711.452/19
The Secretary of
State to the British Ambassador (Lothian)
Washington, October 10, 1939.
Excellency: With further reference to the
Embassy’s note of December 30, 1938 conveying the acceptance of the
Indian Government of this Government’s proposal of May 12, 1938 for
the negotiation of a treaty of commerce and navigation between the
United States and India, and with reference to the Embassy’s note of
March 14, 19397
inquiring as to the status of this matter, I now have pleasure in
transmitting herewith a draft of a treaty of establishment,
commerce, navigation and consular rights between the United States
of America and India.
As of possible assistance I wish to offer some comment on the various
articles of this draft. Paragraph 1 of Article I provides that
nationals of either country may enter the territories of the other
country on the same terms as nationals of the most favored nation.
While paragraph 8 of this Article reserves the operation of
immigration laws specific provision is made by means of the proviso
in that paragraph that nationals of each country may enter the other
country to carry on trade between the two countries, or to engage in
any activity related to or connected with the carrying on of such
trade upon the same terms as nationals of the most favored nation.
It is believed that the granting of this right, which is considered
to be one of the important considerations in these negotiations,
will meet the desire of the Indian Government that nationals of
India shall have their rights to enter and reside in the United
States to engage in international trade enlarged.
Other paragraphs of Article I deal with rights of nationals of either
country within the territory of the other country. Paragraph 2 [Page 353] grants, on a
most-favored-nation basis, rights to travel and reside and to engage
in professional, commercial and other work. In this connection, it
may be pointed out that paragraph 3 of Article XVI defines
most-favored-nation treatment as treatment accorded to the most
favored third country, including the United Kingdom of Great Britain
and Northern Ireland.
Paragraph 3 of Article I deals with rights in connection with the
acquisition, possession and disposition of immovable property. These
provisions are practically identical with those embraced in Article
1 of the treaty of friendship, commerce and navigation between the
United States and Siam, signed November 13, 1937.8 The provisions of the treaty with
Siam were elaborated after considerable study, and as the Senate of
the United States gave its advice and consent to the ratification of
that treaty it is believed that the provisions would be accepted by
the Senate if included in a treaty applicable to India. Three copies
of the treaty with Siam are herewith enclosed.
The remaining paragraphs of Article I are practically identical with
provisions in treaties now in force between the United States and
several other countries, or differ only slightly from the provisions
of those treaties.
Articles II to VI, inclusive, embrace, generally speaking,
applications of the most-favored-nation principle in regard to
commerce and the principle of national treatment in regard to
navigation.
Article VII contains reservations with respect to the adoption of
prohibitions or restrictions on the importation or exportation of
certain articles and the adoption of neutrality measures and of
sanitary measures.
Article VIII provides for most-favored-nation treatment in respect of
the exploration for and exploitation of mineral resources. With
respect to a specified list of resources, including oil, it provides
for national treatment in the ownership of stock of domestic
corporations. The proposed Article conforms to the United States
Mineral Leasing Act, approved February 25, 1920 (41 Stat. 437). In
drafting this Article the provisions of the British Petroleum
(Production) Act of 1934 and Regulations, were kept in mind.
Article IX of the draft provides for both national and
most-favored-nation treatment in connection with industrial and
intellectual property.
The provisions of Articles X to XIV, inclusive, relate to consular
officers. While it was not at first contemplated that the treaty
would contain provisions relating to consular officers, this
Government suggests that it is possible to deal briefly but
adequately with this subject [Page 354] in the present treaty. The five articles concerning consular
rights are entirely standard and may be found in many treaties now
in force between the United States and other countries.
Provisions such as those embraced in Article XV of the draft treaty
terminating the operation of the existing convention of commerce and
navigation between the United States and Great Britain so far as it
affects commerce, navigation and consular rights between the United
States and India seem necessary.
Paragraph 1 of Article XVI relating to the territorial applicability
of the treaty provides that the treaty shall extend, on the part of
India, to India, including the Indian States. This Government would
be desirous of extending to Burma the provisions agreed upon in
respect of India in the same instrument if possible, or in another
instrument, if necessary.
