.

In accepting the above decisions the following reservation was made:—

The American Delegates stated that the United States Government had undertaken to repatriate a number of Czecho-Slovakian refugees at Vladivostock and that their Government would require to use for this purpose the ex-enemy passenger tonnage now being used for the repatriation of American troops;

The French Delegates called attention to their urgent needs of cargo tonnage for coal and wheat and of passenger tonnage for their essential repatriation and colonial services.

The Italian Delegates requested that in the re-allocation of ex-enemy passenger tonnage due regard might be had to the requirements of the Italian Government in respect of the repatriation of Italian emigrants, particularly refugees in Macedonia.

247. Gold Deposit at Vienna by Hungarian Syndicate as Security for Foodstuffs To Be Supplied to Hungary.

With reference to Minute 227 the following decision reached by the Finance Section at their Meeting on 27th June was noted and approved.

“It was agreed that the three million gold crowns in question should be sent to the Bank of Italy at Trieste and should remain there and not be removed except on order of the Italian Treasury who would only act on the authority of the Allied and Associated Governments.”

248. The Danube Situation.

(i) The Director General of Belief referred to the impossibility of maintaining adequate communication with the States adjacent to the Danube until such time as an arrangement was made whereby the passage of goods through Hungary could be facilitated and urged upon the Council the imperative necessity for ensuring that some immediate action would be taken in order to prevent an economic disaster.

It was agreed that the Director General of Relief should prepare a statement of the position for submission to the Council of Ten, recommending that immediate steps should be taken to alleviate the present situation.

(ii) With reference to Minute 231, amended resolutions from the Inter-Allied Danube Commission (229) and draft resolutions submitted by the Communications Section (230) regarding the arrangements to be made for control of the Danube traffic until the execution of the terms of the Treaty of Peace, were submitted and approved.

The French Delegates requested that their reservation to the effect that “the final decision would be subject to any objections raised by the High. Command or by the Foreign Offices of the several Countries represented on the Inter-Allied Danube Commission”, might be placed on record.

249. Consideration of Economic Problems Arising in Connection With the Treaty of Peace.

The French Delegates referred to the probable necessity for constant discussion between the Delegates of the Allied and Associated Governments and the German Delegates regarding economic problems which would arise in connection with the execution of the Treaty of Peace. They pointed out that the Reparation Commission provided for by the Treaty had not yet been established and that some of the problems needed immediate attention.

It was agreed that the Council should take no action regarding this matter it being their view that the problems referred to by the French Delegates would more properly be dealt with by the existing Reparation Commission under the Peace Conference, rather than by the Council.

Appendix 217⁴

American Note on Suggestions of Various Allies as to Economic Co-operation After Peace

With respect to the note by the British Delegation,⁵ the American Delegates would like to observe as to paragraph 2, that they cannot at all agree with the constructions placed on the expressions in the Treaty with regard to German supplies. Such construction will imply the rationing of Germany over a term of years the establishment of priorities, and a control over commercial relations of Germany, and by agencies outside the Separation Commission which are in contradiction to the spirit of the Treaty, and the American Delegates who were members of the Committee, who settled these phases of the Treaty, absolutely repudiate any suggestion that such intention was ever discussed or determined. They also find themselves in entire disagreement with many other propositions contained in the note. They simply want to record the fact that they do not accept the propositions laid down.

With respect to the French propositions,⁶ they wish to observe that from a historical point of view co-operation in economic measures between the nations engaged against Germany have grown gradually since the beginning of the war, and do not take their root in any particular document or agreement. The organisations for this purpose have expanded and contracted with the problems to be met. Many forms of organisation have already been abandoned and new ones created as necessities suggested, nor are any of the arrangements entered into in any way obligatory of continuation after the signature of Peace. The American Delegation wishes to place on record the fact that so far as the United States is concerned all economic arrangements binding the American Government fall absolutely with the Peace signature, and bear no relation to any subsequent arrangements that may be entered upon, which must be of world character and not limited to a particular block of nations.

As to the role of the various executives and sections now extant, they cannot agree to any participation in the continuation of these bodies except in the sheer sense of liquidation at the earliest possible moment.

