811.512394/66
The Department of State to the Japanese Embassy
Memorandum
The Department of State acknowledges the receipt of a memorandum, dated September 19, 1936, from the Japanese Embassy, in which it is stated that the Nippon Yusen Kaisha, the Osaka Shosen Kaisha and the Toyo Kisen Kaisha are prepared to effect settlement of pending cases in which additional war profits taxes are asserted by the Treasury Department, on the understanding that the amount to be paid as the balance of the deficiencies assessed against the Nippon [Page 962] Yusen Kaisha and the Osaka Shosen Kaisha after deducting any excess assessment to be refunded to the Toyo Kisen Kaisha will not be more than $650,000, and on the further understanding that the payment of interests that may have accrued from the said deficiencies or excess amount will not be claimed in any way.
The Department of State is authorized by the Treasury Department to accept the counter-proposal of the Japanese Government, as set forth in the memorandum of the Japanese Embassy under acknowledgment, as a basis for settlement.
As it is necessary that the details of the plan of settlement be worked out in conference between the Treasury Department and representatives of the steamship companies, it is assumed that the Japanese Government will advise the steamship companies to arrange for such conference at an early date.
The attention of the Japanese Embassy is invited to the fact that it will be necessary for the steamship companies to reach an agreement among themselves as to the allocation of the $650,000 payment among the companies; and inasmuch as the counter-proposal of the Japanese Government stipulates that there should be no payment of interest, it is assumed that the amount mentioned will be paid in cash at the time of the consummation of the agreement.