The Minister in Poland (Stetson) to the Secretary of State
[Received November 22.]
Sir: Referring to the negotiations between the Colt’s Patent Firearms Manufacturing Company and the Fabrique Nationale d’Armes de Guerre, of Herstal, I have the honor to inform the Department of the present status of those negotiations, bringing the matter up to date since my confidential Despatch No. 1163, of July 14, 1927.
Mr. Joassart, the Director of the Fabrique Nationale, called on me Saturday, November 5th, with the report that Mr. Nichols, Vice President of the Colt Patent Firearms Manufacturing Company, had come to Herstal in reference to the proposed contract for arms with the Polish Government and had refused to accept the results of his (Joassart’s) negotiations with the Polish Government, in spite of the fact that he (Joassart) held the power of attorney of the Colt’s Patent Firearms Manufacturing Company to act for them in the negotiations with the Polish Government.
The break had come after Mr. Joassart had agreed on a contract with the Polish Government in which the two points which were the last to be settled were, first, the amount of the surety bond to be furnished by the Manufacturing Company, and, second, the length of time for the delivery of the jigs, dies and gauges.
The Colt’s Patent Firearms Manufacturing Company found that the conditions accepted by Mr. Joassart were unacceptable to them and cabled him to that effect. A lengthy discussion followed between the Belgian and the American companies regarding the matter, the outcome of which was that the Board of Directors of the Colt’s Company rejected the contract as proposed and Mr. Nichols went to Belgium to talk the matter over with Mr. Joassart. While Mr. Nichols was in Belgium he wrote a letter, copy of which is enclosed,3 direct to the Ministry of War of the Polish Government, because of which the Poles have taken offense. They are surprised that the contract [Page 608]as accepted by the recognized agents should have been disqualified by a letter addressed over the head of the agent directly in contact with the Ministry of War. One of the ranking officials of the Ministry of War has asked explanations of this method of doing business of the American Military Attaché. Colonel McKenney made the only possible answer that the Legation had had no information as to the intentions of the Colt Company, but he was certain that the letter carried with it no desire whatsoever of being offensive to the Polish Government.
Mr. Joassart states that he has agreed with Mr. Nichols to continue the negotiations with the Polish Government on his own responsibility, with the hope of concluding a contract with the Polish Government which leaves the Colt Company entirely out of the transaction, except in so far as the Colt Company will profit by the royalties, as is provided in the license contract between the Colt’s Patent Firearms Manufacturing Company and the Fabrique Nationale d’Armes. Mr. Joassart added, however, that he must obtain some modifications in the contract, especially as regards deliveries. He feels in honor bound not to induce the Polish Government to change any of the major conditions which he has already accepted, but he is now making every effort to arrange a new set-up for the contract due to the changed conditions.
Mr. Joassart informed me that he is anxious to get this contract because he believes it will lead to more business in the future. At the present moment the Rumanian Government is also considering the purchase of Browning rifles, similar to those in this contract,—Poland and Rumania being united by a military treaty, desire interchange-ability of armament. Moreover, the Polish Government is holding tests with tripod machine guns and Mr. Joassart expects the Browning to give the same excellent results in the competition as the rifle. He believes, also, that the Polish military authorities are now so favorably impressed with the Browning principle as applied to firearms, that they will use arms of this manufacture wherever possible. This will include anti-aircraft and other types of light caliber automatic cannons.
On one visit to me, Mr. Joassart had asked the assistance of the Legation in getting a decision on these points, but I told him that they involved the private affairs between purchaser and seller and that for that reason it was impossible for us to take any direct steps in his favor. I have from time to time, as occasion offered itself, spoken with members of the Polish Government in favor of the arms manufactured by the Colt’s Patent Firearms Manufacturing Company and have expressed the hope that the results of their tests would be so satisfactory as to induce the Polish Government to accept a contract [Page 609]with this firm even though the price seemed to be higher than those offered by the competing companies.
Viewed from the standpoint of business, I think that the Colt Company is right in refusing the terms of the contract. I myself know enough of this kind of business to see the difficulties of fulfilling the conditions set by the Polish Government, especially at such long range. However, it is to be regretted that their action in disavowing the agent to whom they had given the power of attorney to negotiate at the last moment has created an unfavorable impression with the Polish Ministry of War.
I have [etc.]
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