H. Hoover

June 27 [sic?], 1919.

Appendix 218

Memorandum From the French Delegation on National Control Policy

The French Government, owing to the complete suppression by the United States of all measures of control, has given complete freedom to exports, the only reservation being that of laws connected with trading with the enemy.

The French Government has also, by a recent decree, permitted the importation of the majority of products, freedom of import which will very shortly be extended to almost all goods.

This has been done in accordance with the desires constantly expressed by the American and British Delegates on the Supreme Economic Council.

But the Allies, as a whole, have not taken corresponding measures, and the situation created in France by the maintenance of national control in other Allied countries is extremely grave.

Two instances of this stand out clearly and are as follows:—

Coal.—England instituted a control of coal which enabled her to supply the Allies with coal at the same price as that used for national consumption.

At present the only person profiting by it is the English consumer. The French purchaser pays 60 to 80 f. o. b. more than the English buyer. Further, France is compelled, owing to the destruction of her mines, to turn to England for supplies.

Moreover, the freight rates to France are now extremely high, owing to the control of tonnage by the British.

A limited price was fixed by the Franco-English agreement of December 1918, but this price is very high and it is impossible to charter under it owing to the restrictions imposed on the ships carrying coal to Dunkerque, for example, to go to Bilbao to carry a cargo of ore for England at a ridiculous price.

The result that this has on the French metallurgical industry is that she pays an exorbitant price for her coal, whereas the English industry buys coal and ore at a very low price.

Freight.—When a quarter of wheat is sent from New York to Liverpool, one has to pay 9s.; from New York to Le Havre, 15s. For a ton of wheat 110s. from Australia to England; France cannot even find ships at 250s.

France cannot get the necessary ships to carry the stocks in her Colonies which are deteriorating on the spot, and is compelled to purchase in England the same commodities coming from the English Colonies.

Besides, the French trade has always had need of British tonnage, now more than ever, since the war has reduced considerably French tonnage.

Other instances could easily be given of similar differences in the price of a number of essential products.

Import restrictions produce the same disastrous results.

Consequently the French Delegation desire:—

1. That the Supreme Economic Council draw the attention of the Heads of Governments to the gravity of the situation resulting from the want of balance at present existing, and of the necessity, having regard to the circumstances, of returning to a uniform condition of freedom.

2. That the Council recommend, as being absolutely necessary, the Allied and Associated States to guarantee between them freedom to purchase, at equal prices and conditions, all products and materials coming from their respective territories, as well as permission to use under the same conditions, the means of transport under their control or at their disposal; also mutually to guarantee permission to import and export.

3. That, if in certain exceptional cases national control is maintained by any one of the Allied countries, this country should take all necessary measures in order that the other Allied countries should not suffer therefrom.

Appendix 219

[Minute of Meeting of the Blockade Section Held June 25, 1919, Regarding] Termination of Restrictions Upon Trade With Germany

The Council adopted the following resolutions:—

Resolved.

“That, in accordance with the decision of the Supreme Council of the Principal Allied and Associated Powers, the Superior Blockade Council recommend that the War Trade Board, in the case of Norway and Denmark, and the Governments of Great Britain, France and Italy in the case of Sweden, and the said Governments in conjunction with the War Trade Board in the case of Switzerland and Holland, shall at once instruct their representatives in the respective countries to arrange, if possible, for the termination of the General Agreements with those countries by mutual consent upon such date as may be fixed by the Supreme Council; or failing consent by the neutral parties to such termination, to give upon the date fixed as aforesaid formal notice to terminate said agreements; and the Council further recommend that the Governments of Great Britain, France and Italy, and the War Trade Board, in the case of agreements to which they were not principal parties, but merely adhered, shall instruct their respective representatives to advise the neutral parties to such agreements of their concurrence in the proposal of the principal Allied parties to the agreements to terminate the same.”

Further resolved.

