740.00112A European War, 1939/17843: Airgram
The Secretary of State to the Ambassador in the United Kingdom (Winant)
A–290. Reference BEW 326 dated September 10, 1942 from Bern and Department’s A 259 of December 3 and Bern’s telegram no. 4574 dated October 825 on Confidential List. The Department believes that it is probably not possible or desirable to fix as exact rules and criteria for listing firms in neutral countries of Europe as are applied with respect to firms in South America. In general, the purpose of the Proclaimed and Statutory Lists is to bring to bear all of the sanctions available to the British and this government against firms and individuals whose operations, activities or known sympathies are favorable to the Axis cause. Such sanctions should be regarded as including the stoppage of transactions between such firms and persons subject to the control of the British and American Governments, the blocking of funds of such firms in the United States, Great Britain or Canada, and such effect as the stigmatizing of the firm may have on local transactions and on transactions with other neutral countries in Europe and South America.
In general, firms which should be considered for inclusion are:
- 1.
- Those that are controlled by persons in Axis territory or by Axis nationals known to be sympathetic to the Axis cause.
- 2.
- Firms maintaining trade with enemy territory or substantially connected by trade or otherwise with firms on the published lists.
- 3.
- Firms whose activities in any way aid the Axis.
Considerations against the strict application of these general rules would be:
- 1.
- If the firm had available for export to the United States strategic materials.
- 2.
- If the number of firms to be included under the criteria mentioned was so large as to weaken the effectiveness of the list. This consideration should be balanced against the results to be obtained from listing and the mere size of the list would not constitute an objection if any salutary results were to be expected as a result of the listing.
- 3.
- Political considerations, including the essentiality of the operations of the firm in the local economy.
In general, in the absence of considerations with respect to strategic materials the fact that a firm has been an agent for or has engaged in trade with the United States or Great Britain should not affect its inclusion in the published lists. In rare cases where the Consul believes [Page 305] that considerations of this nature should be taken into account, the case should be reported in full to the Embassy at London and to the Department with a statement of the reasons why the reporting office believes that special considerations are applicable.
With respect to the question raised in your despatch no. 5311 dated September 3, 194226 enclosing communications relating to the application of listing policies to firms in Sweden, the Department believes that the absence of vulnerability may be taken into account in connection with other factors such as the unimportance of the firm and the unduly large number of firms in a given country which might otherwise be eligible for listing. In the absence of such other factors, however, the Department believes that the absence of vulnerability to American or British controls should not usually be a controlling factor as the stigmatizing of a firm which is controlled from enemy territory or which is pro-Nazi in its activities is of itself useful in most cases and may result in indirect sanctions through the unwillingness of other firms in the same country or other countries to transact business with it following its listing.