611.526 Wines/40
The Secretary of State to the Ambassador in Spain ( Bowers )
Sir: There is enclosed for your information a translation of a note of the Spanish Ambassador at Washington, dated February 16, 1934,2 and copy of the Department’s reply, dated February 23, 1934,3 this exchange of notes constituting an agreement to issue permits for the importation of wines and spirits from Spain up to the amount of 1,100,000 gallons in consideration of the purchase by the Spanish Tobacco Monopoly of 1,585,000 kilos of Virginia tobacco, in addition to current purchases of the year.
[Page 691]The Spanish Ambassador stated orally that the Monopoly intends to buy as normal purchases 6,340,000 kilos of tobacco, but insisted that this be not entered in the agreement. The Ambassador also stated that in pounds the amount mentioned in the agreement is 3,494,291 which, added to the so-called normal purchases of 13,977,164 pounds, gives a total of 17,471,455 pounds.
The wines and spirits quota is operated under the terms of a marketing agreement for the alcoholic beverages importing industry and license for the importers of alcoholic beverages issued in connection therewith by the Secretary of Agriculture, December 6, 1933. The agreement and license provides that the minimum amount of any kind of alcoholic beverages that may be imported into the United States from any foreign country during any period shall not be less than the average amount for the like period imported between July 1, 1910, and June 30, 1914. Under this minimum provision, Spain was entitled to a quota of 394,690 gallons for the four months period ending March 31, 1934, but to round off the actual issues of 407,579 gallons, the basic quota for this period has been taken as 410,000 gallons, leaving 2,421 gallons unissued.
Early in January the Federal Alcohol Control Administration announced a second permit period comprising the two months of March and April, for which applications would be received up to January 31 and permits would be issued February 28. Under the minimum provision this established a quota for Spain of 205,000 gallons for the second permit period. Applications to import 1,896,621 gallons of wines and spirits from Spain were filed by American importers. It is understood that the permits distributed February 28 comprised the 1,100,000 gallons covered by agreement, the 205,000 gallons minimum quota and the 2,421 gallons not issued in respect of the first four months period. No publicity has been given to the issue in excess of 1,100,000 gallons.
Very truly yours,