The Secretary of State to the Ambassador in Spain ( Hammond )
Sir: With further reference to the Embassy’s telegram No. 24, April 26, 1929, concerning pressure reported as being brought to effect the immediate denouncement by the Spanish Government of the present modus vivendi, there are outlined below, for your convenience, [Page 792] the various Spanish grievances which have been brought to the attention of the Department and the present status of these matters:
(1) Duty on shelled almonds, olive oil and onions. These grievances are anticipatory. Memoranda have been presented by the Spanish Ambassador against any increases in the present duty on these commodities, and these have been promptly brought to the attention of the Committee on Ways and Means by the Department.28 With particular reference to onions, see the Department’s instruction No. 534 of April 4, 1929.29
(2) Marking of corks. See Department’s telegram No. 3 of February 1, 1929, 7 p.m.29 No appeal was filed within the statutory period of sixty days subsequent to the denial by the Customs Court of the request for a rehearing, and accordingly the decision of October 5, 1928, that corks imported from foreign countries are subject to individual marking to indicate the country of origin, under section 304 (a) of the Tariff Act of 1922,30 automatically became effective on February 26 and must stand unless a new case should be brought before the Customs Court and pursued through to the higher court and the decision should be overruled. The Spanish Ambassador has been so informed. In Treasury Decision 43245 which gave effect to the decision of the Court, very small corks which have not sufficient space for legible marking, are exempted from individual marking and are made admissible with marking on the bags or other immediate containers to indicate the country of origin.
(3) Eibar revolvers. The exclusion of Eibar revolvers was under Section 316 of the Tariff Act and because of unfair trade practise in the simulation of a side swing ejector type, which had been manufactured by Smith and Wesson and its predecessors since 1896 and which, incidentally, constituted 90 per cent of that company’s business. The revolvers excluded were identical in visual appearance with those of the American company whose distinctive appearance was obtained by a collection of details or elements of design and surface ornamentation, arbitrarily selected, non-functional, and therefore not necessary to be used by a competitor except for purposes of simulation. The imported revolvers were substantial reproductions even to the extent that the trade marks appearing thereon could not be distinguished from that on the American product except by the closest inspection. Previous to the President’s order of June 23, 1926, competent United States courts had in several cases sustained the American company in its rights in the distinctive appearance of its revolvers and granted injunctions against the sale of the Spanish imitations held to constitute unfair competition in trade. The exclusion of firearms that unfairly simulate those made in this country is applicable alike to imports from all countries and has been enforced on shipments from other countries. It may be suggested that Spanish manufacturers have only to cease copying American designs in order to avoid any difficulties.[Page 793]
(4) Pimientos. Paragraph 779 of the Tariff Act makes “whole pimientos packed in brine or oil or prepared or preserved in any manner” dutiable at the rate of 6 cents per pound. Canned Spanish pimientos from which skins, stem and seeds have been removed were first placed in this classification, but the Customs Court of Appeals held that they should be classified as canned vegetables at a lower rate. In 1926, the question was again brought before the Customs Court and, upon a more complete record than in the previous case, it was held that the Spanish pimientos came under section 779. The Customs Court of Appeals in December 1926 sustained that ruling. It was decided that the only form in which anything approaching a “whole pimiento” had ever been imported was with stem, seeds and skins removed, and that therefore it was that form of the commodity which the Tariff Act of 1922 had intended to cover in section 779.
(5) Canned goods. Another case arose in connection with canned goods, in which the restrictions imposed were in harmony with those imposed in this country as well as those involved in importations from all foreign countries. The Department of Agriculture, under food regulations, objected to the use of the term “superiores” on labels as extravagant and misleading. A shipment held up in 1927 on this account was admitted with the understanding that in future consignments this term would be omitted unless qualified by an appropriate translation of the term “brand” in the same style and size of letters as the term thus qualified, or immediately preceded by the name of the manufacturer in its possessive form.
(6) Quarantine against the importation of grapes, oranges and tomatoes. 31 There has been no change in the situation with reference to the grape embargo. It should be noted, however, as an indication of the seriousness with which this Government regards the dangers from Mediterranean fly, that, in view of the recent appearance of this pest in a part of Florida, the Congress by joint resolution which was approved by the President on May 2 has appropriated the sum of $4,250,000 immediately to combat it, and that an embargo has been placed upon fruits from Florida, as was done in the case of fruits from Hawaii.
There has been no change in the situation with reference to the embargo on Spanish oranges. In this connection, it should be recalled that so long as it was believed that oranges were free from Mediterranean fly, an exception was made to the general embargo and oranges were admitted. It was only when it was found that this fruit was infested with the fly that there was a reversal of the special privilege which had been accorded. See letter from Department of Agriculture transmitted with Department’s instruction No. 333 of February 11, 1926,31a for full details. This letter was quoted to the Spanish Ambassador at the same time. It should be noted that modification of the embargo to permit the entry of tomatoes from the Canary Islands and Spain was effected promptly after investigation had determined that there was no risk from fruit fly or other pests in the importation of such tomatoes into the United States.
The Department has always been unable to see wherein the situation with respect to Almeria grapes has any proper bearing upon the [Page 794] question of commercial relationship. It has regretted the unwillingness of the Spanish Government to make the important distinction between purely economic tariffs or other forms of regulating commerce and restrictions or prohibitions under plant quarantines established for the sole purpose of the exclusion 01 destructive pests.
With reference to the reported allegation of Carlos Prast, president of the Spanish Overseas Commerce Board, that Spanish tomatoes and peppers are often thrown overboard by United States customs authorities because it is pretended that they are in bad condition and no chance is given to the shipper to recover the merchandise, it will be appreciated that investigation will be difficult without more specific information. The Department has, however, informed the Department of Agriculture of this allegation and you will be advised of its report.
The Department is reluctant to believe that the Spanish Government would take the serious step of denouncing the modus vivendi on the basis of alleged grievances which, when examined, are shown principally to concern decisions which have been based on substantial grounds. You will, however, keep the Department fully and promptly informed of any developments.
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