The Ambassador in France (Bullitt) to the Secretary of State
[Received August 21—10:31 a.m.]
1188. Reference our 1164, August 16, 5 p.m.10 I have today received a letter dated August 19 from the Ministry of Foreign Affairs signed by Leger in the absence of Delbos of which the following is a translation:
“Mr. Ambassador: Following the exchange of views between the representatives of your Embassy and those of the French Government relative to the importation of American apples and pears into France, I have the honor to inform your Excellency that the French Government will take the following measures concerning the license taxes and the delivery of import authorization for apples and pears. These measures which will be applicable until September 30, 1938, will go into effect on the date upon which this letter and the reply from Your Excellency will be published in the Journal Officiel.
1. License taxes. As an indication of its good will and following the representations made by the representatives of the American Government, the French Government will reduce by 50% for the entire season 1937–1938 the license taxes assessed upon the importation of apples and pears. Accordingly, the maximum license taxes assessable during this entire period will be 16 francs per quintal for apples and 24 francs per quintal for pears.
Moreover, the French Government undertakes not to impose upon the importation of apples and pears any license tax of a protectionist character. The established license taxes have no other basis than to assure the payment to the Treasury of a part of the difference in price between the national products and the imported products. In the absence of such a measure this difference would in effect [be] gained by the private importers. As a result these taxes will be subject to a new decrease if the differences in prices mentioned should justify such decrease.
2. Distribution of licenses. The French Government has undertaken a careful investigation among the beneficiaries of licenses to determine to what extent these licenses are actually being utilized. It undertakes in the future to deliver licenses only to those importers likely to utilize them to the maximum in order to guarantee in conformity with the trade agreement as complete utilization as possible of the quota for apples and pears allotted to the United States.
To assure the maximum utilization of these licenses, the French Government will accord import authorizations only to those having import rights who have undertaken irrevocable commitments for the importation of fruit or who have contracted with a dealer or agent having himself irrevocable commitments. These commitments will be proved by production of irrevocable bank credits.[Page 283]
In view of the fact that the allotment to the United States for the importation of apples and pears for each quarter is specified under the trade agreement and to credit the maximum use of the quota the French Govt. undertakes to deliver the licenses within the first 10 days of quarter.
I should be glad if your Excellency would be kind enough to let me know if the preceding arrangements meet with the approval of the American Government”. End of letter.
I believe that this proposal is satisfactory and I hope that you will cable me your approval as soon as possible so that I may send my letter of acceptance.11
. . . . . . . . . . . . . .
The French Government plans, if we agree, to publish between the 1st and 15th of September the exchange of letters putting these measures into force as well as the necessary decree effecting the stipulated reduction in license taxes. Pending such publication the French Government has agreed, as soon as we have accepted this proposal, that we may notify discreetly but not through published notification, the interested American exporters and French importers of the measures agreed upon but the French Government requests, in view of pressure from certain European countries for a commitment from the French Government to engage itself to issue licenses for other products immediately after the first of each quarter, not to specify the exact engagement made with the United States, namely, that licenses will be issued within the first 10 days of each quarter but merely to state that the French Government will do everything in its power to issue these licenses at the earliest possible date after the beginning of each quarter.