800.8836/1163

The Secretary of State to the Ambassador in Cuba ( Braden )

No. 2280

Sir: Further reference is made to your despatch no. 4141 of August 12, 194351 in relation to recent developments in connection with the Habana docks situation.

The Department has received communications from the New York and Cuba Mail Steamship Company and United Fruit Company from which it appears that the latter company and the Cuban American Terminal Company, which is understood to be a wholly owned subsidiary of the New York and Cuba Mail Steamship Company, are the owners of concessions to operate certain warehouse and terminal facilities in Habana under definite regulations and tariffs which were adopted by mutual agreement between the companies and the Government of Cuba.

It seems clear that provisions of General Order no. 8, issued by the Cuban Maritime Commission on May 4, 1943, as modified by General Order no. 12, issued on August 10, 1943, constitute an infringement of the companies’ rights under their respective concessions in at least the following respects:

1.
By fixing a free storage period of greater length than the companies are required to accord under their concessions;
2.
By fixing storage rates at less than the maximum rates which the companies are permitted by their concessions to charge during the first month of storage; and
3.
By prohibiting the companies from exercising the right granted by their concessions to collect double storage charges in certain circumstances.

It is represented that, in reliance upon the terms of their concessions, which accorded them the right to operate under definite regulations and to collect charges within certain fixed maximum limits, the operating companies invested large sums of money to provide the port with adequate and modern facilities. The contentions of the operating companies to the effect that the rights which they acquired by the respective concessions cannot lawfully be modified by unilateral action of the Cuban Government appear to be fully supported by decisions heretofore rendered by the Supreme Court of Cuba.

Consequently, it is suggested that unless you perceive objection thereto, a communication be addressed to the Foreign Office requesting [Page 999] that the Cuban Government promptly take such steps as may be necessary to enable the companies mentioned in the second paragraph of this instruction, and also such other American-owned companies as may be similarly situated, to conduct their operations in accordance with the terms of their respective concessions.

It is also suggested that you take such other steps as may in your judgment serve to effect an expeditious settlement of the matter.

Very truly yours,

For the Secretary of State:
Breckinridge Long
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