CFM Files

Report of the Economic Commission for Italy 2

C.P. (Plen) Doc. 26

Mr. Chairman: The Economic Commission for Italy, which consists of all the Delegations, members of the Conference, with the exception of the Norwegian Delegation, was asked to consider Articles 64 to 72 and Annexes 3, 6, 7 and 8 of the draft Treaty.3 At the request of the Political and Territorial Commission, it considered Articles 23 and 31, Annex 9 and also the amendments to the said Articles and annex. It began its work on August 13, 1946 and finished it on the 6th October; it held 39 meetings.

At its first meeting, the Commission unanimously elected as Chairman Sir Joseph Bhore (India); as Vice-Chairman, Dr. Ales Bebler (Yugoslavia)—The latter has been at his own request replaced since the 8th Meeting by Dr. Leontic (Yugoslavia) and as Rapporteur M. Hervé Alphand (France).

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In conformity with the rules of procedure, the Norwegian delegation and delegations of States invited to the Conference (Albania, Cuba, Egypt, Irak, Mexico), were invited to attend the discussion of Articles on which they had views to express.

The Commission asked the Italian delegation to submit written observations on the Articles referred to it and these have been considered by the Commission in the course of its discussions.

The Commission also invited the Italian Delegation to submit, orally, its views on reparation and on Articles 65 to 69.

Paris, October 3, 1946.

Reparations—Article 64

The Commission had on the one hand to examine the section of this Article dealing with reparation due by Italy to the U.S.S.R. which had been agreed upon in the Council of Foreign Ministers and, on the other hand, the reparation claims submitted by other Powers, together with the means of meeting them and the extent to which they could be satisfied.

I.

As regards reparation in favor of the U.S.S.R., the Commission had before it five proposals for amendments.

a) Amendments C.P. (GEN) Doc.1.B.9 and 1.B.10 submitted by the Australian Delegation proposed that the total amount of reparation due to the U.S.S.R. and other Allied Powers should be determined within a period of six months from the date of the coming into force of the Treaty, by a Reparation and Restitution Commission and, on the other hand, that currency payments calculated on the basis of a percentage of the value of Italy’s exports be substituted for deliveries of Italian war industrial equipment and current industrial production. These two amendments were rejected by a ⅔ majority (15 votes to 2, with 3 abstentions).

b) An amendment to paragraph 5 of the draft Treaty submitted by the Australian Delegation (C.P.(IT/EC) Doc.13) advocated the principle included in previous amendments of a body which should coordinate and ensure the execution of the treaty, a Reparation and Restitution Commission, to determine in conjunction with the Soviet Government, the quantities and categories of goods to be handed over by the Italian Government. This proposal was rejected by 13 votes (Belgium, Byelorussia, China, Czechoslovakia, France, India, Netherlands, Poland, Ukraine, United Kingdom, U.S.A., U.S.S.R., Yugoslavia,) to 7 (Australia, Brazil, Canada, Ethiopia, Greece, New Zealand, the Union of South Africa).

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The views of the Australian Delegation on these two points are given in Annex 1,4 those of the U.S.A. Delegation in Annex 2.5

c) An amendment submitted by the Brazilian Delegation (CP (GEN) Doc.1.E.9) which by adding the words, “if necessary” before the words “shall furnish”, would restrict the scope of Paragraph 4, under which the U.S.S.R. would provide the raw materials and goods needed for the deliveries of reparation to the Soviet Union from Italian current industrial production. This amendment was rejected by a ⅔rds majority (15 votes to 4 with 1 abstention).

The views of the U.S.A. Delegation are given in Annex 3.5

[d)] An amendment by the Soviet Delegation (C.P.(IT/EC) Doc. 16) providing that payment for such raw materials and goods should be calculated on the basis of the U.S. dollar at the gold parity on July 1st, 1946 was unanimously adopted.

The Commission then unanimously adopted Part A as completed.

II.

As regards reparations for United Nations other than the Soviet Union, the Commission decided, at its meeting on 29th August, to set up a Sub-Commission composed of representatives of all the countries directly interested in this question, which should examine the demands of countries which had submitted claims in connection with Part B of Article 64, to draw up a table arranging these claims under various headings and say how far these claims seemed to have been calculated on a uniform basis.

This Sub-Commission, after electing M. Rueff (France) as its Chairman, proceeded to draw up a report which was submitted to the Commission by the Chairman. On October 4th, the U.S., French, U.K. and U.S.S.R. Delegations submitted a joint proposal, (Document C.P.(IT/EC) R. 346) except for certain points concerning Part B of Article 64 and suggesting the addition of two supplementary parts, and the insertion of an additional paragraph in Article 70.

Document R.34 laid down the principles according to which reparations claims were to be met, but did not fix the amount of these reparations.

After the Yugoslav Delegation which reserved the question of the amounts had withdrawn its proposal contained in Document [C.P. (GEN) Doc] 1U17, Document R.34 was adopted as a sole basis of discussion.

After the discussion of paragraph 1 of Part B concerning the amount of reparations to be paid by Italy to Albania, Ethiopia, Greece [Page 341] and Yugoslavia had been left over by the Commission for consideration after the paragraphs relating to the principles to be applied, the Commission proceeded to consider paragraph 2 defining the sources of reparations.

Sub-paragraph (a) providing as the first source a share of Italian war-industry equipment was adopted unanimously.

Sub-paragraph (b) providing as the second source the current industrial production of Italy was likewise adopted unanimously with the addition of the words “including products of mining industries” as proposed by the United States Delegation.

Sub-paragraph (c) providing as the third source all other categories of payments in capital or in services was adopted unanimously with the following addition at the end proposed by the French Delegation, “but excluding Italian assets subject, by virtue of Article 69, to the jurisdiction of the Powers enumerated in Paragraph I of Part B of this Article; payments effected under this paragraph may include seeds”.

Sub-paragraph (d) (proceed [proposed] by the U.S. and U.K. Representatives and opposed by the French and U.S.S.R. Representatives) providing as the fourth source State and parastatal property in the territories ceded was rejected by 13 votes (Belgium, Byelorussia, China, Czechoslovakia, Ethiopia, France, Greece, India, Netherlands, Poland, Ukraine, U.S.S.R., Yugoslavia,) to 7 (Australia, Brazil, Canada, New Zealand, Union of South Africa, United Kingdom, United States).

On the proposal of the South African Delegation, the two subparagraphs of Paragraph 3 were discussed separately.

The first sub-paragraph relating to methods of delivery and to bilateral agreements to be concluded with Italy for this purpose, was adopted by 18 votes (Australia, Belgium, Byelorussia, Brazil, Canada, China, Czechoslovakia, France, India, Netherlands, New Zealand, Poland, Ukraine, Union of South Africa, United Kingdom, United States, U.S.S.R., Yugoslavia) to 2 (Ethiopia, Greece), after a Greek amendment proposing the insertion of the word “serious” between the words “avoid” and “interference” had been rejected by 15 votes (Belgium, Byelorussia, Brazil, Canada, China, Czechoslovakia, France, Netherlands, New Zealand, Poland, Ukraine, Union of South Africa, United Kingdom, United States, U.S.S.R.) to 5 (Australia, Ethiopia, Greece, India and Yugoslavia).

The second sub-paragraph, relating to the communication of the said bilateral agreements to the four Ambassadors in Rome,7 was the [Page 342] subject of an amendment by the Australian Delegation proposing the creation of an Italian Reparations Commission of co-ordination and control [which] would apply only to Reparations levied under Part B, (IT/EC) Doc. 94,8 as regards which it was decided to vote each paragraph separately.

The first paragraph of the Australian amendment setting forth the principle of the creation of such a Commission was adopted by 12 votes (Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, Netherlands, New Zealand, Union of South Africa, United Kingdom, United States) to 8 (Byelorussia, China, Czechoslovakia, France, Poland, Ukraine, U.S.S.R., Yugoslavia).

The second paragraph of the Australian amendment dealing with the composition of the Commission was discussed sub-paragraph by sub-paragraph.

The wording of sub-paragraph (a), giving a list of members, was first altered to make explicit mention of the U.S.S.R. and then adopted by 12 votes (Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 7 (Byelorussia, China, Czechoslovakia, Poland, Ukrainian S.S.R., U.S.S.R., Yugoslavia,) with 1 abstention (France).

The South African Delegation proposed an amendment to subparagraphs (a), appointing the U.S. Representative as Chairman, (b) authorising the Commission to establish its own rules of procedure and (d) giving it a free hand in recruiting personnel. The amendment, to delete sub-paragraphs (b) and (d) and to add the words “and its organisation” at the end of sub-paragraph (c), was adopted by 7 votes (Belgium, Ethiopia, India, Netherlands, New Zealand, Union of South Africa, U.K.) to 3 (Australia, Brazil, Canada) with 5 abstentions (China, France, Greece, Poland, U.S.A.). Five Delegations (Byelorussia, Czechoslovakia, Ukrainian S.S.R., U.S.S.R., Poland) did not take part in the voting.

The new sub-paragraph (b) (the former sub-paragraph (c)) as amended above, was adopted by 12 votes (Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 4 (Byelorussia, Czechoslovakia, Ukrainian S.S.R., Yugoslavia) with 3 abstentions (China, France, Poland). The U.S.S.R. did not take part in the vote.

The former sub-paragraph (e), relettered (c), requiring the Italian Government to defray the expenses of the Commission, was adopted by 12 votes (Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 4 (Byelorussia, Czechoslovakia, Ukrainian S.S.R., Yugoslavia) [Page 343] with 3 abstentions (China, France, Poland). The U.S.S.R. did not take part in the vote.

The former sub-paragraph (f), relettered (d), granting diplomatic privileges to members of the Commission, was adopted by 11 votes (Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, Netherlands, New Zealand, Union of South Africa, U.S.A.) to 4 (Byelorussia, Czechoslovakia, Ukrainian S.S.R., Yugoslavia) with 4 abstentions (China, France, Poland, U.K.). The U.S.S.R. did not take part in the vote.

The third paragraph of the Australian amendment, dealing with the powers of the Commission, was also put to the vote sub-paragraph by sub-paragraph.

Sub-paragraph (a), giving the Commission power to co-ordinate and control deliveries of factory and tool equipment and deliveries from current production, was adopted by 12 votes (Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 4 (Byelorussia, Czechoslovakia, Ukrainian S.S.R., Yugoslavia) with 3 abstentions (China, France, Poland). The U.S.S.R. did not take part in the vote.

Sub-paragraph (b), giving the Commission the power to examine the bilateral reparation treaties concluded with Italy, was adopted by 12 votes (Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 4 votes (Byelorussia, Czechoslovakia, Ukrainian S.S.R., Yugoslavia) with 3 abstentions (China, France, Poland). The U.S.S.R. did not take part in the vote.

The U.S. Delegation proposed an amendment to sub-paragraph (c) which provides that beneficiary States should submit periodical reports to the Commission, and also lays down a system of sanctions to be applied if the Italian Government should not fulfil its obligations. This amendment to delete the clauses relating to sanctions was adopted by 6 votes (Belgium, Brazil, China, India, Union of South Africa, U.S.A.) to 4 (Australia, Canada, Ethiopia, New Zealand) with 6 abstentions (Czechoslovakia, France, Greece, Netherlands, Poland, U.K.). Byelorussia, Ukrainian S.S.R., U.S.S.R. and Yugoslavia did not take part in the vote.

The first sentence of sub-paragraph (c) was then adopted by 11 votes (Australia, Belgium, Brazil, Canada, Ethiopia, India, Netherlands, New Zealands, Union of South Africa, U.K., U.S.A.) with 4 abstentions (China, France, Greece, Poland). Byelorussia, Czechoslovakia, Ukrainian S.S.R., U.S.S.R. and Yugoslavia did not take part in the vote.

Sub-paragraph (d), providing that the Commission shall be accredited to the Italian Government to represent beneficiary States was [Page 344] adopted by 12 votes (Australia, Belgium, Brazil, Canada, China, Greece, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 4 (Byelorussia, Czechoslovakia, Ukrainian S.S.R., Yugoslavia) with 3 abstentions (France, Poland, Ethiopia). The U.S.S.R. did not take part in the vote.

Sub-paragraph (e) providing for the publication of an annual report by the Commission, was adopted by 12 votes (Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 4 (Byelorussia, Czechoslovakia, Ukrainian S.S.R., Yugoslavia) with 3 abstentions (China, France, Poland). The U.S.S.R. did not take part in the vote.

The views of the U.S.S.R. Delegation are given in Annex 4.9

The Australian amendment is intended to replace the second subparagraph of paragraph 3 of part B; this sub-paragraph should therefore be deleted from the text proposed in Doc. R.34.

Paragraph 4 of part B, which concerns supplying Italy with the raw materials needed for the production of goods to be delivered as reparations, was unanimously adopted.

Paragraph 5, establishing the gold dollar as a calculation basis, was unanimously adopted.

Paragraph 6, empowering the Ambassadors of the Four Powers in Rome to determine the value of the Italian assets to be transferred, was likewise adopted unanimously, after an Australian amendment to the effect that the Italian Reparations Commission be entrusted with this task had been rejected by 11 votes (Byelorussia, Canada, China, Czechoslovakia, France, Poland, Ukrainian S.S.R., United Kingdom, United States, U.S.S.R., Yugoslavia) to 8 (Australia, Belgium, Brazil, Ethiopia, India, Netherlands, New Zealand, Union of South Africa), with 1 abstention (Greece).

On the proposal of the French Delegation, a paragraph 7, reading as follows, was unanimously adopted: “Claims of the Powers mentioned in Part B, paragraph 1, of this Article, in excess of the reparation allocated under the same paragraph, shall be satisfied out of the Italian assets assigned to their respective jurisdiction under Article 69 of the present Treaty”.

To allay the Greek Delegation’s anxieties, the single paragraph which constitutes Part C, by which special provision is made for the deliveries authorised under Parts A and B, was the subject of an amendment submitted by the French Delegation and modified at the request of the U.S.S.R. Delegation proposing to qualify deliveries from current industrial production, capital and services, by the words “as provided in Part A, sub-paragraph 2(c), and in Part B, paragraph 2, sub-paragraph (b) and (c).

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This amendment was adopted by 14 votes (Byelorussia, China, Czechoslovakia, Ethiopia, France, Greece, India, Netherlands, New Zealand, Poland, Ukrainian S.S.R., United States, U.S.S.R., Yugoslavia) to 6 (Australia, Belgium, Brazil, Canada, Union of South Africa, United Kingdom), the U.K. Delegation reserving the right to insert a minority statement in the present report.

The views of the British Delegation are given in Annex 4 bis.10

Document R. 34, Part D, deals with reparations due to Powers other than those listed in Parts A and B. The first two paragraphs of Part D, providing the possibility for the States in question to obtain satisfaction of their claims in the manner laid down in Article 69, as well as by the dissolution for their own benefit of the holdings of Italian natural and juridical persons domiciled in Italy, of water, gas, electricity and transport services in the ceded territories, were unanimously adopted.

The views of the French Delegation are given in Annex 5,11 those of the U.S.S.R. Delegation in Annex 6.12

The third paragraph of Part D, submitted by the U.S.S.R. Delegation relating to the possibility for certain countries to liquidate loans contracted during the war, was the object of statements by the U.K., U.S.A. and French Delegations to the effect that the said debtor States could discharge pre-war debts by means of methods based upon the provisions of Article 6, paragraph 1, of the Treaty. After a statement by the Polish Delegation that it concluded that these opinions were in favour of the satisfaction of its claims, the U.S.S.R. Delegation withdrew its proposal concerning the third paragraph of Part D.

The views of the Polish Delegation are given in Annex 5 bis.13

In the course of the discussion of paragraph 1 of Part B (which had been postponed until after consideration of document R. 34) the following proposals were made in million dollars:

In the case of Albania: 0 (U.K.)
0 (U.S.A.)
25 (U.S.S.K.)
5 (France)
In the case of Ethiopia: 25 (U.K.)
25 (U.S.A.)
35 (Australia)
In the case of Greece: 100 (U.K.)
100 (U.S.A.)
In the case of Yugoslavia: 100 (U.K.)
80 (U.S.A.)
400 (Yugoslavia)

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A proposal by the Polish Delegation to refer the whole question to the Plenary Conference with a recommendation that it should be submitted to the Council of Foreign Ministers was rejected by 13 votes (Australia, Belgium, Brazil, Canada, Ethiopia, France, Greece, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 7 (Byelorussia, China, Czechoslovakia, Poland, Ukrainian S.S.R., U.S.S.R., Yugoslavia). The Commission then began discussion of the question whether Albania should in principle be admitted as a beneficiary under the present paragraph.

10 delegations (Byelorussia, China, Czechoslovakia, France, Ethiopia, India, Poland, Ukrainian S.S.R., U.S.S.R., Yugoslavia) were in favour and 10 against (Australia, Belgium, Brazil, Canada, Greece, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.). The Chairman concluded that there was not a majority in favour of the allocation of a share to Albania.

In the case of Ethiopia, a proposal made by the Australian Delegation and seconded by the Indian Delegation to allocate 35 million dollars to Ethiopia was rejected by 10 votes (Byelorussia, Brazil, Canada, China, France, New Zealand, Union of South Africa, U.K., U.S.A., U.S.S.R.) to 10 (Australia, Belgium, Czechoslovakia, Greece,. India, Netherlands, Poland, Ukrainian S.S.R., Yugoslavia, Ethiopia).

The Commission then unanimously adopted a figure of 25 million.

The Yugoslav claim for 400 million was rejected by 12 votes (Australia, Belgium, Brazil, Canada, China, France, India, Netherlands, New Zealand, Union of South Africa, U.K., U.S.A.) to 8 (Byelorussia, Czechoslovakia, Ethiopia, Greece, Poland, Ukranian S.S.R., U.S.S.R., Yugoslavia).

On the proposal of the French Delegation, the Commission then took a vote on the proposal regarding the attributions to Greece and Yugoslavia. As the British proposal for parity was adopted by 15 votes (Australia, Belgium, Byelorussia, Brazil, Canada, China, Ethiopia, France, Greece, India, Netherlands, New Zealand, Ukraine, Union of South Africa, United Kingdom) to 1 (U.S.S.R.) with 4 abstentions (Czechoslovakia, Poland, United States, Yugoslavia), the Commission did not vote on the United States proposal of 10 to Greece against 8 to Yugoslavia, or on the Soviet proposal of 1 to Greece against 2 to Yugoslavia (The Soviet Delegation reserving the right to maintain its points of view on this subject).

Passing to the determination by vote of the total amount of reparations under Part B, the Commission rejected by 11 votes (Australia, Belgium, Brazil, Canada, France, India, Netherlands, New Zealand, Union of South Africa, United Kingdom, United States) to 8 (Byelorussia, China, Czechoslovakia, Greece, Poland, [Page 347] Ukraine, U.S.S.R., Yugoslavia) with 1 abstention (Ethiopia) a Greek proposal to leave the fixing of this total to the Council of Foreign Ministers; and adopted by 11 votes (Australia, Belgium, Brazil, Canada, China, France, Netherlands, New Zealand, Union of South Africa, United Kingdom, United States) to 4 (Byelorussia, Greece, Ukraine, Yugoslavia) with 5 abstentions (Czechoslovakia, Ethiopia, India, Poland, U.S.S.R.) the British proposal of 225 millions.

The Greek and Yugoslav Delegations reserved the right to submit a minority report in this connection.

