611.5531/541: Telegram

The Ambassador in Belgium (Morris) to the Secretary of State

42. Department’s telegram No. 19, April 22, 2 p.m. Camu informed Commercial Attaché today in strict confidence that new decree is now being drafted by the Belgian Government in order to give effect to the provisions of the United States-Belgian Trade Agreement. This decree places a liberal construction on the provisions of the agreement dealing with automotives. Five new categories of automobile parts not included in the trade agreement will be added to the list of parts on which the duty has been reduced to 2½ francs per kilo. The new categories are shock absorbers, brakes, chassis, frames, axles and carburetors.

It is probable that after 1 month licenses for which no fee will be charged will be required for the importation of automobile parts, the stated object being to protect bona fide assembly plants against unfair trade competition and practices. A tentative arrangement has been reached between the Belgian Government and the assembly plants here providing that companies which expend 4000 francs in Belgian labor and materials on each car assembled in Belgium will enjoy all the benefits stipulated in the new agreement.

The Belgian Government is taking steps to prevent importers from resorting to the subterfuge of importing partially assembled cars in order to obtain the benefit of the reduced rates on parts. Camu referred to his conversation with Culbertson on this point.