The Secretary of State to the Ambassador in Spain (Laughlin)
Sir: Reference is made to the general question of Spanish tariff discrimination and to your despatch No. 527 of November 17, 1931, under cover of which you transmitted the text of the memorandum of Spanish “trade grievances” given to you on November 13, 1931, by Señor Calderon of the Ministry of State. The Department submitted translations of the memorandum to the various branches of the American Government concerned in administering the regulations, provisions, et cetera, complained of, and on the basis of their replies it has drafted the following memorandum which you should personally hand to the [Page 1003] Minister of State, as promptly as an interview can be arranged and if possible in the presence of Señor Calderon.
“The American Government has made a careful and sympathetic examination of the points set forth in the memorandum submitted to the American Ambassador in Madrid on November 13, 1931, and has instructed the Ambassador to present the following memorandum in reply.
“It is noted that the Spanish communication consisted of eleven points which, for convenience in reference, are grouped in three categories as follows: (The letters are those appearing in the Spanish memorandum)
“Category 1. Administrative application of American sanitary or customs provisions.
This category includes items A (Fresh Fruits), E (Mineral Waters), F (Canned Goods other than canned fish), G (canned fish), I (garlic and onions) and J (Canary Island Potatoes), all of which are under the administration of the Department of Agriculture; and items D (Cork Stoppers) and H (Firearms) regarding which the provisions complained of are under the jurisdiction of the Treasury Department.
“As a matter of general comment it may be said that the regulations or restrictions imposed are uniformly applied, without any discrimination whatever. In the case of products subject to the Food and Drugs Act, Department of Agriculture, the requirements in import consignments are in all instances similar to those applied in American domestic commerce. The same is true of the application of quarantine laws (Department of Agriculture), if or whenever there is an outbreak in the United States of the pests or diseases the introduction or spread of which the particular quarantine indicated was designed to prevent. It is felt, however, that a more thorough understanding of these regulations by Spanish exporters, and perhaps a more careful compliance therewith, would materially reduce difficulties and subsequent complaints concerning importation into this country. The Department of State would therefore be glad to propose that the Spanish Government designate a representative of the Spanish Embassy in Washington to confer at the Department of State with appropriate officials of other Departments to the end that the existing regulations may be clarified and thoroughly understood. Any suggestions which the Spanish Government might desire to make could thus be considered directly by the officials of other branches of the American Government technically competent to deal with them.
“Brief summaries are given herewith of the items enumerated above:
A. Fresh Fruits. The Department of Agriculture regrets that, until the Mediterranean Fruit Fly shall have been eradicated from Spain, it would be unable to modify the position taken last year and outlined in detail to the Spanish Government in a note from the Secretary of State to the then Spanish Ambassador, dated June 24, 1930.21 The American Government is confident that the Spanish Government cannot fail fully to appreciate the attitude of the American Government [Page 1004] in this matter when it learns that the American Government has already spent over seven million dollars in the control and eradication of this pest in the State of Florida.
E. Mineral Water. The Department of Agriculture states that the principal past difficulty has occurred in connection with one particular brand, certain shipments of which showed evidences of pollution. It added that attention in connection with the spring, and in the bottling operations, would readily render the product acceptable, and that recent shipments had been entirely satisfactory.
F. Canned Goods other than canned fish. The item of principal importance appears to be canned pimientos or peppers, and the Department of Agriculture states that during the last several years the major portion exported from Spain were entirely acceptable and that the recent records of the Department showed very few, if any, detentions. Where entry was restrained, this action was not taken because the product was ‘acid’ or ‘non-acid’, but because improper sterilization or partial spoilage had resulted in a non-sterile product, the bacteria in which constituted a potential health menace. In such cases sorting was permitted and the wholesome tins admitted. Precisely the same supervision is extended to all canned goods in the United States, whether of foreign or domestic origin.
G. Canned fish, principally anchovies, tuna (tunny) and sardines. There has been some difficulty in lack of, or improper, declarations as to weight of contents, but entries have usually been permitted after appropriate rebranding by the importer. In regard to tuna, there has been occasional misbranding, generally corrected in the same way, precisely as the Department of Agriculture requires in similar instances having to do with tuna packed in the United States. With reference to anchovies, the Department of Agriculture reports that out of the large amount imported, there have been a very few instances where the fish have shown evidence of spoilage or decomposition, and in such cases the anchovies have had to be reexported or destroyed.
I. Straw used in tieing garlic or onions. The Department of Agriculture states that it has had correspondence with importers on this subject, and that straw may be used by Spanish shippers without rendering the product subject to restriction, provided the straw is disinfected prior to use, and that it is so certified. It adds that the pertinent regulations are being complied with by shippers from other countries, and that it believes that Spanish shippers will have no difficulty provided they use properly disinfected and certified straw.
J. Canary Island potatoes. It would appear that the difficulty in this connection does not relate to the use of any particular type of packing, but to the fact that Spain permits the importation into Spain and possessions of potatoes from countries where the potato wart is known to exist. Since 1922 the United States has prohibited the entry of potatoes from such countries, and it also prohibits the entry of potatoes from countries which have not established similar health measures. Should the situation in Spain not be as reported above, the Department of Agriculture would of course be willing to reconsider the matter.
