740.22112 RP/7–1945: Telegram

The Ambassador in Ecuador ( Scotten ) to the Secretary of State

551. The press of July 16 carried a first notice signed by the Secretary of the Permanent Legislative Committee advising all persons interested in the legislative decree of March 2 (submitted to Department in despatch 2839 of March 20, 1945)80 to present their claims, et cetera, before the Permanent Legislative Commission within a period of 30 days from the third publication of this notice which appeared yesterday.

I am informed that a strong pressure has been exerted upon the Permanent Legislative Committee by several of the former Axis owners of blocked properties to have the properties returned to these former owners and that the Committee is disposed to do so. This question was discussed with the Minister of Economy (see my 27, January 10,80 and despatch 2839, March 20) and while the Minister of Economy gave the Embassy to understand clearly that he would not permit the return of these properties to the original owners, the Embassy has no written commitment from this Government to that effect.

I have been awaiting the Department’s airgram mentioned in your telegram 367, June 6,80 before taking official action and until those instructions are received it is difficult to formulate a course of action here.

On July 11 the Committee promulgated a regulatory decree interpreting the decree of the National Assembly of March 2 which empowers the Permanent Committee to return the properties to their [Page 1038] former owners, should the Committee so desire. A copy and translation of this decree which has just been published in the press is being forwarded to the Department by air mail in despatch 3268, July 19.82

I am, of course, aware of our policy regarding the return on these properties to their original owners as set forth by Assistant Secretary Clayton (Department’s radio bulletin 151, June 25) and record of action of Interdepartmental Committee on July 2.

Prior to making any official representations, the British Minister and I discussed this matter today with ex-Minister Laso who had the understanding with us last January which is cited above. Laso was in entire agreement as regards the commitment he had made at that time and stated that he will speak to the President83 tomorrow and urge that action be taken vis-à-vis the Permanent Legislative Commission to modify its decree. After the Department has had opportunity to study despatch 3268, I would appreciate the receipt of instructions as to what official representations I should make in case necessity arises.

Ecuadoran internal politics are involved in this matter as several of the former Axis owners have influential connections with the present Government.

  1. Not printed.
  2. Not printed.
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  4. Not printed; for description of the decree referred to, see instruction 1242, August 11, to Quito, p. 1039.
  5. José Maria Velasco Ibarra.