The Secretary of State to the Minister in El Salvador ( Corrigan )

No. 80

Sir: It has been noted that paragraph (e) of Section 1 of Article IV of the Deposit Agreement of March 24, 1932,27 under which owners of Salvadoran bonds have deposited them with the Bondholders Protective Committee for the Republic of El Salvador, empowers the Committee to

“Amend, modify or adjust the provisions for payment of the principal and/or interest of the Bonds, or some or all of the provisions of [Page 570] the Loan Contract28 or other instrument, or the rights or powers of any agent or agency bearing upon or connected with the collection of the pledged Customs Revenues, or any tribunal or procedure in respect thereof.”

The Department takes it for granted that the Government of El Salvador, in the event it reaches a revised agreement with the Committee referred to, will wish to omit from the revised agreement any reference involving the Government of the United States or any of its officials.

The Department in that case would not, of course, offer any objection to such omission.

You are authorized to set forth the Department’s attitude as outlined, informally and discreetly, to the appropriate officials of the Government of El Salvador should the question arise.

Very truly yours,

For the Secretary of State:
William Phillips
  1. Republic of El Salvador, Deposit Agreement Dated as of March 24, 1982 (n. p., n. d.).
  2. For correspondence concerning the loan contract entered into by the Government of El Salvador and Mr. Minor C. Keith on June 24, 1922, see Foreign Relations, 1922, vol. ii, pp. 885 ff. For the readjustment of this loan contract, see Foreign Bondholders Protective Council, Inc., Annual Report, 1986 (New York, 1937), p.373.