396.1–ISG/12–150: Telegram

The Secretary of State to the United States Delegation at the Intergovernmental Study Group on Germany, at London 1

top secret

Tosig 304. Pass to Spofford.

Urgency of solution to jurisdictional problem raised in Sigto 321 may have been overtaken by events reported Sigto 3282 Wld apprec ur and Spofford’s comments on fol.
We found Sigto 321 very helpful in drawing line of distinction between NATO and ISG re Ger Arms production. We agree discussion this subj shld continue in NATO within context MC 303 and shld not be transferred to ISG at present (re Brit statement para 7 Sigto 321).
We believe essential maintain distinction between role NATO and three occ powers. NATO is concerned with formulating conditions under which Germany will be offered opportunity to participate in common defense. This decision is not self-executing. It remains for the three occ powers to act upon this proposal and also upon Germans to take necessary action. We assume NATO decision therefore will be on a contingent basis and will depend upon further action by three occ powers and Germany before practical results are achieved. As matter of fact, we anticipate that there may be inevitable time lag between NATO decisions and further development since three occupying powers will have to work out strategy for inviting Germany to participate in common defense. In the meantime however it seems to us that the principles which NATO will formulate shld be elaborated by the three Govts in detail so that they can be put into effect whenever the other problems have been resolved.
We are not clear on procedure you propose. Pls explain statement para 6 Sigto 321 that PLI Agmt is to be eliminated by ISG. In our view, PLI Agmt is instrument for specifying controls over Ger industry for security reasons, whatever scope of these controls may be. We believe PLI Agmt or similar Agmt as amended from time to time shld continue as long as any controls are maintained by occ powers.
Any statement indicating that NATO will decide what arms Ger will be allowed to produce shld be avoided. This decision must be made by three occ powers and expressed through amendment PLI Agmt. Decisions by NATO in this field are only recommendatory. Since three occ powers are members NATO, there is no doubt as practical matter that NATO decisions will be put into effect. Believe distinction is important, [Page 796] since converse is also valid that three occ powers can act in absence NATO decision.
Since NATO has in fact been discussing question what arms Ger will be allowed produce as part of larger problem Ger participation Western defense, believe NATO is proper forum pursue discussion until problem Ger participation disposed of. NATO recommendation on what arms Ger will be allowed produce then be referred to three occ powers for decision.
We wld appreciate further explanation suggestion para 5 that NATO agree gen principles and that three govts then assign task to HICOM of working out details. This appears to look toward slower timetable than we had hoped might be possible. We note also your belief para 8 that Brit and Fr have not thought out their position yet. It might be desirable to have details worked out within specified brief period of time at governmental level, perhaps by ad hoc comite of military experts. Final recommendations wld then be written into governmental agreement and HICOM law.
We do not see basis for direct relationship between NATO and HICOM, such as you refer to in last sentence para 5 Sigto 321, except thru national elements, at least for time being.
As stated Tosig 2704 we approve proposal para 2 Sigto 321 modify PLI Agmt including annex in order to eliminate unnecessary restrictions relating to items used by military estabs.
We agree with step proposed in para 3 Sigto 321 of authorizing HICOM to license any article on Sched A. This means that HICOM wld act according to instrs issued from time to time by three govts. This wld be useful procedural device if at later time method can be found of relating HICOM licensing to decisions of NATO as to requirements. We had however assumed from earlier messages such as Sigto 2194 that Fr and Brit wld want duration so-called long term controls to be defined more precisely than you now suggest in paras 2 and 6 Sigto 321.
We assume that final product ISG will result in revised PLI Agmt which will embody principles as to Ger arms production formulated by NATO, and will also dispose of question of duration, review and amendment. This wld of course also dispose of secret minutes.

  1. Repeated to Frankfort as 4138, to Paris as 3141.
  2. Not printed, but see footnote 5 supra.
  3. Regarding MC 30, see Depto 228, November 27, vol. iii, p. 488.
  4. Not printed.
  5. Not printed.