Papers Relating to the Foreign Relations of the United States, 1927, Volume I

711.242/3a

The Secretary of State to the Minister in Bolivia (Cottrell)

Washington, August 19, 1927.

No. 308

Sir: This Government has, as you are aware, entered upon the policy of negotiating with other countries general treaties of friendship, commerce and consular rights, of which the central principle in respect of commerce is an unconditional most-favored-nation clause governing customs and related matters.¹ This policy was inaugurated pursuant to the principles underlying Section 317 of the Tariff Act of 1922;² it seeks assurances that equality of treatment for American commerce will be maintained in all countries.

Besides the provisions relating to commerce, these treaties include provisions relating to rights of nationals of each country in the other country, to protection of property and to rights and immunities of consuls. This Government now desires to enter into such a treaty with Bolivia.

The first treaty to become effective expressing the present policy of this Government was the Treaty of Friendship, Commerce and Consular Bights with Germany, signed December 8, 1923; ratifications of which were exchanged October 14, 1925.³ Similar treaties have been signed by the United States with Hungary, Esthonia and Salvador, of which those with Esthonia and with Hungary have been brought into force by exchange of ratifications.

A treaty containing the unconditional most-favored-nation clause was signed with Turkey on August 6, 1923. About a dozen other treaties containing such a clause are in process of negotiation. Modi mvendi based upon the same principle, entered into with the following countries, are in force—Brazil, Czechoslovakia, Dominican Republic, Finland, Greece, Guatemala, Haiti, Latvia, Lithuania, Nicaragua, Poland (including Danzig), Rumania and Turkey.

Two copies of the treaty of December 8, 1923, with Germany are enclosed.⁴ You are requested, unless you perceive objection, to inquire whether it would be agreeable to the Government of Bolivia to proceed to the negotiation with the United States of a similar treaty. A special draft of treaty will, of course, be prepared for presentation to Bolivia if this proposal is acceptable to the Bolivian Government. That certain departures from the text of the German treaty should be made is probable, but the views of both countries in respect of this matter may appropriately be exchanged during the course of negotiations.

It would be gratifying if, among its early treaties embodying this principle, the United States could celebrate a general commercial treaty with Bolivia. Such treaty would supersede the Treaty of Peace, Friendship, Commerce and Navigation which was concluded by the two countries on May 13, 1858.⁵ You should in this connection keep particularly in mind that a most-favored-nation clause with a condition such as that contained in Article II of the Treaty of 1858 would not now be acceptable to this Government.

For your confidential information, though the Department, in proposing a treaty with Bolivia, is influenced chiefly by its policy of concluding with other countries generally treaties containing the unconditional most-favored-nation clause, you are nevertheless desired to use especial diligence in seeking a favorable response from the Bolivian Government, thus forestalling any efforts that other countries may be planning to make for the purpose of interposing in South American arrangements based upon special privilege—a policy wholly antagonistic to the policy of equality of treatment which the United States is undertaking to promote. You may recall in this connection that in 1923 this Government renounced the preferential customs treatment which certain American products had been receiving in Brazil and requested instead a pledge of equal footing with other countries in the Brazilian market.⁶

For your further confidential information and guidance, it was some time ago suggested to the Department that there was a movement on the part of Spain to seek from the countries of Latin America special commercial concessions in return for certain advantages to be accorded to their commerce in Spain. In this connection see the Department’s circular instruction dated April 19, 1926.⁷

The Department either has transmitted or expects at an early date to transmit instructions similar to the present instruction to the American missions in the other South American capitals except Ecuador, the political regime now functioning in which is not recognized by the United States, and, for the present at least, Panama, with which an important treaty of a different character is now pending.⁸

I am [etc.]

Frank B. Kellogg

1. See Foreign Relations, 1923, vol. i, pp. 121 ff.
2. 42 Stat. 858, 944.
3. For treaties and modi vivendi hereafter referred to in this instruction and not cited therein, see footnotes to instruction No. 1162, Aug. 21, 1926, to the Ambassador in Brazil, Foreign Relations, 1926, vol. i, p. 569.
4. Foreign Relations, 1923, vol. ii, p. 29.
5. Malloy, Treaties, 1776–1909, vol. i, p. 113.
6. See Foreign Relations, 1923, vol. i, pp. 453 ff.
7. Not printed.
8. i. e., the unperfected treaty between the United States and Panama, signed July 28, 1926. See Foreign Relations, 1926, vol. ii, pp. 828 ff.; also ibid., 1927, vol. iii, pp. 484 ff.