“That in regard to other matters affecting the liquidation of the blockade, such as the termination of sundry Blockade Agreements, including the various agreements between the British and General Trading Association, Limited, and certain bodies in Holland, the Council entrusts to the Allied Blockade Committee, the Inter-Allied Commission, Berne, and the Comité du Blocus de l’Orient in the case of the northern neutrals, Switzerland and the East respectively, the duty of taking into consultation with their Governments any measures necessary to carry into effect the above decision of the Supreme Council of the Principal Allied and Associated Powers.”

Further resolved.

“That the Council adjourn sine die.”

Appendix 220

Decision of Council of Heads of States [Regarding] Removal of Blockade on Germany

The Superior Blockade Council is instructed to base its arrangements for rescinding restrictions upon trade with Germany on the assumption that the Allied and Associated Powers will not wait to raise the blockade until the completion of the ratification, as provided for at the end of the Treaty of Peace with Germany, but that it is to be raised immediately on the receipt of information that the Treaty of Peace has been ratified by Germany.

• W. W.
• G. C.
• D. Ll.-G.
• N. M.
• S. S.

June 26, 1919.

Note.—On the 27th June the Council agreed that the above decision should be notified to the Germans by the President of the Peace Conference on behalf of the Allied and Associated Governments immediately after the signature of Peace.⁷

Appendix 221

[Letter From Sir Maurice Hankey Embodying] Decision Reached by Heads of States Regarding the Blockade of Hungary

The Council of the Principal Allied and Associated Powers this morning had before them a proposal which had been forwarded to President Wilson by Mr. McCormick,⁸ recommending that—

• After the Treaty of Peace has been accepted and signed by Germany;
• After the Bela Kuhn Government of Hungary has withdrawn its military forces within the lines fixed by the Allied and Associated Powers;
• After the Bela Kuhn Government of Hungary has suspended military operations against surrounding States, as specified by the Allied and Associated Powers;

the blockade of Hungary be raised in the same manner as has been done for German Austria, to permit shipments of food, raw materials, animal products, manufactured articles, and all ordinary commodities, excluding, however, all implements of war, gold, securities or other values, which would reduce the power of Hungary to complete such reparations as may be imposed upon her.

It was agreed that the Superior Blockade Council should be authorised to carry out this recommendation as soon as they are notified by the Allied and Associated Powers that Hungary has actually complied with the requirements of the Principal Allied and Associated Powers.

I am directed to communicate the above decision for your Excellency’s information in order that the Superior Blockade Council and other interested parties may be notified, and in order that the necessary notification may be made to the Superior Blockade Council if and when Hungary actually complies with the requirements of the Principal Allied and Associated Powers.

Believe me [etc.]

M. P. A. Hankey

June 26, 1919.

Appendix 222

Report of the Finance Section on the Extension of the Operations of the Supreme Economic Council To Include Russia

1. Importance of Assistance to Russia.

It must be borne in mind that no Government can hope to keep in power in Russia and to avoid fresh civil wars unless it is able substantially to improve the economic condition of the country. This aspect of the matter is at least as important as questions of a purely military character. The financial assistance which would probably be required by any Government which may establish itself in Russia is dealt with below.

The Finance Section wish to point out that the relief funds of the United States and the United Kingdom are almost exhausted, and the French relief fund entirely so. It is therefore an urgent matter for the Governments concerned to consider what further financial provision will be required to assist Russia in order that Parliamentary sanction may be asked for whatever funds are decided to be necessary.

2. Financial Requirements.

(a) The Food Section have reported that it would cost 30,000,0002. a year to finance a relief programme for Russia. It is understood, however, that Russia should be self-supporting as regards food to a large extent if stable Government and transport were restored. It is not therefore considered that any large financial provision need be made for food supplies.

(b) The Communications Section stated that the immediate requirements for the whole of European Russia would cost 8,000,000l. It is understood that the requirements for the parts of Russia at present occupied by the Anti-Bolshevik Government would cost 2,000,000l. to 3,000,000l. Of this, 500,000l. to 1,000,000l. has been promised by the British War Office for the area occupied by General Denikin. It is important to realise that delay in meeting these demands involves a much greater expenditure hereafter.

