740.00119 Council/3–2747: Telegram
The Secretary of State to the Acting Secretary of State
urgent
1056. Delsec 1358. For the President, Vandenberg, Connally and Acheson from Marshall. 15th CFM meeting, March 27, Bidault presiding, opened with a discussion of whether the Council should invite representatives of the Yugoslav Government to Moscow to present views on the report of the Quadripartite Commission on the financial situation of the free territory of Trieste.85
[Page 294]Molotov and Bidault wanted to invite the Yugoslavs, but Bevin saw no reason for the Council to hear the Yugoslavs, since their views had already been heard by the Commission. Marshall agreed and added that his most serious concern is that the Council is making very little progress on questions which are of interest to the entire world. He pointed out that if the Council spends its time on minor problems that are not of first importance, the prospect of progress on the problems which the Council met to discuss would be diminished. He again urged the Council to pass on to the important problems.86
The Ministers agreed to invite the Yugoslav and Italian Governments to submit to the Council in writing, any observations they wished to make on the Trieste Commission’s report.
The Council then took up the question of German assets in Austria. Marshall stated that US disagreed with the Soviet position that the title to these assets has passed to the Soviets, but that in order to open the way for further discussion by the Deputies for Austria of the entire assets question, he repeated his suggestion that the disagreement over title be by-passed. (1) He asked that agreement be reached on a definition of just what assets in Eastern Austria the Soviet Union thinks it should have title to as a result of the Potsdam decision. He said that none of the Allies intended at Potsdam to transfer title to German assets which were taken from the victims of Nazi aggression and which justice and equity demand be returned to them. (2) He suggested that the Deputies be instructed to provide in the Austrian Treaty for arbitration of disputes over German assets in Austria. (3) He said Austrian law should apply to all properties in Austria which are transferred to the USSR.87
Bevin agreed with Marshall’s three points, but asked the Council to instruct the Deputies to discuss the German assets question on the basis of a draft UK directive.88 He said he had no desire to repudiate the Potsdam Decisions, but did think it necessary to decide what was meant by those decisions. He added that when Stalin said at Potsdam that reparations would not be taken from Austria, he interpreted this as a generous gesture toward a country which had to be reestablished. If the present Soviet position is accepted, he continued, this action would be undone.
[Page 295]Molotov disagreed with all three points. He said no new definition of German assets in Austria is necessary and objected to the establishment of any arbitration machinery. He denied the USSR is claiming extra-territorial rights for properties taken over in Austria.89
Bidault agreed with Marshall’s points and proposed that the Deputies for Austria be instructed: (1) to prepare a draft article recognizing in the treaty the disposal of German assets in Austria under the conditions provided for by the Potsdam Agreement; (2) to prepare a definition of German assets in Austria, excluding such property as was seized by the Germans by force or duress or was in any way unduly taken either from the United Nations or from the Austrians for political, racial or religious reasons; and (3) to prepare an arbitration clause on the basis of Article 50 of the Austrian Draft Treaty.90
Marshall accepted this proposal, Molotov suggested major changes in it, and Bevin asked the Council to adjourn and continue the discussion tomorrow. The Council agreed it will also discuss tomorrow the report of the special committee which is coordinating all proposals submitted during the Council’s discussion of the Allied Control Council’s report.
Repeated to London 110, Berlin 176.
Dept please pass to Vienna as 17, to Rome as 15, and to Paris as 87.
- Under reference here is the Report of the Trieste Commission of Inquiry, document CFM (47) (M) 2, March 10, 1947, not printed; see footnote 28, p. 163. The Yugoslav Government’s request for a Council hearing on the Report was circulated to the Council as document CFM (47(M) 59, March 24, 1947, not printed.↩
- For the text of Secretary Marshall’s statement summarized here, see Department of State Bulletin, April 6, 1947, p. 609.↩
- For the text of Secretary Marshall’s statement summarized here, see Department of State Bulletin, April 13, 1947, pp. 653–654. Secretary Marshall’s proposals were previously circulated to the Council in document CFM (47) (M) 76, March 20, 1947, not printed.↩
- The Draft Instructions to the Deputies for Austria proposed by the United Kingdom Delegation were circulated to the Council as document CFM (47) (M) 79, March 27, 1947, not printed.↩
- Foreign Minister Molotov’s statement summarized here is presented in detail in Molotov, Speeches and Statements at Moscow, pp. 47–49. The views of the Soviet Delegation on the German assets issue were set forth in document CFM (47) (M) 78, March 24, 1947, not printed.↩
- The proposals of the French Delegation described here were circulated to the Council as document CFM (47) (M) 75, March 27, 1947, not printed.↩