810.74/523: Telegram
The Ambassador in Chile (Bowers) to the Secretary of State
[Received October 9—2:33 a.m.]
1659. For Welles and Duggan.
1. Trans Board of Directors without record vote approved following motion:
“I desire submit for the approval of directors a measure to bring to an end the rumor which has circulated for some time that our company is serving for the transmission of messages relating to war operations. Since several days these charges have been published in press articles which without specifically referring to us have placed us in a disagreeable situation. In conformity with instruction received from the shareholders I propose that beginning today the company not accept communications in secret cipher or code directed to or received from any non-American country”.
Department’s 1189, October 7, 8 p.m.
2. Prior to the meeting directors Ricci, Jory, Blood [?] and the President of the company, Valenzuela, orally informed the Embassy that this decision of the Board was to be regarded as a “first step” directed toward the entire possible closure of the Axis communications. They also expressed the sincere belief that it would be a mistake to postpone the meeting and the decision until the problematical date when the Chilean Government would be willing to indicate to the two Chilean members of the Board it desired them to vote for outright discontinuance of Axis circuits. Without such indication the two Chilean directors, [Page 162] while friendly disposed, feel they could not vote since it would be taking political action beyond that approved by the Chilean Government itself and would also endanger the concession of the company.
3. The following new complication has, however, arisen: despite the tentative approval of his Commercial Attaché, the British Ambassador94 today endeavored to get the Board to postpone applying the decision until he received instructions that London had no objections. He was told the decision could not be modified until another meeting was called. I trust that the British Government will not object at this time since it would give useful grounds for the Axis Embassies and the Spanish and other European neutral missions to make similar protests, devitalize the whole decision of the Board and provide additional loopholes for German communications.
In my opinion the British Embassy needs to take no notice of a purely company decision at this moment. The British Embassy is not sending code messages over Transradio and has no intention of doing so since it is not a means of confidential communication. At some later date or if and when it becomes necessary for the British Embassy to send a cipher telegram over Transradio then, if it should be refused, the matter would become a practical issue and could be settled at once.
What the British Government might do if it feels it necessary to oppose any prohibition of its code communications over Transradio is to take it up later leisurely with CRIC asking it to instruct the directors here to accept the suggestion of the British that exceptions be made to the board’s decision as regards code communications to Britain. However, the British Ambassador should be instructed immediately not to use his influence to set aside or postpone the actual application of the board’s decision since in so doing he would be following the lead of the German director, the only one actively to oppose the decision. British Embassy intervention at this time would make a diplomatic issue of a commercial company decision and place the Chilean Government in a position which it could with difficulty refuse sympathetically to entertain protests from the other European countries with which confidential communication has been cut off by the decision of Transradios’ board.
I have no doubt that if we continue our representations to the Chilean Government particularly in view of the recent German spy exposures that we can within a not too distant date proceed to direct closure of the Axis radio circuits restoring at a later time, if the Department thinks best, the privilege of code communication over Transradio circuits to England alone.
Jory asks RCA be informed.
- Charles W. Orde.↩