The Siberian Railway is already being supervised by an Inter-Allied Committee, and financial assistance is being given by the United States, British, and Japanese Governments. The British Government have also allocated 500,000l. for railways in Poland.

(c) The report from the Raw Materials Section has not yet been received.

(d) Currency reorganisation.

The complete disorganisation of Russian currency is undoubtedly one of the chief obstacles to the resumption of trade and normal conditions.

The rouble—which is worth 2s. at par—fell to 5d. in the beginning of 1919, and has now fallen to 2d. to 1 1/2d.; the reasons for this depreciation are:—

1. The issue of vast quantities of Imperial and Kerensky rouble notes by the Bolsheviks.

2. The issue of large quantities of paper money made in America by the Omsk Government.

3. The prohibition of export and import of roubles in most countries throughout the world.

4. The lack of exports from Russia owing to political and transport conditions.

There are numerous varieties of rouble notes in circulation, the Czar rouble, the Kerensky rouble (at a depreciation of 10 to 20 per cent, in different parts), the Omsk Government rouble, manufactured in America (at a depreciation of 15 to 20 per cent., as against Czar and Kerensky roubles in Siberia), and innumerable local issues, of which there are no less than thirty-two in South-East Russia alone.

The only solution of the difficulties will probably be found to lie in a currency reorganisation scheme, under which all existing currency will be called in and a new paper currency issued at the rate of, for example, one new rouble for ten existing roubles, and considerable dollar and sterling loans to the Russian Government to assist in the provision of foreign exchange.

The Finance Section are decidedly of opinion that:—

(a) No attempt can be made to deal with the problem until Russia is freed from civil war, and

(b) The initiative should come from the Government of Russia and not from any outside Powers.

It should, however, be realised that this problem will require to be very speedily dealt with as soon as Russia is freed from civil war, and that a large measure of financial assistance will inevitably be required.

3. Co-operation.

The problem of assisting Russia is much too great for any one Power to tackle alone, and it will have to be faced by all the Governments concerned in close co-operation. It is essential that a concerted policy should be framed as soon as possible and suitable methods of cooperation worked out.

June 24, 1919.

Appendix 223

Note From the Allied Maritime Transport Executive [Regarding] Allied Economic Policy in Russia

With reference to the Supreme Economic Council Minute 212, regarding the economic policy to be adopted as regards Russia in the event of the re-establishment of a stable Government, I am instructed by the Allied Maritime Transport Executive to inform the Supreme Economic Council that, in the view of the Executive, it appears that the question of relief in Russia is primarily one of food and finance, and that in the absence of estimates as to the extent of relief contemplated, the Executive are not in a position to say how the use of ex-enemy tonnage would be affected thereby.

On behalf of the Executive I am also desired to point out that the only tonnage under their control is ex-enemy tonnage, and on conclusion of Peace this tonnage will in due course be divided between the Associated Powers for final ownership, with the result that the Allied Maritime Transport Executive will not have the same control over their employment as they now possess.

C. C. Barrie

June 26, 1919.

Appendix 224

Extract From Minutes of an Informal Meeting of the Raw Materials Section [Regarding] Allied Economic Policy in Russia

Continuation of the discussion of the effect of the inclusion of Russia within the scope of the activities of the Supreme Economic Council.

Mr. Baruch stated that, so far as the United States were concerned, the Delegation in Paris had no authority to take any action in this matter, and it would be necessary to consult Washington before any definite decision could be taken. Mr. Baruch added that the solution of the financial problem, which appeared to him to be the most important side of the question, would, in all probability, go a considerable way towards settling the difficulties of the supply of raw materials in Russia. He gave it as his opinion that the declaration of Peace would, in all probability, bring about a considerable reduction of freight rates, and a consequent lowering of prices in Europe.

Major Bemelmans referred to the statement which he was preparing, more particularly in connection with the requirements of Belgian firms in the Donetz basin, and in other parts of Russia, and enquired whether there would be any objection to the submission of this report, when ready, to the Supreme Economic Council.

Mr. Baruch was of the opinion that the collection of information on the problem might be of considerable use if and when any executive action were decided upon.