Finally, the Commission adopted unanimously a French proposal to submit to the Plenary Conference the text of the paragraph without a figure being stated, as the present report contains all the necessary information on this point.

The views of the U.S.A. Delegation on Parts B, C and D of Article 64 are given in Annex 7 [8].14

III.

The Commission therefore submits as recommendation to the plenary conference the text of the part of Article 64 approved by the Council of Foreign Ministers, amended:

1.
By the adjunction to para. 2c of the words: “Including the yield of industries of extraction”.
2.
By the adjunction of a new para. 6.

“Payments under this Article shall be calculated on the basis of the U.S. dollar (gold parity as at July 1st, 1946, i.e. 35 dollars per ounce of gold).”

It also submits as recommendations the following provisions, adopted unanimously or by a two-thirds majority, as regards parts B, C and D of Article 64:

b. reparations for albania, ethiopia, greece and Yugoslavia

1.
Italy shall pay reparation to the following countries:
  • Albania in the amount of $
  • Ethiopia in the amount of $
  • Greece in the amount of $
  • Yugoslavia in the amount of $
These payments shall be made during a period of 7 years from the date of the coming into force of this Treaty. Deliveries from current industrial production shall not be made during the first two years.
2.
Reparation shall be made from the following sources.
(a)
A share of the Italian factory and tool equipment designed for the manufacture of war implements which is not required by the permitted military establishments and is not readily susceptible of conversion [Page 348] to civilian purposes and which is removed from Italy pursuant to Article 58 of this Treaty.
(b)
Italian current industrial production, including the products of mining industries.
(c)
All other categories of capital goods or services, including either or both the passenger vessels Saturnia and Vulcania if, after their value has been determined by the method indicated in paragraph 6 below, they are claimed within 90 days by one of the countries indicated in paragraph 1, part B of this Article, but exclusive of Italian assets subject under Article 69 to the jurisdiction of the powers mentioned in para. 1, Part B of this Article—. Payments effected under this paragraph may include seeds.
3.
The quantities and types of goods and services to be delivered shall be the subject of agreement between the Italian Government and the beneficiary governments, and shall be selected and deliveries scheduled in such a way as to avoid interference with the economic reconstruction of Italy and the imposition of additional liabilities on other Allied and Associated Powers.
4.
The governments beneficiary of reparation from current industrial production shall furnish to Italy on commercial terms the materials which are normally imported into Italy and which are needed for the production of these goods. Payments for these materials shall be made by deducting the value of the materials furnished from the value of the goods delivered.
5.
The basis for calculating the settlement provided in this Article will be the United States dollar at its gold parity on the 1st July, 1946, i.e. 35 dollars for an ounce of gold.
6.
The Four Ambassadors shall determine the value of the Italian assets to be transferred to the countries referred to in paragraph 1, Part B of this Article.
7.
Claims of the Powers mentioned in Paragraph 1 of Part B of this Article in excess of the reparations allocated under the same paragraph, shall be satisfied out of the Italian assets subject to their respective jurisdiction under Article 69 of this Treaty.

c. special provision for earlier deliveries

With respect to deliveries of current industrial production, capital-goods and services such as those provided in Part B, paragraph 2, nothing in either Part A or Part B of the present Article shall be deemed to prevent deliveries during the first two years, if such deliveries are made in accordance with agreements between the Italian Government and a beneficiary government.

d. reparations for other powers

1.
Claims of the other Allied and Associated Powers shall be satisfied out of the Italian assets subject to their respective jurisdiction, under Article 69 of this Treaty.
2.
Claims of countries receiving ceded territories in application of the present Treaty which are not mentioned in part B of the present Article, shall also be satisfied out of the ownership interests of Italian nationals, including both natural and juridical persons, resident in Italy, in companies of ceded territories engaged in the following services: water, gas, electricity and transport.

The Italian interests thus transferred shall remain subject to all charges and liens held by natural or juridical persons not of Italian nationality.

The Commission finally submits to the Conference various proposals in relation to Article 64, which have not obtained a two-thirds majority or been rejected by a two-thirds majority:

I. Amendment to Part A, para. 3, submitted by the Australian Delegation and rejected by 13 votes to 7:

Replace the words: “The Italian Government and the U.S.S.R. Government …[”]

By: “The Italian Government and the U.S.S.R. Government and the Reperations and Restitution Commission set up under Section C of this Article; the choice …”

Delete the last sentence of para. 3.

II. Addition to part B, para. 2 of a sub-paragraph d, submitted by the U.S.A. and U.K. Delegations and rejected by 13 votes to 7:

“Property rights held by the Italian State, or by Italian parastatal organizations, in commercial enterprises operating in the ceded territories.”

III(a) Addition to Part B, para. 3, submitted by the Australian Delegation, the principle of which was accepted by 12 votes to 8:

  • “1. An Italian Reparation Commission shall be set up to co-ordinate and supervise the execution of the provisions of Part B of this Article.” (Obtained 12 votes to 8).
  • “2. (a). The Italian Reparation Commission shall consist of one representative of each country entitled to reparations by virtue of part B of the present Article, and of one representative of the United States of America, France, the United Kingdom and the U.S.S.R., respectively.” (Obtained 12 votes to 7).
  • “(b). The Commission shall determine its own rules of procedure and decide upon its own organisation.” (Obtained 12 votes to 4).
  • “(c). The administrative expenses of the Commission shall be met by the Italian Government.” (Obtained 12 votes to 4).
  • “(d). The members and staff of the Commission shall enjoy such diplomatic privileges as may be necessary for the performance of their duties.” (Obtained 11 votes to 4).
  • “3. (a). The Commission shall co-ordinate and supervise the execution of the provisions of Part B of the present Article with regard to reparations levied from current production and industrial equipment.” (Obtained 12 votes to 4).
  • “(b). Each of the Governments entitled to reparations under Part B, before concluding the agreement with the Italian Government provided for in Part B, shall submit the proposed agreement to the Commission for approval. The Commission shall examine all such agreements in the light of the present Article, bearing in mind, more particularly, the need to avoid disputes and duplicate allocations in apportioning Italian production and resources to the various countries entitled to reparations under Paragraph [Part] B.” (Obtained 12 votes to 4).
  • “(c). Each of the Governments entitled to reparations under Part B shall submit to the Commission periodical reports on deliveries effected in accordance with the agreements approved by the Commission.” (Obtained 11 votes to 4).
  • “(d). At the request and on behalf of any of the Governments entitled to Reparations, the Commission may enter into negotiations with the Italian Government, or assume the executive role which may be entrusted to it by the Government concerned, in order to implement the provisions of Part B of the present Article or of any agreements concluded thereunder.” (Obtained 12 votes to 4).
  • “(e). The Commission shall draw up an annual agreement [report?] to be circulated to each of the Allied and Associated Powers signing the present Treaty.” (Obtained 12 votes to 4).

III(b). The eight Delegations voting against the inclusion of the above text, proposed that a second sub-paragraph be added to para. 3:

“Agreements concluded under this paragraph shall be communicated to the Ambassadors at Rome of the United States, France, the United Kingdom, and the U.S.S.R.”

Article 65—Restitution

The Council of Foreign Ministers agreed on a text for this Article by which Italy was required to return in good order all identifiable property removed from United Nations territory and found to be in Italy.

1.
The Commission had before it six amendments and one amendment to an amendment:
a)
The Yugoslav Delegation proposed (C.P. (Gen) Doc. 1.U. 18):
1)
To add to para. 1 of the Draft Treaty text, which requires Italy to return property removed, the phrase “within a period of 6 months after the filing of the claim for restitution”.
On the suggestion of the U.K. Delegation the Commission unanimously decided to insert the words “in the shortest possible time” after the words “will return” in para. 1 and the Yugoslav Delegation withdrew its proposal.
2)
To amend para. 2, which limits restitution to identifiable property, to include the replacement of property which cannot be returned by property of equivalent value.
The Yugoslav delegation withdrew this proposal.
3)
In para. 3 to require the Italian Government to bear the cost of refloating and repairing vessels belonging to the Allied and Associated Powers sunk in Italian waters.
The Yugoslav delegation withdrew this proposal.
4)
To make clear in para. 4 that the Italian Government would meet “the maintenance costs of Restitution Delegations of the Allied and Associated Powers in Italy.”
The Yugoslav Delegation was satisfied by the interpretation of the Draft Treaty given by the Delegations of the 4 Powers represented in the Council of Foreign Ministers and withdrew its proposal.
According to this interpretation, para. 4 as at present worded implies that Italy will defray all expenses incurred there in tracing property liable to restitution. It therefore covers the expenses of any group of experts sent to Italy by nations entitled to restitution.
5)
In paragraph 7, to modify the respective obligations of the Allied and Associated Powers and of Italy, regarding proof of ownership and proof that property was legitimately acquired. Explanations of [Page 351] this point made in the course of discussion satisfied the Yugoslav Delegation, which withdrew its proposal.
6)
To add two new paragraphs concerning the replacement of vessels belonging to the Allied Powers, which were seized by Italy and cannot be returned and also the replacement of rolling stock removed from Yugoslavia in 1941 and not restored within three months of the coming into force of the Treaty.
The Commission examined the memorandum (C.P.(IT/EC) Doc. 57) submitted at its request by the Italian Delegation on the total tonnage of vessels covered by the amendment.
The addition of the two new paragraphs proposed by the Yugoslav Delegation was rejected by 12 votes to 4 with 2 abstentions, as departing from the principle requiring the return of the actual property lost. No roll-call was taken.
The views of the U.S.A. Delegation on these two points are given in Annex 9.15
b)
The Greek Delegation (C.P. (Gen.) Doc.1.J.11) had proposed the addition of a new paragraph declaring null and void any instrument or contract drawn up during the war, between Greek and Italian nationals, purporting to transfer Greek property. The Commission having expressed the view that the United Nations Declaration of January 5, 1943,16 made adequate provision for the annulment of fraudulent contracts concluded during the occupation, the Greek Delegation withdrew its amendment in the light of this interpretation.
c)
An amendment by the Greek Delegation (C.P. (Gen.) Doc.1.J.12) proposed the insertion of an additional Article 65 bis to provide that the proceeds of the administration of Greek property by Italian natural or juridical persons, and debts collected by such persons in occupied Greek territory, should be refunded in dollars.
The Greek Delegation withdrew this amendment in view of the interpretation as given in (b) above.
d)
An amendment by the Greek Delegation (C.P. (Gen) Doc.1.J.10) superseded by amendment (C.P. (IT/EC) Doc.42), proposed the insertion in the Treaty of a new para. 2 bis providing for the replacement of objects of archaeological, historical or artistic value which had been damaged or not returned.
The Byelorussian Delegation proposed an amendment to this amendment to the effect that this provision should also apply to Albania. This amendment and the sub-amendment were withdrawn as the Greek and Byelorussian Delegations subsequently gave their support to the U.S. amendment (C.P. (IT/EC) Doc.47) that objects of the categories described in the Greek amendment should be replaced [Page 352] if they belonged to the cultural heritage of the United Nation from which they were removed.
The U.S. amendment was adopted unanimously, subject to the insertion as suggested by the Czechoslovak representative of the words “or Italian nationals” after “Italian forces or authorities”.
e)
An Australian amendment (C.P. (IT/EC) Doc.50) proposed that objects of literary, artistic, historical or religious value unlawfully removed from Italy during the war or since the Armistice should be returned to Italy.
This amendment was withdrawn, the Australian Delegation considering itself satisfied with the statements made in this condition by the U.S.A., France and U.K. According to these statements the Powers will chiefly base themselves on the provision contained in the last sentence of Article 67 of the draft Treaty, to take all such measures as they may deem equitable for the restitution to Italy of Italian property removed to Germany (statement by the three Powers annexed).17
2.
The Commission unanimously adopted and submits as a recommendation to the Plenary Conference the text of the draft Treaty with the following modifications:
1)
In para. 1 insert the words “in the shortest possible time” after the words “will return”.
2)
The United States amendment (C.P.(IT/EC) Doc.47) as modified by the Czechoslovak Delegation, provides a new para. 9 reading as follows:

“If in particular cases, it is impossible for Italy to make restitution of objects of artistic, historic or archaeological value belonging to the cultural heritage of the United Nation from which such objects were removed by force or duress by Italian forces, authorities or nationals, Italy undertakes to transfer to the United Nation concerned objects of the same kind and of substantially equivalent value to the objects removed, in so far as such objects are obtainable in Italy.”

The Commission noted the following statement:

“Para. 4 of the draft Article as at present worded implies that Italy will defray all expenses incurred in tracing in Italy property liable to restitution.[”]

Views of the Ethiopian Delegation concerning Paragraph 3 of Article 65 are given in Annex 10.18

Renunciation of Claims by Italy—Article 66

The Council of Foreign Ministers had agreed on a text for this Article whereby Italy waived, on behalf of the Italian Government and Italian nationals, all claims against the Allied and Associated Powers or any United Nation which severed diplomatic relations with Italy [Page 353] and took action in co-operation with the Allied and Associated Powers, for damages arising directly out of the war or out of actions taken because of the existence of a state of war after September 1st 1939.

However, the Delegations of U.S.A., and U.S.S.R. had reserved the right to propose changes with regard to the treatment in the Peace Treaty of submarine cables owned at the beginning of the war by the Italian Government or Italian nationals.

Paragraph 6 of the draft Treaty simply lays down that the provisions of this Article shall not affect the rights of ownership of the Italian Government or Italian nationals in such submarine cables.

1.
The Commission considered three proposed amendments:
a)
The Yugoslav Delegation (C.P. (Gen.) Doc.1.U.19) proposed the addition to paragraph 4 of the text of the Draft treaty, of the words “or Associated” after the word “Allied” whenever the latter was used, in order to extend the responsibility assumed by the Italian Government as regards the military currency issued in Italy also to the currency issued by the Yugoslav occupation forces east of the Morgan Line.
The Yugoslav Delegation agreed to this proposal being discussed later in connection with Annex 3 (Economic and Financial Provisions relating to Ceded Territories).19
b)
The Yugoslav Delegation also submitted an amendment concerning the disposal of Italian submarine cables.
This question having been discussed and settled in connection with Article 69 and Annex 3, the Commission unanimously decided to include in paragraph 6 of Article 66 a statement to the effect that the provisions of this paragraph are without prejudice to the application of Article 69 and Annex 3.
c)
An amendment submitted by the Greek Delegation (C.P. Gen. Doc.1.J.13) proposed the addition of a paragraph by which Italy should undertake to restore in gold to the Greek Government the amount of 783,080 dollars advanced by Greece during the occupation as a war indemnity to Italian nationals.
This proposal was rejected by sixteen votes to one (without roll-call).
2.
Consequently, the Commission unanimously proposed to the Plenary Conference the text of the Draft Treaty, with the addition at the end of paragraph 6 of the following sentence:

“This provision is without prejudice to the application of Article 69 and of Annex 3.”

Article 67

The Council of Foreign Ministers had reached agreement on the text of this Article whereby Italy renounces all claims against Germany, including debts, with the exception of those arising out of contracts [Page 354] and other obligations entered into, and rights acquired, before September 3, 1939.

1.
The Commission had before it two proposed amendments.
(a)
The Yugoslav Delegation (C.P. (Gen) Doc.1.U.20, replaced by C.P.(IT/EC) Doc.64) proposed that Italy should recognize that the Allied and Associated Powers, being entitled to German reparation in the Western Zone, are likewise entitled to all German assets in Italy, and should agree to take all necessary measures to facilitate the transfer of such assets.
This proposal was rejected by 11 votes (Australia, Belgium, Brazil, Canada, China, India, the Netherlands, New Zealand, the Union of South Africa, the United Kingom, the United States) to 7 (Byelorussia, Czechoslovakia, Greece, Poland, Ukraine, the U.S.S.R., Yugoslavia), and 2 abstentions (Ethiopia, France).
(b)
The United States Delegation (C.P.(IT/EC) Doc.69) proposed that Italy should agree to take all necessary measures for facilitating such transfers of these assets as might be determined by those of the Powers occupying Germany which were empowered to dispose of German assets in Italy.
This amendment was adopted by 13 votes (Australia, Belgium, Brazil, Canada, China, France, Greece, India, the Netherlands, New Zealand, the Union of South Africa, the United Kingdom, the United States) to 2 (Byelorussia, Ukraine), with 5 abstentions (Czechoslovakia, Ethiopia, Poland, the U.S.S.R., Yugoslavia).
2.
Consequently
(a)
Apart from one abstention, the Commission unanimously adopted the text agreed upon by the Council of Foreign Ministers for submission to the Plenary Conference as a recommendation.
(b)
The Delegations of Australia, Belgium, Brazil, Canada, China, France, Greece, India, the Netherlands, New Zealand, the Union of South Africa, the United Kingdom, and the United States were in favour of the following addition to the text drafted by the Council of Foreign Ministers:

“Italy agrees to take all necessary measures for facilitating such transfers of German assets in Italy as may be determined by those of the Powers occupying Germany which are empowered to dispose of German assets in Italy.”

(c)
The Commission took note of the following statement of the Yugoslav Delegation:

“The Yugoslav proposal has been rejected, but the Delegation of Yugoslavia has been instructed to express on behalf of its Government, the hope that the rights defined in the Potsdam Agreement of the States who were victims of Nazi aggression will be safeguarded. The Yugoslav Government likewise hopes that the three Powers whose [Page 355] task it is to watch over the interests of these victims will do their duty—that is to say, will take the necessary steps to ensure that German assets in Italy are placed at the disposal of the States entitled to German reparation from the Western Zones.”

The views of the U.S.A. Delegation on this Article are given in Annex 11.20

United Nations’ Property in Italy—Article 68

The Council of Foreign Ministers had agreed upon the text of this Article with the exception of Paragraph 4 concerning the compensation due by the Italian Government when as a result of the war property belonging to a United Nations national could not be returned or had sustained damage.

The United States Delegation had submitted a proposal for total compensation, which had been approved, subject to the wording, by the French and United Kingdom Delegations. The U.S.S.R. Delegation considered that compensation should be partial, up to one-third of the damage and paid in Italian lire.

1. The Commission considered 9 amendments or proposals.

(1) It decided by 15 votes to 1 to refer to the Political and Territorial Commission for Italy an Amendment submitted by the Greek Delegation (C.P. (Gen) Doc.1.J.15) concerning the special case of property of the Greek Orthodox Communities in Italy, to be considered by the Commission in connection with Article 14 of the draft Treaty.

(2) A proposal of the Delegation of Ethiopia (C.P. (Gen) Doc 1.H.4), designed to give more legal force to the text of paragraph 1 of the Article and stipulating that the restitution of property should take place within 18 months, was rejected by 10 votes to 3 with 7 abstentions.

(3) The Yugoslav Delegation (C.P. (Gen) Doc.1.U.21) proposed:

As regards paragraph 1 to state for each Allied or Associated Power the date of its entry into the war against Italy.

This amendment was withdrawn.

As regards Paragraph 4 to make rate of compensation for the damage sustained proportionate to the amount of the average reparation allowed according to Article 64B, to the Allied and Associated Powers benefiting by the provisions of this Article.

The Commission, by a ⅔rds majority, (14 votes to 4 with 2 abstentions) rejected the principle proposed by the Yugoslav Delegation in the second part of its amendments.

