840.51 Frozen Credits/2732c: Telegram
The Acting Secretary of State to the Ambassador in China (Gauss)
167. From Treasury Department for Fox: Extension of freezing order to China and Japan. New Executive Order simply applies usual freezing control to China and Japan. By general license Japanese and Chinese living in the United States since June 17, 1940 are unfrozen. All trade between the United States and free and occupied China excluding Manchuria has been generally licensed. All American, British, Russian, Dutch and Chinese Governmental banks in China have been given general licenses covering their own transactions and also covering transactions relating to trade between China and the United States, British Empire, Dutch East Indies, Latin America and Russia on account of persons living in China excluding Manchuria. Clearings of other Chinese banks with the generally licensed banks will be permitted through the Central Bank of China. General license given to the Chinese Government and Central Bank in effect take them out of the freezing order and also permit all funds in the United States of Chinese nationals to be transferred [Page 687] to accounts in the names of Chinese Government and the Chinese Central Bank. A general license has also been given to the China Defense Supplies Company, the Universal Trading Company and the New York Branch of the Bank of China. Although Hongkong is not a part of China within the meaning of the freezing order since so many Chinese and Japanese operate out of Hongkong a general license has been issued applying the general licenses to Hongkong to the same extent as though Hongkong were a part of China.
As far as Japan is concerned no general licenses have been given to agencies in the United States of Japanese banks except those agencies which are also banks of deposit. The Comptroller’s Office has stationed its examiners in banks of deposit to which general licenses have been issued. Trade between the continental United States (including Hawaii) and Japan will be handled on a specific application basis.
A series of general licenses has been issued covering the relationships between the Philippines and China and Japan. The general licenses cover all Japanese and Chinese banking and business institutions in the Philippines and all trade between the Philippines and Japan and China. Toward Japan as well as China we will adhere to a policy in the Philippines of liberality and continuity of normal business for the present. In Hawaii general licenses have been furnished to Japanese and Chinese banks and business institutions. Hawaiian trade with Japan will require specific applications. Hawaiian trade with China is covered by the general trade license. We will try to forward to you as soon as possible copies of the general licenses. [Morgenthau.]