Papers Relating to the Foreign Relations of the United States, 1926, Volume II
382.1121 Dr. Shattuck and Cheek: Telegram
The Chargé in Liberia (Clark) to the Secretary of State
[Received November 11—10:15 a.m.]
42. … The planting agreements have now passed both Houses in the form agreed upon. As regards the loan agreement the President has formulated the remaining points of difference which De la Rue is now transmitting. Articles 15 and 25 of the last-named appear to be the only ones at all difficult of adjustment. I am convinced that the Finance Corporation can accept no material weakening of the first without impairing Firestone’s security while the suggested amendment of the arbitration clause may not be acceptable to the Department.
The Department is not a party to the loan agreement but in view of present conditions considered as a whole, perhaps the Department could reexpress its friendly interest in a manner peculiarly effective.
An Act Passed by the Liberian Legislature November 10, 1926, Approving the Agreement Between the Government of Liberia and the Firestone Plantations Company61
It is enacted by the Senate and House of Representatives of the Republic of Liberia in Legislature assembled:—
Section 1. That from and after the passage of this Act the Agreement between the Government of Liberia and the Firestone Plantations Company hereinunder recited, be and the same is hereby approved.
Memorandum of Agreement made and entered into at the City of Monrovia this 2nd day of October in the year of our Lord Nineteen Hundred and Twenty-six by and between The Government of the Republic of Liberia hereinafter styled the Government and Firestone Plantations Company, a Corporation organized and existing under and by virtue of the laws of the State of Delaware, with principal office in the City of Akron, State of Ohio, United States of America, hereinafter styled the Lessee Witnesseth:—
Article I
That the Government hath agreed and by these presents doth agree to grant, demise and to farmlet unto the Lessee for the period of Ninety-nine years from this date an area of land within the boundaries of the Republic of Liberia of one million acres or any lesser area that may be selected by the Lessee from time to time within said period of Ninety-nine years; such land to be suitable for the production of rubber or other agricultural products.
But should the Lessee fail
- (a)
- To notify the Government of its acceptance of the conditions herein contained and stipulated within six months after the execution of this Agreement by the Government of Liberia;
- (b)
- Or within one year thereafter to commence the selection of lands hereunder;
Then in such case the obligation of the Government under this Agreement shall be discharged and ended.
Article II
The Government further agrees the Lessee shall during the life of this Agreement have and enjoy the following additional rights and exemptions:
- (a)
- All products of Lessee’s plantations and all machinery, tools, supplies and buildings established, constructed or placed upon the leased land or elsewhere for the operation and development of the Lessee’s land holdings and all leasehold interests, improvements and other property, franchises rights and income shall be free of and exempt from any internal revenue or other tax, charge, or impost except [Page 562] the revenue tax provided for in Article III, Paragraph (d), provided, however that the exemption herein granted shall not affect the liability of the Lessee for the payment of the Emergency Relief Fund nor for the payment of the tax leviable on vehicles.
- It is understood and agreed that this exemption shall not apply to Lessee’s employees, labourers or servants.
- (b)
- All machinery, tools and supplies of all kinds purchased and imported by Lessee for the operation and development of the lands held by Lessee under this Agreement and for the welfare of the employees of Lessee’s enterprise shall be exempt from all customs dues or other import duties. But such import duties, if any, as are now required by the “Agreement for Refunding Loan, 1912”, or any modification thereof, shall be paid by the Lessee until such Agreement shall be so modified as to reduce or abrogate such duties required on such imports by Lessee; in which event, Lessee shall be required to pay only such import duties as are demanded by such Agreement as modified. It is understood and agreed that the word “welfare” used in this paragraph shall connote only hospital supplies and games and that any articles which may be used by the Lessee in trade or barter or in payment for labour shall not be deemed “supplies” within the meaning of this section.
- (c)
- Lessee shall have the exclusive right and privilege upon the lands which shall be selected under this Agreement to construct highways, railways and waterways for the efficient operation and development of the properties. It is agreed that all trails across such lands used immemorially by the population shall be subject and open to free use by the public.
- (d)
- Lessee shall have the right to construct and establish at its own expenses lines of communication such as highways, roadways, waterways and railways outside the lands selected under this Agreement. Such routes may be so located by the Lessee as to best serve the purpose of efficient operation of its plantations and enterprises but the Lessee agrees to consult the Government in the matter of such location. All highways and roadways in this paragraph mentioned shall upon completion become public property. But the Government in any event shall not be required to refund to the Lessee any sums of money expended by it in the construction and maintenance of such highways, roadways, waterways or railways.
