The Chargé in Panama (Donnelly) to the Secretary of State
[Received 6:52 p.m.]
208. In connection with proposed informal conversations with officials of the Panamanian Government regarding the provisions of the Nationalization of Commerce Act and articles in the proposed constitution discriminating against foreign business enterprises in Panama, it would be helpful if the Department could send the Embassy as quickly as possible a statement of the treatment accorded to foreigners legally admitted into the United States to engage in business there. The Embassy is of the impression that no discrimination exists but hesitates to make this statement to the Panamanian authorities in view of the nonuniformity of legislation in the different states. If it can be established that Panamanians legally residing in the United States are entitled to the same treatment as citizens of the United States as regards their engaging in all phases of commerce and industry the Panamanian Government may agree to modify the existing and proposed legislation so as to provide for reciprocal treatment.
Certain articles in the proposed constitution (see Articles 21, 25, 218 and 219 of the proposed constitution92 copy transmitted with Embassy’s despatch No. 1263 of February 19, 194593) are much more drastic than the Nationalization of Commerce Acts and if adopted by the National Assembly, which is scheduled to convene in June, would force a number of American companies operating in Panama to liquidate their businesses at once. The Embassy suggests that amendments to existing legislation and changes in the proposed constitution in order to provide for reciprocal treatment would establish an important precedent not only for Panama but for all the American Republics.