852.75 National Telephone Co./419

The American Ambassador in Spain (Hayes) to the Spanish Minister for Foreign Affairs (Jordana)45

No. 2001

Excellency: As Your Excellency is aware, very considerable sums of American capital have been advanced to and invested in the Compañía Telefónica Nacional de España by the International Telephone [Page 424] and Telegraph Corporation in order that the company should have means for creating and furnishing urban, inter-urban and international telephone service. These investments were made by reason of the fact that the Government of Spain had granted a concession contract to the Compañía Telefónica Nacional de España which assured to it certain rights and privileges for a minimum period of twenty years, and the right to fair and just compensation for that investment in the event that the Spanish State exercised its right to recapture the developed properties at the termination of the stipulated period. The International Telephone and Telegraph Corporation is the principal shareholder in the Compañía Telefónica Nacional de España, owning approximately eighty percent of its common shares.

Certain recent acts of the Spanish Government, and, in some instances, the failure of the State or its representatives to act, have prejudiced the American investment in the company and threaten to impair the value of such investment.

I am informed that Mr. F. T. Caldwell, Vice President of the International Telephone and Telegraph Corporation, New York, has submitted a petition to the Presidency of the Government appealing for an early and fair solution for a number of difficulties which have arisen in relations between the Company and the State, some of which have been caused by administrative acts of the Government. I am attaching hereto a copy of that petition.46

My Government has instructed me to request Your Excellency’s good offices to assure full and prompt consideration of the arguments set forth in the petition of the representative of the International Telephone and Telegraph Corporation.

I avail myself [etc.]

Carlton J. H. Hayes
  1. Copy transmitted to the Department in despatch 2362, April 21, from Madrid; received May 11.
  2. Not printed.