The Minister in Czechoslovakia (Wright) to the Secretary of State

No. 437

Sir: Although I am as yet unable to report definitive results from the representations which I have made pursuant to your instruction No. 113 of April 7, 1936, concerning discrimination by Czechoslovakia against American merchandise, I have the honor to report as follows in order that the Department may be informed as to the steps which I have taken and the developments which have occurred to date.

The instruction under acknowledgment was received on April 22nd. On Monday April 27th—the first day upon which the Minister for Foreign Affairs could arrange to see me—I handed him under cover of my note No. 97 of April 24—a copy of which is herewith enclosed11—your note which was transmitted to me with the aforementioned instruction.

The tenor and result of my conversation with the Minister is set forth in the enclosed self-explanatory memorandum thereof, dated April 27th.11 On April 29th, I had a long conversation with Messrs. Friedmann and Stangler, Chief and Assistant Chief respectively of the Economic Section of the Foreign Office, pursuant to arrangements which had been made by the Minister on the day following my conversation with him. Preparatory to such conversation and in order to provide for my own assistance—as well as for transmission to the competent officers, if such should prove advisable—a statement of the practices and specific instances of which we complained in the form of an Aide-Mémoire was compiled with the assistance of the Commercial Attaché, a copy of which is also enclosed,11 and which, I trust, embodies all the instances and practices enumerated in, or envisaged by, your instruction. In this connection I welcome the opportunity of expressing my appreciation of the valuable assistance rendered by the Commercial Attaché’s Office—especially in the preparation of confidential data in support of each item of the Aide-Mémoire, which will be of great value in succeeding conversations and copies of which will be transmitted to the Department in due course.

I began the conversation by an expression of my assumption that Messrs. Friedmann and Stangler were in possession of the note of the Secretary of State, dated April 7, 1936, transmitted to the Minister [Page 34] for Foreign Affairs on the 27th instant as an accompaniment to my note of the 24th, and that they had re-read the notes exchanged in Washington on March 29, 1935, between the Czech Minister to the United States and the Secretary of State, together with the Aide-Mémoire of November 27, 1935, handed to the Czech Minister by the Department of State at his request. They said that such was the case.

Dr. Friedmann then suggested that, pursuant to the suggestion contained in the note of the Secretary of State, I inform them of the specific instances with which my Government was not satisfied, in order that all phases of each case might be discussed between us. I replied that I had already prepared an Aide-Mémoire preparatory to such procedure, the points in which I would proceed to discuss. Before doing so, however, I improved the opportunity to endeavor to explain again to these officials the principles underlying the policy of our Government in this matter: namely, that we desired—in fact, that it practically amounted to a demand—that in such instances as our trade with a respective country was governed by any such instrument as the present Modus Vivendi between our two countries, American products be accorded equality of treatment; and that I had hopes that the amicable spirit of our conversations would permit me in due course to discuss such practices as those enumerated in the last page of the Aide-Mémoire, to which I then called the attention of Dr. Stangler, who speaks English, requesting him to translate them into Czech for the benefit of Dr. Friedmann (with whom my conversation was in German). I added that the two principal phases of the matter with which my Government was not at present satisfied, were set forth in the Aide-Mémoire of November 27, 1935—the reasons supporting such opinion to be discussed in detail in our forthcoming conversations.

I then commenced detailed discussion of the instances in the order in which they are set forth in the Aide-Mémoire—beginning with automobiles. This consideration of the three phases of this situation set forth on Page 1 of the Aide-Mémoire led to such detailed discussion that the time at the disposal of these officials was exhausted, and I was requested to return at a later date to be set by them—not before May 11th—for a continuation of the discussions, the Foreign Office meanwhile undertaking to obtain from all available sources information with which detailed reply will be made to each point in my Aide-Mémoire. In this connection request was made as to whether I was in a position to furnish data in writing in order to assist the Foreign Office in the preparation of their reply. The opportunity being thus presented—as I had hoped—for a demonstration of complete frankness in the discussions, I stated that I had prepared my Aide-Mémoire with such eventuality in mind and then handed them two copies thereof.

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It therefore only remains for me to report in this despatch that Messrs. Friedmann and Stangler observed with regard to Item 1 (a) “Private” duty refunds for automobiles other than of American manufacture, that the Commercial Attaché had undoubtedly apprised me of the information which he had given him; to the effect that this practice had been discontinued as of date of March 31st last, and that a new basis of allowances for the importation of French automobiles had been fixed. I replied that Mr. Woods had, of course, done so and that I had so reported to my Government (see despatch No. 433 of April 20, 193612). Dr. Stangler then stated that the Czech Legation in Washington had been directed to convey the same information to the Department of State and inquired whether this information had not probably crossed the instruction upon which I was now working. I replied that it had and that of course my Government would be interested in the information thus communicated: I added, however, that under my instructions I hoped in due course to receive confirmation of this fact—probably in the form of a reciprocal Aide-Mémoire in which reply would be made to each of the matters to which I had referred.

It is interesting to observe at this point that, notwithstanding repeated denials by officials of this Government in the past that discrimination of this nature in favor of French cars existed, the information and assurances now received from Dr. Stangler are tantamount to an admission that such practices did obtain.

Intimations are not lacking that directions have been received from superior officials that this entire matter of commerce with the United States under the existing Modus Vivendi be discussed immediately and in detail, and I shall, of course, report developments as they occur—although it is not improbable that a certain amount of delay may ensue with regard to some items.

Respectfully yours,

J. Butler Wright
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