The Ambassador in Italy ( Child ) to the Secretary of State
[Received 2:33 p.m.]
11. I have been given information that quite possibly, in case certain nation or nations block any conference agreement with Soviet Russia, the difficulty will be overcome by other countries entering into similar but separate treaties with the Soviet Government outside of the Conference as Germany has done.9
I have informally told the Italian Minister of Foreign Affairs that should such a development come about I am confident that the same pains would be taken to protect American interests as would be done were the Conference to frame the agreements with Soviet Russia.
I will state for the Department’s information and that of any American company having interests in Soviet Russia that the general policy which the Soviet representatives have expressed so far and have firmly adhered to is to refuse recognition to former concessions whether they be foreign or Russian, which are now claimed to come under the nationalization of property. As far as possible, however, they will recognize those who held former concessions as having a prior right to substantially the indefinite use of the property under a plan whereby the Soviets will receive a small percentage of the product or of profits.
Krassin10 has made the proposal that a parent trust shall cover the entire petroleum industry in Soviet Russia with a government monopoly but operating various fields of deposits, including those controlled by foreigners, by means of private subsidiaries.