The Minister in Greece ( MacVeagh ) to the Secretary of State

No. 3101

Sir: In reference to my telegram No. 93 of May 26, and the Department’s telegraphic reply, No. 108 of June 5, 1939, concerning the obligation recently placed upon foreign residents in Greece to convert their earnings into drachmas, I have the honor to report that I saw Mr. Mavroudis, the Under Minister for Foreign Affairs, this morning, and placed the matter before him in the manner indicated by the Department. On leaving, I handed him the enclosed Aide-Mémoire.

Mr. Mavroudis appeared to understand and sympathize with the attitude expressed, and promised to bring the Aide-Mémoire promptly to the attention of the Minister of Finance and other responsible authorities. He expressed doubt as to whether the law could be amended, but thought that some way could be found to accommodate our point of view.

I am informing my colleagues here of my action and believe that it will soon be supported by similar representations on their part. But in view of the urgency of the matter, and the Department’s permission to act separately, it seemed best not to risk the possible delays attendant on strictly parallel action.

Respectfully yours,

Lincoln MacVeagh

The American Minister ( MacVeagh ) to the Greek Permanent Under Secretary of State for Foreign Affairs ( Mavroudis )


The American Minister had the honor of being received today by His Excellency Mr. Nicholas Mavroudis, Permanent Under Secretary of State for Foreign Affairs, and of bringing to His Excellency’s attention Article 12 of Greek Emergency Law No. 1704, published in the Government Gazette (Volume I, No. 149) of April 14, 1939, the text of which reads as follows:

“Any person established in Greece, who receives any payments, commissions, or other profits in foreign exchange by reason of business done in Greece, or any remuneration in foreign exchange for services rendered in Greece to persons established abroad, or as rental for buildings, must sell the foreign exchange in question to an authorized bank within three months after its receipt.”

Mr. MacVeagh said that informal inquiries with regard to this article of Law 1704 had failed to disclose any indication that it was [Page 611] not to be taken literally, or that it would not be applied, among others, to American citizens, though exemption might be made in exceptional cases on personal application. He had accordingly been instructed to say that, in the opinion of the American Government, the requirement of conversion of the earnings of foreign residents into the currency of the country is a measure destructive of the mutual advantages of residence and establishment rights, and that, when applied by Greece to the United States, which is the largest supplier of free exchange to Greece, it lacks any equitable basis of reciprocity.

Regarding the practical aspects of the matter, Mr. MacVeagh pointed out that the comparatively few American citizens who are paid by concerns in the United States but work in Greece, principally with the tobacco companies, the Standard Oil Company, or in the American-supported schools, even though they may remain here for a considerable period of time, depend on the United States for their livelihood and must eventually return there where the interests of themselves and their families lie. While in this country, they need only enough drachmas to cover their actual living expenses and similar expenditures, whereas they need dollars in the United States to pay for leaves of absence spent there, for insurance, for the education of their children, and the like, and as savings, which would be useless to them in drachmas. Investigation of individual cases with a view to making just exemptions could only result in the uniform establishment of the above facts, and yet would entail great inconvenience to all concerned, including the authorities themselves.

Mr. MacVeagh added that he hardly felt it necessary to remind His Excellency that Greece receives millions of dollars annually from the United States, remitted without restraint or control on the part of the American authorities by Greek subjects and even by American citizens of Greek origin residing and working there.

Mr. MacVeagh said that he felt confident that the competent Hellenic authorities would accord this matter a considerate reexamination, in the light of the foregoing, and expressed the hope that His Excellency would be able to give the Legation an early and favorable reply for transmission to its Government.

Athens, June 8, 1939.