463.00 R 29/156: Telegram

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

64. L–89. 1st. In connection with apportionment and distribution of liberation debt of the Austrian states of Austro-Hungarian Monarchy, Finance Service recommends following repartition to Commission all gold francs: Poland 225,000,000, Roumania 235,000,000, Servia 178,000,000, Czechoslovakia 750,000,000, Italy 59,000,000; and also recommends notification of repartition to Great Britain, France and Italy with a request for their views as to whether the issue of the liberation bonds should be called for and if so “whether the United States of America should be consulted.”

2d. Last suggested question arises from the fact that by article 4 of liberation debt agreement of September 10, 1919 signed by the [Page 155] powers and by United States delegates to Peace Conference27 it was provided that the bonds should be delivered “to such person or body as the Governments of the United States of America, the British Empire, France and Italy may designate.” A similar provision in article 4 of amendatory agreement of December 20[8], 1919.28

3d. In practice understand that only Poland and Czechoslovakia may be called upon to issue bonds, because reparation claims of other states involved more than offset the liberation bond indebtedness. However this point is not quite clear.

4th. By article 2 Spa Agreement29 and paragraph 3 of annex of Finance Ministers’ Agreement of March 192230 provided that the issue of liberation bonds is to be divided among the powers in the ratio of their participation in Austro-Hungarian reparation payments and credited on Austro-Hungarian account.

5th. Finance Service intimates view that United States probably not interested in delivery or division of present bonds in view of non-ratification of peace treaties and nonparticipation in Spa Agreement. Furthermore it does not appear that United States ratified liberation bond agreement of September 10, 1919.

6th. Am sending this advance outline of situation so that you may decide upon appropriate attitude of United States and instruct me whether I should take any action or make any reserves when the subject of transmitting the repartition problem to the powers is discussed in the Reparation Commission. Inasmuch as we probably will, and have had no participation in these bonds [it] seems immaterial to what body bonds are delivered. Present suggestion is Reparation Commission. Logan.

  1. William M. Malloy, Treaties, Conventions, etc., between the United States of America and Other Powers, 1910–1923 (Washington, Government Printing Office, 1923), vol. iii, p. 3299.
  2. Ibid., p. 3303; the amended agreement was held open for signature until Dec. 20, 1919.
  3. Foreign Relations, 1920, vol. ii, p. 406.
  4. British and Foreign State Papers, 1922, vol. cxvi, pp. 612, 621.