Your Excellency will note that Article XVII provides for an initial
term of five years. This Government would be disposed to accept an
initial ten-year term, but in any case would desire to make the
commercial provisions terminable within a shorter period, and to
stipulate that the termination of the commercial provisions would
not impair the operation of the remainder of the treaty.
This Government will be pleased to be informed in the near future of
the views of the Indian Government with respect to the enclosed
draft. It is understood, of course, that either Government may
introduce changes at any time during the course of the
negotiations.
Accept [etc]
For the Secretary of State:
R. Walton Moore
[Enclosure]
Draft of a Treaty of Establishment,
Commerce, Navigation and Consular Bights Between the United
States of America and India
The President of the United States of America and His Majesty the
King of Great Britain, Ireland and the British Dominions beyond
the Seas, Emperor of India, in respect of India, being desirous
of strengthening the commercial and economic relations between
the United States of America and India and of promoting friendly
intercourse between the Governments and peoples of the two
countries have resolved to conclude a Treaty of Establishment,
Commerce, Navigation and Consular Rights applicable to the
United States of America and India and for that purpose have
appointed as their plenipotentiaries,
[Page 355]
The President of the United States of America:
and
His Majesty the King of Great Britain, Ireland and the British
Dominions beyond the Seas, Emperor of India:
For India:
Who, having communicated to each other their full powers found to
be in due form, have agreed upon the following Articles:
Article I
- 1.
- The nationals of either country, upon conforming to the
laws and regulations of the other country, may enter the
territories of the other country on the same terms as
nationals of the most favored nation.
- 2.
- Nationals of either country within the territories of the
other country may, upon the same terms as nationals of the
most favored nation:
- (a)
- travel and reside,
- (b)
- engage in professional, scientific, religious,
philanthropic, industrial, manufacturing, financial
and commercial work of every kind, and
- (c)
- employ agents and employees of their
choice.
- 3.
- (a) In all that relates to the
acquisition, possession and disposition of immovable
property, the nationals of each country shall, in the
territories of the other country, be subject exclusively to
the applicable laws of the situs of such immovable property.
The applicable laws of the situs of immovable property as
herein used shall in reference to nationals of India be
understood and construed to mean the laws applicable to
immovable property in the state, territory or possession of
the United States of America in which such immovable
property is situated; and nothing herein shall be construed
to change, affect or abrogate the laws applicable to
immovable property in any state, territory or possession of
the United States of America.
- (b) It is expressly agreed that
nationals of the United States of America, including
partnerships, corporations, associations and other legal
entities, who are legal residents of or are organized under
the laws of any state, territory or possession of the United
States of America which accords to nationals of India the
right to acquire, possess and dispose of immovable property
shall be accorded all the rights respecting immovable
property in India which are or may hereafter be accorded to
the nationals of the most-favored-nation.
- (c) Nothing in either sub-paragraph
(a) or sub-paragraph (b) of this paragraph shall be
construed to affect the application of the provisions of the
Convention relating to the Tenure and Disposition of [Page 356] Real and Personal
Property between the United States of America and Her
Majesty the Queen of the United Kingdom of Great Britain and
Ireland, signed at Washington on March 2, 18999 to which notice of accession on
behalf of India including the Native States was given June
30, 1902.
- 4.
- The nationals of each country within the territories of
the other country shall not be subjected to the payment of
any internal fees, charges or taxes other or higher than
those that are exacted of and paid by nationals of the
country of residence.
- 5.
- The nationals of each country shall enjoy freedom of
access to the courts of justice of the other country as well
for the prosecution as for the defense of their rights, and
in all degrees of jurisdiction established by law.
- 6.
- The nationals of either country shall receive within the
territories of the other country, upon submitting to
conditions imposed upon nationals of the latter country, the
most constant protection and security for their persons and
property, and shall enjoy in this respect that degree of
protection that is required by international law. Their
property shall not be taken without due process of law and
without payment of prompt, just and effective
compensation.
- 7.
- In the manner of the exercise of any of the rights
stipulated in this Article, the local law must be
observed.
