611.84A94/2–850

The Ambassador in Israel ( McDonald ) to the Secretary of State

confidential
No. 78

Subject: Proposal to Negotiate Air Transport Agreement with the Israel Government.

Sir: The Commercial Attaché, upon several occasions extending from August 1949 to date, has discussed informally the points of difference that may occur between the United States and Israel in negotiating a bilateral air agreement. The Department and the CAB is acquainted with the Embassy’s note to the Israel Government, No. 17, August 9, 1949,1 for formalizing the presentation of a draft agreement. A tentative date was set for a formal discussion on the subject during November, 1949, but the Department found it expedient to recommend that the Embassy not press the negotiations with Israel while an air agreement was being negotiated with Iraq.2

In the meantime and with reference to the Department’s telegram No. 42, January 27, 1950,3 attorneys for the El Al Aviation Company have called on the Department and CAB to inquire regarding the status of an El Al application for a Foreign Air Carrier Permit. Officials of El Al have seen fit not to mention this application to the Embassy, and the Embassy, concurring with the Department, has not made any inquiry on the subject. As the Department points out in the above-mentioned telegram, the Israel Government has seen fit, driven by problems of currency stringency, to follow a definite restrictionist line—in this case appplied to transport by land, sea and air—and it is further reflected throughout its present politico-economic policies. Nevertheless it is becoming more evident that in matters aviation, the officials of El Al are evidencing a disposition to court and even favor American transportation (air and sea) over that of other nations. This occurs to the Embassy as a somewhat dangerous line for them to take and the Commercial Attaché has been quite reluctant to express in his informal contacts with the local officials either approval or disapproval. An example of special consideration is the recent authority [Page 1088] given TWA to put a third weekly flight into this country while denying the same privilege to France, Italy and Holland (Embtel 81, February 6, 1950).4 The Department has on several occasions suggested that a proposal be put to the competent Israeli authorities to set forth points in the draft agreement delivered to the Israel Government on August 9 by Note No. 17 upon which discussion may well develop in a formal negotiation. For some reasons best known to the Israeli authorities, this has only now been done and the Embassy attaches herewith an exact copy of an informal note5 received today from Mr. L. A. Pincus, Legal Advisor and Managing Director, Ministry of Transport and Communications, who sets forth in paragraphs 1–5 certain principles of the Bermuda type agreement6 on which he seeks advice.

[Here follow the remaining three paragraphs of the despatch, chiefly in the nature of an analysis of the operations of El Al and of its management.]

For the Ambassador:
Malcolm P. Hooper

A/Counselor and Commercial Attaché
  1. Not printed; it formally submitted the U.S. draft civil air transport agreement for consideration by the Israeli Government. Embassy Tel Aviv transmitted a copy of the note to the Department of State in despatch 202, August 11 (711.67N27/8–1149).
  2. These negotiations did not eventuate in a treaty with Iraq.
  3. Not printed.
  4. Not printed.
  5. Dated February 5, not printed.
  6. For documentation on the Bermuda Conference, see Foreign Relations, 1946, vol. i, pp. 1450 ff.