811.114 Mexico/345

The Secretary of State to the Chargé in Mexico ( Norweb )

No. 722

Sir: Within the past six months the bases of operations from which the greater part of the smuggling of alcohol and liquors into the United States has been carried on have gradually been closed. The Cuban Government, by a decree dated November 30, 1934, prohibited the exportation of alcohol and alcoholic beverages to any territory which is believed to be used as a smuggling base. This action was in addition to the requirement already in force, providing for the giving of a bond conditioned on the presentation of a landing certificate showing the arrival of the cargo at its declared destination. This has effectively prevented the shipment of alcohol and alcoholic products from Cuba intended for smuggling into the United States, both directly as well as by means of transshipment in a port of another country.

On February 16, 1934, the British Government instituted in Newfoundland the following regulations which have prevented the further use of the port of St. John’s as a smuggling base:

Clearance of vessels for “the high seas” with cargoes of spirits is prohibited.
No liquor may be exported from any port of Newfoundland in a vessel of less than two hundred tons.
A bond in double the amount of the import duty must be given for the production of a landing certificate covering any liquor exported from or transshipped in any port of Newfoundland.

[Page 416]

Bermuda has a law requiring the giving of a bond in an amount triple the import duty, conditioned upon the presentation of a landing certificate showing the arrival of the spirits at their declared destination. The Government of Bermuda, furthermore, has expressed its determination that the Island shall not become a base for the operation of smugglers. In addition, we have been informally assured by the British Government that, should smuggling develop in any of the other British West Indies, similar regulations to those instituted in Newfoundland will be placed in effect wherever necessary.

The French Government, within the last two weeks, has adopted regulations similar to those in effect in Newfoundland to prevent the use of St. Pierre-et-Miquelon as a base of operations for liquor smugglers. It is confidently believed that these regulations will be effective in closing the port of St. Pierre to the unprincipled persons who have heretofore used it for many years as a smuggling base.

The matter of preventing the use of Puerto Barrios by those engaged in smuggling alcohol and liquors into the United States has been taken up with the Government of Guatemala and it is believed that a favorable reply will be received.

The Canadian Government had previously taken effective measures to prevent the use of its territory as a smuggling base. There has been in effect in Canada for a number of years a requirement that a bond for the production of a landing certificate be given in all cases in which liquors are exported from or transshipped in ports of Canada, and this was implemented in 1930 by a law prohibiting the exportation of alcoholic beverages to any country where their importation is forbidden. With the repeal of the 18th Amendment this law no longer applied to the United States, but in order to guard against any attempts to smuggle, the Canadian Government took the further step of permitting no liquors to be released from warehouses for shipment to the United States except upon the presentation of an invoice certified by an American consular officer, showing that the liquor will be legally imported.

This Government has, therefore, succeeded, with the cooperation of foreign governments, in eliminating practically all of the chief bases from which alcohol and alcoholic beverages have been smuggled into the United States for several years. Those engaged in this illicit traffic will therefore be compelled to seek other fields from which to operate and Mexico remains practically the only country from which it could be done successfully. It is most likely, therefore, that the smugglers will make an effort to transfer their operations to Mexican ports.

Shortly before the Cuban decree prohibiting the exportation of alcohol and alcoholic beverages to smuggling bases was promulgated, preparations were actively in progress for large scale operations [Page 417] involving the Island of Cozumel, Mexico, the chief port of which, it is understood, had recently been made a free port. Several steamships with large cargoes of alcohol were expecting to leave Habana for Cozumel where the cargoes were to be landed and later loaded on smuggling vessels. One of these steamships succeeded in leaving Habana before the decree was placed in effect. There are enclosed two copies of a letter, one of which may be forwarded to the Mexican authorities, advertising Cozumel as a smuggling base. The advantages arising from the fact of its being a free port, with no landing certificate requirements, and, furthermore, that there is at present no restriction against the transshipment of alcohol and alcoholic beverages from abroad, would appear to make it most desirable as a base of operations for the illicit liquor traffic.

The island of Contoy, off the coast of Yucatan, has also served from time to time as a port of transshipment for liquors to be smuggled into the United States. Other reports, just received, indicate that fishing vessels are surreptitiously taking on cargoes of spirits at a point on the Gulf coast a few miles south of the Rio Grande River. Furthermore, vessels with cargoes of alcohol and liquors destined for smuggling into the United States have been leaving from Ensenada and other ports on the west coast of Mexico for some time and it is believed that this traffic will increase in the near future, due to the closing of other bases of operation.

In view of this situation you are requested to take up the matter with the appropriate Mexican authorities, pointing out the cooperation which has been received from the Governments of Great Britain, France, Canada, and Cuba, as the result of which those engaged in liquor smuggling have been driven from their former strongholds and will undoubtedly seek to establish themselves on Mexican territory. This Government does not believe that the Mexican Government will wish to lend its aid and assistance, and the facilities of its ports, to these lawless individuals, who are a menace to the order and good government of all countries as they will violate the laws of any country if it is to their financial interest to do so.

You should, therefore, express the earnest hope that prompt action will be taken by the Government of Mexico to prevent the use of Mexican territory for these illegal operations. The following measures, which are similar to those adopted by the British Government in Newfoundland and by the French Government in St. Pierre-et-Miquelon, would be most helpful in this connection:

Refuse clearance from any port of Mexico to any vessel or vehicle with a cargo of alcohol or alcoholic liquors destined for “the high seas”.
Refuse clearance from any port of Mexico to any vessel or vehicle of less than two hundred tons, net, loaded with alcohol or alcoholic liquors, destined for a foreign port or place.
Require the production of a landing certificate, under penalty of a bond in a suitable amount (for example, in Newfoundland the amount of the bond required is $11.60 a proof gallon), to insure the arrival at its declared destination of any alcohol or alcoholic beverages exported by land or water from Mexico, or transshipped in any port thereof.

If, in addition, the provisions of Circular No. 21—30—293 dated September 20, 1929, issued by the Ministry of Finance, prohibiting the reexportation and transshipment of spirits entering Mexico from abroad, could be reestablished, there would appear to be very little likelihood that Mexican territory would afford a foothold for the unscrupulous individuals engaged in the smuggling traffic.

You may assure the Government of Mexico that its cooperation in this matter will be greatly appreciated.

The result of your representations will be awaited with interest.42

Very truly yours,

For the Secretary of State:
Sumner Welles
  1. During subsequent months, the Embassy kept the Department informed of its correspondence and conversations with Foreign Office officials on this subject. Finally the Chargé noted in despatch No. 3146 of December 23, 1935, “that to date no satisfactory progress has been made, although the Embassy has received various assurances from officials of the Foreign Office to the effect that the Mexican Government was willing to cooperate with the United States in order to curb smuggling and had instigated studies to determine the most effective method which it could adopt.” (811.114 Mexico/402)