661.9131/121
The Minister in Persia (Hart) to the Secretary of
State
No. 1323
Teheran, January 12, 1933.
[Received
February 10.]
Sir: I have the honor to acknowledge the
receipt of the Department’s special written instruction No. 198 of
November 14, 1932, file
[Page 810]
No. 661.9131, and telegram No. 27 of December 30, 4 p.m.,16 directing me
to dispatch to the Persian Minister for Foreign Affairs a first
person note protesting formally in the matter of the discrimination
against American trade with Persia resulting from the Perso-Soviet
Convention of October 27, 1931.
As a matter of record, I enclose a copy of the note, No. 411, which
in accordance with those instructions, I addressed to the Persian
Foreign Minister under date of January 5, 1933.
Permit me, at the same time, to refer to the following passages of
the written instruction under acknowledgment:
[Here follow paragraph 3 and the first sentence of paragraph 4 of
instruction No. 198, printed on page
808.]
I shall comment briefly on the points raised in the second and third
of the above quoted paragraphs, to the end that the Department may
be informed of my reasons for not incorporating reference thereto in
my above-mentioned note.
Under the first point I found, after consultation with local
representatives of American automotive interests, that no
discrimination in fact, prejudicial to their interests or to those
of their principals, results from the privilege in question.
Practically all of their importations are, in the ordinary course of
the trade, made either through Mohammerah or via Baghdad through
Kermanshah. And I have not been able to learn of any specific case
where the Persian port quotas have prevented their making such
importations by way of such port as, in any particular instance,
they may have preferred. Further, these port quotas are flexible
figures, used rather as a guide than as a fixed “control” factor.
Frequently one sees reported in the local press notice of the
increase of one port’s quota together with a corresponding decrease
in that of another. This, I am reliably informed, is to facilitate
the normal movement of imported goods.
On the second point I was unable to ascertain any facts whatsoever
tending to substantiate the report of the National Automobile
Chamber of Commerce. I believe that report may have had its origin
in the fact that at Pahlevi the Soviet Trade Delegation (Torgpred)
has constructed at its own expense and is permitted to use its own
bonded warehouses. Obviously, on merchandise in such warehouses the
Persian Customs Administration makes no demurrage charges, whereas
on goods in its Government-built-and-owned warehouses such “service”
charges are levied.
Respectfully yours,
[Page 811]
[Enclosure]
The American Minister (Hart) to the Persian Minister for Foreign
Affairs (Foroughi)
No. 411
Teheran, January 5,
1933.
Highness: I am instructed by my
Government to refer once again to the subject of the
Perso-Soviet Convention of October 27, 1931, and its effect on
American trade with Persia, and in particular to the views of
the American Government on this matter as set forth in a
memorandum presented to the Under Secretary of State for Foreign
Affairs on April 14th last. To date no reply has been received
from the Persian Government either to the memorandum in question
or to the Legation’s oral representations on the subject.
The Government of the United States has taken cognizance of the
fact that with the exchange of ratifications on June 22, 1932,
the Perso-Soviet Convention has now fully come into force. As
the Persian Government has previously been informed, my
Government considers that the most-favored-nation clause of the
Provisional Agreement of May 14, 1928, between the United States
and Persia entitles American trade with Persia to privileges
equivalent to those accruing to Soviet trade under the
Perso-Soviet Convention, and in my Government’s judgment it does
not appear that such privileges are accorded to American trade
under any of the provisions of the present trade monopoly
regulations of Persia. In particular, after a careful
examination of the recently amended foreign trade monopoly law,
my Government is of the opinion that the so-called bank
guarantee plan incorporated in Article 8f2 of that law fails to
afford American trade with Persia, if such was its intent,
facilities equivalent to those granted to Russian trade under
the terms of the Perso-Soviet Convention.
From the standpoint of the American exporter, my Government finds
especially burdensome the two essential requirements
conditioning the issue of import permits under the Persian trade
monopoly law which Soviet importers in Persia are not required
to fulfill and which therefore appear to be of a nature
discriminatory against American trade with Persia: namely, the
requirement to export Persian goods before importing an
equivalent amount of foreign goods; and the requirement to sell
to the Persian Government foreign exchange to the value of such
exports. Furthermore, it appears that under the newly amended
trade monopoly law an importer not wishing to avail himself of
the bank guarantee plan may import goods only up to 95 per cent
of the value of his export certificate, a stipulation not
applied in the case of Soviet trade and therefore also
discriminatory
[Page 812]
in fact
against American trade with Persia. In addition, mention may be
made of the flexibility enjoyed by Soviet commerce in the matter
of balancing exports against imports, in contrast to the
provisions of Article 8f2 above referred to, under which
importers of American goods must effect such a balance within
six months not from the date of actual importation but from the
date of receiving an import permit.
My Government desires me to reiterate at this time its view that
the monopolization and percentage allotment of import quotas in
favor of Soviet trade is incompatible with the
most-favored-nation principle and that to the extent that this
practice results in an adverse effect on American trade it
regards such monopolization and percentage allotment of quotas
as constituting additional discrimination against American trade
with Persia. I am instructed to add that an early expression of
the Persian Government’s views in the above matters would be
appreciated.
Accept [etc.]