Finally the Yugoslav Delegation requested the omission of paragraph 6 of the text of the draft Treaty, which exempts Allied property from any exceptional taxes levied on their capital by the Italian authorities since September 8th, 1943 or which might have been levied before the coming into force of the Treaty of Peace.

[Page 356]

This amendment was withdrawn.

(4) 9 Delegations (Australia, Belgium, Canada, Ethiopia, United Kingdom, Greece, New Zealand, Netherlands, Union of South Africa) expressed themselves in favour of the principle of total compensation contained in the amendment submitted by the U.K. Delegation (C.P.(IT/EC) Doc.60).

9 Delegations (U.S.A., Byelorussia, Brazil, China, Poland, Czechoslovakia, Ukraine, U.S.S.R., Yugoslavia) voted against this principle.

The French and Indian Delegations abstained.

The views of the United Kingdom Delegation are given in annex 12.21

(5) The proposal of the United States Delegation, seconded by the U.S.S.R. Delegation, to fix a 25% rate of compensation was rejected by 12 votes (Australia, Belgium, Brazil, Canada, Ethiopia, France, United Kingdom, Greece, India, New Zealand, Netherlands and the Union of South Africa), to 5 (United States, Byelorussia, China, Ukraine, U.S.S.R.) with three abstentions (Poland, Czechoslovakia, Yugoslavia).

The views of the United States and U.S.S.R. Delegations are given in annex 13 and 14.22

(6) Proposal of the French Delegation to fix at 75% the rate of compensation was adopted by 13 votes (Australia, Belgium, Brazil, Canada, Ethiopia, France, United Kingdom, Greece, India, New Zealand, Netherlands, Czechoslovakia, the Union of South Africa) to 5 (Byelorussia, China, Ukraine, U.S.S.R., Yugoslavia) with two abstentions (U.S.A., Poland).

The views of the French Delegation are given in annex 15.23

(7) The Commission then considered amendment C.P.(IT/EC) Doc.65 submitted by the French Delegation. This amendment introduced the text submitted by the United States Delegation in document (C.P. (IT/EC) Doc.59) including the rate of 75% in sub-paragraph (a). Further, it includes a sub-paragraph (e) providing for the total compensation of damage sustained owing to special measures taken during the war by the Italian Government.

Sub-paragraph (a) establishing the principle and quota of the compensation was adopted by 11 votes (Belgium, Canada, Ethiopia, France, United Kingdom, Greece, India, New Zealand, Netherlands, Czechoslovakia, Union of South Africa) to 4 (Byelorussia, Ukraine, U.S.S.R., Yugoslavia) with 5 abstentions (U.S.A., Australia, Brazil, China, Poland).

Sub-paragraph (b) extending compensation to shares held by United Nations nationals in companies or associations which are not nationals [Page 357] of the United Nations, was adopted by 12 votes (U.S.A., Australia, Belgium, Canada, Ethiopia, France, United Kingdom, Greece, India, New Zealand, Netherlands, the Union of South Africa) to 6 (Byelorussia, Brazil, China, Ukraine, U.S.S.R., Yugoslavia) with two abstentions (Poland, Czechoslovakia).

Sub-paragraph (c), establishing the freedom to utilise in Italy the compensation paid under the preceding sub-paragraphs, was adopted by 13 votes (Australia, Belgium, Brazil, Canada, Ethiopia, France, United Kingdom, Greece, India, New Zealand, Netherlands, Union of South Africa, Czechoslovakia) to 5 (Byelorussia, China, Ukraine, U.S.S.R., Yugoslavia) with 2 abstentions (U.S.A., Poland).

The French Delegation withdrew sub-paragraph (d).

Sub-paragraph (e), which now becomes sub-paragraph (d), was adopted by 14 votes (Australia, Belgium, Brazil, Canada, China, Ethiopia, France, United Kingdom, Greece, India, New Zealand, Netherlands, Czechoslovakia, Union of South Africa) to 5 (U.S.A., Byelorussia, Ukraine, U.S.S.R., Yugoslavia) with one abstention (Poland).

Document C.P. (IT/EC) Doc. 65 as a whole, with the exception of the original sub-paragraph (d), withdrawn by the French Delegation, was adopted by 14 votes (U.S.A., Australia, Brazil, Belgium, Canada, Ethiopia, France, United Kingdom, Greece, India, New Zealand, Netherlands, Czechoslovakia, Union of South Africa) to 6 (Byelorussia, China, Poland, Ukraine, U.S.S.R., Yugoslavia).

(8) The Greek Delegation withdrew its amendment (C.P. (Gen) Doc.1.J.14) concerning compensation by Italy of losses sustained by Greece between the dates of September 1, 1939, and the entry of that country into the war. The Greek Delegation stated that its Government will put forward its claims on the Italian Government by the methods usually adopted for the settlement of international disputes, in accordance with the provisions of Article 7024 of the Treaty.

(9) The Commission rejected by a two-thirds majority, i.e. 17 votes to 2 with one abstention, the Australian amendment C.P. (Gen) Doc. 1.B.12 concerning the definition of the term “United Nations national” given in paragraph 8, sub-paragraph (a), of the Draft Treaty of Peace. According to this definition, the provisions of Article 68 can only apply to physical or juridical persons of the nationality of one of the United Nations at the date of the Armistice. The Australian amendment asked for this condition to be deleted.

2. Therefore,

[Page 358]

(A) The Commission unanimously voted for submission to the Plenary Conference as its recommendation the text of the Draft Treaty for paragraphs 1, 2, 3, 5, 6, 7 and 8.

As regards paragraph 1, the Commission requested the Legal and Drafting Commission to suppress such discrepancies as might arise in respect of the three official texts.

(B) The Australian, Belgian, Brazilian, Canadian, Ethiopian, French, United Kingdom, Greek, Indian, New Zealand, Netherlands, Czechoslovakian, and South African Delegations, expressed themselves in favour of the adoption of document C.P. (IT/EC) Doc. 65 as the text for paragraph 4, including in sub-paragraph (a) the 75 percentage and deleting the original sub-paragraph (d).

This new paragraph 4 is thus worded as follows:

  • “(a) The Italian Government will be responsible for the restoration to complete good order of the property returned to United Nations nationals under paragraph 1 of this Article. In cases where property cannot be returned or where as a result of the war a United Nations national has suffered a loss by reason of injury or damage to property, he shall receive from the Italian Government compensation in lire to the extent of 75% of the sum necessary, at the date of payment, to purchase similar property or to make good the loss suffered. In no event shall United Nations nationals receive less favourable treatment with respect to compensation than that accorded Italian nationals.
  • (b) United Nations nationals who have ownership interests, held directly or indirectly, in corporations or associations which are not United Nations nationals within the meaning of paragraph 8(a) of this Article, but which have suffered a loss by reason of injury or damage to property, shall receive compensation in accordance with sub-paragraph (a) above. This compensation shall be based on the total loss or damage suffered by the corporation or association and shall bear the same proportion to such loss or damage as the beneficial interest of such nationals bears to the total capital of the corporation or association.
  • (c) Compensation shall be paid free of any levies, taxes or other charges. It shall be freely usable in Italy but shall be subject to the foreign exchange control regulations which may be in force in Italy from time to time.
  • (d) The Italian Government shall grant United Nations nationals an indemnity in lire sufficient to compensate, at the date of payment, the losses and damage due to the special measures applied to their property during the war, and which were not applicable to Italian property.”

(C) The Commission took note of the following statements:

Statement of the Yugoslav Delegation with regard to the paragraph (b) of Doc. C.P.(IT/EC) Doc.65:

The Yugoslav Delegation feels obliged to state that this provision should be deleted on grounds of international morality.

[Page 359]

The Yugoslav Delegation considers that the insertion of such a provision in the Peace Treaty would be inconceivable. As a matter of fact, this provision grants special protection and privileges to United Nations nationals who during the war made upon their country by Fascism, took part in the operations of companies or associations which were solely and openly in the services of Fascism. Far from considering their participation as that of an enemy, the Fascist Government regarded it up to the end of the war as an integral part of its own national effort.

The Yugoslav Delegation considers that Delegations which in this matter refuse to admit the criterion of international ethics will have to defend themselves now and in the future against such criticism as may be directed against their action.

In the opinion of the Yugoslav Delegation, the United Nations nationals covered by this provision should be treated on the same footing as Italian nationals with whom they have collaborated during the war and whose advantages they have shared. (C.P.(IT/EC) 26th Meeting, Annex A).

Statement of the United Kingdom Delegation:

Insofar as the United Kingdom Delegation took part in the voting on any of the proposals for the principle of partial compensation, this was without prejudice to the United Kingdom’s own principle of full compensation, to which she still adheres, and to which she attaches the greatest importance.

(C.P.(IT/EC) 23rd and 24th meetings’ annex)

Article 69

The Council of Foreign Ministers had agreed on the text of this Article relating to Italian property in the territory of the Allied and Associated Powers, with the exception of the sub-paragraphs (e) and (f) of para. 5; the latter, dealing with the property of Italian nationals in ceded territories and in the Free Territory of Trieste, were proposed by the United States Delegation.

1) Ten proposed amendments were laid before the Commission.

A) An amendment proposed by the Ukrainian S.S.R. (IT/EC) Doc.70

1) to add two new sub-paragraphs to para. 1.

The first sub-paragraph (1a) provided that Italian property abroad should not be retained by any Allied or Associated Power whose territory had not been occupied, except in so far as the retention of such property would not hinder the economic reconstruction of Italy or endanger her balance of payments.

The second sub-paragraph (1b) entrusted the Four Ambassadors at Rome with the task of determining the total claims of each of the Allied and Associated Powers concerned and of fixing the amount of Italian property to be retained by each.

[Page 360]

2) to add to Article 69 as a whole, a paragraph 6 enabling Italy to avoid the liquidation of property mentioned above by making payment in settlement of the claims of the Allied or Associated Power concerned in the currency of that Power, or by any other means mutually agreed.

The amendment proposed by the Delegations of the Ukraine was rejected by 14 votes (U.S.A., Australia, Belgium, Brazil, Canada, China, Ethiopia, France, India, New Zealand, Netherlands, U.K., U.S.S.R., Union of South Africa) to 5 (Byelorussia, Czechoslovakia, Poland, Ukrainian S.S.E., Yugoslavia), with one abstention (Greece).

The views of the Ukrainian Delegation are given in Annex 16.25

The views of the American Delegation are given in Annex 17.26

B) An amendment proposed by Yugoslavia took up the first part of the proposal included in the Albanian Memorandum (C.P. Gen. Doc.7) which aimed at modifying Article 69 para. 1. by taking into account the date of Italy’s entry into the war as well as the date of the coming into force of the Treaty in deciding which Italian property should be seized. Yugoslavia’s proposed amendment added the words “and Albania” after the words “Allied and Associated Powers” in the Albanian proposal.

This proposal was rejected by 14 votes (U.S.A., Australia, Belgium, Brazil, Canada, China, France, Greece, India, Netherlands, New Zealand, U.K., U.S.S.R., Union of South Africa) to 2 (Ukrainian S.S.R. and Yugoslavia) with 4 abstentions (Byelorussia, Czechoslovakia, Ethiopia, Poland).

C) An amendment proposed by the Yugoslav Delegation (IT/EC Doc. 62) leaving to the domestic legislation of each Allied or Associated Power the task of deciding the Italian origin of property, rights and interests which belonged at any date subsequent to June 10th, 1940, to Italy or to Italian nationals. This amendment replaced the proposal contained in Yugoslav amendment U22, which was similar in purpose to the aforesaid Albanian proposal (cf. B above). The Yugoslav Delegation withdrew its first amendment (U22).

The new Yugoslav proposal was submitted in two alternative forms and the Commission had to choose between modification of para. 1 or of para. 2 of Art. 69.

The first alternative, para. A of the Yugoslav proposal referring to Para. 1. of Art. 69, was rejected by 14 votes (U.S.A., Australia, Belgium, Brazil, Canada, China, Ethiopia, France, India, Netherlands, New Zealand, U.K., U.S.S.R., Union of South Africa) to 6 (Byelorussia, Czechoslovakia, Greece, Poland, Ukrainian S.S.R., Yugoslavia).

[Page 361]

7 votes (Byelorussia, Czechoslovakia, Greece, India, Poland, Ukraine, Yugoslavia) were cast in favour of the second alternative and 13 against.

D) An amendment proposed by Yugoslavia, providing for the waiving by Italy, in favour of the Allied or Associated Power concerned of property rights belonging to the Italian Government or to Italian nationals:

a)
throughout the length of submarine cables linking points in the territory of the Power concerned;
b)
up to half the length of submarine cables linking a point in the territory of the Power concerned with a point in Italian territory.

The original version of the amendment was withdrawn by the Yugoslav delegation which accepted the proposed new wording. According to the new text, the provisions of the first part of the Yugoslav amendment would apply only to cables linking points in Yugoslav territory.

As regards the submarine cables referred to in the second part of the Yugoslav amendment, the provisions of Art. 69, according to the new draft of the amendment, would no longer apply to terminal facilities or to lengths of cables lying in territorial waters.

This proposal was adopted unanimously.

E) An amendment proposed by the Australian Delegation to exclude literary and artistic property rights from the seizure and liquidation action provided under Article 69, para. 1.

The Australian proposal to that effect was:

a)
to delete the words “literary and artistic” in the second and seventh lines of para. 4;
b)
to insert a new sub-para. 5(e) after sub-para. 5(d) as follows “Literary and artistic property rights”.

This amendment was adopted by 14 votes (Australia, Belgium, Brazil, Byelorussia, Canada, China, Czechoslovakia, India, Netherlands, New Zealand, Poland, Ukrainian S.S.R., Union of South Africa, Yugoslavia) to 6 [5?] (Ethiopia, France, Greece, United Kingdom, U.S.S.R.). The views of the American delegation are given in Annex 18.27

F) A sub-amendment to the Australian amendment, proposed by the Ukrainian Delegation to the effect that industrial property rights should benefit under this amendment.

This sub-amendment was rejected by 14 votes (Australian, Belgium, Canada, China, Ethiopia, France, Greece, India, Netherlands, New Zealand, Union of South Africa, United Kingdom, United States, USSR) to 4 (Byelorussia, Poland, Ukrainian S.S.R., Yugoslavia), with 2 abstentions (Brazil, Czechoslovakia).

[Page 362]

G) An amendment by the Ethiopian Delegation, proposing to modify para. 5, which lists the Italian property not subject to the seizure and liquidation action to be taken under para. 1.

1)
Following the explanations given by the Delegates of the United States, France, and the United Kingdom with regard to the scope of sub-paragraphs a) and c), the Ethiopian Delegation withdrew the part of its amendment whereby sub-paragraphs a) and c) would not apply to Ethiopia.
2)
Following the explanations given by the Delegate of France, the Ethiopian Delegation likewise withdrew the other part of its amendment to the effect that the words “other than property acquired or constituted under the military occupation” be added to sub-para, (b) concerning “property belonging to religious bodies or charitable institutions”.

The explanation referred to in paragraphs 1 and 2 are given in Annex 19.28

The French Delegation’s proposal was adopted unanimously.

H) An amendment by the Yugoslav Delegation reverting to the text of a proposal contained in the Albanian memorandum (C.P. Gen.Doc.7) which likewise suggested a modification in sub-paragraph b) para. 5, whereby this provision would not apply to property belonging to religious bodies or charitable institutions which had engaged in political activities in occupied territory on the enemy’s behalf. This proposal was also withdrawn after the French Delegate had submitted a verbal proposal to add the word “exclusively” i.e. “… used exclusively for religious or charitable purposes.”

The French proposal was unanimously adopted.

I & J) With regard to sub-paragraphs e) and f) of para. 5 as submitted by the United States Delegation to the Council of Foreign Ministers, the Commission had before it:

A proposal by the U.S.S.R. to delete sub-para, e);

A Yugoslav proposal reproducing the U.S.S.R. proposal and suggesting an addition at the end of para. 5, as follows:

“the fate of property belonging to Italian nationals in ceded territories shall be determined by Annex 3”.

These two proposals were not discussed, as the Commission decided to postpone consideration of sub-paragraphs e) and f) until Annex 5 of the Draft Treaty came up for discussion.

2. Consequently:

A) The Commission adopted by a two-thirds majority (17 votes to 3, Byelorussia, the Ukraine and Yugoslavia, voting against) and decided [Page 363] to submit as a recommendation to the Plenary Conference the text of the Draft Treaty as regards para. 1.

B) The Commission unanimously adopted and decided to submit as a recommendation to the Plenary Conference the text of the Draft Treaty as regards paragraphs 2 and 3.

C) The Commission unanimously adopted and decided to submit as a recommendation to the Plenary Conference the text of the Draft Treaty as regards paragraph 4, with the modifications resulting from the adoption of the Australian proposal to delete the words “literary and artistic” in lines 2 and 7.

The new draft of paragraph 4 therefore reads as follows:

4. “No obligation is created by this Article on any Allied or Associated Power to return industrial property to the Italian Government or Italian nationals, or to include such property in determining the amounts which may be retained under paragraph 1 of this Article. The Government of each of the Allied and Associated Powers shall have the right to impose such limitations, conditions and restrictions on rights or interests with respect to industrial property acquired prior to the coming into force of the present Treaty in the territory of that Allied or Associated Power by the Government or nationals of Italy, as may be deemed by the Government of the Allied or Associated Power to be necessary in the national interest.”

A new paragraph 4A is made up of the Yugoslav amendment (C.P.(IT)/Doc.72) which was voted unanimously in the redraft proposed by the U.K. Delegation.

4A. a) “Italian submarine cables linking points in Yugoslavia shall be deemed to be Italian property in Yugoslavia, despite the fact that lengths of these cables may lie outside the territorial waters of Yugoslavia.

b) “Italian cables linking a point in the territory of an Allied or Associated Power with a point in Italian territory shall be deemed to be Italian property within the meaning of this Article, so far as concerns the terminal facilities and the lengths of cables lying in territorial waters.”

D) The Commission unanimously voted and decided to submit as a recommendation to the Plenary Conference the text of the Draft Treaty agreed upon by the Council of Foreign Ministers as regards paragraph 5, a) b) c) and d), as modified by the insertion in sub-para, b) of the word “exclusively” before the words “for religious or charitable purposes”, and the addition of the new sub-para e) proposed by the Australian Delegation.

The new text of paragraph 5 sub-para b) is therefore as follows:

5b) “Property belonging to religious bodies or private charitable institutions and used exclusively for religious or charitable purposes.”

The new sub-para. 5 e) is as follows: “5 e) Literary and artistic property rights.”

[Page 364]

E) The Commission took no decision as regards the former sub-paras e) and f) of paragraph 5.

Section III—DebtsArticle 70

The Council of Foreign Ministers had agreed on a text for this Article which deals with pecuniary debts contracted prior to the existence of a state of war and due whether by the Government or nationals of one of the Allied and Associated Powers, to the Government or nationals of Italy.

1. The Commission had before it an amendment by the Yugoslav Delegation (Doc. 1.U.23), for the addition to Article 70 of a 3rd paragraph with the object of freeing the Allied or Associated Powers whose territory was occupied by Italy and their nationals from the obligation to repay any debt to Italy or its nationals.

This amendment was withdrawn following a personal statement of opinion by the U.K. Delegate that the provisions of Article 69 would apply to debts due to Italian nationals which had fallen due.

