The Secretary of State to the Chargé in Latvia (Cole)

No. 221

Sir: Reference is made to the Legation’s despatch No. 1461 of July 7, 1933, reporting on discriminatory trade legislation in Latvia and more particularly to the two cases of alleged discrimination against imports of American automobile tires and motor oil described on page two thereof. The Department has carefully examined the facts set forth in the Legation’s despatch under reference but it is not able to determine therefrom whether these two cases actually constitute discrimination by the Latvian authorities against American trade, since the Legation has failed to include in its report complete and precise data with respect to Latvian imports of these two commodities.

There is, for example, nothing in the despatch to show whether the United States is receiving equitable treatment with regard to the granting of permission to import automobile tires and motor oil of American origin into Latvia. In the case covering the imports of automobile tires, the Latvian Imports Regulating Commission denied an application for permission to import some 2,000 kilograms of automobile tires of American origin while at the same time granting in part another application filed by the same importer for permission to import tires of British origin. Such action in a single case may not constitute discrimination against American trade by officials of the Latvian Government. If the Latvian authorities have granted equitable quotas to tires of American origin in acting on other applications for permission to import tires, [Page 615] the action taken by the Imports Regulating Commission in the case reported in the Legation’s despatch under reference would not necessarily constitute discrimination against American trade. This same comment applies to the case with regard to the imports of motor oil of American origin.

The Department has observed that the Latvian Ministry of Foreign Affairs in its note to the Legation dated April 21, 1933, a copy of which was transmitted to the Department by the Legation as enclosure No. 1 to its despatch No. 1314 of April 26, 1933, states strongly, and supports its statements with statistics covering imports from the United States, that American commerce is receiving equitable treatment in Latvia. In its reply to the Latvian Foreign Office, the Legation apparently cites in its note No. 176 of April 24, 1933, a copy of which was transmitted to the Department as enclosure No. 2 to despatch No. 1314 of April 26, 1933, the two cases commented on hereinbefore as examples of actual discrimination against American trade by Latvian officials. While the Department approves of the general statements regarding most-favored-nation treatment made by the Legation in this note, it believes that the two cases should not have been brought to the attention of the Latvian Foreign Office in this manner without the inclusion of the pertinent facts relating to American participation in Latvian imports of tires and motor oil tending to establish definitely discrimination against American trade, particularly in view of the fact that the Latvian Foreign Office had already asserted to the Legation that statistical data covering imports from, and the release of foreign exchange to, the United States indicated that American trade was receiving equitable treatment in Latvia.

The Department is of the opinion that its instruction No. 182 of April 4, 1933, pointed out clearly to the Legation the need for careful investigation into, and accurate determination of, all the facts relating to cases of seeming discrimination against American imports into Latvia in order that it may take appropriate measures properly to protect American trade. The data contained in the Legation’s despatch under reference does not indicate that such investigations are being made or, at least, reported to the Department by it. The Legation is again cautioned to be in full possession of all the facts before taking action on cases involving alleged discrimination against American trade. The Department hopes that the next quarterly report on the Legation’s activities in connection with the protection of American trade in Latvia will reflect greater diligence and precision in carrying out this important function of the Department and its representatives in the field.

Very truly yours,

For the Secretary of State:
Wilbur J. Carr