Memorandum of Conversation, by the Assistant Chief of the Aviation Division (Walstrom)

Participants: Lord Beaverbrook, Lord Privy Seal
Mr. Ralph Assheton, Member of Civil Air Transport Committee of British Cabinet
Mr. Peter Masefield, aviation adviser to Lord Beaverbrook
Mr. A. A. Berle, Jr.
Messrs. Stokeley Morgan and J. D. Walstrom, AD
Mr. Livingston Satterthwaite, Civil Air Attaché, London.

The first matter discussed was the memorandum handed to us by the Russians on August 1, stating that the Soviet Union wished all air routes within its territory to be operated by Soviet planes and crews. A copy of the Russian memorandum was shown to Lord Beaverbrook and his associates. It was agreed that an effort should be made to get the Soviets to change their attitude. If this could not be achieved, it would still be possible for other countries to engage in international air transport on a large-scale, since the transit of Soviet territory was not essential in establishing major world routes.

The second item of discussion related to the acquisition of landing rights abroad. Mr. Berle said that certain London papers had apparently misinterpreted our negotiations for landing rights in Spain,61 but we hoped the British Government did not feel that we “were jumping the gun.” Lord Beaverbrook said they had no feeling of this whatever. It was then agreed that both the United States and Britain should be able to negotiate for landing rights abroad, so long as both countries continued their informal understanding that such rights would not exclude the other country. Mr. Berle said we realized that the British desired to go to South America, and we did not intend to stop them. Equally, we desired to operate through the Near and Middle East, and we presumed the British would have no objection. Lord Beaverbrook said they did not want to go to South America until they could go to Argentina. However, he agreed with Mr. Berle that both our countries should feel free to proceed with negotiations to obtain landing rights pari passu.

Mr. Masefield raised the question of flight equipment for British lines. He was told that the American lines themselves were short of [Page 523] equipment, but that the Munitions Assignments Board (which also sits in London) might be able to assign some American planes to British airlines later on.

The third subject dealt with Lowell Yerex and the Taca interests. Lord Beaverbrook said their Ambassador (he did not mention the country) had informed London that Yerex was not wholly satisfied with the sale of his companies to American interests, and in view of this, together with Yerex’ British nationality and the British interests in B.W.I.A.,62 he had been invited to London to talk. According to Lord Beaverbrook, Yerex indicated his desire to sell both his interests and those of T.W.A.63 to the British, but Lord Beaverbrook had said they would not go through with such a deal “unless Mr. Berle approved.”

Mr. Berle pointed out that British acquisition of the Yerex companies in the Caribbean area would undoubtedly meet with strong criticism of the British from certain sections of American official circles and public opinion, and he felt that such a development would be undesirable from the standpoint of both our countries. He therefore suggested that the British defer action for six or eight months, and that we would again review the matter with them. Lord Beaverbrook gave the impression that he would follow this suggestion.

  1. Negotiations for air transport services agreement between the United States and Spain, signed at Madrid, December 2, 1944 (Department of State Executive Agreement Series No. 432).
  2. British West Indian Airways, Ltd.
  3. Trans-World Airways.