660F.116/115: Telegram
The Secretary of State to the Minister in Czechoslovakia (Wright)
47. Anderson Clayton and Company inform us that Czechoslovakian Government has published a law or decree requiring their cotton mills that buy cotton from Germany to pay minimum 4 percent of invoice value in reichsmarks, hence not over 96 percent in dollars. This measure is applied also to contracts between Anderson Clayton and Company and Czechoslovakian mills because these contracts are negotiated through the Clason Burger and Company of Bremen, Germany, who are the general sales agents through central Europe for Anderson Clayton and Company. These contracts are signed for Anderson Clayton and Company as follows: “We confirm having sold for account Anderson Clayton and Company, Houston.” These contracts stipulate payment in dollars and the cotton is financed by New York banks whose terms require repayment in dollars and no other currency.
The Department suggests that you investigate the situation and ascertain whether there is any good reason why the Czechoslovakian law or decree applicable to cotton purchased from Germany should be made to apply to cotton sold directly to Czechoslovakia by Anderson Clayton and Company or other American firms even though made through an intermediary Bremen firm.
Please cable brief reply.