- 8.
- Nothing contained in this Treaty shall be construed to
affect existing statutes of either country relating to
emigration or immigration or to the right of either country
to enact statutes relating to these matters, provided,
however, that nationals of each country may enter the other
country to carry on trade between the two countries or to
engage in any activity related to or connected with the
carrying on of such trade upon the same terms as nationals
of the most favored nation.
Article II
- 1.
- The United States of America and India will grant each
other unconditional and unrestricted most-favored-nation
treatment in all matters concerning customs duties and
subsidiary charges of every kind and in the method of
levying duties, and, further, in all matters concerning the
rules, formalities and charges imposed in connection with
the clearing of goods through the customs, and with respect
to all laws or regulations affecting the sale or use of
imported goods within the country.
- 2.
- Accordingly, articles the growth, produce or manufacture
of either country imported into the other country shall in
no case be subject to any duties, taxes or charges other or
higher, or to any [Page 357]
rules, formalities or method of levying duties, taxes or
charges, other or more burdensome, than those to which the
like articles the growth, produce or manufacture of any
third country are or may hereafter be subject.
- 3.
- Similarly, articles exported from the territory of the
United States of America or India and consigned to the
territory of the other country shall in no case be subject
with respect to exportation to any duties, taxes or charges
other or higher, or to any rules, formalities or method of
levying duties, taxes or charges, other or more burdensome,
than those to which the like articles when consigned to the
territory of any third country are or may hereafter be
subject.
- 4.
- Any advantage, favor, privilege or immunity in regard to
any duties, taxes, subsidiary or other charges, or method of
levying them or in regard to any rules or formalities, which
has been or may hereafter be granted by the United States of
America or India to any article originating in any third
country or consigned to the territory of any third country
shall be accorded immediately and without compensation to
the like article originating in or consigned to the
territory of India or the United States of America,
respectively, and irrespective of the nationality of the
carrier.
- 5.
- The stipulations of this Treaty regarding the treatment to
be accorded by each country to the commerce of the other
country do not extend:
- (a)
- to the advantages now accorded or which may
hereafter be accorded by the United States of
America, its territories or possessions or the
Panama Canal Zone to one another or to the Republic
of Cuba. The provisions of this paragraph shall
continue to apply in respect of any advantages now
or hereafter accorded by the United States of
America, its territories or possessions or the
Panama Canal Zone to one another, irrespective of
any change in the political status of any of the
territories or possessions of the United States of
America;
- (b)
- to any advantages which are, or may in the future
be accorded by either country to purely border
traffic within a zone not exceeding ten miles (15
kilometers) wide on either side of the customs
frontier;
- (c)
- to any advantages in customs matters which are, or
may in the future be accorded to countries in
customs union with either country so long as such
advantages are not accorded to any third
country.
Article III
- 1.
- No prohibition or restriction of any kind shall be imposed
by the Government of either country on the importation of
any article the growth, produce or manufacture of the other
country or upon the exportation of any article destined for
the other country, unless the importation of the like
article the growth, produce or manufacture [Page 358] of all third countries, or
the exportation of the like article to all third countries,
respectively, is similarly prohibited or restricted.
- 2.
- If the Government of either country imposes any
restriction or limitation upon the importation of any
article in which the other country has an interest, or
regulates the importation of any such article by means of
import licenses or permits, it shall establish in advance,
and, upon request, shall inform the Government of the other
country of, the total quantity of such articles permitted to
be imported during a specified period.
- 3.
- If the Government of either country regulates the
importation of any article in which the other country has an
interest either as regards the total quantity permitted to
be imported or the quantity permitted to be imported at a
specified rate of duty, and if a share is allotted to any
third country, a share shall be allotted to the other
country equivalent to the proportion of the total
importation of such article supplied by that country during
a previous representative period, unless it is mutually
agreed to dispense with such allotment.
- 4.
- If the Government of either country establishes or
maintains any form of control of the means of international
payment, it shall accord unconditional most-favored-nation
treatment to the other country in this matter. It is agreed,
further, that such control shall be administered so as not
to influence to the disadvantage of the other country the
competitive relationships between articles originating in
that country and similar articles originating in third
countries, and so as not to impair the operation of any
other provisions of this Treaty.
