Foreign Relations of the United States Diplomatic Papers, 1936, General, British Commonwealth, Volume I

811.114 Belgium/210

Memorandum by the Secretary of State²

[Washington,] January 25, 1936.

During the call of the Ambassador,³ I took up with him the question of alcohol smuggling into this country and spoke substantially along the following lines:—

“Mr. Ambassador, I should like to discuss with you informally a situation which is of very real interest to the United States Government. Since last May, five steamers have sailed from Antwerp with a total of approximately 360,000 gallons of alcohol, destined for smuggling into the United States. Four of these vessels discharged their cargoes on the high seas into small, well-known smuggling vessels, and the fifth vessel landed its alcohol cargo at St. Pierre about the middle of last month. The illicit importation of this alcohol into the United States represents a loss to the United States Government of about five million dollars in revenue.

“This smuggled alcohol is used as a base for the manufacture of cheap synthetic liquor; the 360,000 gallons which I have just mentioned would normally be manufactured into approximately 3,240,000 quarts of whiskey, gin, or brandy, which can, of course, be sold at a very low price since no duty or taxes have been paid on it. This illicit product, of course, competes with the products of legitimate producers, both foreign and domestic, and not only reduces their sales but has repercussions in allied trade and industries.

“The United States Government has discussed with a number of other governments the elimination of this traffic. With the cooperation of other governments we have succeeded in eliminating all smuggling bases heretofore existing. Canada, Cuba, Guatemala, Mexico, Great Britain and France have each taken appropriate measures to put an end to the use of their territory as a smuggling base. It is precisely because of the cooperation which we have had from these governments that smugglers have in recent months been compelled to trans-ship their cargoes on the high seas. In most cases, the governments mentioned have eliminated the smuggling of alcohol by requiring a bond in an adequate amount of the production of a landing certificate to insure a delivery of the cargo at its declared destination.

“Belgium now remains the only country from which large-scale alcohol smuggling operations are directed against the United States. I am told that Belgium already has a law, (enacted July 30, 1930), requiring the giving of a bond for the production of a landing certificate covering shipments of alcohol and spirits to neighboring countries. It would thus seem to be a relatively easy matter for Belgium to extend this law to include all shipments of these commodities, regardless of their destination. Such a step would be of great assistance to us, and would be in line with similar action already taken by other countries.

“Last October and November, Ambassador Morris discussed this question in considerable detail with officials of the Belgian Government. At that time your Prime Minister told Mr. Morris that he would be disposed to recommend cooperative action along the abovementioned line, provided that Belgium’s neighbors took similar steps. May I emphasize in this regard that the British and French Governments have already taken action to prevent the use of their territory which has heretofore been used as smuggling bases, and that Belgium is the only country with which we now have a smuggling problem. In these circumstances it seems to me that your Government might well feel that it could cooperate with us in this matter without stipulating that we discuss hypothetical questions with other countries where no problem exists. In fact, I cannot conceal my disappointment at the attitude which your Government has thus far taken.

“May I express the hope that you will ask your Government to reconsider its decision in this matter and give earnest consideration to cooperative action to put an end to this illicit traffic.”^*

The Ambassador expressed special interest in this matter and inquired if he had not already written me a letter indicating that steps would be taken. I replied that no letter had come to my attention, but that I was aware of the fact that the Belgian Government had not thus far taken any steps or shown any sign of taking steps to cooperate with this Government under laws it already has for the purpose of preventing this smuggling, which is so damaging to the United States and worth so little to Belgium as a nation.

The Ambassador said he would give the matter every attention right away and felt sure his Government would be glad to cooperate.

C[ordell] H[ull]

2. Copy transmitted to the Ambassador in Belgium in Department’s instruction No. 320, February 4, 1936, not printed.
3. Count Robert van der Straten-Ponthoz, Belgian Ambassador in the United States.
4. The above quoted paragraphs are excerpts taken from a memorandum prepared in WE [Division of Western European Affairs] for the Secretary’s guidance, [Footnote in the original.]