740.00119 PW/11–1247: Circular
telegram
The Secretary of State to
Certain Diplomatic and Consular Officers
46
secret
Washington, November
12, 1947—3 a.m.
For your secret info only, following
proposed policy statement has been sent by Dept to Amer Representative
on Far Eastern Commission for submission to that body for adoption:
- “1. Assets in the neutral countries (Afghanistan, Eire,
Portugal, Spain, Sweden and Switzerland including for
present purposes Liechtenstein) should be marshaled by the
Japanese Gov pursuant to appropriate SCAP directives. Compensation
of Japanese nationals should be afforded by credits against
taxes owing the Japanese Gov.
- 2. SCAP should request
the governments of the Four Powers (China, the UK, the USSR,
and the US, or such of them as maintain diplomatic relations
with the respective neutral countries) to consult on Japan’s
behalf with the neutral countries and to conclude on behalf
of Japan arrangements pertaining to the assets. Such
arrangements should include provision for the liquidation of
the assets. In the process
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of such liquidation secured claims
against a specific asset and unsecured claims (including
those of the governments of the neutral countries) having a
direct relationship to a specific asset should be satisfied
in accordance with the law of the neutral country (except
that the Four Powers should attempt to preclude the
assertion of unsecured claims by any government other than
that of the neutral country on its own behalf, even though
such claims have a direct relationship to a specific asset).
No other claims should be satisfied out of such assets.
Where appropriate, settlement of valid claims may be
effected by the transfer to the neutrals of such assets in
Japan as may be designated for reparation delivery and are
not accepted by the countries entitled to
reparations.
- 3. In the course of such consultations due regard should
be had to any agreements, undertakings, or understandings
already existing between any of the Four Powers and any of
the neutrals relevant to such assets.
- 4. The local currency and credit accruing from the
liquidation should remain in the respective neutrals and be
used in such manner us SCAP
deems necessary. The initial value of the proceeds should be
used for payment for accrued and current costs of disease
and unrest imports in Japan.”
It will be further proposed that the Four Powers may refrain or desist
from acting in regard to assets in any of neutral countries where value
of the assets considered in conjunction with the claims likely to be
held valid does not warrant action.
