393.115/11–945: Telegram

The Chargé in China ( Robertson ) to the Secretary of State

1950. [For the Consul at Tientsin:] Immediately upon receipt, Chargé d’Affaires discussed question with Foreign Minister Wang Shih-chieh. (Re your Nos. 14 and 15, November 4.) Wang readily agreed that in cases where stocks and equipment in premises of American firms are identical or similar to those in premises when Japanese took possession, such stocks and equipment should be considered just as much property of firms as the premises and should be turned over accordingly. This principle should apply to consumable goods as well as to fixed assets such as machinery and equipment. In instances where premises are used for storage of goods having no connection such as automobiles in department store, Chinese do not agree that American firms have legitimate claims.

It was not clear from your No. 14 whether machinery and raw materials stored in property of A. and M. Karagheusian taken over by General Chiang Shi-yi represented original or similar equipment and materials or whether plant was simply being used as storehouse. We were also unable to determine relationship of 35 motor vehicles and spare parts to ordinary business of Frazar Fed., Inc. Wulfsohn and Majestic Theatre would appear to fall into category about which there is no question.

Chinese Foreign Minister is communicating directly with Yorkson Shen, Adviser to Ministry of Foreign Affairs in Tientsin, directing that this principle be followed and that status quo be maintained in doubtful cases pending decision as to rights involved. Presumably Shen is in position to give proper instruction to appropriate Chinese authorities. (Sent to Tientsin, repeated to Department.) Embassy suggests that you communicate with Shen immediately and advise result of conversations.