832.802 Lloyd Brasileiro Navigation Co./18: Telegram
The Secretary of State to the Ambassador in Brazil (Morgan)
20. If you perceive no objection, the Department desires you to discuss informally and discreetly with the appropriate authorities the possibility of having Decree No. 19682 modified. This decree was published in the Diario Oficial for February 12.
The United States Shipping Board has pointed out that certain provisions of this decree, notably article VII, favor the Lloyd Brasileiro Navigation Co. over American shipping companies plying to Brazil, whereas Brazilian ships sailing to the United States receive from the United States essentially the same treatment as American vessels.
In the past American shipping interests have unsuccessfully attempted to secure preferential treatment over foreign vessels by congressional action. The above-mentioned decree will serve as a precedent for further action. In case of possible retaliation, Brazilian shipping would stand to lose more than American shipping would lose from effects of the Brazilian decree.