Article IV
- 1.
- In the event that either country establishes or maintains
a monopoly for the importation, production or sale of any
article, or grants exclusive privileges, formally or in
effect, to any agency to import, produce or sell any
article, the country establishing or maintaining such
monopoly, or granting such monopoly privileges, agrees that
in respect of the foreign purchases of such monopoly or
agency, the commerce of the other country will be accorded
fair and equitable treatment. To this end it is agreed that
in making its foreign purchases of any article such monopoly
or agency will be influenced solely by considerations such
as price, quality, marketability and terms of sale, which
would ordinarily be taken into account by a private
commercial enterprise interested solely in purchasing the
article on the most favorable terms.
- 2.
- Each country, in the awarding of contracts for public
works and generally in the purchase of supplies, shall
accord fair and equitable [Page 359] treatment to the commerce of the other
country as compared with the treatment accorded to the
commerce of third countries.
Article V
- 1.
- Vessels of the United States of America shall enjoy in
India and Indian vessels shall enjoy in the United States of
America the same treatment as national vessels or vessels of
the most favored third country.
- 2.
- The coasting trade of the two countries shall be exempt
from the foregoing provision and from the other provisions
of this Treaty, and shall be regulated according to the laws
of each country in relation thereto. It is agreed, however,
that with respect to the coasting trade vessels of either
country shall enjoy within the territory of the other
country the most-favored-nation treatment.
- 3.
- Vessels under the flag of either country shall be
permitted to discharge portions of cargoes at any port open
to foreign commerce in the territories of the other country,
and to proceed with the remaining portions of their cargoes
to any other ports of such territories open to foreign
commerce, and to unload portions of their cargoes at such
ports, without paying other or higher tonnage dues or port
charges than would be paid by national vessels or vessels of
the most favored nation in like circumstances, and they
shall be permitted to load in like manner at different ports
in the same voyage outward.
Article VI
The nationals and goods of each country within the territories of
the other country shall receive the same treatment as nationals
and goods of the latter country or of any third country with
regard to internal taxes, transit duties, charges in respect of
warehousing and other facilities and the amount of
drawbacks.
Article VII
- 1.
- Subject to the requirement that, under like circumstances
and conditions, there shall be no arbitrary discrimination
by either country against the other country in favor of any
third country, the provisions of this Treaty shall not
extend to prohibitions or restrictions (1) imposed on moral
or humanitarian grounds; (2) designed to protect human,
animal or plant life or health; (3) relating to prison-made
goods, or (4) relating to the enforcement of police or
revenue laws.
- 2.
- Nothing in this Treaty shall be construed to prevent the
adoption or enforcement of measures (a) relating to the importation or exportation of
gold or silver; (b) relating to the
control of the export or sale for export of arms,
ammunition, or implements of war, and, in exceptional
circumstances, all other military supplies, or (c) relating to neutrality.
[Page 360]
Article VIII
The nationals of each country shall enjoy in the territories of
the other country, upon compliance with the conditions there
imposed, most-favored-nation treatment in respect of the
exploration for and exploitation of mineral resources. In
respect of the ownership of stock in domestic corporations
engaged in the exploration for and exploitation of coal,
phosphate, oil, oil shale, gas and sodium on the public domain,
the nationals of each country shall enjoy within the territories
of the other country, on condition of reciprocity, and upon
compliance with the conditions there imposed, all the rights and
privileges now or hereafter granted to the nationals of the
latter country. It is understood, however, that neither country
shall be required by anything in this article to grant any
application for any such right or privilege if at the time such
application is presented the granting of all similar
applications shall have been suspended or discontinued.
Article IX
The nationals of either country shall have in the territories of
the other country the same rights as nationals of the latter
country with respect to patents for inventions, trade-marks,
trade-names, designs and copyright in literary and artistic
works. In no case shall such treatment be less favorable than
that accorded to nationals of the most favored nation.
Article X
- 1.
