882.635 Neep/5

The Minister in Liberia ( Walton ) to the Secretary of State

No. 126

Sir: Referring to my telegram No. 42, August 30, 10 a.m.54 I have the honor to transmit herewith full text of the agreement entered into by the Liberian Government and the Noord Europeesche Erts En Pyriet Maatschappy.

The agreement, which is to be submitted to the Liberian Legislature when it convenes in October, has been the subject of much discussion. Mr. D. Caffe, Director of the Holland Syndicate, who has been an active and conspicuous figure in promoting the project, has left Monrovia for the Gold Coast. After spending a short time there looking after his company’s interests he will proceed to Amsterdam, home office of the Noord Europeesche Erts En Pyriet Maatschappy, to confer with the principals. He expects to return to Monrovia early in November.

President Barclay, in an informal discussion of the agreement with me, stated that for some time criticism has been directed against Liberia for not developing its mineral resources. He felt that in this move Liberia would prove to the world that this accusation is unwarranted.

The attitude of the Firestone Plantations Company toward the granting of a concession to the Noord Europeesche Erts En Pyriet Maatschappy is not known at Monrovia. However, representatives here manifest deep concern over the future labor situation in the event the Noord Europeesche Erts En Pyriet Maatschappy enters Liberia.

American, British and French diplomatic representatives at Monrovia have informally made known to the Secretary of State that they do not look with favor on the building of a harbor near their respective Legations. Assurance has been given that no harbor will be near enough to their sites to be deemed by them objectionable.

Respectfully yours,

Lester A. Walton
[Page 834]
[Enclosure]

Agreement Between the Government of the Republic of Liberia and the Noord Europeesche Erts En Pyriet Maatschappy

This Agreement made and entered into at the city of Monrovia in the Republic of Liberia this twenty-third day of August in the Year of Our Lord Nineteen Hundred and Thirty-seven by and between The Government of the Republic of Liberia, hereinafter styled “the Government,” represented by Gabriel L. Dennis, Secretary of the Treasury, R. L., and the Noord Europeesche Erts En Pyriet Maatschappy, a company organized and existing under and by virtue of the laws of the Netherlands, with principal offices established at Amsterdam, Holland, hereinafter styled “Neep,” represented by D. Caffe, Director Holland Syndicate.

Witnesseth:—

Article I

  • Section A. That the Government hath agreed and by these presents doth agree to grant to Neep for a period of three years and six months (3½ years) computed from the date on which notice is given to Neep by the Government that this Agreement has been ratified by a law of the Republic of Liberia the sole and exclusive right and license to explore and prospect for the research of iron ore and other ore, with the exception of platinum, diamond and gold, through the Western Province including the Bong Mountains area in the Central Province of said Republic, excluding only such areas as shall prior to the date hereof have been granted to third parties; all of such excluded areas Neep may neither explore nor prospect.
  • Section B. That the Government undertakes to grant to Neep such assistance as may enable the experts and other technicians sent by Neep to carry out their task in the best and most efficient manner.
  • Section C. In consideration of the exploration and prospecting rights hereby conferred, Neep will expend from its own resources the full costs of such exploration and prospecting and place at the disposal of the Government copies of all surveys and other maps which may be the result of their work. Of the maps placed at the disposal of the Government under the terms of this section, all maps of a geographical nature shall become the unrestricted property of the Government whilst all maps and plans of a technical nature shall be treated as confidential and remain the exclusive property of Neep.

Article II

Should Neep before the expiration of the period of Three (3) Years and Six (6) Months mentioned in Article I, Section A. of this Agreement notify the Government that Neep is of the opinion that the working of one or more of the mining areas explored and prospected [Page 835] is justifiable from an economic point of view, then the Government hath agreed and by these presents doth agree to grant, demise and let unto Neep for a period of Eighty (80) Calendar Years, commencing on the date that notice is given to Neep by the Government that this Agreement has been ratified by a law of the Republic of Liberia, an area or areas of land within the Republic of Liberia aggregating Six Thousand Five Hundred (6500) Acres or any lesser area or areas that may be selected by Neep from time to time within said period of Eighty (80) Years; such lands to be suitable for mining iron ore and/or other ore with the exception of platinum, diamonds and gold.

Nevertheless, should any particular area of land so leased by Neep be subsequently found useless at any time before the expiration of the lease period and Neep so desires, they shall have the right to give one (1) Year’s notice to the Government in writing and in that case shall be entitled to a cancellation of the lease for that particular area. But should Neep within One (1) Year after the execution of the first lease of land under the conditions herein expressed fail to commence operations in Liberia towards the development of its enterprises, the obligations of the Government under this Agreement shall be discharged and ended.

