Foreign Relations of the United States, Diplomatic Papers, 1945, European Advisory Commission, Austria, Germany, Volume III

740.00119 EW/12–2845

The Ambassador in France (Caffery) to the Secretary of State

Paris, December 28, 1945—3 p.m.
[Received December 30—1 p.m.]

7389. Angell No. 194. Russian reciprocal deliveries considered as reparation inasmuch as Western Powers entitled to reparation secure such deliveries in lieu of plant and equipment. (From Angell No. 42.¹⁵) Reciprocal deliveries are included in category A of agreement proposed at Paris Conference, of which the US secures 28%. This does not necessarily mean that 28% of reciprocal deliveries will be received, since according to Final Act “if a signatory government receives more than its percentage share in certain types of assets in either category A or category B, its receipts of other types of assets in that category shall be reduced so as to insure that it shall receive not more than its share in that category as a whole”. Nevertheless, it is probable that US will receive approximately 28% of reciprocal deliveries. Such receipts may be (1) exported to the US; (2) sold to other nations; or (3) used in the American zone of occupation. In the latter event the materials should be priced and charged as approved imports just as any other product owned by the US or its nationals and imported into Germany under the first charge principle. (Urtel No. 1299, December 20, to Department, repeated to Paris for Angell as No. 179.)

Presumably much of the US portion of reciprocal deliveries will be used in the US zone in substitution for raw materials and foods which would otherwise be imported. Therefore, authorities in US zone are in the best position to determine the types of raw materials and foods which would be most useful. IARA will assemble information from all member nations on types of materials which they desire as reciprocal deliveries and will later arrange actual deliveries. This problem will be considered by Secretariat as soon as IARA is established by Assembly when it convenes. No discussions on types of materials desired as reciprocal deliveries were held during Reparations Conference.

It is assumed that the procedure will be as follows:

(1) IARA will indicate what types of materials and what quantities are desired by countries members of IARA;

(2) Agreement will be reached in ACC on what will be delivered by Russia;

(3) ACC will inform IARA of the types of products and amounts which have been made available;

(4) IARA will allocate the available products to the various claimant powers in accordance with their shares in category A;

(5) Each claimant nation will then indicate through IARA to ACC the procedure which should be followed for disposition of its share.

In this connection it should be recognized that the US, UK and France secure in the aggregate 72% of category A, and Canada, the Netherlands, Czechoslovakia and Yugoslavia an additional 17% of category A. Therefore, information on the products desired could be largely ascertained through inquiry of these countries. If immediate action is desired, suggest discussion and preliminary agreement among US, UK, France.

Sent Berlin 277, repeated to Department as 194 from Angell and 7389 from Paris.¹⁶ [Angell.]

Caffery

15. Apparently this is an incorrect reference; for previous discussion of this subject, see telegram 6420, November 5, 8 p.m., from Paris, p. 1371, telegram 5246, November 9, 8 p.m., to Paris, p. 1378, and telegram 6722, November 20, 10 p.m. from Paris, p. 1401.
16. The Department gave the following reply in telegram 50, January 7, 1946, 8 p.m., to Berlin for Mr. Murphy, and for Mr. Angell who was then in Berlin: “Procedure and comment described in telegram from Angell No. 194 Dec. 28 repeated to Berlin as 277 approved by Dept. This answers urtel 1299 Dec. 20.” (740.00119 EW/12–2045)