The Secretary of State to the Minister in Colombia (Philip)
You are correct in assuming that Department and Senate realize great importance of pending Colombian legislation on nationalization of petroleum deposits.
After consulting Subcommittee of Senate Foreign Relations Committee, Department believes this Government would be disposed to make agreement with Colombia providing that neither Government should in any way nullify rights of citizens of the other contracting party in or to real estate, mines, petroleum deposits, or other similar property in its country acquired prior to execution of agreement, unless in the documents of title or written contracts, whether public or private, under which such real estate, or other property, is claimed or held, specific reservations or limitations on such rights are made and set forth.
Agreement should further provide that foregoing provisions are intended to obviate, so far as possible, future legal or diplomatic controversy arising through any claim of right of either power to nationalize any property acquired by nationals of either power through any contract, lease, deed or concession wherein specific reservation or limitation authorizing such subsequent nationalization is not distinctly set forth in original title to such property.
Third paragraph [sic]. Parties agree to recognize to fullest extent general rights of sovereignty of each nation within its own boundaries, including, as attributes of sovereignty, right to enact revenue and other legislation, with the understanding, however, that neither power will discriminate against citizens of the other in governmental grants, leases, franchises or contracts, or other means of acquisition of property rights, titles or interests, within its boundaries, but will afford to such citizens all possible protection in the enjoyment of such rights.[Page 744]
In view of foregoing, which Senate appears to be insistent upon, notwithstanding observations your August 21, 11 a.m., it is felt that Colombian treaty will be likely to remain in committee until purpose of Colombian Government respecting property rights in question is defined in binding agreement.
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