800.515/7–1645: Telegram

No. 983
The Acting Chief of the Division of Economic Security Controls ( Oliver ) to the Director of the Office of Financial and Development Policy ( Collado )1

secret

44. For Collado from Oliver.

Chief development is that British have agreed to join in warnings to neutrals. Madrid reports that Spanish have instructed Ambassador here2 to take up with Department question of German subsidiaries in Spain which Franco, through Instituto Nacional de Industria, a government development corporation, wishes to acquire. (Reurtel 23 July 163) Department has asked urgently for French concurrence to Department’s original proposal. Regarding Russians, Moscow has been instructed to inform Russians we assume tacit approval from Russian unilateral action in Turkey and Sweden.4

Department will probably recommend to SecState that German external assets in Rumania, Hungary and Bulgaria be included within four-power trusteeship principle. Department will also object to Russian attempt to acquire German Legation buildings at Stockholm on reparation account, pointing out to Russians that regarding German properties in western European neutrals British and ourselves have scrupulously adhered to principle that particularized advantage should not be obtained by any one of occupying powers.

ES is now discussing a preamble to vesting decree such as was suggested by telegram5 sent to you by courier July 13.

Discussions with Swiss Chargé6 indicated utility of deletion7 as bargaining point re neutral recognition control German external assets. Swiss wished deletion Scintilla A. G., in which there is majority German interest. Swiss were told deletion impossible until our control over German interest established. Chargé indicated Swiss would perhaps help us establish such control.

  1. Sent to the Secretary of State at Babelsberg over the signature of Grew.
  2. Juan Francisco de Cárdenas.
  3. Document No. 981.
  4. See document No. 982.
  5. Not identified.
  6. Max Grässli.
  7. From the Proclaimed List of Certain Blocked Nationals. Concerning the Proclaimed List, see Hackworth, Digest of International Law, vol. vii, pp. 654–656.