The Secretary of State to the Chargé in Peru (Wadsworth)

No. 363

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

The first treaty to become effective expressing the present policy of this Government was the Treaty of Friendship, Commerce and Consular Eights 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 now in process of negotiation. Modi vivendi 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 [Page 595]whether it would be agreeable to the Government of Peru to proceed to the negotiation with the United States of a similar treaty. A special draft will, of course, be prepared for presentation to Peru if this proposal is acceptable to the Peruvian Government. It is probable that certain departures from the text of the German treaty should be made either in the special text to be submitted to the Government of Peru or, on behalf of either party, during the course of negotiations. In view of the existence of the Convention and Protocol Facilitating the Work of Traveling Salesmen entered into by the United States and Peru on January 19, 1923,5 Articles XIV and XV of the German treaty would be omitted in a draft treaty presented to Peru.

It would be gratifying if, among its early treaties embodying the principle of unconditional most-favored-nation treatment, the United States could celebrate a general commercial treaty with Peru. The lack of such a treaty with Peru since the Treaty of Friendship, Commerce and Navigation, concluded August 31, 1887,6 was terminated on November 1, 1899, is a matter of regret to this Government and it hopes that a comprehensive modern agreement may now be entered into. You will of course keep in mind in this connection that a most-favored-nation clause with a condition, such as that contained in Article III of the treaty of September 6, 1870,7 between this country and Peru would not now be acceptable to the United States.

For your confidential information, though the Department, in proposing a treaty with Peru, 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 Peruvian Government in order to forestall any efforts that other countries may be planning to make for the purpose of interposing in South America 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.8

For your further confidential information and guidance, the Department was informed some time ago that there was a, movement on [Page 596]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, 1926.9

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, at least for the present, Panama, with which an important treaty of a different kind still remains pending.10

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 referred to in this instruction and not cited therein, see footnotes to similar instruction, No. 1162, Aug. 21, 1926, to the Ambassador in Brazil, Foreign Relations, 1926, vol. i, p. 569.
  4. Ibid., 1923, vol. ii, p. 29.
  5. See Foreign Relations, 1919, vol. i, p. 45, footnote 47; Malloy, Treaties, 1910–1923, vol. iii, p. 2800.
  6. Malloy, Treaties, 1776–1909, vol. ii, p. 1431.
  7. Ibid., pp. 1414, 1415.
  8. See Foreign Relations, 1923, vol. i, pp. 453 ff.
  9. Not printed.
  10. i. e., the unperfected treaty between the United States and Panama, signed July 28, 1926. See ante, pp. 484 ff.; also Foreign Relations, 1926, vol. ii, pp. 828 ff.