The Secretary of State to the Ambassador of the Soviet Union ( Panyushkin )

Excellency: I have the honor to refer to the lend-lease settlement negotiations now under way between our two Governments and to your note No. 36 of Februray 24, 1948 in which you informed me of the agreement of your Government to acquire the thirty-six war-built merchant vessels received under the Lend-Lease Act at prices stated by the United States on June 25, 1947, and to effect payment for these vessels in accordance with the conditions established by the Act of March 8, 1946.

The agreement of your Government concerning these vessels resolves tentatively one of the several points necessary to a satisfactory comprehensive settlement of the obligations under the agreement between our two Governments of June 11, 1942. The Government of the United States is hopeful that the other points enumerated in the “Outline of Main Points of Settlement Proposed by the U.S. Side” presented to Soviet representatives on June 25, 1947 may be resolved without further delay so that all matters pertaining to lend-lease may be embodied in a comprehensive settlement agreement at the earliest possible date.

In this connection your attention is invited to the fact that at the first meeting of the Working Groups on May 3, 1947, United States representatives stated that, since the object of the negotiations was to achieve a satisfactory comprehensive settlement, agreement reached [Page 976] on any particular subject was tentative and subject to agreement on a issues necessary to a general settlement. The Soviet representatives indicated their concurrence. Accordingly, the first paragraph of the “Outline of Main Points of Settlement Proposed by the U.S. Side” in keeping with the above-mentioned understanding reached by the representatives of our two Governments on May 3, 1947 reads in part as follows: “As both sides have understood from the outset, the reaching of agreement upon any one issue is tentative and subject to the conclusion of a satisfactory comprehensive settlement”.

In the intervening period, until agreement has been reached on all necessary points, technicians of the United States Government will prepare the details applicable to the transfer of title to these vessels as a part of the over-all settlement agreement.

Accept [etc.]

For the Secretary of State:
Willard L. Thorp