2. On the proposal of the U.S., French, U.K. and U.S.S.R. Delegations, the Commission also unanimously adopted an additional paragraph worded:

“The Allied and Associated Powers declare that the rights attributed to them under Articles 64 and 69 of this Treaty cover all their claims and those of their nationals for loss and damage due to acts of war, including measures due to the occupation of their territory, attributable to Italy and having occurred outside Italian territory, with the exception of claims based on Articles 65 and 68.”

The views of the Greek Delegation are contained in an Annex.

3. The Commission therefore adopted unanimously, and submitted as a recommendation to the Plenary Conference, the text agreed upon by the Council of Foreign Ministers, thus completed.

Part VIII—General Economic RelationsArticle 71

The Council of Foreign Ministers had agreed on the introductory paragraph, sub-paragraphs a and b, and the first clause of sub-paragraph c, of the Article relating to certain aspects of Italy’s general economic relations during the transition period following the coming into force of the Peace Treaty, and also on paragraph 2 providing for the exceptions customarily included in commercial treaties concluded by Italy before the war.

A. As regards the end of sub-paragraph c, of paragraph 1, the Council of Foreign Ministers submitted to the Conference:

1) A proposal by the U.S.S.R. Delegation for the insertion in subparagraph c of a phrase excluding from the sphere in which national and most-favoured-nation treatment should be granted to United Nations Nationals certain branches, where, in accordance with the [Page 365] internal legislation of the country, private enterprise does not take place.

The Commission rejected this proposal by 12 votes (Australia, Belgium, Brazil, Canada, France, Greece, India, Netherlands, New Zealand, Union of South Africa, United Kingdom, United States) to 6 (Byelorussia, Czechoslovakia, Poland, Ukraine, U.S.S.R., Yugoslavia) with 2 abstentions (China, Ethiopia).

2) A proposal by the United Kingdom, United States and French Delegations to substitute for the Soviet proposal a second clause interpreting sub-paragraph c of paragraph 1.

The Commission accepted this proposal by 12 votes (Australia, Belgium, Brazil, Canada, France, Greece, India, Netherlands, New Zealand, Union of South Africa, United Kingdom, United States) to 6 (Byelorussia, Czechoslovakia, Poland, Ukraine, U.S.S.R., Yugoslavia) with 2 abstentions (China, Ethiopia).

3) A further addition proposed by the United States Delegation and supported by the United Kingdom Delegation, stipulating in a third clause of sub-paragraph c that this paragraph would not apply to civil aviation, but that no discriminatory measures would be taken against any United Nation with regard to the operation of civil aircraft in international traffic.

The U.S.S.R. Delegation saw no reason for the insertion of these texts in the treaty.

This proposal was adopted by 14 votes (Australia, Belgium, Brazil, Canada, China, Ethiopia, France, Greece, India, Netherlands, New Zealand, Union of South Africa, United Kingdom, United States) to 5 (Byelorussia, Czechoslovakia, Ukraine, U.S.S.R., Yugoslavia) with 1 abstention (Poland).

The views of the U.S. Delegation are given in annex 20, those of the U.S.S.R. in annex 21.29

B. The Commission had also to consider:

1) a draft amendment submitted by the Netherlands Delegation (C.P.(IT/EC) Doc.73). This was a proposal to insert in the new paragraph, proposed by the United States Delegation, a phrase about granting to the United Nations the right to fly over Italian territory without landing or to land for non-commercial purposes.

This amendment obtained 12 votes in favour (Australia, Belgium, Brazil, Canada, China, Ethiopia, France, Greece, Netherlands, Union of South Africa, United Kingdom, United States) while 5 votes were cast against (Byelorussia, Czechoslovakia, Ukraine, U.S.S.R., Yugoslavia). There were 3 abstentions (India, New Zealand, Poland).

The views of the U.S. Delegation are given in Annex 22.30

[Page 366]

2) a draft amendment (C.P. (Gen) Doc.1.F.1) submitted by the Canadian Delegation, proposing to change in the second line of the first paragraph the time limit of 18 months to 3 years.

This draft amendment obtained a majority of 12 votes (Australia, Belgium, Brazil, Canada, China, Ethiopia, Greece, India, Netherlands, New Zealand, Poland, Union of South Africa), to 8 (Byelorussia, Czechoslovakia, France, Ukraine, United Kingdom, United States, U.S.S.R., Yugoslavia).

A.
The Commission adopted unanimously, as a recommendation to the Plenary Conference, the text agreed upon by the Council of Foreign Ministers, leaving, however, a blank space for the insertion of the time-limit.
B.
As regards the time-limit to be inserted, the Commission submits the two following proposals:
1)
Three years (draft amendment submitted by the Canadian Delegation, which obtained 12 votes in favour to 8 against).
2)
Eighteen months (proposed by the Council of Foreign Ministers).
C.
As regards sub-paragraph c of paragraph 1, the Commission proposes to the Conference the insertion in the text agreed upon by the Council of Foreign Ministers of:
1)
either the text proposed by the United Kingdom, United States and French Delegations, which obtained 12 votes to 6 against with 2 abstentions.
This text is as follows:

“This paragraph shall not be deemed to confer on the United Nations, or their nationals, rights to engage in any branch of commerce, industry, shipping or other form of business activity which under Italian law is a monopoly of the Italian State. Nevertheless, the most-favoured-nation principle shall be observed in any such cases in which foreign participation is allowed.”

2)
or the text proposed by the U.S.S.R. Delegation which obtained 6 votes in favour to 12 against.
This text is as follows:

“… excluding certain branches where, in accordance with the internal legislation of the country, private enterprise does not take place.”

D.
The Commission adopted by a two-thirds majority (14 votes to 5 with one abstention) the following text of the draft further addition to sub-paragraph c, proposed by the United States Delegation.

“It is further understood that this paragraph shall not apply to civil aviation but that Italy will grant no exclusive or discriminatory right to any country with regard to the operation of civil aircraft in international traffic and will afford all the United Nations equality of opportunity in obtaining international commercial aviation rights in Italian territory.”

This text is submitted for the approval of the Plenary Conference as a recommendation of the Commission under the terms of Section VI b of the Rules of Procedure of the Conference.
As the draft amendment C.P.(IT/EC) Doc.73 submitted by the Netherlands Delegation secured 12 votes in favour to 3 against, the Commission proposes that the Conference should:
1)
either delete in the preceding clause the word “and” after “international traffic” replacing it by a comma, and insert a sub-paragraph proposed by the United States Delegation and adopted by the Commission, reading:

“and with regard to the operation of civil aircraft in international traffic, will grant, on a reciprocal and non-discriminatory basis to all United Nations, the right to fly over Italian territory without landing or to land for non-commercial purposes.”

2)
or retain without deletion or addition the text proposed by the United States Delegation as an addition to sub-paragraph c.
E.
Finally, the Commission took note of the following statement by the Polish Delegate regarding the effect of Article 71, paragraph 1, on the special bilateral agreements which Italy could conclude in the matter of currency control and fixing of trade quotas.

In reply to M. Lychowski’s questions regarding (1) the effect of Article 71, paragraphs 1 a and 1 b on Italy’s ability to conclude bilateral trade agreements, (2) the determination of whether a given transaction involved arbitrary discrimination, and (3) the enforcement of the prohibition of arbitrary discrimination, Mr. Thorp spoke as follows:

The conditions under which international trade is now carried on are abnormal, largely because of special current problems. The usual ways of conducting trade have therefore been modified at many points, particularly by the use of bilateral barter agreements. The special necessities of the present state of affairs have been widely recognized. For example, the International Monetary Fund Agreement provides for an interim period during which special exchange controls will be permitted. The proposals for the Expansion of World Trade and Employment put forward by the U.S. Government also recognize the necessity of an interim period during which special arrangements will have to be allowed. In both these cases, however, it is clearly and emphatically indicated that any special controls and arrangements must not be contrary to the underlying principle of non-discrimination among countries in international trade.

Everyone hopes that the conditions of world trade will so improve that the need for special arrangements will disappear, for they cannot help but diminish the total volume of trade. In the short run, it is entirely possible to conduct trade under such arrangements without arbitrary discrimination. The key word is “arbitrary”. It is necessary to consider the specific character of each special arrangement to determine whether or not it involves arbitrary discrimination.

[Page 368]

Part IX—Settlement of DisputesArticle 72

Two texts concerning the appointment of a Commission for the settlement of disputes which may arise in connection with certain Articles of the Treaty were submitted to the Commission by the Council of Ministers.

The proposal of the United Kingdom Delegation was the following:

“Any disputes which may arise in connection with Articles 65 and 68 and Annexes 6, 7 and 8 of the present Treaty shall be referred to a Conciliation Commission composed of an equal number of representatives of the United Nations Government concerned and of the Italian Government. If agreement has not been reached within three months of the dispute having been referred to the Conciliation Commission, either Government may require the addition of a third member to the Commission and failing agreement between the two Governments on the selection of this member, the President of the International Court of Justice shall be requested to make the appointment. The decisions of the Commission, as so constituted, shall be taken by the same procedure as is provided for decisions of the International Court itself in Articles 48 and 55–57 of the Statute of the Court and shall be final and binding on all parties.”

The proposal of the U.S.S.R. Delegation was the following:

“Any disputes which may arise in giving effect to the present Articles 65 and 68 of the present Treaty shall be referred to a Conciliation Commission consisting of Representatives of the Government of the United Nations concerned and the Government of Italy, appointed on an equal footing. If within three months after the dispute has been referred to the Conciliation Commission no agreement has been reached, either Government may ask for the addition to the Commission of a third member selected by mutual agreement of the two Governments from Nationals of the third countries. Should the two Governments fail to agree on the selection of a third member of the Commission, the Governments shall apply to the Ambassadors in Rome of the U.S.S.R., U.K., U.S.A. and France, who will appoint the third member of the Commission.”

The United States Delegation said it was ready to accept either the U.K. or the U.S.S.R. proposal provided the following sentence was added at the end of the latter:

“Should the Ambassadors fail to agree, within a period of one month, on the appointment of the third member, the Secretary-General of the United Nations will be requested by either party to make the appointment.”

The French Delegation took the same view as the United States Delegation with the proviso that the Article should also apply to Annexes 6, 7 & 8.

1. In the course of the Conference, the United States Delegation submitted a new proposal (C.P (IT/EC) Doc.74) This proposal was, with [Page 369] certain modifications as to its scope, based on a text submitted in the observations of the Italian Government on the draft Peace Treaty (Doc. 36 bis. G) suggesting the setting up of a Mixed Arbitral Tribunal.

The Ukrainian and Yugoslav Delegations submitted two draft amendments.

The object of the Ukrainian amendment was to extend the competence of the Mixed Arbitral Tribunal, proposed by the U.S. Delegation to Article 69.

The Ukrainian amendment was rejected by 13 votes; United States, Australia, Belgium, Brazil, Canada, Ethiopia, France, Great Britain, Greece, India, New Zealand, Netherlands and Union of South Africa, to 6: Byelorussia, China, Ukraine, U.S.S.R., Yugoslavia, Poland. Czechoslovakia abstained.

The Yugoslav Delegation’s amendment took up additions originally suggested by France and the United States to the U.K. and Soviet proposals. The views of the U.S. delegation are set forth in an annex.31

2. The Commission adopted the new U.S. proposal by a ⅔ majority of 14 votes to 6.

The following countries voted in favour: United States, Australia, Belgium, Brazil, Canada, China, Ethiopia, France, Greece, India, New Zealand, Netherlands, Union of South Africa and United Kingdom.

The following voted against: Byelorussia, Poland, Czechoslovakia, Ukraine, U.S.S.R., Yugoslavia.

The other proposals which were also put to the vote fared as follows: the U.K. proposal was supported by 4 countries: (United States, France, United Kingdom and Ethiopia) and opposed by 13 (Australia, Belgium, Brazil, Byelorussia, China, Czechoslovakia, India, Netherlands, New Zealand, Poland, Ukraine, U.S.S.R, and Yugoslavia). Canada, Greece and the Union of South Africa abstained.

The Soviet proposal received 6 votes (Australia, Byelorussia, Poland, Ukraine, U.S.S.R., Yugoslavia) and was opposed by 13 (United States, Belgium, Brazil, Canada, China, Czechoslovakia, France, Greece, India, Netherlands, New Zealand, Union of South Africa and United Kingdom); Ethiopia abstained.

The Yugoslav amendment was rejected by 6 votes (Australia, Byelorussia, China, Poland, Ukraine and U.S.S.R.) to 6 (United States, Belgium, Brazil, France, New Zealand and Yugoslavia) while 8 countries (Canada, Czechoslovakia, Ethiopia, Greece, India, Netherlands, Union of South Africa and the United Kingdom) abstained.

Lastly the Commission unanimously agreed to replace the words “High Contracting Parties” by “Contracting Parties” in the United States proposal.

[Page 370]

Consequently, as the Commission by a ⅔rds majority adopted the United States proposal, merely substituting the words “Contracting Parties” for the words “High Contracting Parties” the text thus amended is submitted for the approval of the Plenary Conference as a recommendation by the Commission.

“(a) Whenever the execution of the provisions of the present treaty so requires, a Mixed Arbitral Tribunal for the settlement of disputes arising under Articles 65 or 68 or Annexes 6, 7 or 8 shall be established at the request of any of the Allied and Associated Powers or Italy. Each of these Tribunals shall be composed of three members. Within two months after the date of such request, each of the Governments concerned shall designate one member. The President shall be selected, from among the nationals of a third power, by agreement between the two governments concerned. In the absence of such agreement, either government may request the President of the International Court of Justice to designate the third member of the Mixed Arbitral Tribunal.

In the event of the death or resignation of a member of the Tribunal, or his inability for any reason to perform his functions, the same procedure shall be followed for his replacement as was followed in making the initial appointment.

The decision of the majority of the members shall be the decision of the Tribunal.

(b) When any Mixed Arbitral Tribunal is established under paragraph (a), it shall have jurisdiction over all disputes which may thereafter arise between the Allied or Associated Power concerned and Italy in the application or interpretation of Articles 65 and 68 and Annexes 6, 7 and 8 of the present treaty, and shall perform the functions attributed to it by those provisions.

(c) Each Mixed Arbitral Tribunal shall determine its own procedure, adopting rules conforming to justice and equity. It shall have the power to determine the amounts to be paid by the losing party as costs and expenses of proceedings.

(d) Each government shall pay the salary of the member of the Mixed Arbitral Tribunal whom it appoints and of any agent whom it may designate to represent it before the Tribunal. The salary of the President shall be fixed by special agreement between the governments concerned and this salary, together with the common expenses of each Tribunal, shall be paid in equal shares by the two governments.

(e) The High Contracting Parties undertake that their courts and authorities shall furnish directly to the Mixed Arbitral Tribunals all assistance which may be within their power, especially with respect to the forwarding of notifications and the collection of evidence.

(f) The High Contracting Parties agree to consider the decisions of the Mixed Arbitral Tribunal as definitive and to render them binding upon their nationals.

(g) The seat of the Mixed Arbitral Tribunal shall be chosen by agreement between the two governments concerned. In the absence of such agreement the seat shall be chosen by the President of the Mixed Arbitral Tribunal.”

[Page 371]

Article 73—Scope of Certain Articles of the Treaty

The Council of Foreign Ministers had agreed on a text for this Article, which defines the scope of Articles 65, 68, 71 and of Annex 8 of the Treaty.

1. The Commission had two amendments to consider. One of them had been submitted by the Belgian Delegation, endorsing a proposal by the Norwegian Delegation (C.P.(IT/EC) Doc.45), withdrawn by the latter in the course of the meeting, for the substitution of the words “whose diplomatic relations with Italy have been broken off” for “which have broken diplomatic relations with Italy”.

This amendment was rejected by eleven votes to seven, with two abstentions.

The following States voted against: U.S.A., Byelorussia, Brazil, China, France, United Kingdom, Poland, Czechoslovakia, Ukraine, U.S.S.R., Yugoslavia.

The following States voted for the amendment: Australia, Belgium, Canada, Greece, India, New Zealand, Netherlands.

Ethiopia and South Africa abstained.

The other amendment, which was submitted during the meeting by the U.S.S.R. Delegation and was supported by the U.S. Delegation, proposed to add the following words to the text of Article 73: “or with whom Italy has severed diplomatic relations” and the words “These Articles and Annexes shall also apply to Albania and Norway”.

The U.S.S.R. amendment was adopted by 16 votes to 2 with 2 abstentions.

The following States voted for the amendment: U.S.A., Belgium, Byelorussia, Brazil, China, Ethiopia, France, Netherlands, United Kingdom, India, New Zealand, Poland, Czechoslovakia, Ukraine, U.S.S.R., Yugoslavia.

The following States voted against: Australia, Greece.

Canada and South Africa abstained.

2. The Commission therefore adopted unanimously, for recommendation to the Plenary Conference, the text approved by the Council of Foreign Ministers, subject to the addition of the words “or with whom Italy has severed diplomatic relations. These Articles and Annexes shall also apply to Albania and Norway.”

Article 74

The Council of Ministers reached agreement on a text for this Article to the effect that the provisions of Annexes 3, 6, 7 and 8 shall, as in the case of the other Annexes, have force and effect as integral parts of the present Treaty.

1. Two proposals for amendments were submitted to the Commission:

[Page 372]

(a) An amendment by the Greek Delegation (C.P.(IT/EC) Doc.68) replacing Document C.P.Gen.Doc.1J17 re-affirming the obligation on Italy to refund to Greece the amounts of the advances which the Bank of Greece had been obliged to make to the Italian Authorities over the above occupation charges, the conditions of such refund to be settled directly between the two countries.

The Greek Delegation has withdrawn its amendment stating that the time-limit given to the Commission for completing its work would not allow of the distribution to Members of the Commission of additional information regarding the facts on which this amendment was based; the Greek Delegation would refrain from putting the amendment to the vote. The Greek Delegation considers that in this connection the Italian Government still has an obligation to discharge to the Greek Government, settlement of which the latter will endeavour to secure through other channels.

(b) A second amendment by the Greek Delegation (C.P. (Gen.) Doc.I.J.18) the wording of which was amended during the meeting by the Delegation. The purpose of the amendment was to secure the withdrawal of Italy from the International Financial Commission in Greece. The views of the Greek Delegation are given in annex 24.32

The Delegations of the U.S.S.R., China, Ukraine, Yugoslavia, Czechoslovakia, Poland and Byelorussia, made the following statement:

The above-mentioned delegations consider that Greece has the right to liquidate the interests of Italy in the International Financial Commission in Greece under other Articles of the present treaty. The inclusion of this amendment into the Peace Treaty would mean an indirect approval of the 1897 Agreement, which can have no relation to the present Peace Treaty.

The Commission adopted this proposal by 13 votes (U.S.A., Australia, Belgium, Brazil, Canada, Ethiopia, France, U.K., Greece, India, New Zealand, Netherlands, Union of South Africa) against 7 (Byelorussia, China, Poland, Czechoslovakia, Ukraine, U.S.S.R., Yugoslavia).

2. The Commission unanimously adopts and submits as a recommendation to the Plenary Conference the text agreed by the Council of Foreign Ministers.

In addition, 13 Delegations are in favour of adding the following sentence:

“Italy shall withdraw from membership of the International Financial Commission in Greece”

which should form an Article 74—bis.

