740.00113 European War 1939/1006
Inter-Allied Declaration Against Acts of Dispossession Committed in Territories Under Enemy Occupation or Control: Interim Report of Inter-Allied Sub-Committee of Experts21
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Part II.—Summary of the Legislation of Each Country
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the united states of america
1. By Section 5(b) of its Trading with the Enemy Act as amended22
Power is conferred on the President of the United States during time of war or national emergency to investigate, regulate, direct and compel, nullify, void, prevent or prohibit any transfer or dealing which involves any property in which any foreign country or national thereof has an interest; he may exercise these powers with respect to any transfer or dealing wherever effected, which involves any property or any person subject to the jurisdiction of the United States. The President is empowered to vest any property or interest of any foreign national or country. Authority is conferred upon the President to define all of the terms employed in said section.
These powers of the President have been made available by delegation to the Secretary of the Treasury and the Alien Property Custodian.
2. General Ruling No. 12, issued by the United States Treasury Department23 under the authority of the said Act, provides that, except as licensed by the Treasury—
Any transfer, effected after freezing control was extended to a country, of property in a “blocked account” of that country or of any national thereof, is null and void.
The word “transfer” includes, with certain exceptions, any acts or transactions effected outside as well as in the United States which may convey or surrender any right or power with respect to property. [Page 450] The expression “property” in General Ruling No. 12 includes, in general, money, bullion, securities, financial instruments, book debts and written contracts, but not as a rule real property or chattels. The exclusion in general of real property or chattels does not necessarily mean that the United States Government considers such transfers to be valid; such exclusion merely means that no formal statement with respect to the invalidity of such transfer has been issued.
3. Pursuant to powers contained in the said Act, freezing control is applied mainly under Executive Order 8389 as amended24 and regulations issued thereunder. The freezing orders, in general, prohibit the following transactions if they involve any “blocked” country or national thereof or any property in which any “blocked” country or national thereof has an interest or any payment or transfer expressed in terms of the currency of such country: all transfers of credit, or payments involving banking institutions within the United States; all foreign exchange transactions; all dealings in securities (including securities physically situated outside the United States); all exports from the United States or earmarking within the United States of gold or silver, coin, bullion, or currency. The term “banking institution” is so broadly defined as to include anyone holding a credit for another as a direct or incidental part of his business.
Any transaction prohibited by the freezing orders may be licensed by the Treasury.
The following are “blocked” countries:—
Norway, Denmark, The Netherlands, Belgium, Luxemburg, France (including Monaco), Latvia, Estonia, Lithuania, Roumania, Bulgaria, Hungary, Yugoslavia, Greece, Albania, Andorra, Austria, China, Czechoslovakia, Danzig, Finland, Germany, Hong Kong, Italy, Japan, Liechtenstein, Poland, Portugal, San Marino, Spain, Sweden, Switzerland, Thailand, U.S.S.R.,
and any area which has been under the occupation or control of any of the foregoing countries at any time after such occupying or controlling country has been blocked.
The U.S.S.R. and the four European neutral countries (Portugal, Spain, Sweden and Switzerland) have each been granted a general licence under the freezing orders. The general licence granted to the U.S.S.R. effectively unblocks that country and its nationals, but does not validate any acts effected under Axis occupation.
Persons whose names are on the Proclaimed List of Certain Blocked Nationals are treated as enemy nationals for the purposes of the freezing orders for such time as their names appear on such List.
[Page 451]4. Control over securities has been established under other prohibitory measures issued by the United States Treasury. Any securities or currency imported into the United States must be reported to and deposited with specified Government agencies. It is illegal to receive or hold any such currency or securities without specific authorisation of the Treasury.
Further, no security to which a tax or other stamp or notarial seal of a foreign country has been attached may be dealt with in the United States unless a certificate has been attached to the security by the authority of the United States Treasury.
No transfer or dealing with respect to any security registered or inscribed in the name of a blocked country or national thereof may be effected without a licence from the Treasury.
To prevent looting, special measures have been taken to prohibit dealing in any Philippine currency or securities.
5. The Alien Property Custodian is empowered to take such action as he deems necessary in the national interest with respect to business enterprises, patents, ships, or vessels and certain other property in the United States where such property is affected with the interest of a foreign or enemy national. The Custodian has (inter alia) power to direct, manage, supervise, control or vest any such property.
6. General legal principles in the United States would suggest that, if transfers and dealings referred to in the Inter-Allied Declaration were wilfully contrary to the prohibitory regulations discussed herein, they would be determined by the courts to be invalid, and, in any event, the Executive Branch of the United States Government could legally invalidate such transfers and dealings. It is to be noted that under Section 3(a) of the said Act and General Ruling No. 1125 all transactions involving trade or communication with an enemy national are prohibited unless licensed.
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- Copy transmitted to the Department by the Ambassador in the United Kingdom in his despatch No. 10401, July 29; received August 5.↩
- Act of October 6, 1917 (40 Stat. 415) as amended by Title III of the First War Powers Act, 1941; 55 Stat. 838.↩
- Treasury Department, Documents Pertaining to Foreign Funds Control, March 30, 1944, p. 36.↩
- For text of Executive Order No. 8389 (3 CFR 128 (Supp. 1940)) as amended by Executive Order No. 8785 (3 CFR 225 (Supp. 1941)), with amendments effected after June 14, 1941, indicated by footnotes, see Documents Pertaining to Foreign Funds Control, March 30, 1944, pp. 5–10.↩
- Documents Pertaining to Foreign Funds Control, March 30, 1944, p. 34.↩