Article III

The Government in consideration of (1) the establishment of Neep’s enterprises in the Republic of Liberia and (2) the payment of the royalty for which provision is made in Article IV, Section C. hereof, agrees that during the life of this Agreement Neep shall have and enjoy the following additional rights and exemptions:—

  • Section A. Neep shall have the exclusive right to take by mining or any similar operation and in any manner which Neep may deem fit, the iron and/or other ore contents of the subsoil of the leased lands as well as the iron and/or other ore contents occurring on the surface of the leased lands, except platinum, diamonds and gold.
  • Section B. Neep shall during the life of this Agreement be entitled to make such importations as may be directly necessary for the operation, development and maintenance of its mines and enterprises and to export without restriction the iron ore contents thereof and freely to transport such exports and imports by land or water within the Republic. Neep shall submit to the Government before starting importations, a list of the articles which may be directly necessary for the operation, development and maintenance of its enterprises and mines in Liberia. This list shall be binding upon both parties after mutual agreement thereon.
  • Section C. Neep shall during the life of this Agreement be wholly free and exempt from the payment of any duties, imposts and excises [Page 836] on machinery, tools, things and substances to be used directly by Neep for the operation, development and maintenance of its mines and enterprises in Liberia, and to the free exportation of machinery, equipment, iron ore and iron; such imports as are hereby exempted from duty shall in no instance be sold, bartered or exchanged by Neep, except directly to the Government of Liberia.
  • Section D. Neep shall have the unrestricted right to construct and establish at its own expense a harbour basin and likewise to construct and operate therein such harbour facilities as Neep may deem necessary for the efficient exportation of its ore and shall be exempt from the payment of harbour dues, wharfage dues and light dues in respect of such harbour during the life of this Agreement, provided however, that said harbour basin shall be located either in the vicinity of Monrovia, Liberia, or in the vicinity of Cape Mount, Liberia, and the final choice between locations to rest with the Government; said choice to be made within Six (6) Calendar Months after the date of this Agreement. The Government shall notify Neep of its decision in writing.
  • Section E. Neep shall have the right to lease a strip of public coastal land, adjacent to the harbour basin constructed and established under the provisions of Section D. of this Article, provided however, that said strip shall not extend back from high water a distance of more than Two Hundred and Seventy-five (275) feet; and Neep shall have free and unrestricted use of the said land including the right to establish quarries thereon and to use the contents thereof for the construction of its harbour basin and harbour facilities and all other constructions which Neep may deem directly or indirectly necessary for the operation, development and maintenance of its enterprises in Liberia. Furthermore Neep shall have the right to lease such areas of land adjacent to the above mentioned strip of coastal land as will be necessary to establish railway-yards and coal dumping-space and to erect such other constructions as Neep may deem necessary for the efficient operation, development and maintenance of its enterprises in Liberia.
  • Section F. Neep shall have the exclusive right and privilege upon the lands selected under this Agreement to construct highways, roadways, waterways, railways and cableways for the efficient operation and development and maintenance of its enterprises.
  • Section G. Neep shall have the free right to construct, establish, maintain and use at its own expense lines of communication such as highways, roadways, waterways, railways and cableways outside the lands selected under this Agreement, such lands to be free of rent. Such routes may be so located by Neep as to best serve the purpose of efficient operation and coordination of its mines and harbour facilities. [Page 837] All highways and roadways mentioned in this section shall, upon completion, become public property without expense to the Government, with the exception of future costs of maintenance. It is further understood and agreed upon, that when constructing any railroad under the terms of this section, Neep shall have an exclusive right-of-way of Two Hundred and Twenty (220) feet. Neep shall refund to the Government the cost of expropriating any private lands for the purpose of this section of Agreement.
  • Section H. Neep shall have the free right to construct, establish, maintain and operate lines of communication for the purpose of more efficiently operating its mines and enterprises, such as telegraph lines and telephone lines upon the lands selected and held under this Agreement and beyond the confines thereof and to the extent necessary for such purposes may use, without the payment of rent for such lands, any Government lands not already devoted to some other use.
  • Section I. Neep shall have the right to cut all timber upon the leased lands covered by this Agreement. It is further agreed and understood that Neep shall have the right to lease under the terms and conditions of this Agreement land for the special purpose of cutting timber and to freely transport such timber by land or water within the Republic to its mining areas and enterprises, provided the number of acres shall not be in addition to nor exceed the number provided in Article II of this Agreement. The timber so cut shall not exceed Fifty (50) Per Cent of the standing forest. The use of such timber by Neep shall be restricted to the purpose of construction and/or buildings which Neep may deem necessary for the efficient operation, development and maintenance of its mines and enterprises in Liberia and may also be used by Neep as fuel, but shall not be sold, bartered, exchanged or exported.
  • Section J. During the life of this Agreement, upon application of Neep therefor, the Government shall detail from time to time a police detachment not exceeding Fifty (50) Men including Officers’, to serve as a protective force or as guards and escorts during the construction, development and maintenance of Neep’s enterprises in Liberia. The cost of maintenance of such detachments shall be refunded to the Government by Neep monthly upon presentation of authenticated vouchers. It is understood that the cost of maintaining such a force shall be limited to pay, uniforms, equipment and subsistence.
  • Section K. The Government warrants to Neep the Title to all lands selected by Neep under the terms and conditions of this Agreement upon which the Government shall accept the rental or compensation as herein provided and will defend and protect such Title for the benefit of Neep.
  • Section L. The Government further agrees that it will encourage, support and assist the efforts of Neep to secure and maintain an adequate labour supply.