[Page 373]

Annex 6—Special Provisions Relating to Certain Kinds of Property

A Sub-Commission was appointed on the 21 September 1946 to consider this Annex, together with Annex 7 and 8. The conclusions of the Sub-Commission have been submitted in the Report under C.P.(IT/EC) Doc.89.

section a. industrial, literary and artistic property

The Council of Foreign Ministers had agreed upon the text of Section A except in regard to Paragraphs 4 and 7. Section A provides that the Allied and Associated Powers and their nationals shall be granted a time-limit corresponding to the duration of the war plus an additional period in which they may carry out in Italy certain acts connected with industrial, literary or artistic property.

Paragraph 4 extended the benefits of this annex to Italy and Italian nationals. The U.S. Delegation to the Council of Foreign Ministers upheld the necessity for an additional clause stipulating that nothing in these provisions should operate so as to give Italy or any of its nationals rights exceeding those accorded by the Allied or Associated Powers to any other of the United Nations.

The U.S.S.R. considered such an additional provision unnecessary.

Paragraph 7, the text of which as proposed by the U.S. Delegation was not agreed to by the 4, stipulated that Italy should extend the benefits of these provisions subject to reciprocal treatment to any United Nation other than the Allied and Associated Powers. The U.S.S.R. Delegation saw no reason for the inclusion of this paragraph.

I. The U.S. Delegation submitted to the Commission a revised text for the additional clause in Paragraph 4 (C.P.(IT/EC) Doc.75) wherein it was stipulated that Italy should not be required to accord to any of the Allied or Associated Powers or its nationals more favourable treatment than Italian nationals receive in the territory of such a power.

With regard to Paragraph 7 the U.S. amendment proposed that the benefits contained in Section A should be extended only to United Nations, other than the Allied or Associated Powers, who had broken diplomatic relations with Italy during the war.

This proposal was adopted unanimously.

II. The Commission adopted unanimously, and submitted as a recommendation to the Plenary Conference, paragraphs 1, 2, 3, 5, 6 and 8 of the text approved by the Council of Foreign Ministers, and paragraphs 4 and 7 as follows:

4. The foregoing provision concerning the rights of the Allied and Associated Powers or their nationals shall apply equally to Italy and its nationals. But nothing in these provisions shall entitle Italy or its [Page 374] nationals to more favourable treatment in the territory of any of the Allied and Associated Powers than is accorded by such Power in like cases to other United Nations or their nationals, nor shall Italy be required thereby to accord to any of the Allied or Associated Powers or its nationals more favourable treatment than Italy or its nationals receive in the territory of such Power in regard to the matters dealt with in the foregoing provisions.

7. Italy shall extend the benefits of Section A of this Annex to United Nations, other than Allied or Associated Powers, whose diplomatic relations with Italy have been broken off during the war and which undertake to extend to Italy the benefits accorded to Italy under Section A of this Annex.

section b. insurance

The Council of Foreign Ministers had not reached agreement on this section. It had noted a proposal by the U.K. Delegation whereby United Nations insurers should be granted full facilities by the Italian Government to recover their former portfolios of business in Italy. This proposal was also intended to provide cover for possible depreciation of these insurers’ guarantee deposits and reserves.

The U.S.S.R. Delegation considered the inclusion of such provisions unnecessary.

The U.S. Delegation had made reservations in respect of the draft as a whole.

I.
The Commission had to consider an amendment proposed by the U.K. Delegation (C.P (IT/EC) Doc. 76) replacing initial U.K. proposal. This proposal was adopted by a two-thirds majority (14 votes to 6)—for: U.S.A., Australia, Belgium, Brazil, Canada, China, Ethiopia, France, U.K., Greece, India, New Zealand, Netherlands, Union of South Africa. Against: Byelorussia, Poland, Czechoslovakia, Ukraine, U.S.S.R., Yugoslavia.
II.
The Commission adopted the following U.K. proposal by a two-thirds majority and submitted it to the Plenary Conference:
1.
The Italian Government shall grant every facility to insurers who are nationals of the United Nations to resume possession of their former portfolios in Italy.
2.
Should an insurer, being a national of any of the United Nations, wish to resume his professional activities in Italy, and should the value of guarantee deposits or reserves required for the operation of insurance concerns in Italy be found to have decreased as a result of the loss or depreciation of the securities which constituted such deposits or reserves, the Italian Government undertakes to accept such securities as still remain (for a period of three years) as fulfilling the legal requirements in respect of deposits and reserves.

Annex 7—Contracts, Prescriptions, Negotiable Instruments

The Council of Foreign Ministers have not reached agreement on this annex, which was made up of a United Kingdom proposal concerning: [Page 375]

a)
The validity of various classes of contracts concluded with enemy nationals.
b)
The suspension due to the war of periods of prescription.
c)
Negotiable instruments, and miscellaneous provisions annexed.

The United States Delegation had stated that, in view of the constitutional position of the Federal Government, the United States Delegation would be unable to accept any obligations in these matters.

The U.S.S.R. Delegation saw no reason for the insertion of this annex.

The French Delegation had supported the United Kingdom proposal with regard to Prescriptions and Negotiable Instruments.

i. contracts

The Commission had to consider the United Kingdom proposal and a French proposed amendment (C.P.(IT/EC) Doc.81), proposing the insertion in the fourth line of the British text of the words “and subject to the repayment of amounts paid as advances or payments on account, and in respect of which no counterpart exists”.

The United Kingdom Delegation had agreed to this addition by the French Delegation.

The United Kingdom proposal as amended by the French proposal was supported by seven delegations (Australia, Belgium, France, Greece, Netherlands, Union of South Africa, United Kingdom). Eight delegations voted against it (Byelorussia, China, India, Poland, Ukraine, U.S.S.R., United States, Yugoslavia). Five delegations abstained (Brazil, Canada, Czechoslovakia, Ethiopia, New Zealand).

The views of the British Delegation are given in annex 25.33

ii. periods of prescription

The Commission had to consider three proposals.

(1) United Kingdom Delegation pointed out that the provisions of paragraph 5 of Part I establishing a date from which the contracting parties are considered to be enemies, applies likewise to Parts II and III.

This proposal was supported by eight delegations (Australia, Belgium, France, Greece, India, Netherlands, Union of South Africa, United Kingdom).

Six delegations abstained (Brazil, Canada, Czechoslovakia, Ethiopia, New Zealand, Poland).

The views of the U.K. and U.S. Delegations are given in the annexes 26 and 27.34

(2) The Soviet Delegation proposed (C.P.(IT/EC) Doc.85) that the prescription should be regarded as being suspended during the war [Page 376] and should begin to run again three months after the signature of the Peace Treaty.

The Soviet Delegation had accepted:

(a)
A Yugoslav amendment proposing the insertion in the first line after the words “right of action” of the words “or of the right of accomplishing an act or formality of preservation”.
(b)
A French amendment proposing the insertion after the words “with reference to” of the words “persons or”.

The Soviet proposal was supported by eight delegations (Belgium, Byelorussia, Czechoslovakia, France, Poland, Ukraine, U.S.S.R., Yugoslavia).

Seven delegations voted against (Australia, China, India, Netherlands, Union of South Africa, United Kingdom, United States).

Five delegations abstained (Brazil, Canada, Ethiopia, Greece, New Zealand).

The views of the U.S. Delegation are given in annex 28.35

(3) The United States Delegation proposed (C.P.(IT/EC) Doc.78) the insertion of a clause in virtue of which, having regard to the legislative system of the United States of America, the provisions of the various parts of Annex 7 should not be applicable as between that Power and Italy. The American proposal secured eleven votes (Australia, Belgium, Brazil, Canada, China, Ethiopia, France, Greece, Union of South Africa, United Kingdom, United States).

There were four against (Byelorussia, Ukraine, U.S.S.R., Yugoslavia), with five abstentions (Czechoslovakia, India, Netherlands, New Zealand, Poland).

The views of the U.S. Delegation are given in annex 30.36

iii. negotiable instruments

The Commission had before it only the U.K. proposal which is shown in the Draft Treaty.

There were 8 votes in favour of this proposal (Australia, Belgium, France, Greece, India, Netherlands, Union of South Africa, United Kingdom).

Six voted against (Byelorussia, China, Poland, Ukraine, United States, U.S.S.R.).

There were six abstentions (Brazil, Canada, Czechoslovakia, Ethiopia, New Zealand, Yugoslavia).

The views of the U.K. Delegation are given in annex 31.37

iv. Miscellaneous

The views of the U.S. Delegation are given in annex 32.38

[Page 377]

The Commission had before it only the U.K. proposal which is shown in the Draft Treaty.

Eight Delegations voted in favour of this proposal (Australia, [Belgium] France, Greece, India, Netherlands, Union of South Africa, United Kingdom).

Four Delegations abstained (Brazil, Canada, Ethiopia, New Zealand).

Eight Delegations voted against (U.S.A., Byelorussia, China, Poland, Czechoslovakia, Ukraine, U.S.S.R. and Yugoslavia).

The Commission took note of a reservation made by the Canadian Delegation concerning Annex 7 as a whole. In accordance with this reservation, the Canadian Delegation abstains from participating in the vote on the annex. The Canadian Delegation will have more to say on this question later in Plenary Session, after a more detailed study of the manner in which Annex 7 will apply to Federal States.

Therefore the Commission submits for the consideration of the Plenary Conference:

(1)
The text of the British proposal on Contracts, against which less than two-thirds of the members of the Commission voted.
(2)
The U.K. and Soviet texts concerning periods of prescription, which each obtained eight votes, and also the reservation of the U.S. Delegation considering this annex, which was supported by eleven Delegations.
(3)
The U.K. proposal concerning negotiable instruments and the clauses relating to Stock Exchange contracts and to the sale of collateral which were supported by eight delegations.

I—Annex 8—Prize Courts and Judgments

Part A—Prize Courts—The matter referred to the Commission was the proposal of the Council of Foreign Ministers. This proposal was adopted unanimously by the Commission.

Part B—Judgments

1. The Commission had to deal with 3 proposals, which are reproduced in the text of the Draft Treaty.

(1)
U.S. proposal supported by the U.S.S.R.
(2)
French proposal.
(3)
U.K. proposal.

All these three proposals (see Draft Treaty, page 86)39 provide for the measures to be taken for the revision of judgments rendered during the war in cases in which the nationals of the United Nations had been unable to defend their cause satisfactorily.

These proposals differed from each other on several points: principally as regards the competent jurisdiction for the revision of such judgments and as regards the obligation to be undertaken by the [Page 378] Italian Government to guarantee the compensation to be granted to United Nations nationals proved to have sustained injury.

The proposal submitted by the United States Delegations and seconded by the U.S.S.R. received 13 votes in favour (United States, Byelorussia, Brazil, Canada, China, Czechoslovakia, India, Netherlands, New Zealand, Poland, Ukraine, U.S.S.R., Yugoslavia); against 5 (Australia, France, Greece, U.K., Union of South Africa) with 2 abstentions (Belgium, Ethiopia).

The proposal of the French Delegation obtained 8 votes (Australia, Belgium, Brazil, Canada, Ethiopia, France, Greece, Union of South Africa); against 9 (U.S.A., Byelorussia, China, Czechoslovakia, Netherlands, Poland, Ukraine, U.S.S.R., Yugoslavia); with 3 abstentions (India, New Zealand, U.K.).

The views of several delegations are given in the Annexes 34 to 39.40

The proposal of the U.K. Delegation obtained 4 votes (Australia, Greece, United Kingdom, Union of South Africa); against 11 (U.S.A., Byelorussia, Brazil, Canada, China, Czechoslovakia, Netherlands, Poland, Ukraine, U.S.S.R., Yugoslavia); with 5 abstentions (Belgium, Ethiopia, France, India, New Zealand).

The views of the delegations are given in Annexes 40 and 41.41

2. A draft Yugoslav amendment was also referred to the Commission (C.P. (Gen.) Doc.U26 which aims at adding to part B of Annex 8 a new part C dealing with questions of judicial procedure in ceded territories.

The Yugoslav Delegation withdrew this proposal in view of the fact that the Sub-Committee set up for the consideration of the Annexes, had expressed an unfavourable opinion, but on the other hand it stated that:

1.
subsequent to the incorporation of the ceded territory, all procedure should be regulated by Yugoslav legislation on public order;
2.
that Yugoslavia should be asked to return the files dealing with the questions at issue, in virtue of the provision concerning archives in ceded territories;
3.
as regards the question of the revision of judgments and awards rendered subsequent to 10 June 1940, the United Nations nationals concerned, including nationals of recent date, should be authorised to apply for revision before Yugoslav courts, in accordance with the principles adopted by the Commission for Section B.

Part A—The Commission unanimously adopted, and submits as a recommendation to the Plenary Conference, the text of Part A, Annex B, concerning Prize Courts, as it figures in the draft Treaty.

[Page 379]

Part B—The Commission submits to the Conference for examination:

(1)
The proposal submitted by the United States Delegation, and seconded by the U.S.S.R. Delegation: this proposal obtained 13 votes (U.S.A., Byelorussia, Brazil, Canada, China, Czechoslovakia, India, Netherlands, New Zealand, Poland, Ukraine, U.S.S.R, and Yugoslavia).
(2)
The proposal in the Draft Treaty submitted by the French Delegation, which obtained 8 votes (Australia, Belgium, Brazil, Canada, Ethiopia, France, Greece, Union of South Africa).
(3)
The proposal in the Draft Treaty submitted by the U.K. Delegation received 4 votes (Australia, Greece, U.K., Union of South Africa).

Articles Transmitted by the Political and Territorial Commission for Italy

The Commission also considered several Articles and annexes which had been submitted for decision or comment by the Political and Territorial Commission for Italy.

Articles 8 and 9 and Annex 2

1. The Commission agreed unanimously that it had no comments to make regarding the adoption by the Political and Territorial Commission for Italy of Articles 8 and 9, and of Annex 2 of the Draft Treaty, dealing with the possibility of establishing railway connection between Briançon and Modane via Bardonnèche, and the utilisation of the hydroelectric resources in territory ceded to France.

Article 11

2. The Commission agreed unanimously that it had no comments to make regarding the adoption by the Political and Territorial Commission of Articles 11a and 13a, proposed by the Yugoslav Delegation (C.P.(IT/P) Docs. 100 and 102), which deal with the restitution of certain objects removed from the territories incorporated by Italy in 1920 and 1924.

It was decided, however, to draw the attention of the Political and Territorial Commission to various inaccurate references and drafting errors in these texts which, in the opinion of the Economic Commission, would justify their being referred to the Legal and Drafting Commission for revision.

Article 23

3. The Commission unanimously adopted, subject to the deletion of the words “or international” in the last line of the first paragraph, and the word “all” in the last line of the second paragraph, an Albanian proposal, seconded by the Yugoslav Delegation (C.P. (Gen.) Doc. 7), [Page 380] which aims at specifying the terms of Italy’s renunciation to rights, concessions, interests and advantages acquired in Albania.

The Commission therefore adopted unanimously, and submits as a recommendation to the Plenary Conference, the text of Article 23, to read as follows:

“Italy renounces in favour of Albania, all property (apart from normal diplomatic and consular premises), rights, concessions, interests and advantages of all kinds acquired before or after 1939, by the Italian State or its parastatal institutions in Albania, or belonging to them. Italy also renounces all claims to special interests or special influence in Albania which she acquired as the result of the aggression of April 7, 1939, or which may have been granted to her under earlier bilateral instruments.

Other Italian property and other economic relations between Albania and Italy will come under the economic clauses of this Treaty applicable to the Allied or Associated Powers.”

With regard to international agreements, the Commission agreed to ask the Political and Territorial Commission for Italy to study the decisions taken in Paris on November 11, 1921, by the Ambassadors’ Conference, in connection with Italy’s rights in Albania.

Article 24

4. The Commission considered an Albanian proposal, seconded by the Yugoslav Delegation, proposing the insertion of an additional Article 24 a, which would dispense Albania and its nationals from repaying Italy or Italian nationals any debts contracted before or after April 7, 1939.

This proposal was withdrawn by the Yugoslav Delegation.

5. The Commission considered an Albanian proposal, seconded by the Yugoslav Delegation, for the inclusion of an additional Article 24b, providing for the restitution of gold reserves of the National Bank of Albania located in Italy.

A proposal by the U.S.S.R. Delegation that this question should be referred to the Plenary Conference, with a, recommendation for its consideration by the Council of Foreign Ministers, was supported by 7 Delegations: (Byelorussia, Czechoslovakia, Ethiopia, Poland, Ukraine, U.S.S.R. and Yugoslavia).

Nine Delegations voted against the proposal: (Australia, Belgium, Brazil, Canada, Greece, Netherlands, New Zealand, United Kingdom, Union of South Africa).

Four Delegations abstained: (U.S.A., China, France and India).

The views of the United States Delegation on the Ethiopian amendment are given in Annex 40 [41]42

[Page 381]

The Commission then voted on the substance of the Albanian proposal.

Twelve Delegations voted against: (U.S.A., Australia, Belgium, Brazil, Canada, China, Greece, India, Netherlands, New Zealand, United Kingdom, Union of South Africa).

Seven Delegations voted for the proposal: (Byelorussia, Czechoslovakia, Ethiopia, Poland, Ukraine, U.S.S.R. and Yugoslavia).

The French Delegation abstained.

The Commission therefore decided, by 12 votes to 7, with 1 abstention, to reject the Albanian proposal.

Articles 28, 29 and 30

6. The Commission agreed unanimously that it had no comment to make regarding the adoption by the Political and Territorial Commission for Italy of Articles 28, 29 and 30, which deal with the status of Italian persons and property in Ethiopia.

Article 31

7. The Commission considered the Ethiopian amendment to Article 31 (C.P. (Gen.) Doc. 1.H.5) concerning the restitution of works of art and objects of religious or historical value removed from Ethiopia to Italy since October 3, 1945. The Commission considered this amendment in three parts:

(a) The additions proposed by the Ethiopian Delegation to the single paragraph in the draft Treaty were rejected by 12 votes to 3.

The following voted against: U.S.A., Byelorussia, Brazil, Canada, China, Czechoslovakia, France, Netherlands, U.K., Union of South Africa, U.S.S.R., Yugoslavia.

The following voted for: Ethiopia, Greece, New Zealand.

The following abstained: Australia, Belgium, India, Poland, Ukraine.

(b) The first sentence of Part 4 of the Ethiopian proposal concerning the restitution of Ethiopian gold and silver by Italy was adopted by 9 votes: Australia, Belgium, Brazil, Canada, Ethiopia, Greece, India, New Zealand, Yugoslavia.

Seven Delegations voted against: U.S.A., Byelorussia, Czechoslovakia, France, Netherlands, United Kingdom, U.S.S.R.

Four abstentions: China, Poland, Ukraine, Union of South Africa.

(c) That part of the Ethiopian amendment regarding the annulment of measures taken by Italy, outside Ethiopia, against the rights and interests of the Ethiopian Government and its nationals, and the repayment of balances and credits to the Bank of Ethiopia, was rejected by 12 votes to 6; the following voted against: U.S.A., Byelorussia, Brazil, Canada, China, France, [Netherlands?] New Zealand, Ukraine, United Kingdom, Union of South Africa, U.S.S.R.

[Page 382]

The following voted for: Australia, Czechoslovakia, Ethiopia, Greece, India, Yugoslavia.

There were two abstentions: Belgium, Poland.

