462.00 R 29/131: Telegram

The Secretary of State to the Ambassador in France (Wallace)

652. For Rathbone from Davis. Treasury R–305.

Your R–455 March 25 regarding Article 260.

  • First: In view of express terms of this article, the attitude of representatives of other governments on Commission and the considerations referred to in paragraph 8 your telegram, we approve of your assenting, in accordance with your recommendation, to procedure outlined in paragraphs 3 to 5 inclusive.
  • Second: With reference to substance paragraphs 3 and 4 relating to lists of properties to be submitted by six Powers and the subsequent disposition of properties that may be taken, we deem it desirable you should at earliest opportunity appropriately make known our views with regard to such disposition which are briefly stated as follows: Article 260 provides for transfer of these properties for purposes of reparation to the Reparation Commission as the joint agency of all interested nations. No single nation is therefore entitled to obtain peculiar advantages from such property. If property of character in question is taken over action should be taken looking to disposition of it so that the greatest possible amount of proceeds may be realized for application to reparation. This could probably best be accomplished through open sales to highest bidder.
  • Three: If China were a party to Treaty and desired to exercise rights granted under Article 297, Article 260 would probably be considered inapplicable with respect to German interests in that country. As a co-belligerent in the war, and as a country not bound by the Treaty with Germany, China is doubtless in a position to exercise, if she so desires, sovereign rights with regard to property within her jurisdiction so as to prevent transfers of property in accordance with Article 260. It would seem desirable no effort should be made looking to transfer of property in that country.
  • Fourth: Having in mind the several doubtful practical and legal questions involved in point raised in your ninth paragraph, we [Page 381] consider advisable adoption of view of legal service therein mentioned.