612.116/42
The Secretary of State to the Ambassador in Mexico (Messersmith)
Sir: Reference is made to the Embassy’s telegram no. 70775 and airgram A–1558 of May 13, 1944, reporting the publication on May 12 of an Executive Decree which provides that imports into Mexico will be subject to restriction by a system of import permits for the duration of the emergency. The Department will, of course, require more adequate data concerning the purpose of the Decree and the products to be restricted before a full evaluation of its implications will be possible. You should therefore endeavor to obtain further information concerning the measure and transmit it to the Department without delay.
The following observations with respect to the possible commercial policy aspects of the measure and its relation to the trade agreement [Page 1223] between the United States and Mexico are based on an informal study of the information at hand, the assumption being that the restrictions are predicated upon wartime necessity. This is a point which will require clarification. These observations are included in this instruction for the general guidance of representatives of the Embassy in any discussions of the subject they may find it desirable to undertake with Mexican officials in their endeavor to ascertain the purpose and probable scope of the measure.
- 1.
- The Decree appears to initiate a system of import control based on wartime emergency considerations at a time when emphasis might more logically be on the gradual diminution or elimination of such wartime trade controls in so far as may be possible in anticipation of efforts to revitalize international trade after the war as an essential factor in the restoration of peace and world prosperity. In that connection, reference is made to the pertinent paragraphs of the memorandum handed to the Mexican Ambassador at Washington on January 14, 1944 following the upward revision of import duties announced in December, 1943. A copy of this memorandum was transmitted to the Embassy with instruction no. 5218 of February 1.
- 2.
- The limitation of the import restrictions to the duration of the emergency appears to indicate the desire to institute a control of imports for the war period along the lines of that envisaged by United States General Imports Order M–63.76 In that connection it should be recalled that the purpose of that Order, which became effective July 2, 1942, was in general to assure the most effective use of available shipping space for imports into the United States. This order is amended from time to time to keep pace with the changing situation as it relates to requirements and available shipping facilities. It is difficult to envisage for Mexico a similar situation at this time where, because of insufficient shipping facilities, control of imports would be necessary in order to provide adequate channels for imports.
- 3.
- The relation of the measure to the trade agreement will no doubt be determined when its purpose is revealed, possibly with the publication of the first list of products to be restricted. Should it prove in fact to be a wartime or national emergency measure, it could of course be interpreted by the Mexican Government as falling within the meaning of Article XVII of the trade agreement which excepts from its provisions any measure “(h) relating to public security, or imposed for the protection of the country’s essential interests in time of war or other national emergency.” It is the Department’s view that the [Page 1224] burden of proof of the measure’s necessity would fall upon the Mexican Government.
- 4.
- Should it prove not, in fact, to be a measure dictated by wartime or other emergency conditions, the control of imports envisaged by the decree would appear to bring it within the meaning of Article X of the trade agreement in so far as articles included in Schedule I may be affected. It seems reasonably clear that the decree does not contemplate measures for which exceptions to the provisions of paragraph 1 are stated in paragraph 2 of Article X.
- 5.
- In the event the measure is, as the Embassy suggests, designed to prevent dumping, reference is made to the Department’s instruction no. 5588 of April 19, 1944, in which this Government’s views with respect to dumping were set forth.
- 6.
- Paragraph 2 of Article VI of the trade agreement may also prove to be pertinent. It provides that no administrative ruling imposing any new requirements with respect to importations shall be effective as a general rule prior to the expiration of thirty days after the date of publication of the ruling in the usual official manner.
In the absence of full information regarding the decree in question, the Department does not desire that representations be made to the Mexican Government. However, when appropriate, the foregoing observations may, in your discretion, be used in connection with the informal discussions authorized above.
Very truly yours,