868.151/140: Telegram
The Secretary of State to the Chargé in Greece (Aldridge)
45. Your 90, July 2, 9 a.m. Please address the Greek Minister for Foreign Affairs in writing and inform him that you have been directed by your Government to communicate the following message to him:
“Ulen and Company has informed the competent authorities of the Government of the United States that in connection with extended negotiations instituted by the Greek Government for the purpose of revising the provisions relating to the Société des Eaux of the contract of December 22, 1924, between the Greek Government and Ulen and Company, certain demands have been made of the Company by the Government, one of which is that the partial fee paid to Ulen and Company for supplemental construction work be refunded to the Government.
This question of the fee for supplemental construction work was a subject of discussion between the Greek Minister for Foreign Affairs and the American Minister at Athens early in July of last year. At that time the American Minister expressed the hope that no arbitrary action prejudicial to Ulen and Company’s interests would be taken in the matter by the Greek Government, and that an amicable settlement of the question at issue could be arrived at within the framework of the contract. Assurances in this sense were given to the American Minister by the Minister for Foreign Affairs.
It is now understood that under date of June 26, 1935, at a time when the Greek Government is insisting upon the acceptance by Ulen and Company of a revision of the contract terms relating to the operation of the Société des Eaux, and notwithstanding the fact that Paragraph 2 of Article 45 provides for arbitration in disputes which may arise between the Government and Ulen and Company, the competent authorities of the Ministry of Communications notified Ulen and Company in writing of an intention to withhold the guarantee deposit posted by the American companies under the Struma contract and to apply other compulsory measures to the end that the fee in question be refunded.
Quite aside from the fact that no relationship exists between the contract for the Athens and Piraeus water supply system and for the Struma irrigation works, this effort to force Ulen and Company to [Page 516] accept the Greek Government’s point of view with reference both to the revision of the contract provisions relating to the Société des Eaux and the question of the fee for supplemental construction work, appears to be of an arbitrary nature justifying interposition by the Government of the United States on behalf of an American company which is prepared to respect its commitments and to submit the various questions at issue to arbitration.
It is with the confident hope that these questions can be settled either by mutual compromise or by arbitration that my Government has directed me to bring this matter to your urgent attention.”
The Department understands that Ulen and Company is most anxious to avoid the cost and delay of arbitration. You may therefore express the hope when presenting this note that an expeditious settlement by way of mutual compromise can be arrived at.