825.6362/21: Telegram

The Secretary of State to the Ambassador in Chile (Collier)

50. Your despatch 1166, September 1st.29 The Department has received a protest from the Chile Copper Company and the Andes Copper Mining Company on the ground that the proposed coal law singles out American copper companies for discriminatory taxation which in application will soon amount practically to confiscation of their properties. The Department is not yet convinced that a formal protest would be justified but you may nevertheless bring the matter informally to the attention of the Minister for Foreign Affairs pointing out that since it appears impracticable for the copper companies to use coal instead of oil the proposed progressive duty upon the latter will apparently prevent them from operating at a fair profit and that the exemption of Diesel engine oil suggested by the Chilean Ambassador will not help matters unless extended to include fuel oil. Please impress upon the Minister for Foreign Affairs that while the Department does not question the right of the Chilean Government to enact legislation for the legitimate encouragement of Chilean industries it is greatly concerned over the probable effects of this particular measure and cannot believe that any law which might threaten the existence of the American copper interests in Chile could ultimately benefit that country.

  1. Not printed; see Ambassador’s telegram No. 119, supra.