Foreign Relations of the United States, 1946, Paris Peace Conference: Documents, Volume IV

Doc. No. 10 (E).

Memorandum on the Arrangements for the Withdrawal of Allied Troops (Art. 63)

undated

Article 63

Paragraph 2 of Article 63 provides that all Italian property for which compensation has not been made and which is in possession of the armed forces stationed in Italy at the time of the coming into force of the Treaty, shall be returned to the Italian Government within a period of ninety days or due compensation shall be made.

In connection with the above provision, the Italian Government would like to point out that several goods and assets are at present in possession of certain Allied Authorities depending from the armed forces without however enjoying a definite military status, such as the Allied Commission and the Allied Financial Agency, which will presumably be leaving Italy at the same time as the Allied Forces.

It would therefore seem necessary to extend also to the above Authorities and Agencies—although this may be implicit—the obligation of returning property. In any case the latter should make adequate compensation, as provided in the paragraph under discussion, for any property (usually real estate) they continue to use. This should be done in order to avoid an unjustifiable difference in the position of the owners of property requisitioned by the Allied Armed Forces and the owners of property requisitioned by civilian Allied authorities, a difference, moreover, not mentioned in any provision of the Treaty and probably never intended.

With regard to paragraph 3 of the same Article 63, the Italian Government wish to point out that the text, as it now stands, provides no solution to a question which has already been the object of a previous exchange of views between the Italian Government and the Allied Authorities in Italy.

As it is known, the Allies, at the time of the disbanding of the German and Fascist armed forces, seized or froze over 16 billion lire which had been found deposited in the name of German authorities, as well as a number of cheques, bonds, shares, etc. (13.729 millions deposited with the Bank of Italy, 3.086 with other banks).

These accounts cannot be classed as German-owned assets, even though they were found set down to German credit, but represent actually Italian currency which it had been possible to withhold from the Germans. In fact, after the 8th of September 1943, the Germans, in addition to looting all removable goods from the country, imposed on Italy the payment of an occupation indemnity, which amounted at first to 7 billion lire per month, but was increased to about 10 billion lire as from January 1944 and to 12 billion as from January 1945. The Bank of Italy partially succeeded in evading the fulfilment of the German imposition by limiting the printing and the issue of the currency needed to meet the above-mentioned requests. It was thus possible to force the Germans into leaving, at the moment of their collapse, a considerable amount of credits, earmarked to the Reichskredit-Kasse, which they did not have time to avail themselves of.

As the Germans did not succeed in laying hands on these sums, it is obvious that they should be returned to Italy. Indeed, in view of their origin (the current account formed by the occupation indemnity imposed on Italy) these credits cannot in all fairness be considered to represent anything but an indemnity imposed on Italy and, precisely, that part of it which the Germans did not succeed in getting hold of.

It should also be noted that every time the question was raised, the Allied Financial Agency has specified, in connection with these accounts, that their ultimate destination would not be prejudiced by the fact of their temporary freezing.

The same considerations apply to money-orders and cheques pay able to Italian citizens which were found in the possession of German troops by Allied authorities. These assets had obviously been taken from their rightful owners, but they are still being held by Allied Authorities.

As all the above-mentioned assets cannot be considered “cash and bank balances supplied free of cost by the Italian Government”, it is felt that paragraph 3 of Article 63 should be partially modified.

It is suggested that paragraphs 2 and 3 of Article 63 of the Peace Treaty should read as follows:

2. All Italian property for which compensation has not been made and which is in possession of the Armed Forces or other Allied Authorities in Italy at the time of the coming into force of the present Treaty shall be returned to the Italian Government within the same period of 90 days or due compensation shall be made.

3. All bank and cash balances in the hands of the Forces of the Allied and Associated Powers at the time of the coming into force of the present Treaty, which have been supplied free of cost by the Italian Government, shall be returned or a corresponding credit given the Italian Government.

In the same way all bank and cash balances in the hands of said Armed Forces or other Allied Authorities and proceeding from war and other indemnities imposed on that part of Italy occupied by the German Forces will be returned to the Italian Government.