The Acting Secretary of State to the Uruguayan Chargé (Montero)
Sir: I refer to the Embassy’s note no. 729/945 C 66.6, dated September 17, 1945,64 concerning Uruguay’s lend-lease account, and to this Department’s note of September 28, 194563 concerning the termination of lend-lease.[Page 1386]
This note informed the Embassy of Uruguay that the Government of the United States had decided that, subject to certain specific exceptions, the transfer of materiél under the terms of the Lend-Lease Agreement signed on January 13, 1942, by representatives of the Republic of Uruguay, would be terminated. This decision is consistent with the Lend-Lease Agreement, which reads in Article I, “In conformity, however, with the Act of Congress of the United States of America of March 11, 1941,66 the United States of America reserves the right at any time to suspend, defer, or stop deliveries whenever, in the opinion of the President of the United States of America, further deliveries are not consistent with the needs of the defense of the United States of America or the Western Hemisphere”. In view of the decision to terminate lend-lease the United States Government will not be able to make further transfers of materiél as requested in the Embassy’s note under reference.
In the terms of Article II of the Lend-Lease Agreement, “In case the President of the United States of America should decide to suspend deliveries in accordance with Article I or if the United States of America should be unable to complete deliveries up to the total value contemplated by that Article, the payments to be made by the Oriental Republic of Uruguay would be reduced in the same proportion, so that the Oriental Republic of Uruguay would not be obliged to pay the United States of America for the deliveries made by the United States of America a greater percentage of the total value of the deliveries than the total payment provided in this Article bears to the total value of deliveries contemplated in Article I”.
In view of this provision of the agreement, the United States Government recognizes the right of the Republic of Uruguay to repayment of such sums as may have been paid in excess of the approximate appropriate percentage of the total value of lend-lease transfers to the Government of Uruguay, and following the final audit of lend-lease transfers will take steps toward the repayment of such excess sums upon request from the Government of Uruguay.
Conversely, if the Government of Uruguay desires to retain its credit balance in the United States as an account to be applied against purchase of surplus property the Government of the United States has no objection to such an arrangement.67 In this case the United States Government would continue to recognize its obligation to repay to Uruguay any unused sums at any time upon request.