463.00 R 29/171: Telegram
The Ambassador in France ( Herrick ) to the Secretary of State
[Received 5:05 p.m.]
169. L–361. Referring to Department’s L–221, February 24, 5 p.m. C bonds have never been distributed. Only one certificate for entire amount (82 milliards) has been issued and this is held by the Reparation Commission. I understand that distribution is not now contemplated.
Bearing in mind that the total of A, B, and C represents total Allied reparation claim of 130 [132] milliards against all Central Powers, for the full amount of which Germany is held liable under the reparation part of Treaty of Versailles, any payment on reparation account of Germany’s allies should be credited on the total sum for which Germany is held liable. For this reason article XI of Finance Ministers Agreement of March 11, 1922, looked to distribution among claimant powers of C bonds to extent of the reparation claims determined to be due from Germany’s allies, and provided that the powers receiving payments in cash or in kind from Austria-Hungary and Bulgaria should return to the Reparation Commission “for cancelation” C bonds to the value of these payments. Had C bonds been distributed therefore, payments on account of reparation obligations of latter states would have involved a cancelation of the C bonds.
The only information I have about possible distribution of liberation bonds is article 2 of the Spa Agreement. Logan.