811.7353b W 52/25: Telegram

The Secretary of State to the Minister in Portugal ( Dearing )

57. Your No. 70 August 7, 7 p.m. and 72 August 10, 1 p.m.

Western Union here advises Department London office reports Kerr has telegraphed his representative to return to Lisbon and confer with you and has directed him to withhold signature from any document containing proviso, to inform Portuguese Government that proviso renders the license useless to the company and to endeavor to have the amendment deleted before Parliament rises.

Department understands company’s representative has been instructed to endeavor to have amendment deleted before action taken by Senate. Render all appropriate assistance to have objectionable features removed and to have concession granted without injurious restrictions.

Continue efforts on behalf Commercial Company, informing Portuguese authorities that this Government desires that there be no discrimination against American cable companies in favor of cable companies of other nationality and likewise that there be no discrimination as between American companies.

Please inquire of Foreign Office reason why Portugal imposes these restrictive terms on American company and insist on answer.

For use in course of your further efforts Department observes that it seems obvious that in inserting in concession condition quoted your 72 August 10th Portugal is yielding to British influence exerted in opposition to American interests because it secures to British cables all traffic of European origin transiting Azores to South America and renders cables extending from Azores to Continent mere feeders of British cables so far as South American business is concerned giving British interests benefits of cables going to Continent without any investment in them. United States Government hopes and feels confident that upon realization real significance and effect proposed condition, Portuguese Government will promptly delete it and will discontinue attempt to impose on American companies such restrictive discriminatory and injurious terms in favor of British interests. Operation of American cables on such terms or refusal of American companies to accept licenses containing such conditions would inevitably result in diversion to North Atlantic cables, with consequent loss of revenue to Portugal, of traffic which would otherwise transit Azores.