859.85/10–1245
The Danish Minister (Kauffmann) to the Secretary of State
Sir: Under instructions from my Government, I have the honor to transmit the following communication to you:
The Danish Government has reviewed with its Minister at Washington the decisions taken by him during the period when Denmark was occupied by the armed forces of Germany. This Government has noted with satisfaction that the Government of the United States recognized the authority of the Danish Minister to act for Denmark during this period thus making more effective his policy of cooperating with the United States in measures designed to bring about victory over the aggressor nations. In the same manner in which this Government has approved the actions of M. de Kauffmann in granting [Page 592] to the United States the use of defense bases in Greenland, in applying Danish public funds to the payment of full interest to American bondholders on Denmark’s public dollar debt and in placing the Danish Government’s training ship Danmark without remuneration at the disposal of the United States Coast Guard, it fully approves the policy adopted by the Danish Minister in lending his support, together with the Danish officers and crews, in making available to the American Government the use of thirty-nine privately owned Danish vessels in American and Philippine harbors and a fortieth brought from the Madeira Island for this purpose.
This Government has taken note of the friendly spirit demonstrated in the assurances given to the Danish Minister before and after the requisition of the Danish ships by the late President of the United States and high American officials that the question of compensation for these ships would be dealt with in a fair and liberal manner and that any ships available for return at the end of the war would be returned at the owners’ request. This friendly spirit was later reaffirmed in a communication of June 9, 194387 in which the Secretary of State88 informed a Committee of the Congress that
“The Department is particularly interested in providing for the fulfillment of both the legal and moral obligations assumed by the United States when it requisitioned forty Danish vessels.”
The Danish Government realizes that the matter of the settlement for these vessels is a comparatively small one from an American point of view. To the Danish nation, however, it is vital that fair compensation for the requisition of the forty ships be determined and paid without delay. The uncertainty is causing the Danish shipowners and thereby the economy of the Danish nation great harm, the more so as Denmark’s foreign exchange situation is largely dependent on Danish shipping and is in a very precarious state.
Denmark has always desired to fulfill her international obligations to the utmost. It was, therefore, in complete harmony with Danish tradition when, during the occupation of Denmark, the Danish Minister continued to pay full interest to American bondholders on Denmark’s outstanding public dollar debt. These payments, however, have by now exhausted Denmark’s dollar resources. The Danish Government does not for this reason expect that the compensation for the Danish vessels should exceed their value measured in accordance with the rules of international law, but Denmark does owe it to her creditors to see to it that the Danish economy receives for the vessels no less than is provided under such law.
It has been of serious concern to the Danish Government that the American authorities, more than four years after the requisition of the ships, have not made any offer to settle the question of compensation, although the rules of international law as to the standards of compensation seem comparatively simple and clear. The Danish Government is in full accord with the view expressed by the Department of State in its memorandum of April 12, 194389 to the War Shipping Administration where it is stated:
[Page 593]“In the light of the foregoing precedents it seems clear that under principles of international law the pecuniary liability of this Government with respect to the Danish vessels in question can be fully discharged only by the payment of an amount which will represent ‘just compensation’ in conformity with the decisions of the Supreme Court and international tribunals, that is, an amount determined on the basis of the actual value at the time of taking. If such compensation is not paid and the matter is submitted to an international tribunal for adjudication, it is expected that this Government will be found liable in an amount representing such actual value, plus interest.”
From the beginning the Danish shipowners have been desirous of seeing the question of compensation for the requisitioned Danish ships solved in an amicable way, and it is still the hope of the shipowners as well as of the Danish Government that the question of just compensation, whether for title or for use, will be satisfactorily settled without resort to international arbitration. The Danish Government, nevertheless, is prepared, should the occasion arise, to refer the matter to adjudication by an international tribunal.
The Danish Government, on the other hand, must reserve all rights in regard to the proceedings and the rulings of the board of three American jurists which has recently been appointed by the American authorities, the more so as the proceedings are not to be of an adversary nature and are directed to the formulation of rules of law, although the real question left for determination is the application of admitted principles of international law to the facts peculiar to the taking of the Danish vessels. Not only are a number of the questions submitted to this board by the War Shipping Administration of little, if any, practical relevance, but some are based upon an assumption that the Danish vessels had a lesser value by reason of the occupation of Denmark—an assumption which, apart from the fact that this Government believes it to be unwarranted, ignores entirely the assurances repeatedly given to the Danish Minister, before and after the requisition of the Danish vessels, that the United States would never seek to gain a pecuniary advantage by reason of Denmark’s misfortune.
This Government would regret further postponement of decision upon what it considers to be the only real question requiring determination; that is, the amount which represents the actual market value of the Danish vessels at the time of taking or, as to vessels which the owners request to have regarded as taken for use, the value of the use of such vessels during the period between their taking and their return.
Further delay in the determination and payment of the compensation will have serious repercussions for the Danish economy. Considering the urgency and the vital importance of this question to Denmark, the Danish Government expresses the earnest hope that the Government of the United States will endeavor as promptly as possible to settle the question of just compensation with interest at the rate customarily allowed under international law.
I avail myself [etc.]