611.5131/457: Telegram
The Secretary of State to the Ambassador in the Soviet Union ( Davies )
103. Department’s 102, July 17, 2 p.m., and your 177, July 19, 11 a.m. The Department is prepared, on the basis of an undertaking by the Soviet Government for purchases of $40,000,000, to include in the agreement an exportation clause to be inserted in Section 1 of draft as given in Department’s 85, July 8, 6 p.m. as follows:
- (a)
- Insert between paragraphs 2 and 3 of Section 1 the following
paragraph: [Page 430]
“Similarly, natural or manufactured products exported from the territory of the United States of America and consigned to the territory of the Union of Soviet Socialist Republics shall in no case be subject with respect to exportation and in regard to the above-mentioned matters, to any duties, taxes, or charges other or higher, or to any rule or formalities other or more burdensome, than those to which the like products when consigned to the territory of any third country are or may hereafter be subject.”
- (b)
- Insert before the last paragraph of Section 1 the following
paragraph:
“Nothing in this agreement shall be construed to prevent the adoption of measures prohibiting or restricting the exportation or importation of gold or silver, or to prevent the adoption of such measures as the Government of the United States of America may see fit with respect to the control of the export or sale for export of arms, ammunition, or implements of war, and, in exceptional cases, all other military supplies. It is understood that any action which may be taken by the President of the United States of America under the authority of Section (2) (b) of the Neutrality Act of 1937 in regard to the passage of title of goods shall not be considered as contravening any of the provisions of this agreement relating to the exportation of natural or manufactured products from the territory of the United States of America.”
If it is possible to conclude negotiations on this basis, please cable Department as soon as possible the exact date on which it is proposed to sign agreement, and whether approval by the Soviet of People’s Commissars can be obtained on same date, so that necessary arrangements can be made for simultaneous Proclamation by the President and release of statement to the press here.