It was resolved that the Section should report to the Supreme Economic Council that the work of the Raw Materials Section, as regards the reconstruction of Russia, could not in the present circumstances go beyond the collection of data and the exchange of information on the subject, with a view to the speedy execution of Inter-Allied policy, if and when such common executive action were decided upon.

June 26, 1919.

Appendix 225

Minute From Communications Section [Regarding] Railway Assistance to Bulgaria

(a) The Italian representative, referring to Minute 47 of the eighth meeting of the Supreme Economic Council,⁹ of date the 17th March, 1919, requested that this matter should be again brought forward by the Communications Section to the Supreme Economic Council for a decision.

(b) The American representative called attention to the fact that, as no reports on the importance of economic railway conditions had reached the Section, and in view of the probable short existence of the Supreme Economic Council and its composite sections, he could not see the advisability of sending out an economic mission at this late date.

(c) It was agreed that the matter should be referred to the Supreme Economic Council as an Italian request.

Appendix 226

Note From the Belgian Delegation [Regarding] Relief Supplies Purchased by Germany in America [Argentina] Through the Compañia Mercantil

Item 7 of the Agenda of the meeting of the Supreme Economic Council held on the 23rd June refers to a report from the Freight Committee of the Food Section, regarding the use of enemy tonnage.¹⁰

In paragraph 7 of the report it is stated that a part of the German tonnage has been utilised for the transport of food supplies purchased by Germany in the Argentine through the agency of the Compania Mercantil; the Company in question effected these purchases through their agents, M. W. Müller & Co., at La Haye.

In this connection it is thought possible that the German tonnage thus utilised will be diverted to Dutch ports instead of to Antwerp.

The Belgian Delegation, therefore, begs the Supreme Economic Council to do all in their power to ensure that a part, at least, of the tonnage be diverted to Antwerp.

Appendix 227

Note From the Belgian Delegation [Regarding] Management of Enemy Merchant Tonnage

At its meeting held on the 12th May the Supreme Economic Council decided:—¹¹

(a) That the Belgian Government should be requested to provide the Transport Executive, at the earliest possible date, with full details regarding the number of Belgian officers, engineers, and seamen now seeking employment.

(b) That the Transport Executive should endeavour to use these crews for manning the ships at present unallocated.

(c) That if, after the completion of these arrangements, the Belgian Government are dissatisfied with the division made, the matter shall, at their request, be reconsidered by the Council.

In accordance with these decisions, the Belgian Government informed the Transport Executive that they were willing to supply a minimum of ten complete crews, and requested, therefore, the management of ten German ships.

Up to the present, however, the Transport Executive are only disposed to allow Belgium the management of three German ships, which were previously managed by the British, and one German ship now under French management.

In accordance with the decision arrived at by the Supreme Economic Council in Clause (c) above, the Belgian Delegation requests the Supreme Economic Council to be good enough to reconsider the question of the division of management of German tonnage, in order that, if possible, a number of German ships equal to the crews which Belgium can furnish may be allocated to her for management.

Appendix 228

Proposals Relating to Enemy Tonnage To Be Put Forward by the British Representatives

Enemy ships delivered to the Allied and Associated Governments by Germany under the Armistice arrangements shall continue to be managed by the country at present managing them until the final ownership is decided, in pursuance of the Treaty of Peace, subject to the following conditions:—

1. Cargo vessels.

(a) It shall at once be ascertained from the German Government which of the ships able to deliver cargoes in Germany by the 31st August are still required and can be financed by the German Government. The Allied and Associated Governments shall be free to dispose of any boat not required by Germany, the Germans being definitely so informed.

(b) That German tonnage up to the amount required for German food to be delivered by the 31st August shall be employed for this purpose.

(c) All surplus German tonnage shall be directed by the managing country until the final division is made, subject to the general supervision of the Allied Maritime Transport Executive.

(d) Up to the date at which the ownership of a vessel passes to the Reparation Commission, hire, at net Blue Book rates, shall continue to be payable to the German Government.

