Foreign Relations of the United States: Diplomatic Papers, The Conference of Berlin (The Potsdam Conference), 1945, Volume I

J. C. S. Files

No. 541
Memorandum by the Representatives of the British Chiefs of Staff

secret
C. C. S. 888

[Washington,] 2 July 1945.

Lend-Lease to the United Kingdom

1. The United States Chiefs of Staff will be aware that agreements were reached between our two governments last autumn regarding Lend-Lease to the United Kingdom after the end of the German war. These agreements have, we understand, recently been affirmed by the United States administration.

2. The attached (Enclosure) is a restatement in summary form of the understandings which were reached between our two governments on this matter. We recommend that this statement be communicated by the Combined Chiefs of Staff to the appropriate agencies and staffs who are now concerned in handling Lend-Lease to the United Kingdom.

3. The assignment of certain Lend-Lease material which is urgently required for operational purposes has been held up while the recent policy discussions have been proceeding, and from the combined military point of view it has become urgent that any obstacle caused by misunderstanding of these agreements should be removed without delay. We therefore recommend that action to communicate the attached document to all interested agencies be taken at the earliest possible moment.

[Enclosure]

Assignment of Military Equipment and Supplies to the United Kingdom Under Lend-Lease in Stage II

1. The following is a restatement in summary form of the understandings reached between the U. S. Administration and the Government of the United Kingdom regarding the supply of military Lend-Lease in Stage II.

2. In October and November, 1944, programs of U. K. military requirements for the first year in Stage II were agreed on the basis of certain principles and subject to certain conditions. The departments concerned undertook to make all practicable efforts to produce the specified quantities. At that time it was accepted as a working hypothesis that the European war would terminate on 31st December 1944. Except in the case of the naval program, which went into operation on the 1st of January 1945, it has been necessary to revise the actual programs agreed in November 1944 in the light of changed conditions. Such revision was provided for in the agreement and new requirements are being drawn up in relation to the commitments set forth in C. C. S. 887.¹

3. The same principles and conditions mentioned above as operative in November 1944 apply with equal force to the revised programs which will be processed through normal channels. These revised programs represent that proportion of U. K. essential military requirements in Stage II for which the U. S. Government accepted it as reasonable that the U. K. should look to the U. S. as a source of supply.

4. The main principles and conditions underlying the agreement are listed below:

Principles

5. The United States Government recognised that in the United Kingdom as in the United States, there would during Stage II be a partial reconversion of industry to meet essential civilian needs. Measures have been taken, through the organised exchange of information through the Combined Production and Resources Board, which enable the United States Government to satisfy itself that the rate of reconversion in the United Kingdom is not disproportionate to that in the United States, and that the United Kingdom is devoting an appropriate share of its resources to the war effort.

6. The United States Government accepted the need for the recovery of Britain’s export trade and has agreed measures with the United Kingdom Government to ensure that there is no misuse of Lend-Lease articles in export.

Conditions

7. The agreement reached, so far as United States departments are concerned, fell within and would be subject to the established procedures of the Munitions Assignments Board.

8. In certain limited cases where it was seen last November that production would fall short of combined requirements it was stipulated that items accepted as a requirement would be subject to the understanding that the British should bid for these items before the Munitions Assignments Board on the basis of operation urgencies.

1. Not printed.