- (e)
- The Lessee shall have the right to construct and establish lines of communication for the purpose of more efficiently operating its plantations and enterprises such as telegraph lines, telephone lines and wireless stations outside of the confines of the lands selected under this Agreement, subject to the provisions of paragraph (h), Article IV of this Agreement; and to the extent necessary for such purpose may use, without the payment of rent for such land, any Government lands not already devoted to some other use. The Government in case of war or other emergency shall have the right to use such lines of communication.
- (f)
- The Lessee shall have the right to cut and use all timber upon the lands covered by this Agreement but if it shall engage in the sale of lumber to be removed from such lands for export it shall pay the Government royalty of two (2) cents per cubic foot for the lumber so sold, in gold coin of the United States of the present standard of weight and fineness.
- (g)
- The Lessee shall have the right to engage in any operations other than agricultural upon the lands held under this Agreement and to utilize any product or materials of or upon said lands; but any mining or other similar operations shall be subject to the laws of the Republic of Liberia unless the parties hereto shall agree upon special terms therefor.
- (h)
- The Government warrants to the Lessee the title to all lands selected by it upon which the Government shall accept the rental or compensation as herein provided and will defend and protect such title for the benefit of the Lessee.
The Government further agrees that it will encourage, support and assist the efforts of the Lessee to secure and maintain an adequate labour supply.
Article III
The Lessee in consideration of the Agreements herein by the Government hath agreed and by these presents doth agree as follows:
- (a)
- To notify the Government within a period of six (6) months after the execution of this Agreement by the Government of Liberia of its acceptance or rejection of the conditions and stipulations of this Agreement.
- (b)
- Beginning one year after the acceptance by the Lessee of this Agreement it shall select from year to year land suitable for the production of rubber and other agricultural products in such areas or quantities within the maximum limit of one million acres of land as may be convenient to it and in accordance with the economical and progressive development of its holding and said Lessee shall upon the selection or location of any tract or tracts of land notify the Government of such selection and the boundaries thereof. But the Lessee shall within five years of the final execution of this Agreement select and begin the payment of rent upon a total of not less than twenty thousand acres.
- Upon written notice by the Lessee to the Government of Liberia of Lessee’s intention to make a selection of land hereunder within a named territory Lessee shall have six (6) months thereafter to select land within such territory and upon the filing by Lessee with the Government within such six (6) months or written notice of the selection of land within such designated territory the title of such selected land shall vest in Lessee for the purpose named in this Agreement.
- It is not intended hereby to deny Lessee the right to make selection of lands hereunder without such previous notification of intention to select within six (6) months; but if such last named notification is filed the same shall have the effect of preventing others from acquiring title within such territory during such six (6) months.
- (c)
- As and when the Lessee takes possession of lands selected by it under this Agreement Lessee shall pay to the Government rental at the rate of six (6) cents per acre yearly and every year in advance in gold coin of the United States of the present standard of weight and fineness. Such payments shall be made to the Secretary of the Treasury of Liberia or to such other officer as may be by law provided, it being understood and agreed that the rent herein provided to be paid by the Lessee shall be due to be paid by it to the Government upon all areas of land selected by it as and when such areas are selected.
- (d)
- Six (6) years after the acceptance by the Lessee of this Agreement and annually thereafter, the Lessee shall pay to the Government a revenue tax equivalent to one per centum of the value of all rubber and other commercial products of its plantation shipped from Lessee’s plantations calculated on the price of such products prevailing in New York market at the time of the arrival of the shipment in New York.
- (e)
- Any taxes which may become payable by virtue of the laws of the Republic by any person or persons carried on the payroll of the Lessee, if the Lessee so desires, shall be collected as follows:—The Lessee may come to an arrangement with the Treasury Department of the Republic of Liberia which shall regulate the method of collection and payment of such taxes. But the Lessee shall in no event be held to collect in any year the tax for a greater number of employees than the average employed during the year.
