Foreign Relations of the United States, 1951, National Security Affairs; Foreign Economic Policy, Volume I

394.31/3–1351: Telegram

The Acting Chairman of the United States Delegation to the Torquay Conference (Corse) to the Secretary of State

confidential

Torquay, March 13, 1951—6 p. m.

537. For Leddy¹ and Catudal.²

1. In discussions WP Article XIX re whether US action “withdrawal without specified time limit as to its duration” fulfills requirements last part paragraph 1 (a) Article XIX and re whether US would re-establish concession, Cassiers (Belgium) prompted by Royer (Secretariat), Burgess (UK), Lecuyer (France) argued (a) phrase “to extent and for such time as may be necessary to prevent or remedy such injury” conditioned the permission “to withdraw or modify the concession” (b) concessions could only be permanently withdrawn or modified pursuant Article XXVIII or unanimous protocol (comparable problem Article XXVII not discussed) and (c) unless US proceed under XXVIII or unanimous protocol Article XIX contemplates re-establishment concession.³

2. Pending legal advice US indicated (a) such interpretation rendered words “to withdraw or modify the concession” meaningless, since all possible action would be covered by words “to suspend obligation in whole or in part” and (b) that in this case, in which agreement of France to the action involved US agreement to French Article XXVIII renegotiations, and agreement of Italy involved compensatory concessions, re-establishment of the hat body concession would cause complications. On latter point Lecuyer indicated possible negotiations would handle situation.

3. Unavailability of any Geneva or Havana Charter documents⁴ makes decision re interpretation difficult.

4. Our appraisal here is on one side words “such time as may be necessary” clearly modifies all that follows. On other side, arguable from Mexican escape clause⁵ that rights withdrawal and modification there and in GATT apply to concessions (only obligations covered in Mexican clause), whereas GATT reference obligations under general provisions gave rise new concept suspension such provisions as preferable to concept one CP unilaterally withdrawing or modifying them. Difficulty such argument is that (1) based only on US practice, not GATT or charter negotiation and (2) change in GATT of words “such time as may be necessary” to overriding position discussed above, compared position in Mexican clause where arguable they relate only to right to “modify” concession, leaving unqualified right withdrawal.

5. Please cable views soonest.

Corse

1. John M. Leddy, Deputy Director of the Office of International Trade Policy.
2. Honoré M. Catudal, Adviser on Commercial Treaties, Commercial Policy Staff.
3. For documentation regarding GATT procedures under Article XXVIII, see pp. 1245 ff.
4. The references are to the General Agreement on Tariffs and Trade concluded at Geneva, Switzerland, in October 1947 and the Charter for an International Trade Organization drafted at Havana, Cuba, in March 1948; for documentation on the latter subject, see Foreign Relations, 1948, vol. i, Part 2, pp. 802 ff.
5. For documentation on the termination of the United States-Mexican trade agreement, see vol. ii, pp. 1470 ff.