611.9331/3–846: Telegram
The Secretary of State to the Embassy in China
433. Dept appreciates Embassy’s and Shanghai Consulate’s prompt reporting on exchange and import export regulations (Urtels 377, Feb. 27 and 413, Mar 2, also Shanghai’s 328, Feb 28) and awaits with interest transmission detailed lists reported under preparation by Chinese Govt.
Dept notes that date of application of 30 day notice provision awaits clarification (Urtel 413, 4th paragraph). Dept feels Embassy justified in representing to appropriate Chinese authorities that 30-day exemption period should date from day on which lists published and not from date on which temporary regulations were promulgated, that is Feb 26, 1946. This would be in line with generally accepted practices and consistent with Art. 17, paragraph 2 of draft commercial treaty.94
Dept likewise feels that in interests of providing prompt, complete and effective service to US firms doing business with China, Embassy and Consulate Shanghai should reach agreement as to responsibility for close followup and reporting, bearing in mind that whereas general regulations may emanate from Govt agencies in national capital, administrative rulings will evolve principally out of day to day trading experience in major posts such as Shanghai.
[Page 962]In connection with publication of detailed lists of restricted or prohibited imports Dept feels Embassy and Consulates should be on alert to detect discriminations against American trade as a whole or categories thereof. As an example it has been reported to Dept that “publication detailed control regulations shows impossible import motor cars with wholesale FOB factory cost over $1200.” If carried through this would undoubtedly be considered unduly restrictive by US automotive interests and Dept would no doubt be requested to make representations on their behalf. Dept is also interested in whether program may be used to minimize private trading possibilities in favor of Government trading.
Dept is anxious, looking toward the objectives of the forthcoming International Trade Conference of which China is to be a participant, that all Govts resist to the utmost during the period prior to the Conference the imposition of trade restrictive or discriminative measures. While some interim trade controls may be justified in China pursuant to financial or rehabilitation objectives Dept hopes every effort will be made to keep them nondiscriminatory and, in broad sense, selective rather than restrictive. Unless you perceive objection, you should inform the appropriate Chinese officials of Dept’s views in the foregoing sense and, in addition, express Dept’s hope that Chinese Govt will consider and treat regulations as temporary in nature. Please keep Dept fully informed of Chinese reactions.
This telegram repeated to Shanghai.