855.852/37a: Telegram

The Secretary of State to the Ambassador in Panama ( Dawson )

35. Department is unofficially informed that Panamanian Government is considering cancellation of Panamanian registry issued [Page 12] to the Belgian vessels Spidoleine, Lubrafol, Belgian Gulf and Good Gulf, wholly owned American properties belonging to the Gulf Oil Corporation of Pittsburgh.

Transfer of these vessels from Belgian to Panamanian registry was taken as a step towards making them available to the United States Navy and the transaction was given the assent of the Department.

These vessels are presently the subject of a law suit between the Belgian Government and the Gulf Oil Corporation, brought by the former in Texas jurisdiction to recover the vessels to Belgian registry. Trial was scheduled for February 28. Counsel representing Belgian Government has applied for continuance which has been granted to March 3.

In consideration of the circumstances surrounding the transaction, Department is reluctant to believe that Panamanian Government would initiate the action indicated without taking into consideration any interest the United States Government might have in the transaction.

Certain suggestions have been made to the Belgian Government designed to bring about a termination of the proceedings without prejudice to the respective rights of the litigants and with the purpose of making the ships available for employment to relieve the present tonnage situation.

Please investigate and if information concerning the impending action of the Panamanian Government is verified, bring the foregoing facts to the attention of the Panamanian Government and report to Department by telegraph.