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860c.516/40: Telegram

The Secretary of State to the Minister in Poland ( Gibson )

42. Your 26, February 4, 11 A.M.

1.
Remittance agreement between Poland and Guaranty Trust Company was examined by Department and certain amendments were suggested and were accepted by Guaranty. Thereupon Department stated that it did not oppose contract, but specifically reserved full liberty of action should undesirable developments occur in the future. Department has not given formal or informal approval.
2.
Informed by Bank that contract has been signed. Copy of contract forwarded by pouch.
3.
Department’s attitude in not opposing agreement was induced by serious depreciation of Polish mark and consequent obstacle to development of American commerce with Poland. For some time to come remittances are likely to constitute an important factor in sustaining Polish-American exchange. Under system now in vogue, commissions and charges of certain types of financial institutions seriously prevent remittances from exerting their full and proper support to Polish exchange, and also are unjust to remitting public.
4.
Plan discussed in your 354 of July 8, 6 P.M., contemplated establishment of possible discrimination against certain American citizens and corporations in Poland. This obviously was unacceptable to American Government. Under present plan Polish Government has designated the Guaranty Trust Company as fiscal agent to distribute remittance forms in the United States. “All banks, bankers and other institutions dealing in exchange shall, upon request, be furnished by the Agent (Guaranty Trust Company) with official remittance forms, notified of the basic rate or retail rate then in effect, and informed that such remittances may be made by drawing upon any designated paying agency of the Republic of Poland.” Both the American bankers and the remitting public are thus protected from exploitation and from discrimination as to rates of exchange by reason of the carefully limited powers of the Polish Government and its fiscal agent. Provision is made for insuring an equitable rate of exchange.
5.
You might point out to proper Polish authorities that this Government reserves right to protest against present agreement if it developes monopolistic or undesirable features either in Poland or in the United States.
Colby