The Commission therefore submits to the Plenary Conference the following addition to Article 31, which was supported by 12 Delegations:

“Italy undertakes to restore within a period of eighteen months from the date of entry into force of the present Treaty all gold and silver, including coin, looted by Italian troops or officials in Ethiopia or wrongfully removed, or to transfer to Ethiopia an amount of gold, or silver, as the case may be, equal in weight and fineness to that looted or wrongfully removed.”

The views of the Ethiopian Delegation on this Article are given in the Annex 10.43

Conclusion

This document, Mr. Chairman, arranged according to the numerical order of the Articles, constitutes a brief summary record of the work of the Economic Commission for Italy and the results attained by that Commission.

If the Plenary Conference agrees with the Commission’s suggestion, I venture to propose:

1) The adoption of the recommendations which the Commission adopted unanimously or by a two-thirds majority of its members, namely:

a) the paragraphs or Articles of the draft Treaty which have been approved unanimously without alteration, namely:

Article 64 Part A—Paragraphs 1, 2a, and 2b, 3, 4 and 5
65 2, 3, 4, 5, 6, 7 and 8
66 1, 2, 3, 4 and 5
68 1, 2, 3, 5, 6, 7 and 8
69 2, 3, 5a, 5c, 5d
70 1 and 2
71 1a, 1b with the exception of the words specifying the time limit
74 In full
in Annex 6A Paragraphs 1, 2, 3, 5, 6 and 8
“ “   8A In full

[Page 383]

b) the alterations or additions to the draft Treaty adopted unanimously:

Annex 23 In full
Article 64 Part A Paragraphs 2c and 6
64 Part B— 1 (without indicating the amount) 2, 4, 5, 6 and 7
64 Part D 1
65 1 and 9
66 6
69 4, 4a, 5b, 5e
70 3
73 In full
in Annex 6A Paragraphs 4 and 7

c). The Articles or paragraphs of the Draft Treaty which have been approved by a ⅔ majority, i.e.

  • —The whole of Article 67 approved by 19 votes to 1 abstention.
  • —Article 69, paragraph 1 approved by 17 votes to 3.
  • —Article 71, the addition proposed to paragraph 1 (c) by the American Delegation approved by 14 votes to 5, with 1 abstention.

d). Alterations or additions to the Draft Treaty which have obtained a ⅔ majority in the Commission.

  • —Article 64, paragraph 3 of Part B, approved by 18 votes to 2. Part C, adopted by 14 votes to 6.
  • —The whole of Article 72 (American proposal—Doc. 74), adopted by 14 votes to 6.
  • —Annex 6B (U.K. proposal Doc. 76) approved by 14 votes to 6.

2) To Give a Ruling on:

a). The following Articles or paragraphs:

  • —Article 67, addition approved by 13 votes to 2, with 5 abstentions (C.P.(IT/EC)Doc.69).
  • —Article 68, paragraph 4 approved by 13 votes to 5 with 2 abstentions.
  • —Article 71, paragraph 1(c), as completed by the U.S.–U.K.–French proposal, approved by 12 votes to 6, with 2 abstentions.
  • —Article 71, Netherlands proposal on paragraph 1(c) approved by 12 votes to 5, with 3 abstentions.
  • —U.S. proposal on Annex 7, approved by 11 votes to 4, with 5 abstentions.
  • —Annex 8B (U.S. proposal) adopted by 13 votes to 5, with 2 abstentions.

b). The following Articles or paragraphs:

  • —Article 31, addition approved by 9 votes to 7, with 4 abstentions.
  • —Article 64, the addition to paragraph 3 proposed by the Australian Delegation adopted by 12 votes to 8.
  • —Insertion in § 1 Part B, of the total amount of 225 millions adopted by 11 votes to 4.
  • —Article 71, time limit to be added in paragraph 1, proposal approved by 12 votes to 8.
  • —Article 74, addition approved by 13 votes to 7.
  • —Annex 7 (II) either:
  • —A Soviet proposal approved by 8 votes to 7 with 5 abstentions, or
  • —A U.K. proposal approved by 8 votes to 6 with 6 abstentions.
  • —Annex 7III, as a whole approved by 8 votes to 6 with 6 abstentions.

The text of proposals which obtained a minority of the votes but which were defeated by less than a ⅔ majority is contained in the special conclusions concerning each particular Article. The Commission did not take a decision on the original subparagraph (a) and subparagraph (f) of paragraph 5 of Article 69.

The Commission further decided to recommend the Plenary Conference to refer the following questions to the Council of Foreign Ministers for decision:

  • —Annex 3, and the Greek and Yugoslav amendments concerning this Annex.
  • —Annex 9, and the first sentence of the draft Article 16B contained in the U.S. Delegations proposal (C.P.(IT/P)Doc.16, page 4).

The Rapporteur
Hervé Alphand

Annex 1

Statement by the Australian Delegation on Article 64, Part B

I (a) Amendments C.P.(Gen)Doc.1.B.9 and 1.B.10

The technical problems involved in fixing reparations, particularly in view of Italy’s limited capacity to pay and the competing claims lodged by several countries, require more time than can be given them in the course of this Conference. The proposed payments in current production will involve external interference in Italy’s economic life and create co-ordination problems as between the several claimants for reparations.

I (b) Amendment (C.P.(IT/EC)Doc.13)

A series of bi-lateral agreements between claimant countries and Italy is likely to give rise to overlapping and conflict, and the Four Ambassadors in Rome cannot be regarded as satisfactory machinery for achieving coordination of these agreements.

[Page 385]

Annex 2

Statement by the United States Delegation on Article 64 (Reparations)—Australian Amendments

C.P. (Gen)Doc.1.B.9 & 1.B.10

C.P.(IT/EC)Doc. 13

These amendments were defeated by non-unanimous votes. The U.S. opposed all of them.

The U.S. Delegation believes that there should be the promptest possible determination of the financial obligations of defeated countries. It does not, therefore, favour any proposal which would delay the definitive determination of these financial obligations. Therefore, it does not consider desirable the establishment of a Reparation and Restitution Commission for the purpose of fixing the total Italian reparation obligation. Furthermore, the U.S. Delegation does not favour payment of reparation in foreign exchange since reparation payments so made could well be financed out of extensions of credit in strong currencies from other countries.

As regards that part of the Australian proposal which has to do with the functions of the proposed commission with respect to restitution, procedures for the restitution by Italy of identifiable property removed from the territory of any of the United Nations are provided for in Article 65, paragraphs 6 and 7, and in Article 72. As regards restitution to Italy of identifiable literary or artistic property removed by force or duress, procedures towards this end are now being developed in ACC, Germany.

Annex 3

Statement by the United States Delegation on Article 64 (Reparations)—Brazilian Amendment

(C.P.(Gen)Doc.1.E.9)

The Brazilian amendment proposed that the raw materials to be processed by Italy for reparation deliveries to the U.S.S.R. be furnished by Italy to the U.S.S.R. not absolutely but “if necessary”.

The U.S. Delegation opposed this amendment. The intention of the agreed C.F.M. proposals was that reparation from Italy to the U.S.S.R. should be provided in substantial part through Italian processing services; that is, in the form of “value added by manufacture.” Therefore, the raw materials to be processed by Italy should be provided on commercial terms by the U.S.S.R. without interference with the commercial ability of Italy to obtain raw materials (a) for domestic consumption and (b) for the export of manufactured products other than on reparation account. This Article does not prevent [Page 386] the U.S.S.R. from arranging for the raw materials from other countries. The responsibility of the U.S.S.R. is to relieve Italy of this cost.

Annex 4

Statement by the Delegation of the Soviet Union in Regard to Article 64, Section B

The proposal made by the Australian Delegation to set up a Reparation Commission is an amendment of an Article which has been agreed between the Delegations of the Four Powers—U.S.S.R., U.S.A., U.K. and France—in respect of the text of paragraph 3 of Section “B” of Article 64 (P.C.(IT/EC)P—Doc 34). If this amendment were to be adopted it would mean the alteration of a text which has been agreed upon. In voting for this amendment suggested by the Australian Delegation, the U.S.A. and U.K. Delegations have gone contrary to an agreement arrived at between the Four Powers—U.S.S.R., U.S.A., U.K., and France.

Those who voted on individual paragraphs of the Australian amendment did not achieve a two-thirds majority on any single one of them. In regard to certain portions of the Australian proposals, only a very small number of the members taking part in the Commission gave their votes: for instance, when paragraph “C” was put to the vote it was approved by only 6 members of the Commission.

The Australian proposal to set up a Reparations Commission is wrong because it involves a number of difficulties in respect of the practical execution of the obligations that Italy has undertaken to carry out with regard to reparations.

Annex 4 bis

Article 64, Part C—Report by the U.K. Delegation

The U.K. Delegation consider that Part C should not be included in the Treaty. It appears to them substantially to modify paragraph one of Article 64 Part A in the form in which it was presented to the Conference by the Council of Foreign Ministers. The U.K. Delegation believe that this paragraph will [which], in its unamended form, provided that deliveries from current industrial production should not be made during the first two years, was founded in wisdom. They consider that the original wording should be retained in Part A; and included in other relevant parts of the Article. Moreover they understand that the leader of the Italian Delegation, when he addressed [Page 387] the Economic Commission at their 14th meeting on September 11th asked that Italy should be granted a moratorium of five years before reparation payments commence. This suggests that the Italian Government do not consider that they would be in a position to make deliveries at any date earlier than that prescribed in the original draft of Article 64A.

Annex 5

Declaration of the French Representative Concerning Article 64, Part D

France has not explicitly claimed the benefits of the clause which constitutes sub-paragraph a) of paragraph 2 of Part B of the present Article for she has not made any explicit claim for reparations. It is noted, however, that Article 58 provides that the Governments of the U.S.S.R., U.S.A., U.K. and France shall be entitled to dispose of all war material of Italian origin, in excess of that authorised for the armed forces, as specified in Sections 3, 4 and 5.

Under these conditions, France reserves the right to claim to a very small share of such material as particularly interests her, in application of Article 58. To make her position perfectly clear, France does not wish to reserve her right to make such a claim without informing the Commission.

Annex 5 bis

Statement by the Delegation of Poland on Article 64 D

The Polish Delegation has heard with particular interest the views of the representatives of the U.K., U.S. and French Delegations as to the scope of para. 1 of Part D of Article 64 of the draft Treaty of Peace with Italy, more especially as to the possibility offered by its provisions of meeting reparation claims from the balance of pre-war debts due to Italy or her nationals by the Allied and Associated Powers and their nationals.

On the basis of these expressions of view, the Polish Delegation states that it will propose to its Government and to Polish nationals that they should take appropriate steps as to the balances of pre-war Polish debts to Italy. The reparation claims put by the Delegation before this Commission will thus be satisfied. Consequently, if the proposal of the U.S.S.R. Delegation which appears as para. D3 of Article 64 is intended to refer to Polish interests alone, the Polish Delegation while thanking the U.S.S.R. Delegation for having sponsored this [Page 388] paragraph, would be prepared to forego the advantages conferred by its provisions, since its interests are adequately safeguarded by the statements of the U.S., U.K. and French Delegations.

I would at the same time ask you, Mr. Chairman, to be so good as to include the statements of the 3 Powers I have just mentioned, together with this statement, in the Record of Decisions of this Meeting.

Annex 6

Statement by the Delegation of the Soviet Union on Article 64, Section D

The Soviet Delegation has noted the statements by the U.K., U.S.A., and French Delegations to the effect that Articles 69 and 70 provide for the satisfaction of the Polish Reparation claims, and therefore there is no necessity to include special provisions to deal with claims against Italy which might be presented by States whose territory was occupied and who took an active part in the war against Italy (Paragraph 3 Section D, Article 64.(IT/EC)R—Doc.34).

The Soviet Delegation states that the Polish Delegation is satisfied by the statements of the Delegations of the U.K., U.S.A. and France. Having in mind the aforesaid statements and in consideration of the fact that the interpretation of the provisions of the Treaty rests with the four Governments, U.S.S.R., U.S.A., U.K. and France, and that there are no differences of opinion between these Governments in regard to the application of the provisions of Articles 69 and 70 in so far as the reparation claims of Poland are concerned, the Soviet Delegation agrees to withdraw its amendment.

Annex 7

Minority Report on Article 64,b.1

The proposal to refer the question of fixing the total amount of reparations due by Italy to Greece and Yugoslavia to the Four Great Powers for decision, who will have time to examine its implications, put to the vote at the request of the Greek Delegation, seconded by the Soviet and Yugoslav Delegations, was not intended to postpone reaching final decisions, or to obtain a mere increase in the reparations proposed: its object was to enable the Conference, which has not sufficient time to examine the question in all its implications, to avoid sanctioning an iniquitous decision, the moral and material consequences of which would be incalculable.

Due regard for the suffering of the heroic peoples whose resistance provoked barbarous reprisals is a touchstone for U.N.O., especially in [Page 389] the case of small countries whose resources are wholly inadequate to defray the enormous cost of reconstruction, which remains an insoluble problem. This is all the more true when it can be proved irrefutably that the aggressor State, if we are to believe the statements of its present leaders, has preserved its industrial structure intact, and requires only to be freed from its liability to pay reparations in order to attain in very few years greater prosperity than before the war.

The Commission, too pressed for time to terminate, to be able to realise the full significance of such statements, has already listened to quotations from the statements made by Signor Binandi [Einaudi], the eminent Governor of the Bank of Italy, to a shareholders’ meeting in Rome on March 29, 1946, which are particularly impressive at the present time.

“If we act in this way” he said, “there is no doubt that we shall not have need to ask for foreign loans, they will be offered freely. There can be no doubt that in a very few years Italy will emerge more beautiful and more prosperous than before. Our national renaissance depends not on others but on ourselves.”

And the prominent Economist, M. Corbino, Italian Minister of Finance [the Treasury], has stated in his speech published in January, 1946, that Italy was one of the few countries already on a good way to recovery.

Then the Minister of Reconstruction [Industry and Commerce], M. Gronchi, said on November 3, 1945 that Italy was the only state of continental repute which was still in possession of full productive capacity.

Lastly, the Prime Minister, M. de Gasperi, has just stated in Rome that the Italian industry has recovered 80% of its pre-war capacity.

It is true that Italy lacks certain raw material, but, as stated above by Mr. Einaudi, the credits needed for buying such material will soon be freely offered to her.

Now everyone agrees that Italian recovery should be promoted, but up to a certain extent and not by condemning to a long drawn out agony hundreds of thousands of Yugoslav and Greek peasants who have been homeless for almost five years. It is not thus that it will be possible to place Europe on a sound basis nor to establish for U.N.O. these unassailable principles of justice towards the weakest and staunchest defenders of the Allied cause on which it should be based.

Meanwhile it has been stated in the Commission that, according to the official memorandum of Bruno Rossi Ragazzi, published by the Instituto Poligrafico delle Stato [sic] in 1946, Italian national income amounted in 1938 to 116 milliards of “lire”, that is 5,700,000 pre-war dollars (20 1938 “lire” were worth one dollar).

[Page 390]

Consequently the reparations of 100 million dollars (present value), that is 50 million 1938 dollars approximately, only represents the ridiculous figure of 1% of Italy’s income for the year of 1938, which, according to M. Einaudi’s forecast, will soon be exceeded. Whereas the damage sustained by Yugoslavia and Greece amounts to 100% of their national income for several years. The extent of this damage and its colossal disproportion with, first the problematic reconstruction potential of these two countries, and secondly the inadequacy of the amount of reparations fixed, to be paid, moreover, in seven years, is not merely iniquitous, and a breach of the fundamental principles of U.N.O., but also raises the practical problem of the non-recovery of the Balkans.

But the Commission which, for the last few days has only been preoccupied by the question of finishing its work at whatever cost, refused in any way to consider these striking proofs of the iniquity of the decision imposed upon it and voted blindly. Notwithstanding this, the Greek proposal was only rejected by 11 of the 20 delegations voting.

It may perhaps be useful to note that Roumania, Finland, and Hungary, whose per capita income has always been smaller than that of Italy, have been called upon to pay aggregate reparations, equivalent to those suggested for Italy.

It should also be noted that in the course of the discussions, before the Greek proposal was brought up, the French Delegate, M. Jacques Rueff, was the first to suggest that, in order to allow sufficient time for the thorough examination of the data, the total of the Italian reparations should be fixed by the four Foreign Ministers.

For the reasons stated above, we again request the Plenary Conference to refer to the Council of the Four the question of the total reparations which Italy should undertake to pay to Greece and Yugoslavia.

Annex 8

Statement by the United States Delegation on Article 64, Sections B, C and D

The United States Delegation supports the provisions for reparation as written into the draft treaty by the Economic Commission for Italy, with certain minor exceptions. The various issues with which the Commission had to deal, are discussed below:

Specific reparations allocations (Paragraph 1, Section B). The Commission divided equally on the proposition as to whether or not Albania should be included among the recipients of reparation listed in the [Page 391] Section. Proposals were made of reparation of 5 million (by France) and 25 million (by USSR). The U.S. Delegation opposed the inclusion of such reparation on the grounds that Albania’s claims would be met more adequately by the application of Italian assets in its jurisdiction, than would be the case of the three other major claimants, even allowing for reparation from all sources.

As to the relative treatment of Greece and Yugoslavia, the U.S. Delegation, after examining their claims in detail and considering such factors as length of occupation and character of territory occupied, concluded that their reparation should be on an equal basis. However, the U.S. Delegation believes that allowance should be made for the much greater extent of state and parastatal property in territories to be ceded to Yugoslavia, and therefore recommended a ratio of 100 to 80 as between Greece and Yugoslavia. However, bearing in mind the variety of imponderables in all reparations calculations, the U.S. Delegation is not inclined to protest the ratio finally adopted of 100 to 100.

Total amount of reparations. The U.S. Delegation believes that Italy’s capacity to pay reparations is decidedly limited. Her commodity trade balance has always been adverse, and the balancing invisible items such as tourist expenditure, shipping and immigrants remittances, have been greatly curtailed. Therefore her economy will heed to reorient itself for increased commercial commodity export, or depend upon a continued supply of foreign credits. Under these circumstances, the U.S. Delegation believes that the total reparation of 325 millions, bears a close relation to capacity to pay. It of course is far below the valid claims for damages, but the process of reparation cannot represent adequate compensation to any appreciable extent. The figure established will be a substantial burden for the Italian economy to bear.

Organization of Reparations Commission. The U.S. Delegation strongly endorses the idea underlying the Australian amendment. Where reparation is to be given to several countries, it seems essential that some body be established to assure that the process will be orderly and the available resources be fairly distributed. The inclusion of the claimant countries as members of the agency will contribute to its effectiveness.

The U.S. Delegation opposed the suggestion to give the Commission authority to assess penalties, in view of the fact that no similar policing device was established at other points in the treaty. The treaty was written on the assumption that its provisions would be carried out in good faith.

Earlier deliveries. Both Part A and Part B provide for a moratorium of two years. These provisions were essentially for the purpose [Page 392] of giving the Italian economy time to reorganize itself and for the Italian Government to put its budget in order. However, there may be situations in which the Italian economy can benefit by getting to work on reparations account at an earlier date, for example, in the case of substantial unemployment where workers would have to be supported by the State in any event. Part C is a permissive clause only, leaving the determination with respect to earlier deliveries clearly in the control of the Italian government.

