“Reference is made to discussions at the conference in Moscow on
October 23, 1943,2 and in
Teheran in November 1943,3 and to subsequent
arrangements between our two governments, according to which the
Government of the United States transferred to the Government of the
USSR the United States merchant vessels the John
Langdon and the Charles Gordon
Curtis, renamed by your Government the Tbilisi and the Sergei Kirov. This
transfer, it will be recalled, was accomplished in lieu of transfer
of an equivalent tonnage of the [Page 1307] Italian merchant fleet, which was then
operating as part of the Allied shipping pool, for the purpose of
prosecuting the war against Germany to the best advantage.
“In view of the fact that the purpose for which these two vessels
were loaned to the Soviet Union has long since ended, it is
requested that the Soviet Government return to the United States at
the earliest practicable date and not later than October 1, 1950,
the United States merchant vessels the John
Langdon and the Charles Gordon
Curtis to one of the major ports in the continental United
States.
“Your prompt advice as to the dates and ports of return of these
vessels is requested.”4
[Attachment]
Background Statement on Loan of Two United States
Merchant Vessels to the USSR During the War in Lieu of Transfer
of Equivalent Tonnage of the Italian Merchant Fleet
confidential
At the Moscow Conference on October 23, 1943, the USSR requested a
share in the surrendered Italian naval and merchant fleets. One
month later, at Teheran, it was agreed that a total of 40, 000 tons
of Italian merchant shipping should be allocated to the USSR for use
during the war with the question of official title to be discussed
at the end of hostilities. Subsequent to this agreement, the U.S.
and U.K. decided that the transfer of Italian ships, then operating
under U.S.–U.K. command in the allied shipping pool, under the
Cunningham–DeCourten Agreement of September 23, 1943,5 would be harmful to the morale of Italian forces
then fighting with the allies and an agreement was reached with the
USSR to substitute temporarily equivalent amounts of British and
American merchant tonnage.
Acting under orders from President Roosevelt, Admiral Leahy on
February 10, 1944, transmitted to the War Shipping Administration a
directive for the transfer to the USSR as the U.S. share, 20,000
tons [Page 1308] of merchant
shipping for temporary use until such time as an equivalent amount
of Italian merchant shipping could be made available. In April,
1944, the U.S. transferred the SS John
Langdon and the SS Charles Gordon
Curtis at Murmansk. The British also transferred 20,000
tons of merchant shipping in keeping with the agreement. While
procurement of the two American vessels was authorized from
lend-lease funds the Soviets refused to accept the vessels under the
Master Lend-Lease Agreement and the transfer was effected by simple
receipt. The British have reported that they made delivery of their
two vessels also on the basis of a simple receipt. The Soviet
Government has never accepted the U.S. position that the vessels
came under the Master Lend-Lease Agreement and at a meeting with
Soviet representatives in connection with over-all lend-lease
settlement discussions in June 1947,6 the U.S.
acknowledged the validity of the Soviet position that the question
of return of these vessels was outside the scope of lend-lease
settlement negotiations and should be treated as a separate
matter.
At the Paris meeting of the Council of Foreign Ministers in May–July,
1946,7 the
proposed terms of the Italian Peace Treaty and the subject of
Italian merchant vessels as reparations to the Soviet Union were
discussed, among other matters. The Soviet Union at the outset
requested a total amount of $100 million as reparations from Italy,
including reparations from future current production. While there
was a tacit assumption on the part of the delegations that the sum
of $100 million would be finally agreed upon (and in fact was, on
July 4, 19468), there was
disagreement as to the composition of the reparations to make up the
agreed total. The U.S. representatives proposed that the two Italian
merchant vessels the Saturnia and the Vulcania9 be included as reparations, among other Italian
assets, the principal source of which was Italian assets in the
Balkans, but the U.S. was notdisposed as a matter of principle to
include current production. Any deficit, the U.S. felt, should be
made up from Italian vessels held by the U.S. and the U.K. and not
from current production. The Saturnia and the
Vulcania, having a gross tonnage of
24,500 each, at the time were being operated by the U.S. The Soviet
Union rejected the two vessels and it was agreed by the Foreign
Ministers that reparations, should come from Italian assets in the
Balkans and that any deficit should come from future current
production including newly constructed merchant shipping.