- Each country will receive from the other country, consular
officers in those of its ports, places and cities, where it
may be convenient and which are open to consular
representatives of any third country.
- 2.
- Consular officers of each country shall, after entering
upon their duties, enjoy reciprocally in the territory of
the other country all the rights, privileges, exemptions and
immunities which are enjoyed by officers of the same grade
of the most favored nation. As official agents, such
officers shall be entitled to the high consideration of all
officials, national or local, with whom they have official
intercourse in the country which receives them.
Article XI
- 1.
- Consular officers, including employees in a consulate,
nationals of the country by which they are appointed, other
than those engaged in private occupations for gain within
the country where they exercise their functions, shall be
exempt from all taxes, National, State, Provincial and
Municipal, except taxes levied on account of the possession
or ownership of immovable property situated in, or income
derived from property of any kind situated or belonging in
the territories of the country in which they exercise their
functions. All consular officers [Page 361] and employees, nationals of the country
appointing them, shall be exempt from the payment of taxes
on the salary, fees or wages received by them in
compensation for their consular services.
- 2.
- The exemptions of the foregoing paragraph shall apply
equally to officials who are duly appointed by the
Government of one of the countries to exercise essential
governmental functions in the territory of the other
country, provided that such officials shall be nationals of
the country appointing them and shall not be engaged in
private occupations for gain in the country in which they
exercise their functions. The Government of the country
appointing them shall communicate to the Government of the
other country satisfactory evidence of the appointment and
shall indicate the character of the service of the officials
to whom the exemptions of this Article are intended to
apply.
- 3.
- The Government of each country shall have the right to
acquire and own land and buildings required for diplomatic
or consular premises in the territory of the other country
and also to erect buildings in such territory for diplomatic
or consular use subject to local building
regulations.
- 4.
- Lands and buildings situated in the territory of either
the United States of America or India, of which the
Government of the other country is the legal or equitable
owner and which are used exclusively for governmental
purposes by that owner, shall be exempt from taxation of
every kind, National, State, Provincial and Municipal, other
than assessments levied for services or local public
improvements by which the premises are benefited.
Article XII
- 1.
- The Government of the United States of America and the
Government of India, respectively, will permit the entry
free of all duty and without examination of any kind, of all
furniture, equipment and supplies intended for official use
in the consular offices of the other country, and will
extend to such consular officers of the other country and
their families and suites as are its nationals, the
privilege of entry free of duty of their baggage and all
other articles for personal use, including automobiles,
spare parts and equipment for automobiles and fuels used in
operating automobiles, whether accompanying the officer, his
family or suite, to his post or imported at any time during
his incumbency thereof; provided, nevertheless, that no
article, the importation of which is prohibited by the law
of either country may be brought into its
territories.
- 2.
- The exemptions of the foregoing paragraph shall apply
equally to officials who are duly appointed by the
Government of one of the countries to exercise essential
governmental functions in the territory [Page 362] of the other country,
provided that such officials shall be nationals of the
country appointing them and shall not be engaged in private
occupations for gain in the country in which they exercise
their functions. The Government of the country appointing
them shall communicate to the Government of the other
country satisfactory evidence of the appointment and shall
indicate the character of the service of the officials to
whom the exemptions of this Article are intended to
apply.
- 3.
- It is understood, however, that the privileges provided in
this Article shall not be extended to officers who are
engaged in any private occupation for gain in the countries
where they exercise their functions, save with respect to
governmental supplies.
Article XIII
- 1.
- In case of the death of a national of either the United
States of America or India in the territory of the other
country without having in the locality of his decease any
known heirs or testamentary executors by him appointed, the
competent local authorities shall at once inform the nearest
consular officer of the country of which the deceased was a
national of the fact of his death, in order that necessary
information may be forwarded to the parties
interested.
- 2.
- In case of the death of a national of either the United
States of America or India without will or testament whereby
he has appointed testamentary executors, in the territory of
the other country, the consular officer of the country of
which the deceased was a national and within whose district
the deceased made his home at the time of death, shall, so
far as the laws of the country permit and pending the
appointment of an administrator and until letters of
administration have been granted, be deemed qualified to
take charge of the property left by the decedent for the
preservation and protection of the same. Such consular
officer shall have the right to be appointed as
administrator within the discretion of a tribunal or other
agency controlling the administration of estates provided
the laws of the place where the estate is administered so
permit.