Article IV

Neep, in Consideration of the Covenants Herein Made by the Government Hath Agreed and by These Presents Doth Agree as Follows:—

  • Section A. That upon taking possession of lands under this Agreement, Neep shall pay the Government rent at the rate of Fifty (50) Cents per acre yearly and every year in advance, calculated at the rate of 4.80 Dollar to the Pound Sterling or Four Shillings and Two Pence to One Liberian Dollar. Such payment shall be made to the Secretary of the Treasury of Liberia or to such other officer as may be by law provided, in coin current in Liberia; it is to be understood and agreed that the rent herein provided to be paid by Neep shall be due to be paid by it to the Government upon all leased areas of land selected by it as and when such areas are selected.
  • Section B. Should the rent reserved for any piece or parcel of land selected by Neep be behind or unpaid on any day of payment whereon the same ought to be paid as herein provided, or should any default be made in any of the covenants hereinbefore contained on the part of Neep to be paid, kept or performed, and if such default in the payment of rent or otherwise shall continue after Six (6) Months written notice of the existence of such default served by the Government upon Neep, then the Government shall have the right to cancel this lease as to that piece or parcel of land the rent for which is in default or in respect of which piece or parcel any default exists as specified in such notice, and reenter into and upon the said demised premises and to again repossess and enjoy the same. But if Neep shall, within said period of Six (6) Months after the written notice, as aforesaid, make good the default complained of in said notice, no right of cancellation shall thereafter exist because of such default. The notice required to be served on Neep shall be delivered to the representative of Neep in Liberia and a duplicate thereof shall be simultaneously sent by registered mail to the Managing Director of Neep at its Head Office in Amsterdam, Holland. Neep shall promptly notify the Government of any change in the location of its Head Office and thereafter any such notice shall be addressed accordingly.
  • Section C. Neep shall pay to the Government annually a royalty equivalent to Four (4) Cents per ton of iron ore exported from its mines in Liberia; said royalty to be calculated as provided in Section A. of this Article. It is further agreed upon that whenever [Page 839] Neep applies for the right to export from Liberia any ore as a result of its mining operations, other than iron ore, the Government and Neep will come to an agreement as to the conditions upon which such ore or ores may be exported. During the first quarter of each Calendar Year Neep shall submit to the Secretary of the Treasury of Liberia or to such other Officer as may be by law provided, a statement showing the computation of royalty due for the preceding Calendar Year. The royalty herein provided shall become due and payable for each preceding Calendar Year, between the first day of April and the thirtieth day of June of each succeeding year.
  • Section D. Neep, during the life of this Agreement, shall maintain in a satisfactory state of upkeep and repair such harbour basin and harbour facilities as Neep shall, under the provisions of this Agreement, construct and establish as necessary for the efficient operation, development and maintenance of its enterprises.
  • Section E. Neep will not import unskilled labour for the carrying out of any operations, developments or maintenance undertaken by virtue of this or any other grant except in the event the local labour supply shall prove inadequate to the needs of Neep. In the event that the local labour supply should prove inadequate as aforesaid, Neep undertakes to import only such foreign unskilled labour as shall be acceptable to the Government. It is understood and agreed that Neep shall not have in its employ in Liberia more than (300) white employees at any one time. The white employees employed by Neep under contract or otherwise, shall be permitted to reside and work in the Republic and to enter and depart therefrom, and they shall be subject to the payment only of such direct or personal taxes as hereunder enumerated, now or hereafter authorized, levied or imposed by the Government of Liberia; that is to say, General Property Taxes, Income Taxes, Permit of Residence Tax, Street and Light Tax or Custom Duties; provided however that the rate of such taxes shall not exceed those levied upon Liberian Citizens. Should an income tax law be enacted by the Legislature of Liberia, the payments to be made thereunder by the foreign employees of Neep shall be governed by the provisions of such treaty in respect of double taxation as may be concluded between the Government of Liberia and the Government of the Country of which such employees shall be subject or citizen.
  • Section F. It is further agreed that Neep shall, after commencement of their exploitation of the areas hereby granted, provide such medical inspection and attention as shall be necessary to safeguard the health and well-being of its Native employees.
  • Section G. Neep shall install such safety devices and observe such adequate safety precautions as are provided and observed by mining [Page 840] enterprises of a similar nature or in accordance with the General Laws of Liberia.