[Page 1309]
It should be noted that the proposal to include the Saturnia and the Vulcania as
reparations was made merely as a result of a search for all possible
potential sources of reparations. On the whole, the desire was to
restore to Italian control as much of the Italian merchant fleet as
feasible so as not to hamper unduly the Italian effort at economic
reconstruction. At the London meeting of the Deputies earlier in the
year the subject of the United States merchant vessels had come to
the attention of the American delegation when the Navy asked them to
consider the request for the return of the cruiser Milwaukee, which had also been loaned to the USSR as a
result of the same decision at Teheran according to which the two
merchant vessels were loaned to the Soviet Union. Upon learning of
the fact that the John Langdon and the Charles Gordon Curtis were, also still in
Soviet hands, the American delegation briefly considered whether any
action should be taken respecting these two vessels. The American
delegation felt that the question of the disposition of the Italian
merchant fleet should be treated as a separate matter from the
question of the merchant vessels that had been loaned to the Soviet
Union during the war. It was then decided to ask for the return of
the Milwaukee10 (which
was, in fact, returned in early 1949) but to defer action respecting
the two merchant vessels although the suggestion was put forward by
people in the Department that they might be left in Soviet hands. In
any event, the disposition of the Italian merchant fleet was finally
settled without an active decision on the part of the United States
Government respecting the disposition of the merchant vessels the
John Langdon and Charles Gordon Curtis. The British Government, however,
obviously tied these two matters together and later in July 1946
reiterated a previous request for the return of its two merchant
vessels, which in fact were returned in September and October 1946
in conjunction with the transfer by the British to the USSR of
several vessels seized from the Germans. The British, in requesting
the return of the vessels, stated to the Soviet Government that the
vessels were lent for the purpose of prosecuting the war and on the
assumption that an allocation of merchant shipping would eventually
be made to the Soviet Union from Italy, and that since the war was
at an end and, moreover, the Soviet Government had relinquished
their claim to any Italian merchant shipping at the Council of
Foreign Ministers meeting, the vessels should be returned.
While the rejection by the Soviet Union of the two vessels the Saturnia and the Vulcania at the Council meeting may be interpreted as a
broader renunciation of a claim to a share of then existing merchant
shipping, there is also contained, in Article 80 of the Italian [Page 1310] Peace Treaty11 (signed on February 10, 1947,
entered into force on September 15, 1947), a statement that Articles
74 (reparations) and 70 (seizure of Italian property in Allied
territory to satisfy claims) cover all Allied claims arising from
the war attributable to Italy, with the exception of claims based on
Articles 75 (restitution of articles removed from Allied territory)
and 78 (restoration of United Nations property in Italy).
The question of the ultimate disposition of these two merchant
vessels was again given brief consideration at the time of the
lend-lease discusions with the USSR in mid-1947, when it was
determined that the subject of the two ships transferred in 1944
should be excluded from the lend-lease discussions and treated as a
separate matter. But whether to inform the Soviet Government that it
could acquire the vessels under appropriate U.S. legislation or to
request their return was never definitely determined.
In the above connection, it is to be noted that the second report of
the Tripartite Merchant Marine Commission, completed two years
ago,12 recommended that certain additional
German vessels be allocated to the USSR (other vessels being
recommended for allocation to the U.S. and the U.K. and that others
be retained in Germany). The Soviet Government has approved this
report; the British and the U.S. Governments have not, preferring to
retain in German hands or in their own hands some of those vessels
which would be transferred to the USSR should the report be
approved. The Soviet Government has several times inquired
concerning our approval of the Second Report and no reply has been
made other than that it is still under consideration. The latest
inquiry, dated May 26, 1950, is being answered by the statement that
the U.S. has not at this time approved the report. Recently,
however, part of the U.S. and U.K. shares under the TMMC report have been turned over to
IARA for allocation. The Soviet
undistributed share is mostly being retained for use in Germany
although several vessels remain in Norwegian and British
custody.
It is believed that the U.S. Government should immediately request
the Soviet Government to return the two merchant vessels immediately
to ports in the continental U.S. In view of the U.S.–U.K. action in
not approving the Second TMMC
Report, however, the Soviet Government [Page 1311] may withhold return of these vessels until
such time as they have received their share of German vessels
recommended for allocation under this report.
Even though the Soviet Government may link the question of the German
vessels to the return of the John Langdon and
the Charles Gordon Curtis, it is not felt
that this possible development should interfere with a U.S. request
for the return of the vessels.
There is also the possibility that the Soviet Union may raise the
point that the vessels should be retained as substitutes for Italian
vessels which should be considered theirs as prizes of war. This
issue, if raised, might involve the U.S. in lengthy legal arguments
but in general could probably be answered by the fact that the
Soviet Union neither seized nor held physical possession of the
Italian vessels.
In view of the fact that arrangements for the transfer of the vessels
were originally concluded in Moscow and to separate the matter of
their return from the question of the return of the German vessels
to the USSR and from other matters being handled in Washington, it
is felt advisable that the request for return be made by Ambassador
Kirk in Moscow.
