352.1153 St 2/20

The Chargé in Spain (Blair) to the Secretary of State

[Extract]
No. 719

Sir: I have the honor to refer to the Embassy’s despatch No. 713 of December 26th, 1927,2 and to submit a further report on the Petroleum Monopoly. At the beginning of the week, a reply was received to the Embassy’s Note Verbale of December 23rd, 1927,3 a copy of which was transmitted with the above mentioned despatch, and I am transmitting herewith copies of the Spanish text of this note together with the Embassy’s translation. …

I have [etc.]

Percy Blair
[Enclosure—Translation]

The Spanish Ministry of State to the American Embassy

No. 304

Note Verbale

With reference to the Note Verbale No. 407 of December 23rd, from the Embassy of the United States of America, the Ministry of State has the honor to inform the Embassy, as a first impression and without prejudice to a more detailed answer, reiterating what was stated in its note of the 21st of December,3 in regard to the seizure by the Petroleum Monopoly of a part of the installations of the Babel and Nervion Company in Alicante, that the seizures of properties belonging to American citizens, and, in general, to citizens of other countries who have interests in the business of petroleum importation into Spain, are being carried out in accordance with the Royal Decree-Law of October 17th last4 and with the reserve, as [Page 833] provided for in Article 2 of this Decree, of making pertinent indemnification.

It has not been possible previously to determine the amount of the indemnification both with respect to the seizures already made as well as to those which have not yet taken place, because it is necessary to make the proper valuation in accordance with Article 10 of the Royal Decree-Law of June 28th last,5 which fixes an as yet unexpired period for these valuations which are being made by a jury designated for this purpose. This appraisal cannot therefore be completed before the first of January, 1928, upon which date the Monopoly must become effective.

Under these circumstances, the Ministry of State does not, therefore, consider justified either the alarm or the unfavorable impression, which, as it has been informed by the United States Embassy, the abovementioned seizures have occasioned in the United States, the more so as His Majesty’s Government has decided that expropriated companies will receive legal interest on the finally determined valuation from the date of seizure to the time when final payment is made, and the Spanish Government will not in any way depart from legal rules and equitable methods either in this matter or in any other, as it is safeguarding its right to organize within legal limits the services of the country.

The Ministry of State is, however, forwarding to the Ministry of Finance the above referred to note of the United States Embassy in order that the latter Ministry may take account thereof and may recommend that the valuations in question may be carried forward with the greatest activity possible.