611.3331/436: Telegram

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

567. At this morning’s meeting the Uruguayan subcommittee orally agreed to recommend to the Cabinet that our proposed general provisions with the exception of article 2 be accepted if accompanied by the related notes described below: [Page 588]

Note based on text of Argentine note regarding preferences to contiguous countries with the addition of the words “and Bolivia and Paraguay” following the phrases “to a contiguous country” and “to contiguous countries” in sections 1 and 2 of the last substantive paragraph. Wherever they appear the words “and Peru” will be omitted. There will of course be other changes in terminology consistent with the two foregoing amendments. These modifications are designed to permit Uruguay to accord permanent tariff preferences and temporary exchange preferences to Bolivia and Paraguay as well as to contiguous countries. Pursuant to convention No. 8 contained in the Final Minutes of the Regional Conference of the River Plate Countries (transmitted with the Embassy despatch No. 778 of February 8, 194156) Uruguay’s [apparent omission] contend that they must insist on including such a reservation with respect to tariff preferences in all future trade agreements.
Note based on Argentine note regarding exchange preferences to sterling area. Although the alternative referred to in the Department’s telegram No. 369 of December 20 was received too late for today’s meeting it undoubtedly will be acceptable to the Uruguayans.
As regards article 2, Uruguayans propose the addition of a second paragraph as follows:

“The provisions of this article relating to national treatment shall not apply to taxes imposed by the Oriental Republic of Uruguay on pharmaceutical specialties, toilet and perfumery products, cigarettes, cigars, fortified wines, vermouth, champagne, matches, and playing cards.”

It may be explained that the existing internal taxes levied upon the above-enumerated products of national origin are slightly lower than those imposed on similar articles of foreign origin. The subcommittee expects to meet no the[sic] serious difficulties in securing the Cabinet’s approval of the above proposals and therefore hopes to subject [submit?] a formal memorandum to the Embassy in confirmation thereof not later than December 24.

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