651.116 Nitrate/9: Telegram

The Secretary of State to the Ambassador in France ( Edge )

452. Your 667, September 8, 6 p.m. Barrett Company advises Department that Chairman of Nitrates Commission had indicated to [Page 261] their agent that French domestic corporation which will be formed to monopolize the import of nitrates will not call for tenders but will distribute licenses on the basis of an annual quota of 350,000 tons, including 60,000 tons already licensed. Receivers of licenses must guarantee to retain one-third of the material licensed as permanent stock in France and to contribute 18 francs per 100 kilos on remaining two-thirds, to the French corporation. This contribution will be passed on by the corporation to French nitrogen producers and to French agricultural interests, thus in effect requiring foreign producers to subscribe to a fund for the direct benefit of their French competitors.

Barrett Company further advised that quotas have been assigned as follows: Germany 100,000 tons, Norway 50,000 tons and the balance to Chile and to Arcadian nitrates. Intimation was that Arcadian quota was 10,000 tons. Barrett Company states further that German and Chilean producers have large stocks of nitrates already in France which are exempt from this new regulation.

Embassy is directed to inquire as to substantial accuracy of proposed method of assigning licenses and in particular as to whether it is proposed that the French nitrogen producers shall be the direct beneficiary of the contribution suggested from foreign producers. As this allegation raises the question of a principle entirely apart from the American interests directly affected Department desires fullest details with a view to considering vigorous protest if method outlined is confirmed by French officials.