740.00119 Council/6–1349
Memorandum by the French Member at the Council of Foreign Ministers (Schuman)1
Over three years have passed since CFM first considered Austrian treaty. During these three years the Ministers have repeatedly discussed problem. Their deputies have held 163 meetings. Treaty Commission in Vienna held 85 meetings, to say nothing of innumerable [Page 1054] other meetings of technicians and experts. But pledge given at Moscow in 1:943 to restore to Austria its independence has not yet been honored.
Austria is liberated country. Occupation has been prolonged only because Allies have failed agree upon terms of treaty. It is extremely difficult justify continued military occupation four years after Allied troops liberated Austrian territory from Nazi domination. Austrian people and Austrian Government have repeatedly called upon us to fulfill our responsibilities and to complete task we assumed. Surely time is now long overdue for execution of these commitments. Deputies over past two years have clarified main points of disagreement on treaty. They can now make no further progress. By taking now certain necessary decisions Ministers can, however, enable work on treaty to be brought speedily to successful conclusion.
What are those decisions? Main obstacle to early conclusion of treaty lies in differences which separate Western Powers and Soviet Union in respect to frontiers of Austria, payment of reparations by that country, and settlement of German assets assigned to Soviet Union by Potsdam Agreement. If these three basic problems can be solved in relation to each other, it would be possible bring about prompt solution of remaining unagreed points in treaty: Ministers should, therefore, now reach agreement upon these three problems and instruct their deputies to complete drafting of treaty by September 1 at latest.
No solution for treaty can, however, be envisaged which does not provide that Austria’s frontiers shall be Restored as they existed in January 1, 1938. Further, in fulfillment of pledge given at Potsdam, it should be made clear in treaty that no reparations are to be exacted from Austria.
Whereas at Potsdam Soviet Union was assigned German assets in eastern Austria in partial settlement of its claims for reparation from Germany, it has not been possible to agree upon definitions of these assets or determination of properties involved. In 1947, however, compromise proposal was put forward by French representative and accepted as basis for settlement.2 It involves cession to Soviet Union of certain Danube shipping company properties and of certain rights in Austrian oil industry which had largely been created by Germans in addition to payment of lump sum by Austria in final settlement of outstanding claims to German, assets.
Soviet Union has insisted that $150 million represents minimum amount in return for which it would be prepared relinquish to Austrian enterprises now controlled or claimed by it other than specific oil rights and Danube shipping properties. Payment of this sum would [Page 1055] constitute heavy burden upon Austria’s economic resources, and it can be justified only if it means complete relinquishment to Austrian economy of all other German assets and war booty. If Soviet Union is prepared now to agree that in return for this payment, Austria will have no undefined obligations in regard to German assets settlement and that Austria’s authority over properties relinquished is definitely established, it may well be possible to meet Soviet insistence upon amount of lump sum payment.
Although this meeting of CFM has thus far failed to resolve basic difficulties preventing German settlement and German peace treaty, nevertheless affords another opportunity for us demonstrate to world that cooperation among Great Powers still possible and fruitful.
- A copy of this memorandum was handed to Vyshinsky at the 19th meeting of the Council, June 12; for the minutes of this session, see p. 985. The source text was transmitted in Delsec 1891, June 13, from Paris, not printed (740.00119 Council/6–1349).↩
- Schuman was referring to CFM(47) (L)8, November 27, 1947. For the text of this French proposal, see Foreign Relations, 1947, vol. ii, p. 799.↩