810.79611 Pan American Airways, Inc./167
The High Commissioner in Haiti (Russell) to the Secretary of State
[Received December 6.]
Sir: Referring to my Despatch No. 1324 of November 26th, 1928, I have the honor to inform the Department that this morning I had a conference with representatives of the Pan-American Airways, Inc., and it appears that they are very desirous of having Article 16 incorporated in the proposed contract.
The Financial Adviser-General Receiver is of the opinion that the second sentence of this Article would grant a monopoly of the most objectionable sort. He further feels that the Haitian Government should not obligate itself to send mails by the services of this Company before an agreement has been reached as to rates. He also believes that the third sentence is objectionable in that it might be construed as giving the Company the right to revise rates upward as well as downward and without the consent of the other party. He recommended that in place of this Article the following be substituted:—
“The Company agrees that it will carry, under tariffs to be fixed from time to time by agreement with the Government, the air mails delivered to the Company by the postal service of the Republic, subject to the limitation as to total weight fixed elsewhere in the present contract.”
The Pan-American Airways states that Article 16 is not in the nature of a monopoly but is preferential treatment due to the fact that the Company is performing pioneer work. It further states [Page 796] that it is very desirous of having this Article as well as Article 8, incorporated in the contract with a view to assisting the Company in obtaining similar provisions in contracts with other countries. And that if these Articles were left out of the Haitian contract it would be very difficult to incorporate them in other contracts, also that they already exist, particularly in the contract with Nicaragua which contract met with the approval of the Department of State.
It would appear that Article 16 gives to the Company an unqualified monopoly and I am quite aware of the Department’s attitude Regarding monopolies. But I feel that the benefits accruing to Haiti from the contemplated services of this Company are such as to permit of the most liberal action on the part of the Haitian Government.
I would therefore suggest that the Department, while not approving of the monopolistic features of Article 16, not object to the giving of this Article as well as Article 8 in the proposed contract, if the Haitian Government so desires.
I have [etc.]