- (f)
- Should the rent reserved on any piece or parcel of ground selected by the Lessee be behind or unpaid on any day of payment whereon the same ought to be paid as herein provided, or if default should be made in any of the covenants hereinbefore contained on the part of Lessee to be paid, kept and performed, and if such default in the payment of rent or otherwise shall continue after six months written notice of the existence of such default served by the Government upon the Lessee, then it shall be lawful for the Government to cancel this lease as to that piece or parcel of ground, the rent for which is in default or in respect of which piece or parcel any other default exists as specified in such notice, and to re-enter into and upon the said demised premises and to again repossess and enjoy the same. But if the Lessee shall, within said period of six (6) months after written notice as aforesaid, make good the default complained of in said notice, no right of cancellation shall thereafter exist because of such default. The notice required by this paragraph to be served on the Lessee shall be delivered to the representative of the Lessee in the Republic of Liberia and a duplicate thereof shall be simultanously sent by registered mail to the President of the Lessee at its head office in the City of Akron, State of Ohio, United States of America. The Lessee shall promptly notify the Government of any change in the location of its head office and thereafter any such notice shall be addressed accordingly.
Article IV
It is further agreed between the parties hereto as follows:—
- (a)
- The Lessee will not import unskilled foreign labour for the carrying out of any operations or development undertaken by virtue of this or any other grant except in the event the local labour supply should prove inadequate to the lessee’s needs. In the event that the local labour supply should prove inadequate as aforesaid Lessee undertakes to import only such foreign unskilled labour as shall be acceptable to the Government of Liberia. It is understood and agreed that Lessee shall not have in its employ in Liberia more than 1500 white employees at any one time.
- (b)
- Should the operations of the Lessee under this Agreement cease for a period of three consecutive years then all and singular [Page 565] of the rights of the Lessee hereunder shall become extinguished and void and this Agreement shall become of no effect but such cancellation of this Agreement shall not affect any rights granted by the Government to the Lessee under any other Agreement.
- (c)
- The rights by this Agreement granted to the Lessee shall not be sold, transferred or otherwise assigned by the Lessee to any person, firm, group or trust without the written consent thereto of the Liberian Government previously had and obtained.
- (d)
- The Government reserves the right to construct roads, highways, railroads, telegraph and telephone lines and other lines of communication through any and all plantations owned and operated by Lessee; but the Government shall pay to Lessee all damage which will be caused to Lessee’s property by the construction and operation of such roads or other lines of communication; such damage to be ascertained in accordance with the General law of the Republic of Liberia.
- (e)
- The Lessee shall have the right to develop for its own use such natural water power and hydroelectric power as may be capable of development upon any of the tracts of land selected by the Lessee under this Agreement and Lessee shall have the right to construct and maintain power lines over any Government lands in order to convey power so developed from one tract of land selected by Lessee to any other tract.
- (f)
- Tribal reserves of lands set aside for the communal use of any tribe within the Republic of Liberia are excluded from the operation of this Agreement. Should any question arise as to the limits and extent of such reserves such question shall be finally determined by the Secretary of Interior of Liberia on a reference by the Lessee.
- (g)
- Lines of communication such as telegraph, telephone lines, railroads and canals constructed and established by Lessee outside the confines of the Lessee’s tracts selected hereunder shall during the life of this Agreement be exempted from all taxation so long as they be used only for the purposes of the operations of Lessee upon lands held under this Agreement. In the event that such lines of communication shall be used by Lessee for general commercial purposes to serve others for hire then while so used they shall be subject to taxation under the general laws of Liberia.
- (h)
- It is further agreed that at the expiration of the term of this lease hereinabove provided or of any extension thereof or: upon the cancellation of this Agreement at any earlier time such buildings and improvements erected by the Lessee upon the land selected hereunder as shall not have been removed before the expiration or cancellation of the lease shall become the property of the Government of Liberia without charge or condition.
- (i)
- It is further agreed that if hereafter the Government shall grant to any other person, firm or corporation any rights in connection with the production of rubber in Liberia upon more favourable terms and conditions in any respect than those granted in this Agreement such more favourable terms and conditions shall inure to the benefit of the Lessee herein the same as if such more favourable terms and conditions were incorporated herein.
- (j)
- It is further agreed that the Lessee shall use its best efforts to secure either from the Government of the United States or with [Page 566] the approval of the Secretary of State of the United States from some other person or persons a loan of not less than five million dollars to establish a credit for public developments in the Republic of Liberia to the end that the credit may be a revolving credit set up through reserves so as to meet the future requirement of funds for such developments. Such loan shall be upon terms and conditions to be negotiated by a Commission appointed by the President of Liberia who shall proceed promptly to the United States for this purpose. It is understood that such terms and conditions as may be agreed upon shall be subject to the approval of the Legislature of the Republic of Liberia.
- (k)
- Wherever in this Agreement the Government grants to the Lessee the right to build and operate a railroad or to use the highways and waterways, it is understood that the Lessee is not seeking and is not granted public utility or common carrier privileges and that the same are not intended to be conveyed to it.