(e) From that date hire shall be paid at commercial net rates to a Central Allied Fund, to be held in trust ship by ship for the country to which the vessel is finally allotted. It is suggested that this central fund should be the fund at present administered by the Allied Maritime Finance Committee, who, for this purpose, should act on behalf of the Reparation Commission.

(f) The Government using a ship before handing it over to another Government to which the ship has been allotted for ownership shall be liable to the Reparation Commission for the expense of reconditioning. Where a vessel has been managed by more than one Government, the expenses of reconditioning shall be allocated between them by the Reparation Commission.

2. Passenger vessels.

As repatriation of troops, prisoners of war and refugees is not yet completed, any enemy passenger vessels allotted to any country in pursuance of and for the purposes indicated in the resolutions of the Allied Maritime Transport Council which may cease to be required for the prescribed services by that country shall be placed by that country at the disposal of the Allied Maritime Transport Executive for reallocation.

The financial arrangements as regards hire and reconditioning to be similar to those for cargo boats.

The foregoing resolutions relate primarily to German tonnage, but will apply equally to Austrian tonnage, it being assumed that there is a corresponding obligation on Austrian tonnage to be used for non-German relief up till the 31st August. Austrian cargo vessels shall be employed on the same principles as proposed for German cargo vessels, and Austrian passenger vessels shall be available for the specified repatriation purposes as long as required.

Appendix 229

Amended Resolution of Inter-Allied Danube Commission

1. In the navigable waters of the Danube River System all craft, whether captured, requisitioned or taken under the Armistice and not already entrusted to an Allied Power shall, except as needed for military purposes, be under the control of the Inter-Allied Danube Commission until other dispositions are made conformably to the Treaties of Peace. The Commission shall cause such craft to be employed for the furtherance of commerce by operating them under the Inter-Allied flag or by arranging for them to be operated under other flags and upon conditions approved by it.

2. International services conducted by the instrumentality of any Danubian State or by any subsidised or unsubsidised company or individual are to be operated in accordance with such rules and regulations as the Inter-Allied Danube River Commission may approve or prescribe.

3. Pilots and pilotage shall be regulated by the Commission, which shall have power to fix and collect charges for pilotage and other services rendered and for the carriage of passengers and freight in craft operated under its flag or control.

4. The Commission shall have power to make works of repair and improvement calculated to facilitate or increase navigation and to requisition or lease such harbour facilities and quarters on land as it may deem necessary to the performance of its work. It shall exercise such powers in accordance with the regulations that govern any Allied military forces in the particular locality.

5. This resolution shall not affect the control of naval crews or the boats or equipment of the European Commission of the Danube or be construed to abridge that Commission’s jurisdiction.

June 19, 1919.

Appendix 230

Draft Resolution Submitted by Communications Section on the Danube Situation

1. The functions of the Inter-Allied Danube Commission, whether as regards regulating the navigation of the river until this duty is transferred to the Commission referred to in Article 247 of the Treaty with Germany, or as regards the control and effective utilisation of captured, requisitioned or Armistice craft pending final disposal conformably to the provisions of the Treaties of Peace, are exercised in virtue of the authority of the High Command, which is competent to authorise the issue of instructions on all the points covered by the resolution of the Inter-Allied Danube Commission dated the 19th June,¹² with which the Supreme Economic Council concurs.

2. The Supreme Economic Council consider it will be best for the High Command to notify the riparian States of the formation of the Commission under its authority, and the powers delegated to it for the execution of its functions.

3. The Communications Section will take the necessary action.

1. See CF–97. minute 8. vol. vi, 741.
2. See CF–92, minute 8, vol. vi, p. 671.
2. Ante, p. 368.
3. Ante, p. 407.
4. Appendixes 217 to 230 filed separately under Paris Peace Conf. 180.0501/35.
5. Appendix 212, p. 414.
6. Appendix 213, p. 418.
7. See CF–95, minute 2, vol. vi, p. 720.
8. See CF–93, minute 8, ibid, p. 701.
9. Ante, p. 67.
10. Appendix 205, p. 382.
11. Minute 154, p. 250.
12. Appendix 229, supra.