- 3.
- Whenever a consular officer accepts the office of
administrator of the estate of a deceased countryman, he
subjects himself as such to the jurisdiction of the tribunal
or other agency making the appointment for all necessary
purposes to the same extent as a national of the country
where he was appointed.
Article XIV
- 1.
- A consular officer shall have exclusive jurisdiction over
controversies arising out of the internal order of private
vessels of his country, and shall alone exercise
jurisdiction in cases, wherever arising, [Page 363] between officers and
crews, pertaining to the enforcement of discipline on board,
provided the vessel and the persons charged with wrongdoing
shall have entered a port or place within his consular
district. Such an officer shall also have jurisdiction over
issues concerning the adjustment of wages and the execution
of contracts relating thereto provided, however, that such
jurisdiction shall not exclude the jurisdiction conferred on
local authorities under existing or future laws.
- 2.
- When an act committed on board of a private vessel under
the flag of the country by which the consular officer has
been appointed and within the territories or territorial
waters of the country to which he has been appointed
constitutes a crime according to the laws of that country,
subjecting the person guilty thereof to punishment as a
criminal, the consular officer shall not exercise
jurisdiction except in so far as he is permitted to do so by
the local law.
- 3.
- A consular officer may freely invoke the assistance of the
local police authorities in any matter pertaining to the
maintenance of internal order on board of a vessel under the
flag of his country within the territories or territorial
waters of the country to which he is appointed, and upon
such a request the requisite assistance shall be
given.
- 4.
- A consular officer may appear with the officers and crews
of vessels under the flag of his country before the judicial
authorities of the country to which he is appointed for the
purpose of observing the proceedings or of rendering
assistance as an interpreter or agent.
Article XV
The present Treaty shall, from the day on which it comes into
force, supplant the provisions relating to navigation, trade and
commerce applicable in respect of the United States of America
and India in Article III of the Convention of Commerce and
Navigation between the United States of America and His
Britannic Majesty, concluded at London July 3, 1815, and
likewise the provisions of Article IV of the said convention in
so far as concerns the appointment of consular officers by the
United States of America to reside in India.
Article XVI
- 1.
- The present Treaty shall apply, on the part of the United
States of America to all territory subject to its
sovereignty or authority, except the Panama Canal Zone and
shall include the Philippine Islands so long as the United
States of America maintains its sovereignty or authority
over those Islands. The present Treaty shall apply, on the
part of India, to India, including the Indian States.
- 2.
- The term “nationals” as used in this Treaty in Article I,
paragraph 2 (b), except as to
professional work, 2 (c), 3 (a), 3 (b), 4,
5 and 6; Article VI; Article VIII and Article IX, shall be
deemed to include natural persons, partnerships,
corporations, associations, and other legal entities.
- 3.
- The term “most favored nation” as used in this Treaty
shall be construed to mean the most favored third country,
including the United Kingdom of Great Britain and Northern
Ireland.
Article XVII
- 1.
- The present Treaty shall take effect in all of its
provisions on the day of the exchange of ratifications, and
shall continue in force for the term of five years from that
day.
- 2.
- Unless at least one year before the expiration of five
years from the day on which the present Treaty shall come
into force, the Government of the United States of America
or of His Majesty notifies to the other Government an
intention of terminating the Treaty upon the expiration of
the aforesaid period of five years, the Treaty shall
continue in full force and effect after the aforesaid period
and until one year from such a time as either Government
shall have notified to the other Government an intention of
terminating the Treaty.
Article XVIII
The present Treaty shall be ratified, and the ratifications
thereof shall be exchanged at . . . . . . . as soon as
possible.
In witness whereof the respective Plenipotentiaries have signed
the present Treaty and have affixed their seals thereto.
Done in duplicate at . . . . . . . this. . . . . . . day of . . .
. . . .
