Office of the Historian

862.60/4–946: Telegram

The Secretary of State to the Ambassador in the United Kingdom (Harriman)

confidential
Washington, April 9, 1946—7 p.m.

3071. Dept requests following memo re deconcentration of German industry79 be formally presented to FonOff.

  • “1. In Potsdam Protocol, Aug 1945 (para 12, Art 3)80 signatory powers agreed ‘At the earliest practicable date the German economy shall be decentralized for the purpose of eliminating the present excessive concentration of economic power as exemplified in particular by cartels, syndicates, trusts and other monopolistic arrangements.’
  • 2. In discussions within Coordinating Committee, ACC of terms of law to implement above provision difference became apparent between Brit view and position advanced by US and supported in substance by other members of Council.
  • 3. US proposed certain objective standards as basis for defining excessive concentration economic power and called for mandatory application such standards to particular German enterprises.
  • 4. While minor differences arose among representatives of four powers as to precise standards to be applied, there was agreement among US, French, and USSR members on principle of mandatory application such standards as might finally be agreed upon.
  • 5. UK representative objected in principle to mandatory application of any standards and proposed that application of whatever criteria were agreed upon should be left to discretion of those responsible for administering the law.
  • 6. Since no agreement could be reached in Berlin on this point, American representative informally requested discussions be undertaken on Govt level between UK and US.
  • 7. Accordingly, preliminary discussions on technical level were begun Washington, Dec 1945 between officers of Dept and Brit Emb. Discussions progressed to point where it was believed basis had been established for agreed position.
  • 8. Terms of proposal contemplated mandatory application some objective standard or standards except where, in discretion administrators of law, considerations of technological efficiency advised against deconcentration.
  • 9. In view of fact that basis for agreement now exists, and in view of fact that approximately four months have elapsed since matter was introduced in ACC final resolution of issue would appear in order.
  • 10. Govt of US regards deconcentration of economic power as basic to reorganization of Germany along democratic lines and feels that positive and concerted measures to accomplish this end should not be delayed.”
Byrnes
  1. For previous documentation on this subject, see Foreign Relations, 1945, vol. iii, pp. 1559 ff.↩
  2. Reference is to the Communiqué of the Potsdam Conference, Foreign Relations, The Conference of Berlin (The Potsdam Conference), 1945, vol. ii, pp. 1499, 1504.↩