D. Marking of individual cork stoppers. Reference is made to Section 304 of the Tariff Act22 which outlines the circumstances in [Page 1005] which the marking requirement may be waived. It is understood from the Treasury Department that although representations were made on this subject by the Spanish Embassy in Washington, no data was submitted in accordance with sub-section (a) of Section 304, on which the Treasury Department could act in compliance with the Spanish request. This matter can be reopened by request at any time through the submission of such data.
H. Firearms. It is assumed that the reference is to revolvers, and the Treasury Department refers to Treasury Decision No. 41655 of June 25, 1926, prohibiting the importation of revolvers simulating certain parts and movements of those patented and manufactured in the United States by Smith and Wesson. Provided they do not simulate a patented American product, Spanish revolvers are admitted, and the Treasury Department points out that in any case, admission of Spanish revolvers is on a basis of complete parity with those from other countries.
“Category 2. Protection of Spanish names, et cetera.
K. California Grapes and American Onions. The Department of Agriculture makes reference to previous correspondence between it and the Spanish Embassy, through the Department of State, concerning the use on California grapes of labels suggestive of Spanish origin, and calls attention to its report in April 1928 of the abandonment of this form of labelling as a result of the activities of the Food and Drug Administration. The Department of Agriculture states that prior to the receipt of a copy of the Spanish memorandum of November 13, 1931,23 it had not previously been aware that Spain was similarly concerned over labels on American onions, and adds that if the Spanish Government will be so good as to furnish specimens or descriptions of the objectionable onion labels, and if they prove comparable to certain of those encountered with grapes, the Department of Agriculture will endeavor to have them abandoned. The Department of State for its part would be glad on request of the Spanish Government to bring any cases, respecting the labelling of either grapes or onions, to the attention of the Federal Trade Commission which deals with alleged unfair trade practices, in addition to that of the Department of Agriculture.
“Category 3. American Tariff Rates.
Items B (Cork Manufactures) and C (Insulation Cork). It is assumed that the Spanish Government is familiar with the flexible provisions of the American Tariff Act, under which it is possible within certain considerable limits, and when investigation by the Tariff Commission has indicated to the President the desirability of so doing, to modify the rates applied to individual products. It is understood that such an investigation has been made in connection with insulation cork, but that no such application for a reduction in duty on cork manufactures has ever been received by the Tariff Commission. Incidentally it may be remarked that there is pending before the Tariff Commission at the present time application for reduction in duties in connection with another item in which Spain is reported to be interested, [Page 1006] namely fresh tomatoes, and that although both the Spanish Embassy and the attorney for the Canary Island tomato producers were present at the recent hearings, the latter did not submit a brief in the premises.
“Should the flexible features of the American tariff, and the provisions under which their application may be invoked, not be sufficiently clear, the Department of State would be willing at any time, on the request of the Spanish Government, to designate an official competent to discuss these matters with a representative of the Spanish Embassy.”
In submitting the foregoing memorandum, I do not believe it would be desirable for you to make reference to the second Spanish memorandum referred to in your telegram No. 11525 of December 22, 5 p.m., inasmuch as the text has not yet been received and you have indicated in the first paragraph of your telegram that it appears to contain little more than an amplification of the first. You should, however, orally emphasize the following points and be sure that they are positively understood.
- Since the United States at present grants most favored nation treatment to Spain, and since its administrative requirements and provisions are applicable to all countries alike, with no discrimination whatever, any discussions such as are suggested variously in the memorandum must necessarily be limited, in cases where the requirements are not susceptible of modification, to better understanding and clarification of procedure, and, in cases where such modification is possible (such as in the flexible provisions of the tariff which would have to do with items B and C of the Spanish complaint for example, or of the marking requirement, complained of under item D), to explaining or clarifying to Spain the proper legal or administrative approach available to the Spanish Government, looking toward such modification.
- If you believe it would be useful at this time to do so, you may also add that the United States stands ready and willing, as heretofore, to negotiate with Spain a commercial treaty providing for reciprocal unconditional most favored nation treatment, and that the American Government believes, moreover, that such an agreement would be of great benefit to the commerce of the two countries.
It is requested that upon the delivery of the memorandum you inform the Department by telegraph summarizing any statements which may have been made to you, and that you also endeavor to obtain an early reply the substance of which should likewise be telegraphed upon its receipt.
The Department is transmitting to you herewith for your consideration and comment a copy of a proposed note of protest25 against Spanish tariff discrimination. This note should not be delivered except upon specific authorization of the Department of State, the [Page 1007] extension of which will depend upon your own comments in regard thereto and developments in connection with the attitude of Spain toward the foregoing memorandum.
Should you be authorized to deliver the note of protest, and should you thereupon be questioned by the Minister of State regarding it, your remarks should be confined to stating that, while obviously you could not predict the course of your Government in the event of the receipt of a negative reply from Spain, you understand that the National Automobile Chamber of Commerce, one of the most important trade bodies in the United States, has recently petitioned the President to cease to extend to Spanish products most favored nation treatment and to apply against them our maximum scale of duties.26 It may be added that you know that your Government is profoundly disturbed over the matter.
Very truly yours,