  • Section H. Should the operations of Neep under this agreement cease for a period of Ten (10) consecutive years, for reasons other than Force Majeure or for reasons other than through the fault of Neep, then the Government shall have the right to cancel such leases which Neep may hold on mining areas not actually under exploitation and from which no ore has been exported at the expiration of the Ten (10) consecutive years mentioned in this Section. Should Neep decide to cease mining operations for a period longer than Ten (10) consecutive years, for reasons other than Force Majeure or for reasons other than through the fault of Neep, it is agreed that Neep shall pay to the Government for every year by which the above mentioned Ten (10) consecutive years are extended, an annual sum of Fifteen Thousand ($15,000) as indemnity against the Government’s deprivation of royalty after such period, provided nevertheless, such extension shall not exceed Five (5) consecutive years. The indemnity herein provided shall become due and payable for such preceding Calendar Year between the first day of January and the thirty-first day of March of each succeeding year. In case Neep should fail to pay this indemnity in any one year when the same shall become due under this Section H. of Article IV of this Agreement, then all and singular the rights hereunder shall become extinguished and void and this Agreement shall become of no effect. But in no case shall Neep be relieved of its obligations contained in the provisions of Article IV, Section D. above; and should Neep cease to perform its maintenance operations for a period exceeding Five (5) consecutive years, for reasons other than as a result of Force Majeure or for reasons other than through the fault of Neep, then the harbour basin becomes property of the Government without charge or condition.
  • Section I. The rights of this Agreement granted to Neep shall not be sold, transferred or otherwise assigned by Neep to any person, firm, group, corporation or trust without the written consent thereto of the Government of the Republic of Liberia previously had and obtained.
  • Section J. Neep shall have the right to develop for its own use such natural water power and hydro-electric power as may be capable of development upon the tracts of land selected by Neep under this Agreement and Neep shall have the right to construct and maintain power lines over any Government land in order to convey power so developed from one tract of land selected by Neep to another.
  • Section K. It is further agreed that at the expiration of the life of this Agreement or the cancellation thereof by mutual consent of [Page 841] both parties or other sooner determination thereof, such railways, harbour basin, and harbour facilities, constructed and established by Neep in Liberia for the furtherance of its enterprises shall, with the exception of machinery, become the property of the Government without charge, cost or condition; and the provisions of this Section shall apply equally to such buildings erected by Neep upon the lands selected hereunder, which buildings shall be surrendered in such condition that the further use and enjoyment thereof will not necessitate fundamental repairs.
  • Section L. It is further agreed that railway bridges constructed outside the confines of Neep’s tracts of land selected hereunder, shall be so constructed as to provide a roadway suitable for vehicular traffic, which roadway shall be available for free public use. The Government undertakes to connect these bridges with roadways suitable for vehicular traffic concurrently with construction of said railroad and bridges.
  • Section M. The plans and specifications of all roadways, railways, waterways and harbour basin to be constructed by Neep shall be submitted to the Government prior to the commencement of construction work. Such plans and specifications shall be treated by the Government as confidential and remain the exclusive property of Neep.
  • Section N. Wherever in this Agreement the Government grants to Neep the right to build and operate a railroad or to operate telephones and telegraphs, or to use the highways and waterways, it is understood that Neep is not seeking and is not granted public utility or common carrier rights and the same are not intended to be conveyed to it.
  • Section O. It is further agreed and understood that any harbour basin and harbour facilities constructed and operated by Neep under the provisions of this Agreement shall not be utilized by Neep for gain or otherwise as a commercial harbour for the accommodation of general shipping, without the written consent of the Government, but shall serve Neep only for the purpose of furthering its mining enterprises.
  • Section P. It is further agreed that any harbour basin constructed by Neep in the vicinity of Monrovia, Liberia, under the provisions of this Agreement shall be of sufficient size and area to provide for the possibility of construction and operation of a commercial dock in addition to the harbour facilities required by Neep. If, however, under the provisions of this Agreement said harbour basin is constructed in the vicinity of Cape Mount, Liberia, Neep will endeavour to build such harbour basin similar to the harbour basin above mentioned, but will be neither obligated nor bound to do so.

