Foreign Relations of the United States, 1946, The British Commonwealth, Western and Central Europe, Volume V

862.50/4–2546: Telegram

The United States Political Adviser for Germany (Murphy) to the Secretary of State

secret

Berlin, [April 22, 1946—9 p.m.]⁹⁰
[Received April 25—11:55 p.m.]

1080. For Terrill.⁹¹ 1. Coleman⁹² reports that last quadripartite meeting on deconcentration law held subsequent to receipt of new State Department instructions⁸⁹ sent through AGWar to OMGUS resulted in failure; that British refused to recede from their original position to the effect that a definition of “excess concentration of economic power could not be formulated”. Coleman has contacted the British on two occasions since the quadripartite meeting and is of the opinion that the British in Berlin have had the Washington proposal on the deconcentration law referred to them from London, and have refused to go along with it.

Coleman further reports that during his conversation with the British, and making it absolutely clear to them that it was not an official position, asked for the British reaction to the following proposal: “Every enterprise which employs in excess of 20,000 persons shall be deemed to be an excess of concentration of economic power and shall take such action as shall be prescribed by the Economic Directorate or by any other agency authorized by the Control Council to take action in such cases.” Added to this he suggested that a list of 35 companies be compiled against which immediate action would be taken. He states that he pointed out to them that the 20,000 figure was a measure for the future, in as much as only a very few enterprises in Germany now employ that many, the 35 companies possible being a sufficient number of reorganizations for present purposes. Coleman reports that the British officials with whom he was conferring became very interested in this proposal and stated they would try to persuade the British delegation to accept a proposition along these lines; that, however, on the following day he was informed by British with whom he had talked that no definition of “excess of concentration” could be accepted. Coleman carried on these talks with British as Acting Chief Decartelization Branch. He states that he also conferred for approximately two hours with General Draper⁹³ on the Deconcentration Law, during which time General Draper talked at considerable length over the phone with Sir Percy Mills⁹⁴ in an endeavor to find a solution the problem but without success. Coleman is convinced that there is primarily only one man in the British delegation who is blocking the law and that is Sir Percy Mills. As April Chairman of the working party on Deconcentration Law Coleman will have to report disagreement on the law to the Economic Directorate during the week of April 22.⁹⁵

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Murphy

90. Date of transmission supplied from copy in the files of the U.S. Political Adviser.
91. Robert P. Terrill, Associate Chief of the International Resources Division.
92. Creighton R. Coleman, Acting Chief of the Decartelization Branch, Economic Division, OMGUS.
89. Not printed.
93. Brig. Gen. William H. Draper, Jr., Chief, Economic Division, OMGUS.
94. Head of the Economic Division, British Element, Allied Control Council for Germany.
95. Subsequently, telegram 4816, May 6, 6 p.m., from London, reported on a note from the Foreign Office, dated May 4, stating that the British Government expressed disappointment at the failure of the Economic Directorate on April 25 to agree to a compromise proposal by the British representative based largely on the Washington understanding, and indicating that the British Government was prepared to accept a law based on that understanding (862.50/5–646).