Foreign Relations of the United States, 1952–1954, Iran, 1951–1954, Volume X

888.2553/1–1453: Telegram

No. 282
The Ambassador in the United Kingdom (Gifford) to the Department of State¹

top secret
niact

London, January 14, 1953—3 a.m.

3844. From Byroade. This is cable 5.

Now that agreement reached on text there is no point recounting today’s discussions in detail. Probably because pressure of time and need for extensive clearances within Her Majesty’s Government we were presented with set of British drafts shortly before meeting that were different in numerous respects from documents we had been working on with British and from papers we had presented. As an example, British drafts had cards stacked in about five different ways so that ICJ judges acceptance of either Mosadeq’s alternatives on form of arbitration would have been virtually impossible. This reflected UK preference against either alternative and in favor tribunal chosen by ICJ vice-president. While thus tactically at disadvantage and presented with redrafting problem of considerable magnitude decided in view time urgency go ahead with Eden meeting on schedule.

Believe most of bugs removed in meeting and subsequent drafting session but realize resulting papers poorly drafted in several respects.

Secretary’s message was extremely effective.² British were horrified at prospect of letting negotiator (as they would equally be in case of their own negotiators) have second alternative to suggest at his discretion. Faced with this possibility they shifted key words in terms of reference. Had thought they would stick to “property, rights and interests” and, if so, we could insist everything else be our way. I think it fortunate this was not the case as would rather accept imperfections, which should be negotiable, than leave point in documents that could well have caused complete rejection by Mosadeq.

Feel most disadvantageous points remaining are as follows:

1. Failure obtain agreement that UK would sign documents on behalf of AIOC. Don’t believe British have real objection to this other than prestige considerations and a desire to get UK–Iran relations back on more normal footing. Eden said he would talk about it at Cabinet tomorrow but wished us try present language in any event. Henderson may be assured that change on this can be obtained here if this develops to be really necessary.

2. Exchange of letters including protection of tankers et cetera. Point on flow of oil without objection by UK could well have been included as phrase of arbitration agreement and points on tankers et cetera, included in commercial contract, if at all. Pointed out that this exchange invited Mosadeq opportunity make undesirable changes and provision on tankers would be insulting to him in context of other agreements. AIOC adamant such an exchange is necessary and their officials still arguing, but not supported by Foreign Office that such exchange must be ratified. Here again government would overrule AIOC if really necessary, but in view situation here hope Henderson can get letters approved as is.

There was considerable discussion on cover memo. British produced formal document to be signed by all three governments in terms quite impossible for us to agree to. They clearly want tripartite signature which we believe undesirable and which still may cause us trouble. As part of first package at least we insisted on simple memorandum identifying documents and stating intentions thereon. We thought this much desirable as agreement should not be in doubt when British proceed to Iran. If point arises Henderson may state that he will witness British agreement here to make certain both parties in agreement on same text.

Eden clearly unhappy that we insisted on 50 million advance and would not agree to installments every two months instead of monthly. He seems worried about advance that large as public relation problem here. Stated he would talk to Cabinet his problem but in meantime we had his agreement.

British did not want to use Mosadeq’s formula in paragraph 2 of DMPA agreement for definite quantity of purchase for definite number of years. Stated commercial agreement might not be in consonance with word “definite”. If introduction of word “substantial” causes difficulty with Mosadeq, Henderson can change it to “agreed” with approval of British. “Substantial” really better from our point of view.

British worried about any deviation from discount of 35 percent in interim price in DMPA contract. I assured them this would not be changed without consultation.

Stressed need today of British representative to be ready early departure Iran. Would hope could be someone from here such as Dixon who understands problem.

Last-minute complications can always arise and also matter of handling press, et cetera, could be very important.

We are committed here that Henderson will make statement contained last portion Tehran’s 2634 to Department repeated London 852 at time and in manner he suggested therein.³

In view time urgency have agreed to all documents here without reference Department with exception DMPA agreement. Would be difficult reopen points but will, of course, do so if Department so instructs.

British will translate documents here into French which British representative can carry Tehran in order relieve burden Tehran Embassy.

Good luck to Henderson!

Gifford

1. Sent to Tehran eyes only for Ambassador Henderson as telegram 150 and repeated to the Department eyes only for the Secretary.
2. Reference is to Document 276.
3. On Jan. 9 the Department, in paragraph 5 of telegram 4570 to London, suggested that Henderson present Mosadeq with a letter at the time an agreement was reached over the DMPA Heads of Agreement. (888.2553/1–953) Henderson, in telegram 2634, Jan. 10, objected to such a letter and instead proposed to tell Mosadeq orally that until he, Mosadeq, had begun conversations with the International Company to sell large quantities of Iranian oil abroad which would justify the resumption of production at the Abadan refinery, it might not be easy to work out schedules of delivery to DMPA. Henderson said he did not plan to press this point, but merely mention it in passing, so that in case negotiations did not commence immediately with the International Company for a long-term contract, Mosadeq would understand why negotiations regarding the DMPA schedules were not proceeding faster. (888.2553/1–1053)