863.51 Relief Credits/393: Telegram
The Chargé in Germany (Gilbert) to the Secretary of State
[Received May 16—4:35 p.m.]
248. The substance of the Department’s telegraphic instruction No. 69, May 14, 2 p.m. was communicated by a member of the Embassy staff today to Ministerial Director Wiehl, head of the Commercial Policy Division of the Foreign Office, who said that the Foreign Office was unaware of the meeting of the Committee of Control of the Guarantor States at Geneva on May 17 but would give due examination and consideration to the question of the priority standing of the unguaranteed loans of the Austrian Government.
To an inquiry as to when a decision might be expected in the matter of debts owed by Austria to foreigners he replied that an aide-mémoire was handed to the Financial Attaché of the British Embassy several days ago in which the German Government denied legal liability for Austrian debts but stated its willingness to discuss the matter in the trade and payment negotiations with Great Britain beginning May 24. He stated that reply had been first made to Great Britain because that country was the principal creditor of Austria. He said further that he understood that in response to an inquiry in the House of Commons the text of the German aide-mémoire was to be made public today and would probably appear in this evening’s London papers. He thereupon handed the Embassy’s representative a copy of the aide-mémoire in question which in translation reads as follows:
“The German Government following a careful examination of the pertinent precedents and principle of international law is not of the opinion that there is a legal obligation upon it to assume the foreign debts of the former Austrian Federal Government. It does, therefore, not regard itself as being in a position to give the desired assurances that the interest and amortization payments on these debts should continue to be paid. It repeats, however, its willingness also to take up the problem of Austrian foreign indebtedness in the negotiations with the British Government beginning on May 24.”
Wiehl said that the second sentence in the foregoing aide-mémoire referred to an oral request from the British Financial Attaché that [Page 487] interest and amortization payments on British owned Austrian bonds be continued at the contractual rate at least until the end of the negotiations beginning May 24. Wiehl further said that while the German Government had taken the stand that it was not obligated under international law to assume the foreign indebtedness of the Austrian Government it had as yet taken no position on the question whether the indebtedness of the former central Government of Austria was now a debt of the Austrian Province of the German Reich.