[Page 842]

Article V

It is further mutually agreed that the right is reserved to the Government to check the weight of all ores which may from time to time be exported from the Republic by Neep in virtue of the provisions of this Agreement or any other Agreement which may in future be entered into between the contracting parties hereof. Neep is prohibited from making any local or other dispositions of the quantity of ores or minerals, other than iron ore mined by Neep or other than iron produced by Neep, without the consent of the Government in writing previously had and obtained, provided, however, that Neep shall have the right if it so desires, to produce in Liberia iron and/or other products from the ores won from its mines. The provisions stipulated in Section B. and Section C. of Article III of this Agreement shall also apply to such iron and/or other products. Any violation of the provisions of this Article by Neep shall entitle the Government to cancel this Agreement and the Deeds of Lease executed in virtue thereof, anything to the contrary herein contained, notwithstanding.

Article VI

Section A. All and any question in dispute arising out of this Agreement between the Government and Neep which cannot be harmonized or adjusted by Neep and the Government shall be referred to the Liberian Circuit Court for arbitration on application of either party. Said Court shall make appointment of Three (3) arbitrators, technically qualified, one of whom shall be nominated for such purpose to the said Court by the President of the Republic of Liberia and one of whom shall be nominated for such purpose by the representative of Neep in charge of Neep’s affairs in the Republic of Liberia; these two to agree upon and choose a third arbitrator whom they shall nominate for such purpose to said Court. The arbitrators so appointed as aforesaid shall render their decision on the question or questions in dispute in writing and file same with the Clerk of the Circuit Court, together with a copy of testimony taken and statements of proceedings had, within Ninety (90) Days after their appointment as aforesaid. Unless an application for further arbitration, as hereinafter provided, be made by either party within a period of Six (6) Months after said decision is given, said decision shall be a definite settlement of the question or questions in dispute and shall be binding upon both parties, their Agents or Assigns, and the Government of Liberia agrees to make said decision operative. Should, however, either party feel aggrieved at the decision of the arbitrators, then the Government and Neep agree that the question or questions at issue shall be submitted to a sole arbitrator to be agreed upon or failing agreement to be nominated by the President of the International Chamber of Commerce and such [Page 843] arbitration shall be carried out in accordance with the arbitration regulations of the Republic of Liberia, provided, however, that in the case of such further arbitration each party shall bear its own respective costs; and provided further that the procedure of such further arbitration shall be as follows:—

Written notice of desire for further arbitration shall be given by either party to the other within Six (6) Months after the written decision of the arbitrators in the first instance has been filed with the Clerk of the Liberian Circuit Court; thereupon both parties shall prepare and file with the Clerk of the Circuit Court within Sixty (60) Days after service of the notice, written statements of the question or questions in dispute, and these statements together with a copy of the testimony and proceedings of the arbitrators together with a copy of their decision, shall be certified by the Clerk of the Circuit Court and delivered within Five (5) Days after receipt of said papers in his office to the Secretary of State of Liberia who will thereupon promptly arrange with the President of the International Chamber of Commerce for further arbitration of the question or questions in dispute in the manner as stated above, the decision of which arbitration shall be final and binding upon both parties to this Agreement.

It is understood and agreed that the final decision shall become effective Thirty (30) Days after such final decision has been rendered and shall not be retroactive.

It is also understood and agreed that during the period of arbitration, Neep shall be permitted by the Government to carry on without interference, all operations under this Agreement, including the operations involved in the subject matter of dispute, which Neep had undertaken, and, being undertaken, had not been objected to by the Government prior to the dispute arising. It is understood, however, that the fact there was no objection on the part of the Government shall not prejudice its rights in the subject matter of dispute.

Section B. It is hereby expressly understood and agreed that the arbitration procedure provided for herein does not apply to any civil or criminal proceedings which might be brought by or against employees of Neep in Liberia.

In Witness Whereof the parties hereto have hereunto set their hands and seals the day and year first above written.

De Noord Europeesche Erts en Pyriet My.
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The Government of Liberia
_________________________________________________________
D. Caffe: Director, Holland Syndicate
  1. Not printed.