400.62A9/8–3150
The Department of State to the British Embassy 1
Aide-Mémoire
The United States Government is addressing itself to the British Government because it is disturbed over the reported laxity in the administration of West German 1–B export controls since the responsibility for administering these controls was turned over to the Federal Republic in May. Discussions on this subject within this High Commission have not resulted in full tripartite agreement on remedial action.
The basic instruction from the High Commission to the German Federal Republic on export controls (HICOM P (49)74)2 provided for a complete embargo on the shipment of 1–A and AEC items to certain destinations. With regard to 1–B exports, the instruction reads as follows:
“… The Allied High Commission now requires that the attached lists be taken into immediate use by the Federal Government and that controls be applied for the time being in accordance with the following guiding principles:3
. . . . . . . . . . . . . .
“(11) Commodities included in List 2 (1–B)
[Page 183]The export of any of these commodities to:
- (a)
- Austria, Albania, Bulgaria, China, Czechoslovakia, Finland, Hungary, North Korea, Poland, Rumania, Switzerland, the U.S.S.S.R., Yugoslavia and the Soviet occupied area of Germany may be authorized by the Federal Government at its discretion in cases where the quantity of the proposed commodity is not substantial. In cases where the quantity proposed is substantial the application for export should be referred for prior approval to the Allied agency to be designated by the Allied High Commission. Whether or not a proposed export covers a substantial quantity of the commodity involved is for the Federal Government to determine, but the Allied High Commission is prepared to offer advice to the Federal Government in cases of doubt.
- (b)
- Any country or area not included in (a) above may be authorized by the Federal Government at its discretion.”
In so far as 1–B commodities are concerned this instruction, in general, required the German Federal Republic to apply export controls to such commodities and to submit to the High Commission applications for export in cases involving substantial quantities of these commodities.
An examination of the statistics prepared by the German central licensing agency covering the first several weeks of its operation clearly indicates that this instruction has not been followed. During 1949, according to additional statistics prepared by the German Ministry for Economics, shipments of 1–B commodities to the Soviet area, excluding Finland, Yugoslavia and the Soviet Zone of Germany, totalled only about $7,000,000. In contrast, during the first 20 days following the assumption of responsibility for export controls by the Federal Republic on May 10, 1950, 1–B export applications for the same area were approved at an annual rate of almost $70,000,000 even though during this same period more than 30 per cent of applications were returned for resubmission due to improper preparation. If the majority of these defective applications are resubmitted in proper form another $20 million more or less may therefore eventually be added to this already excessive total.
The United States Government feels that the German Government has violated both the letter and spirit of the High Commission instructions to it. It has not referred to the High Commission more than a negligible number of 1–B applications. At the same time, it is approving such applications at a disturbing rate, far exceeding any previous Allied approval rate for the same commodities.
In view of this action on the part of the German Government, and in view of British participation in the issuance of the above-mentioned instructions to the German Government, it is thought probable that agreement can be reached by the Occupying Powers to instruct the [Page 184] German Government to process 1–B applications, for the time being, in accordance with the following principles:
- (1)
- A limitation of the average monthly total of approved applications for the shipment of 1–B commodities to the Soviet-controlled area (excluding the Soviet-occupied area of Germany) to $700,000 (equivalent to 1949 1–B shipments plus an added 20 per cent for unconsummated approvals), and reference to the High Commission of application in excess of that quantity;
- (2)
- A limitation of the average monthly total of approved applications for the shipment of 1–B commodities to the Soviet-occupied area of Germany to 24 per cent of average total monthly shipments to the Soviet-occupied area of Germany during the period January–June 1950 (this figure is roughly equivalent to the percentage of 1–B commodities included in total exports to Eastern Europe in 1949); and
- (3)
- A careful review by the High Commission of the monthly statistics prepared by the German central agency, in order to insure that monthly 1–B approvals are not concentrated too heavily in particular items on the 1–B list. The High Commission might use as a guide in this review the percentage of shipments of the particular items in 1949.
If the British Government is in agreement that the German Government has not followed the instructions of the High Commission, and that the above procedure constitutes an appropriate course of remedial action, the United States Government will request its representatives in the High Commission to seek agreement with their British and French colleagues as to the method of implementing the above procedures.
A similar conversation is to be held with the French Embassy on this subject.
- A similar aide-mémoire was presented to the French Embassy on September 1.↩
- The reference here is to the High Commission’s letter of November 25, 1949, delivered to the German Federal Government on November 28; see letter from Adenauer to McCloy, February 2, p. 73.↩
- Omission indicated in the source text↩