Truman Papers

No. 972
Report by the Drafting Committee on Reparations From Germany1

Report of Drafting Committee on Protocol of German Reparation

No agreement was reached by the Committee on a protocol on German reparations. The U. S. and U. K. representatives considered that, in return for the percentages of capital equipment allocated to the Soviet Union under the terms of paragraph 4 of the attached draft, the U. S. S. R. had agreed to refrain from asserting a claim to German external assets, gold captured in Germany or securities of German corporations in the Western Zones. Therefore, the U. S. and U. K. [Page 932]representatives maintained that German external assets should be included in paragraph 3, as a source of reparation to countries other than the U. S. S. R. Lacking this, the percentages in paragraph 4 would be unacceptable to the U. S. and U. K. representatives.

The Soviet representative considered that no agreed decision had yet been taken regarding relinquishment by the U. S. S. R. of a claim to external assets, gold and securities. Therefore the Soviet representatives did not accept the addition of German external assets in paragraph 3 and recommended that the matter should be referred to the Heads of Government.

The attached draft would be acceptable to the U. S. and U. K. representatives upon condition that the Soviet representatives confirm the above understanding regarding external assets, gold and securities. The Soviet representative stated that he could not agree with the way this question had been raised.

[Attachment]

German Reparation

1.
Reparation claims of U. S. S. R. shall be met by removals from the zone of Germany occupied by the U. S. S. R.
2.
The U. S. S. R. undertakes to settle the reparation claims of Poland from its own share of reparations.
3.
The reparations claims of the United States, the United Kingdom and other countries entitled to reparations shall be met from the Western Zones* and from German external assets[.]*
4.
In addition to the reparations to be taken by the U. S. S. R. from its own zone of occupation, the U. S. S. R. shall receive additionally from the Western Zones:
(a)
15 per cent of such usable and complete industrial capital equipment, in the first place from the metallurgical, chemical and machine manufacturing industries as is unnecessary for the German peace economy and should be removed from the Western Zones of Germany, in exchange for an equivalent value of food, coal, potash, zinc, timber, clay products, petroleum products, and such other commodities as may be agreed upon.
(b)
10 per cent of such industrial capital equipment as is unnecessary for the German peace economy and should be removed from the Western Zones, to be transferred to the Soviet Government on reparations account without payment or exchange of any kind in return.
Removals of equipment as provided in (a) and (b) above shall be made simultaneously.
5.
The amount of equipment to be removed from the Western Zones on account of reparations must be determined within six months from now at the latest.
6.
Removals of industrial capital equipment shall begin as soon as possible and shall be completed within two years from the determination specified in paragraph 5. The delivery of products covered by 4 (a) above shall begin as soon as possible and shall be made by the U. S. S. R. in agreed installments within five years of the date hereof. The determination of the amount and character of the industrial capital equipment unnecessary for the German peace economy and therefore available for reparation shall be made by the Control Council under policies fixed by the Allied Commission on Reparations, with the participation of France, subject to the final approval of the Zone Commander in the Zone from which the equipment is to be removed.
7.
Prior to the fixing of the total amount of equipment subject to removal, advance deliveries shall be made in respect to such equipment as will be determined to be eligible for delivery in accordance with the procedure set forth in the last sentence of paragraph 6.2
  1. This report was presented at the Twelfth Plenary Meeting, August 1. See ante, p. 566.
  2. Reserved by Soviet Representative. [Footnote in the original.]
  3. Reserved by Soviet Representative. [Footnote in the original.]
  4. In an earlier draft apparently considered by the Drafting Committee paragraph 7 reads as follows: “7. Prior to the fixing of the total amount of equipment subject to removal, advance deliveries will be made in respect to such equipment as will be determined to be eligible for delivery by the Allied Reparations Commission with the confirmation of the Control Council.” A footnote to the entire paragraph reads as follows: “Proposed by U. S. S. R. representative. Not accepted by U. S. and U. K. representatives.” Cf. document No. 970.