- (l)
- Wherever in said Agreements the Lessee is granted the right to construct and maintain telephone or telegraph lines or wireless stations it is understood that the rights intended to be conveyed permit the establishment of such lines of means of communication for the private use of the Lessee in the operation of its business and that the Lessee does not seek and is not granted the right to establish and maintain any public services.
- (m)
- During the life of this Agreement the Lessee shall at all times have access to the port and harbour facilities at Monrovia, or in any other district of the Republic where it may be carrying on operations, upon not less favourable terms than is accorded others under existing treaties and the laws of the Republic of Liberia. It shall be privileged to lease available lands in all ports of entry from the Government upon favourable terms.
- (n)
- All or any questions in dispute arising out of this Agreement between the Government and the Lessee which cannot be harmonized or adjusted by the Lessee and the Government shall be referred to the Liberian Supreme Court or any one of the Justices thereof for arbitration on application of either party; and said Court shall make appointment of three arbitrators (one of whom shall be nominated for such purpose to said Court by the President of Liberia, and one of whom shall be nominated for such purpose to said Court by the representative of the Lessee in charge of Lessee’s affairs in the Republic of Liberia, the third arbitrator being the Court’s selection without nomination) to hear and determine such dispute within five days after application being filed, upon first being satisfied of the service of notice of such application at least five days previous to the filing of the application by (a), by delivery of a copy of the application to the Attorney General of Liberia, or in his absence, to the officer in charge of his office when said application is made by the Lessee, and (b), by delivery of a copy of the application to the representative of the Lessee in charge of Lessee’s affairs in the Republic of Liberia and by mailing a duplicate thereof on the same date by registered mail to the President of the Lessee at its head office in the City of Akron, State of Ohio, United States of America, when said application is made by the Government.
That the arbitrators so appointed as aforesaid shall render their decision of the question or questions in dispute in writing and file same with the Clerk of the Supreme Court, together with copy of testimony taken and statement of proceedings had within fifteen days after their appointment as aforesaid, unless an application for further arbitration, as hereinafter provided, be made by either party within a period of four months after said decision is given, said decision shall be a definitive settlement of the question or questions in dispute and shall be binding upon both parties, their agents or assigns, and the Government of Liberia agrees to make said decision operative. Should however, either party feel aggrieved at the decision of the arbitrators then the Government agrees to arrange with the United States Department of State for a further arbitration of the question or questions submitted by either or both parties; provided, however, that in the case of such further arbitration each party shall bear its own respective costs; and provided further that the procedure for such further arbitration shall be as follows:
Written notice of desire for further arbitration shall be given by either party to the other within four months after the written decision of the arbitrators in the first instance has been filed with the Clerk of the Supreme Court; thereupon both parties shall prepare and file with the Clerk of the Supreme Court within sixty days after service of the notice written statements of the questions in disputes, and these statements together with a copy of the testimony and proceedings of the arbitrators together with a copy of their decision, shall be certified by the Clerk of the Supreme Court and delivered within five days after receipt of said papers in his office to the Secretary of State of Liberia who will thereupon promptly arrange with the United States Department of State for further arbitration of the questions in dispute, the decision of which arbitration shall be final and binding upon both parties to this Agreement.
It is understood and agreed that the final decision shall become effective thirty days after such final decision has been rendered and shall not be retroactive. It is also understood and agreed that during the period of arbitration, the Lessee shall be permitted by the Government to carry on without interference, all operations under this Agreement, including the operations involved in the subject matter of dispute, which the Lessee had undertaken, and, being undertaken, had not been objected to by the Government prior to the dispute arising. It is understood, however, that the fact there was no objection on the part of the Government shall not prejudice its rights in the subject matter of dispute.
It is hereby expressly understood and agreed that the arbitration procedure provided for herein does not apply to civil or criminal proceedings to be brought by or against employees of Lessee in Liberia.
In Witness Whereof the parties hereto have hereunto set their hands and seals the day and year first above written.
Witness: | For the Government of Liberia . . . . . . . Secretary of State. |
|
Attest: | Firestone Plantations Company By . . . . . . . |
|
Secretary. | President. |
Section 2. This Act shall take effect immediately and be published in hand bills.
Any law to the contrary notwithstanding.
- Printed from Acts Passed by the Legislature of the Republic of Liberia During the Session 1926 (Monrovia, Government Printing Office, 1926), ch. iv, p. 3.↩