Annex 9

Statement by the United States Delegation on Article 65 (Restitution)—Yugoslav Amendment

(CP(Gen) Doc. 1.U.18 para. 6)

These amendments which called for the replacement of ships and rolling stock were rejected by non-unanimous votes. The U.S. Delegation voted for rejection. The Draft Treaty does not provide for the replacement of any other categories of property in the event they cannot be restored (except for a very limited category of objects of cultural value). To require replacement of ships and rolling stocks would create a special preferential position for claims in connection with certain types of property and certain countries. The claim in question should constitute a part of the total reparation claim of the country suffering the loss.

Annex 10

Statement by the Ethiopian Delegation on Article 31

The following amendment submitted by the Ethiopian Delegation and in regard to which the Economic Commission for Italy expressed a favourable opinion by a vote of 9 votes to 7 with 4 abstentions, is presented for transmission to the General Assembly for its consideration.

“Italy undertakes to restore within a period of eighteen months from the date of entry into force of the present Treaty all gold and silver including coin, looted by Italian troops or officials in Ethiopia or wrongfully removed, or to transfer to Ethiopia an amount of gold or silver as the case may be, equal in weight and fineness to that looted or wrongfully removed.”

The reason for this amendment is a simple one. During the Italian occupation the Italian military seized throughout Ethiopia large stocks of silver currency, the Maria Theresa thaler. Ethiopia merely [Page 393] seeks the return of these sums wrongfully seized. Article 65 sub-paragraph 8 would have afforded adequate protection except for the fact it covers gold only, not silver. The Ethiopian Delegation, on the other hand, did not wish to undo the work already accomplished in regard to Article 65 sub-paragraph 8 by proposing an amendment in regard thereto, all the more so as the amendment is designed to cover a situation peculiar to Ethiopia. For these reasons the Ethiopian Delegation has proposed the insertion of an additional pargaraph to Article 31, which itself concerns solely Ethiopia.

Annex 11

Statement by the United States Delegation on Article 67 (Claims Against Germany)—Yugoslav Amendment

C.P.(Gen)Doc.1.U.20

C.P.(IT/EC)Doc.60

The Yugoslav amendment (1.U.20) would have obligated Italy to recognize the full rights of the Inter-Allied Reparation Agency over German property in Italy.

The U.S. Delegation opposed this amendment because the Paris Agreement on Reparations does not give the Inter-Allied Reparations Agency any authority over German assets in Italy. The substitute amendment (C.P(IT/EC)Doc.64)—proposed by the Yugoslav Delegation which would require [entitle?] Italy and Associated Powers under this treaty to German assets in Italy—is likewise without foundation in the relevant agreements regarding German external assets.

The U.S. Delegation voted for the rejection of the Yugoslav amendment and proposed an alternative amendment (C.P.(IT/EC)Doc.69) providing that Italy would facilitate such transfers as might be determined by the powers occupying Germany responsible for the disposition of German assets. This alternative proposal was carried by non-unanimous vote. The U.S. Delegation supports it as being, in the light of other international undertakings, the only permissible provision with respect to German assets in Italy.

Annex 12

Statement by the United Kingdom Delegation on Article 68, Paragraph 4

The United Kingdom Delegation consider that, in justice, full compensation should be paid to United Nations persons who have suffered [Page 394] loss or damage to their property in Italy; otherwise they support the text proposed by the French Delegation.

In the view of the British Delegation, there is no doubt that the ex-enemy Government is under a moral obligation to make good all the losses and damage caused by the war. Neither the United Nations nor the property owner was responsible for the war, and it is difficult to see why either should be required to make good its effects. In the United Kingdom the property of foreigners has been covered by various war-damage schemes in force equally with that of British subjects. These schemes have been very expensive to the British tax-payer.

The United Kingdom Delegation share the views expressed by the French and United States Delegations that the burden imposed by reparation is of a different character from that imposed by the provision of compensation. Unfortunately it is not practicable to exact reparation in full across the exchanges for all the losses caused in modern war, but so far as compensation is in question, the Italian Government has produced no evidence of the impossibility of meeting losses in Italy in full. The charge would be a budgetary one and the restored property would be a contribution to the rehabilitation of the Italian economy.

In the course of the War the United Kingdom has assumed huge internal financial burdens and has undergone an unprecedented process of external disinvestment and a further reduction of its national wealth.

The United Kingdom Delegation maintain their position that compensation should be paid in full.

Annex 13

Statement by the United States Delegation on Article 68 (United Nations Property)—Paragraph 4 44

The position of the U.S. Delegation, in connection with texts submitted to the conference on this subject, was that in logic and equity, full compensation should be paid to United Nations nationals whose property, whether held directly or through a corporate intermediary, has suffered damage on the territory of Italy. It has been unable to accept the view that any analogy determinative of policy can be drawn between reparation and compensation; and has accordingly [Page 395] opposed the Yugoslav amendment (1.U.21) which would relate the amount of compensation to be paid to the amount of reparation to be paid.

The damage which Italy by her military effort has inflicted on the territory of the United Nations can be compensated only through the transfer of assets from Italy to various United Nations. Obviously it cannot be compensated in full. Italy does not have sufficient transferable assets for this. Therefore the reparation problem is to determine the total amount of assets which Italy can transfer without destroying her own economic existence and to make an equitable allocation of this total among the reparation claimants.

However, the damage inflicted within Italy upon the property of United Nations nationals has to be repaired in any case if Italy is to restore her economy; and its prompt rehabilitation is in Italy’s interest. Furthermore, payment of compensation as proposed by the U.S. does not involve the transfer of assets abroad. What is required is the payment of sums in Italian currency which can be used for repairing the damage and rehabilitating the property.

Because of these substantive differences between compensation and reparation, the U.S. Delegation felt that compensation should be paid in full, and submitted to the conference a draft embodying this concept. Nevertheless, recognizing the magnitude of the total economic burden imposed upon Italy by various provisions of the Treaty of Peace, and recognizing the dislocations to which the Italian economy has been and will be subjected, the U.S. Delegation decided to accept partial compensation and to oppose full compensation.

The U.S. Delegation proposed that compensation be paid at the rate of 25%. However, it is prepared to take into account the views of other governments which may feel that their interests are affected to a greater degree.45

In addition to the question of rate of compensation there are other matters in paragraph 4 of Article 68 which were the subject of non-unanimous votes.46

Sub-paragraph (b) protects the beneficial interests of ultimate United Nations owners of damaged property stipulating that such [Page 396] owners shall receive compensation (at the agreed rate) proportionate to their ownership interest in the damaged property, whether that interest be held directly or indirectly, and even though the immediate corporate owner may not be a United Nations national within the meaning of Article 24, paragraph 8(a). Since the bulk of modern business enterprise is organized in the corporate form and since in the majority of cases foreign investments are made through corporations or associations organized under the laws of the country in which the physical property is located, the U.S. Delegation believes it is imperative to “pierce the corporate veil” and to ensure that compensation for loss or damage shall accrue to those ultimate United Nations owners upon whom the burden of loss or damage if uncompensated would ultimately devolve.

The U.S. Delegation opposes the contention that United Nations nationals who hold interests in property through the corporate form should be deprived of the benefits of these provisions because of the use of corporate property by enemy states, at a time when they were not under the control of the owners.

Sub-paragraph (c) stipulates that compensation shall be paid free of all levies, taxes and charges, and shall be freely usable in Italy; but shall be subject to foreign exchange controls in force. The U.S. Delegation supports these provisions as being necessary for a precise clarification of the nature of Italy’s obligations and of the rights of compensation-recipients.47

Sub-paragraph (d)48 provides full compensation in the case of property which had been subject to special measures as enemy property. The U.S. Delegation opposes this provision, believing that the principle of partial compensation should apply in all cases where compensation claims arise and that no special distinctions should be made among various classes of property.

[Page 397]

Annex 14

Statement by the Delegation of the Soviet Union on Article 68, Paragraph 4

The Soviet Delegation considers that the claim for full compensation for loss to the property of the United Nations in Italy is not correct. Italy was the first of the powers of the Axis to break her relations with Germany, to go over to the side of the United Nations, and thereby incurred serious losses in her own territory in the course of the conduct of a common war against Germany side by side with the Allied States. When the extent of compensation in respect of losses caused to the United Nations property in Italy is under consideration this fact should be considered.

It is for this reason that the Soviet Delegation considers it necessary that only partial compensation should be provided for, not exceeding one-third of the amount of the said losses.

Annex 15

Statement by the French Delegation on Article 68, Paragraph 4

The French Delegation was in favour of full compensation for damage suffered by United Nations property in Italy. It did not think that this would impose an excessive burden on Italy.

1.
In fact, this was only a charge on the budget and not on the balance of payments.
2.
Moreover, the repair of factories and immovable property in Italy constitutes an advantage for Italian national economy.

However, after taking into consideration all the obligations imposed by the Treaty on Italy, the French Delegation has proposed a formula by which:

1.
For damage caused to United Nations property as a result of special measures taken in respect of it by the Italian Government, full compensation would be paid;
2.
For damage caused to this property as a result of the war, 75% compensation would be paid.

In consequence, the French Delegation has been unable to support or oppose the principles of full compensation, since its own proposal is based on both these principles.

Annex 16

Statement by the Delegation of the Ukrainian S.S.R. on Article 69

(Italian Assets on Allied and Associated Powers Territory—Ukrainian Amendment C.P.(IT/EC) Doc.70).

[Page 398]

The intention of the Ukrainian Delegation was to comprise the claims of the Allied and Associated Powers, in respect of Italian assets on their territory to reasonable limits thus enabling Italy to retain these assets, by satisfying the claims of the Allied and Associated Powers by other appropriate means.

The Ukrainian Delegation is of the opinion that the liquidation of Italian foreign assets would, undoubtedly, interfere with Italy’s economic reconstruction. It is recognised that the revenue derived by Italy from her assets abroad formed an important item of her balance of payments, and that consequently the liquidation of these assets would cause a serious breakdown in the foreign economic relations of Italy with foreign Powers, and would have a most unfavorable effect on Italian economy.

The Ukrainian Delegation considered, and continues to consider, that none of the Allied and Associated Powers concerned should be given the right to determine for itself, the amount of its claim against Italian assets, or make its own estimate of the value of Italian assets on her territory—the Four Ambassadors in Rome should objectively examine and fix the amount of the claims of each of the Powers concerned, and this procedure should be recorded in the Peace Treaty.

The Ukrainian Delegation is of the opinion that the Council of Foreign Ministers should take these views, which met with sympathy and support from a number of Delegations in the Commission, into account and at the final discussion of the Draft Peace Treaty with Italy, should add the following points to Article 69:

1.
The retention of Italian assets abroad by the Allied or Associated Powers concerned, in so far as this country was not occupied, shall be effected in such a way as not to interfere with the economic reconstruction of Italy and not to affect her balance of payments to any appreciable extent.
2.
The Four Ambassadors (U.S.S.R., U.S.A., Great Britain and France) in Rome shall examine and fix the amount of the claims of each of the Allied and Associated Powers, which can be met in accordance with the provisions of the present Article and determine the total amount of Italian assets which shall be retained by the said Powers.
3.
Nothing in the present Article shall prevent Italy from satisfying the claims of the Allied and Associated Powers concerned by means of payment of the amount of the claim in the currency of that Power or, by mutual agreement, by some other method in order to avoid the liquidation of Italian assets in the said country.

[Page 399]

Annex 17

Statement by the United States Delegation on Article 69 (Italian Assets in Territory of Allied and Associated Powers)—Ukrainian Amendment

(C.P.(IT/EC)Doc.70)

This amendment provided that Italian assets in the territory of Allied and Associated Powers should be liquidated in such a manner as not to burden Italian reconstruction or balance of payments and that this liquidation should be supervised by the Four Ambassadors in Rome. The amendment further provided that Italy should not be prevented from satisfying claims of Allied and Associated Powers by methods other than liquidation of Italian assets abroad, if this could be accomplished by mutual agreement.

The U.S. Delegation opposed the Ukrainian amendment on the grounds that it placed a new undesirable limitation upon the right of the Allied and Associated Powers to satisfy their claims against Italy, and it assigned to the Four Ambassadors in Rome a judicial function with respect to fixing the amount of claims of each of the Allied and Associated Powers against Italy. Such a function is not appropriate for such an agency. Furthermore, there is nothing in the Treaty to prevent some other disposition of the problem to be arranged between Italy and an Allied and Associated Power.

Annex 18

Statement by the United States Delegation on Article 69 (Italian Assets in Territory of Allied and Associated Powers)—Australian Amendment

(C.P.(IT/EC)Doc.72)

The Delegation of Australia proposed an amendment providing that literary and artistic property should be excepted from the right of seizure by Allied and Associated Powers granted under Article 69. The Delegation of the Ukraine proposed to amend this Australian amendment so as to except also industrial property.

The United States Delegation opposed the Australian Amendment both with and without the Ukrainian subamendment.

The United States Delegation is not opposed to the substance of the Australian amendment but was compelled to oppose the text on the ground that it did not contain necessary safeguards for war-time action by Allied Governments particularly in connection with the granting of licenses.

[Page 400]

It opposed the Ukrainian subamendment because various countries including the United States have during the war taken action with respect to Italian patents for the purpose of putting them to use in the Allied war effort. This action has taken the form in many cases of throwing patents open to general use. Since the value of a patent is destroyed when the monopoly it confers is terminated it would be impossible to return Italian patents with respect to which such action had been taken.

Annex 19

Declaration by the Representatives of the Four Powers Concerning the Ethiopian Amendment to Sub-Paragraph a of Paragraph 5 of Article 69

Mr. Thorp: I think the clear statement of facts by the representative of Ethiopia (regarding Italian diplomatic and consular promises in Ethiopia) indicates that the entire Article 69 is not applicable in this case. Therefore no exception needs to be made to the exception provided in para. 5 (a). This exception relates to Italian property used for diplomatic and consular purposes. It is clear Italy had not much property in Ethiopia—it was lent to Italy by Ethiopia. It therefore would not be affected by Art. 69, and would remain at the disposition of the Ethiopian Government.

In reply to a question by the Ethiopian representative as to the necessity for a similar exception to sub-para. (c), Mr. Thorp said:

Although my previous statement does not apply exactly to the situation contemplated in the remainder of the Ethiopian amendment, I believe Ethiopia is quite as well protected in regard to such cases, particularly in view of the provisions of Article 68 and Article 29.

The latter Article would permit annulment of Italian measures respecting Ethiopia taken since October 3, 1935, and gives Ethiopia full protection.

M. de Carbonnel, representative of the French delegation made the same statement concerning sub-para. b.

Mr. Gregory, representative of the U.K. delegation, associated himself with the U.S. delegation, as regards sub-para. (a).

As regards sub-para, (c), he said he did not believe it was the intention of the Ethiopian Government to realise the lawfully acquired property of Italian nationals but the effect of the amendment would undoubtedly be to allow of this being done. He considered that other provisions in the Treaty would enable the Ethiopian Government to reserve [reverse?] illegal acts resulting in the wrongful acquisition of [Page 401] property. He considered that, for the purpose the Ethiopian delegation had in view, this should suffice but that power should not be given to liquidate all the property of all the Italians permitted to reside in Ethiopia.

The Soviet representative declared that according to the words of the delegate for Ethiopia, Italian diplomatic and consular buildings were in fact the property of the Ethiopian Government and were used by Italy, not in the manner intended but for war aims (housing of the staff). In this case, of course, this does not apply to point 5 “a”.

Annex 20

Statement by the United States Delegation on Article 71 (General Economic Relations)—State Enterprise

With regard to subparagraph (c) of Article 71, paragraph 1, relating to the applicability of subparagraph (c) to state enterprise, the U.S.S.R. proposal was defeated by non-unanimous vote, and the U.S., U.K. and French proposal was carried by non-unanimous vote.

The U.S. Delegation opposed the U.S.S.R. proposal and supported the U.S., U.K. and French proposal. It did not feel that either addition to subparagraph (c) was really necessary since the requirement of that subparagraph, that Italy should accord national and most-favoured-nation treatment to United Nation nationals in all matters pertaining to commerce, industry, etc., was normally and uniformly understood not to include any obligation to accord to foreigners any rights of participation in state monopolies or nationalized industries. The U.S. Delegation supported entirely the view of the U.S.S.R. Delegation that Italy should be free to establish by law a state monopoly in any branch of industry or commerce if that appeared to Italy to be in her best interests. If, however, a further provision was to be written into the treaty safeguarding this right of Italy, it would, in the view of the U.S. Delegation, be very unfortunate to include it in the form of an exception since, in fact, the exception was implicit and customarily understood. The U.S. Delegation felt the matter could better be handled in the form of an interpretation and that such an interpretation should make it perfectly clear that Article 71 conferred upon United Nation nationals no rights to participate in any branch of industry or commerce which under Italian law becomes a monopoly of the Italian state, but that if foreign participation in a state monopoly or nationalized industry was permitted the most-favoured-nation principle should apply.

[Page 402]

Annex 21

Statement by the Delegation of the Soviet Union on Article 71

1. Paragraph 1 C

The Soviet Delegation considers that in such cases where, in certain spheres of economics in accordance with internal legislation, private enterprise is not permitted, the Italian Government itself should be allowed to decide whether or not it requires the assistance of foreign capital and to determine for itself the conditions and extent to which such foreign capital shall be invited to participate. The proposals of the U.K., U.S.A. and French Delegations in regard to this Article infringe on the sovereign rights of the Italian Government in this connection, and are therefore unacceptable.

2. U.S.A. Proposal for an Addition to the Paragraph on Civil Aviation

The Soviet Delegation considers that the request that Italy should grant equal rights to all the United Nations in respect of conditions of civil aviation is not acceptable. Civil aviation is very closely tied up with questions of national defense and therefore any interference in this sphere would be impermissible from the point of view of the sovereign rights and interests of the State.

The Soviet Delegation considers that questions concerning civil aviation can only be settled by bilateral agreement between Italy and the States concerned, in accordance with the practice which is normally followed between governments at the present time.

Annex 22

Statement by the United States Delegation on Article 71 (General Economic Relations)—Civil Aviation

The United States proposal for a special provision relating to civil aviation supported by the U.K. provided that Article 71 paragraph 1.c. should not apply to civil aviation but that Italy should afford to all United Nations equality of opportunity to obtain commercial aviation rights in Italian territory and should grant no exclusive or discriminatory rights to any country. In other words it provided that civil aviation should not be subject to the national treatment requirement of sub-paragraph c but should be subject to most-favoured-nation treatment as that concept applies to the particular circumstances of international commercial aviation. This United States proposal was adopted by the Economic Commission for Italy with a two-thirds majority.

In the Commission, however, the Delegation of the Netherlands [Page 403] proposed to amend the United States proposal by adding to it the provision that Italy should grant to United Nations nationals the two freedoms having to do with transit rights and technical (non-commercial) landings.

The United States Delegation supports the additional provisions contained in the Netherlands proposal (which failed to obtain a two-thirds majority) as assuring for the eighteen-month period a minimum basis for international commercial aviation.

Annex 23

Statement by the United States Delegation on Article 72 (Settlement of Disputes)

This Article was the subject of a complex divergence of views in the draft treaty prepared by the CFM. There was a U.K. proposal and a U.S.S.R. proposal. The U.S. was able to accept either of the drafts, provided a specified addition was made to the U.S.S.R. text. Finally, the French Delegation was able to accept either proposal subject to the amendment of the U.S.S.R. proposal urged by the U.S. Delegation, and subject also to the inclusion of Annexes 6, 7 and 8 within the coverage of Article 72.

