611.42251/133

The British Embassy to the Department of State

Aide-Mémoire

In connection with the tariff preference to Empire wheat granted under the Ottawa Agreements Act, there has been considerable doubt in political and trade circles whether this preference would be applicable to wheat of Canadian growth which on its way from Canada to the United Kingdom has passed through and possibly been stored at the United States Lake Port of Buffalo and thence forwarded by rail through United States territory for shipment from New York or other Atlantic Ports of the United States.

In the case of the recent shipment by a Canadian exporter on the Cunard steamer Laconia, there was no evidence that when the wheat left Canada it was in fact consigned to the United Kingdom, and the decision of the United Kingdom Customs was to the effect that the preference could not be accorded in this case as the documents did not comply with the conditions necessary to establish a claim. If the wheat in question had in fact been consigned at the time it left Canada to an individual or company in the United Kingdom and if the documents had clearly established this to the satisfaction of the United Kingdom Customs, the wheat would have been accorded preferential treatment.

On the general question His Majesty’s Government in the United Kingdom desire to state that there would appear to be no reason why exportation of wheat from Canada cannot be effected in such a manner as to satisfy the conditions as to Imperial preference notwithstanding the fact that it is transitional through the United States.

His Majesty’s Government in the United Kingdom desire to emphasize that the requirements of consignment from a part of the Empire is not in any sense new but has on the contrary been an essential principle of preference ever since 1919. It is therefore obvious that there [Page 2]can be no question of this being an innovation designed to prejudice United States interests in connection with the new wheat preference.