During the deliberations in the Economic Commission for Italy the United States Delegation put forward a proposal involving the establishment of mixed arbitral tribunals. This proposal was with slight modifications based upon the Italian observations contained in Document 36 bis G.49

The advantage of the mixed arbitral tribunal approach is that it provides a rapid, final and equitable method of settling disputes. The United States Delegation feels that this procedure which has been tested by experience should be used rather than to experiment with an untried procedure for the settlement of disputes.

While the United States Delegation could still accept either the U.K. proposal or the U.S.S.R. proposal with the changes proposed by the U.S. and French Delegations as set forth in the draft peace treaty it feels that its own is far more satisfactory and strongly supports its adoption.

Annex 24

New Article Submitted by the Greek Delegation to Follow Article 74

The Greek Delegation has submitted the following amendment (Doc. 1.J.18) as a new article to follow Article 74;

[Page 404]

“Italy shall forego any right to which she was entitled under any treaty, convention or agreement to be represented on or to participate in any commission of any kind operating in Greece.”

When this amendment was discussed at the 30th meeting of the Commission on October 1, 1946, some Delegations suggested that the amendment might be more clearly drafted. The Greek Delegation proposed the following text:

“Italy shall forego the right to any participation in the International Financial Commission in Greece.”

The latter text was adopted by a majority of 13 to 7. The 7 delegations composing the minority, while in agreement with the principle of the Greek amendment, were in favour of the more general wording of the amendment in its original form.

Annex 25

Statement by the United Kingdom Delegation on Annex 7 of the Treaty—Section 1 (Contracts)

The United Kingdom Delegation consider that some provision ought to be included in the Peace Treaty to deal with the status of contracts which had been entered into before the War.

It must be accepted that the outbreak of a state of war effects to a greater or lesser degree all contractual relations then existing between persons who become enemies. Unfortunately there is no clear rule of law determining the position and in the absence of a specific provision matters in dispute will be left to litigation. In the opinion of the United Kingdom Delegation it is desirable to avoid such litigation, and particularly to avoid the uncertainty which will undoubtedly arise. Accordingly, the United Kingdom Delegation had proposed this Annex with a view to giving a known rule whereby the status of particular contracts could be determined without recourse to litigation.

The United Kingdom Delegation is of the opinion that considerable advantage would accrue from adopting their proposal in principle.

Annex 26

Statement by the United States Delegation on Annex 7 of the Treaty—Part I—United Kingdom Proposals on Contracts

The United States opposed the U.K. proposals on contracts, primarily because it regards paragraph 2 (f) as unreasonable.

[Page 405]

Annex 27

Statement by the United Kingdom Delegation on Annex 7 of the Treaty, Section II (Period of Prescription)

This Section is intended to provide for extensions of the time periods during which legal actions may be taken and legal formalities complied with and for extensions of periods of prescription.

It is common knowledge that in the course of legal actions of all kinds litigants are required to comply with formalities within certain specified times, but it is equally obvious that, by reason of an existence of a state of War, this will frequently be found to have been impossible. Further conditions attached to the issue of many bonds, and coupons arising from those bonds, require that they should be presented for payment within a stipulated period. This again will have proved to have been impossible during the War.

The intention of the U.K. proposal is to extend the prescribed periods by the War years, and further, as a consequence, to make provision for persons whose interests have been adversely affected by noncompliance at the originally stipulated date. So far as coupons are concerned, it is obviously unjust that, because United Nations persons have been unable to present their coupons for payment during the War, ex-enemy Government or National should benefit by this disability.

Steps have already been taken in the United Kingdom to extend the various periods of time which might otherwise run against persons resident during the War in Enemy Territory or territory occupied by the Enemy.

Annex 28

Statement by the United States Delegation on Annex 7—Part II—Prescription: Soviet Proposal (C.P.(IT/EC) Doc. 85) as Amended by France and Yugoslavia, October 2

The U.S. opposes this proposal. The exact scope and drafting are unclear, particularly in the case of the provisions of paragraph 2, regarding “the redemption of securities”. The U.S., however, would not oppose the inclusion in the treaty of a provision that would suspend the statute of limitations for the period during which enemies were unable to sue.

Annex 29

Statement by the United States Delegation on Annex 7 of the Treaty, Part II—United Kingdom Proposal on Prescription

The U.S. opposes the U.K. proposal, objecting primarily to certain aspects of Paragraphs 2, 3, 4, 5 and 6. These paragraphs do not relate [Page 406] to periods of prescription, but to the effect of war upon contractual relations. They permit individuals to apply to the international Conciliation Commission for relief, including compensation to be paid by the Italian Government. The U.S. sees no reason to throw such burdens upon the Italian Government, and believes that a simple provision for the suspension of periods of prescription during the time when an enemy was unable to prosecute legal actions is all that is necessary or desirable.

Annex 30

Statement by the United States Delegation on Annex 7—Amendment Proposed by the United States Regarding the Inapplicability of the Annex as Between the United States and Italy

This U.S. amendment was approved 11 to 4, with 5 abstentions. Under the federal system of the U. S., matters relating to contracts, prescription, etc., are primarily within the jurisdiction of the 48 State Governments, rather than that of the Federal Government. It is therefore, doubtful how far the U. S. Government may appropriately conclude treaty provisions on these subjects. The 1919 peace treaties contained clauses providing that provisions similar to Annex 7 should not apply to the U. S. taking into account its position as a federal stare. The amendment does not give the U. S. one-sided privileges in Italy; it means that the Annex would be entirely inapplicable as between Italy and the U. S. Matters covered by Annex 7 would be left for the courts of Italy and of the U. S. to deal with under their applicable laws. In the U. S. the general principles of those laws would be similar to the Annex provisions in so far as the Annex incorporates legal principles, although there might be differences in detail.

Annex 31

Statement by the United Kingdom Delegation on Annex 7—Section III—Negotiable Instruments

Proposition Supported by 8 Delegations

The proposal made by the United Kingdom Delegation is to extend by the war years periods during which Negotiable Instruments may be accepted or presented for payment or within which notice of non-acceptance or non-payment has to be given.

Bills of Exchange or Negotiable Instruments generally are in a class apart, and depend for their validity on strict compliance with the [Page 407] requirements of domestic law. The present proposal will merely remove the disabilities under which acceptors and presenters of Negotiable Instruments are under by reason of their inability to comply with those requirements during the War years. The proposal should commend itself as one which is justified on grounds both of justice and of convenience to all parties.

Annex 32

Statement by the United Kingdom Delegation on Annex 7, Section IV

Proposition Supported by 8 Delegations

The United Kingdom Delegation wish to offer the following comments on the proposals contained in this Section. At the outbreak of war it was necessary for exchange or commercial associations to provide rules under which contracts entered into before the war between their members and enemies should be closed and the proposal made by the United Kingdom Delegation is intended to deal with this fact and with the conditions that flow from it. Accordingly it is considered necessary that the Italian Government should recognise the closure of contracts and provided the rules were applied to all persons concerned and that the conditions attached to the closure were fair and reasonable to waive claims arising thereunder. The Section would not apply to rules made by Exchanges during occupation by the enemy.

The second part of the proposal relates to the sale of securities held as collateral for a debt and proposes that where the creditor has sold such security no claim will be made against him irrespective of the fact that he did not give the necessary notice to his debtor. It will be appreciated that such notice could not have been given.

Annex 33

Statement by the United States Delegation on Annex 7—Part 4—Miscellaneous

The U. S. opposes the U.K. proposals regarding stock exchange and commercial exchange contracts and the sale of securities for unpaid debts. These highly specialized provisions do not appear necessary or suitable for inclusion in a general peace treaty. The U. S. particularly questions the desirability of a multilateral peace treaty confirming private rules made by exchanges or commercial associations, either in Allied countries or in Italy.

[Page 408]

Annex 34

Statement by the United States Delegation on Annex 8: United States Proposal on Judgments

The U.S. draft, supported by the U.S.S.R., provides for the review of judgments rendered during the war by Italian courts, in cases in which a United Nations national was unable to present his case to the court adequately either as a plaintiff or a defendant. It requires the Italian Government to provide for review of such cases by appropriate Italian courts and authorities. Since the complaint of the United Nations national is that he was unable to present his case adequately to an Italian court, the fair and proper course is to let him do that now, just as a litigant is often granted a new trial when there were errors in the original trial. The matter should not go to an international tribunal unless a dispute arises between the United Nations Government concerned and Italy regarding the execution of the Annex.

If the Italian court finds that the United Nations national was prejudiced by the judgment, the fair thing is to restore him to the position which he occupied before the original judgment was rendered. In cases where that would be impracticable or unjust, the Italian courts should grant just and equitable relief—that is, adjustment of right and interests between the injured United Nations national and the persons who benefited by the original judgment. The U. S. opposes any requirement that the Italian Government pay compensation in such cases.

Annex 35

Annex 8 B: Judgments, Statement by the United Kingdom Delegation

The proposal made by the United Kingdom Delegation is in two main parts. Firstly it requires the Italian Government to recognise as final the judgements given by the courts of a member of the United Nations and secondly it proposes that a certain judgement given by Italian Courts during the war should be referred to an independent tribunal.

The contention of the United Kingdom Delegation is that in those cases in which an United Nations national was unable adequately to present his case a revision of the judgement given ought to be undertaken and the parties to the action either replaced in the situation which they occupied before that judgement or that compensation (or damages) be granted to the prejudiced party. In the opinion of the British Delegation it is important that this review should be undertaken by an independent tribunal both with a view to satisfying the [Page 409] prejudiced United Nations national that his case had been properly reviewed and with a view to relieving the Italian courts of an anomalous position. So far as the litigant is concerned it is important that he should see that justice was being done and he is scarcely likely to accept anything other than the judgement of an independent court. So far as the Italian courts are concerned the proposal which lays upon them the obligation to review judgements already given can scarcely be welcomed. In the one case they themselves will be conscious that the decision would be accepted with reservations by the litigant and in the other case they are placed in the unwelcome position of criticising action which has previously been taken by their colleagues in other Courts.

Accordingly the United Kingdom Delegation maintain the position that in principle it is desirable that any review of improper judgements which have occurred during the war should be in the hands of an independent body.

Annex 36

French Declaration Concerning Annex 8—Part B

The French Delegation maintains its proposal concerning the revision of judgments rendered by Italian courts against nationals of the United Nations.

It considers that its proposal follows a middle course between the proposal of the United States and the Soviet Union on the one hand and the proposal of the United Kingdom Delegation on the other.

The former offers no guarantee that United Nations nationals who have suffered from an unjust judgment will be equitably compensated by the Italian Government for the prejudice they have sustained.

The latter proposal, on the contrary, gives too wide powers to the court of arbitration by comparison with the discretionary powers of the Italian courts.

Annex 37

Statement by the United States Delegation on Annex 8—French Proposal on Judgments

The U. S. opposed the French proposal, chiefly because it does not believe that the Italian Government should be required to pay compensation in those cases where United Nations nationals were unable to present their cases. The final paragraph of the French draft appears unnecessary since Article 72, as approved by the Commission, provides that disputes under this Annex would go to the mixed arbitral tribunals therein provided for.

[Page 410]

Annex 38

Statement by the United States Delegation on Annex 8—United Kingdom Proposal on Judgments

The U. S. opposed the U. K. proposal. Where a United Nations national complains that he was unable to present his case to an Italian court, there seems no adequate reason to require that his case be taken directly to an international commission or tribunal instead of giving him a chance to be heard by the Italian courts. Adjustment of rights between the parties appears fairer than requiring the Italian Government to pay compensation in these cases. Any provision, as in paragraph 4, for compensation to United Nations nationals who suffered prejudice by judicial measures in occupied territory would appear to be merely one aspect of compensation for injuries suffered during the occupation, which does not require specialized treatment in an Annex on Judgements; the state whose territory was occupied may itself annul the effects of such judgements.

Annex 39

[This annex, presumably included in the Report of the Commission in error, is identical with Annex 35, printed on page 408.]

Annex 40

Statement by the United States Delegation on Article 24 bis—Provision Requiring Italy To Make Restitution of Gold to the National Bank of Albania

The position of the United States Delegation is that the Treaty should establish a general rule regarding the obligation of Italy to make restitution of monetary gold, leaving the claimant countries to adduce the facts which would bring them within the general rule. The Albanian proposal which Yugoslavia presented to the Economic Commission for Italy would have imposed an absolute liability upon Italy to return gold to the National Bank of Albania, without reference to whether the facts in the case of the Albanian claim or the application of the general rule in Article 65, paragraph 8 to those facts would justify full recovery by Albania of gold from Italy.

[Page 411]

Annex 41

Statement by the United States Delegation on Article 31: Ethiopian Amendment

(Referred by the Political and Territorial Commission for Italy to the Economic Commission for Italy)

The Ethiopian proposal for compensation in the event looted property cannot be returned or has been damaged could not be supported by the United States Delegation, because such claims are properly considered in connection with reparation.

The Ethiopian proposal regarding gold and silver looted by or wrongfully removed by Italian troops or authorities is covered by the restitution provisions (Article 65) to the extent that the silver is identifiable and to the extent that Ethiopian monetary gold was looted by or wrongfully removed to Italy. The claim for the loss of looted silver which cannot be recovered under the restitution provisions is a reparation matter.

The Ethiopian proposal concerning Italian restrictions over Ethiopian property in Italy and elsewhere outside Ethiopia is unnecessary, because of the provisions of Article 68, especially paragraph 3 relating to the invalidation of transfers resulting from force or duress, and Article 65, paragraph 5, which requires Italy to take the necessary measures to effect the return of looted property held in third countries by persons subject to Italian jurisdiction.

Annex 42

Statement by the Yugoslav Delegation

The Yugoslav Delegation has endorsed the Albanian Delegation’s amendment contained in C.P.(Gen)Doc. 7 (Albanian Delegation Memorandum) for an Article 24 (b) with the following text, which was supported by the Yugoslav Delegation in the Economic Commission for Italy:

Article 24 (b)

“The Italian Government undertakes to restore to the Albanian Government any gold reserves of the former National Bank of Albania located in Italy.”

This Yugoslav amendment was discussed by the Economic Commission at its meeting on October 2, 1946, and was rejected by 12 votes to 7 with one abstention.

In accordance with the Rules of Procedure, the Yugoslav Delegation requests that this amendment be referred to the Plenary Conference for the following reasons:

[Page 412]
(1)
The amendment was rejected by a simple majority.
(2)
The Yugoslav Delegation attaches importance to this amendment as it involves a very serious claim by Albania and considers that this matter should be reconsidered in view of the fact that a just settlement necessitates thorough consideration of the problem.
  1. A corrigendum to this report states: “The Economic Commission for Italy was informed at the beginning of the last meeting devoted to examining the text of the draft Treaty that the Political and Territorial Commission had referred to it, for decision, an American proposal entitled Annex 13 and contained in Doc. C.P.(IT/P) Doc. 16. The Economic Commission for Italy did not have sufficient time to examine this annex before the end of the meeting.” For the text of the proposed Annex 13, see post, p. 783.
  2. For text of Draft Peace Treaty with Italy, see p. 1.
  3. Post, p. 384.
  4. Post, p. 385.
  5. Post, p. 385.
  6. Post, p. 792.
  7. Namely, the Ambassadors of the United States, United Kingdom, the Soviet Union, and France. This provision, referring to agreements between Italy and the Soviet Union, is found in the draft treaty, Article 64, section A, paragraph 3, p. 25.
  8. Post, p. 794.
  9. Post, p. 386.
  10. Post, p. 386.
  11. Post, p. 387.
  12. Post, p. 388.
  13. Post, p. 387.
  14. Post, p. 390.
  15. Post, p. 392.
  16. For documentation regarding the Inter-Allied Declaration Against Acts of Dispossession Committed in Territories Under Enemy Occupation or Control, see Foreign Relations, 1943, vol. i, pp. 439 ff; for text of the Declaration, see ibid., p. 443.
  17. Statement not printed.
  18. Post, p. 392.
  19. For text of Annex 3 of Draft Peace Treaty with Italy, see p. 40.
  20. Post, p. 393.
  21. Post, p. 393.
  22. Post, pp. 394 and 397, respectively.
  23. Post, p. 397.
  24. Ante, p. 32.
  25. Post, p. 397.
  26. Post, p. 399.
  27. Post, p. 399.
  28. Post, p. 400.
  29. Post, pp. 401 and 402, respectively.
  30. Post, p. 402.
  31. Annex 23, p. 403.
  32. Post, p. 403.
  33. Post, p. 404.
  34. Post, pp. 404 and 405, respectively.
  35. Post, p. 405.
  36. Post, p. 406.
  37. Post, p. 406.
  38. Post, p. 407.
  39. Ante, pp. 5859.
  40. Post, pp. 408410.
  41. Post, pp. 410411.
  42. Post, p. 411.
  43. Post, p. 392.
  44. With the additions indicated in the following footnotes, this statement is the same, mutatis mutandis, as the statements by the United States Delegation on Article 24, Paragraph 4 of the Draft Rumanian Treaty (Annex 1, p. 458), Article 22, Paragraph 4 of the Draft Bulgarian Treaty (Annex 9, p. 507), Article 23, Paragraph 4 of the Draft Hungarian Treaty (Annex 5, p. 557), and Article 24, Paragraph 4 of the Draft Finnish Treaty (Annex 2, p. 584).
  45. In the U.S. Delegation statement on Article 23, Paragraph 4 of the Draft Treaty for Hungary, this paragraph read as follows:

    “The U.S. Delegation felt that the total burden imposed upon Hungary by the Treaty was so great that it was unable to abstain on the issue of 75% compensation and was compelled to vote against it.”

  46. In the U.S. Delegation statement on the equivalent provisions of the Draft Treaties for Rumania, Bulgaria, and Finland, this paragraph was followed by a new paragraph reading as follows:

    “The U.S. Delegation opposes the amendment to subparagraph (d) of the U.S. draft, submitted by the Soviet Delegation, dealing with compensation to United Nations nationals who hold interests in property through corporations. It feels that such interests should be dealt with as provided in subparagraph (b) of the U.S. draft.”

  47. In the U.S. Delegation statement on equivalent provisions in the Draft Treaties for Rumania, Bulgaria, Hungary, and Finland, this paragraph was followed by a new paragraph reading, mutatis mutandis, as follows:

    “Subparagraph (d) stipulates that Rumania shall accord fair and equitable treatment to United Nations nationals with respect to the allocation of materials and of foreign exchange. The purpose of this provision is to insure that United Nations national receiving compensation in lei will in fact be able to use the compensation proceeds for rehabilitation of their properties to the extent that the availability to Rumania of materials and foreign exchange permits and that in the allocation of materials and foreign exchange there shall be no discrimination against United Nations nationals as compared with Rumanian nationals. The U.S. Delegation strongly supports this provision believing that an explicit obligation to afford fair and equitable treatment to United Nations nationals is necessary to insure that such nationals are able to reconstruct their properties to the extent that the situation of the Rumanian economy permits.”

  48. In the U.S. Delegation statements on the equivalent provisions in the Draft Treaties for Rumania, Bulgaria, Hungary, and Finland, the reference here was to sub-paragraph (e).
  49. Ante, p. 163.