Foreign Relations of the United States, 1955–1957, Arab-Israeli Dispute, 1957, Volume XVII

306. Telegram From the Department of State to the Embassy in the United Kingdom¹

Washington, April 29, 1957—7:30 p.m.

7627. London’s tel 5869,² Rome’s tel 4180.³UK Embassy informed Department April 27 that British Government has requested SCUA Administrator arrange for Council Meeting Tuesday afternoon to discuss numbered questions.⁴ Department views on questions follow:

1) Do users favor further negotiations with Egypt? If so, what negotiating machinery would be appropriate. Should it be done by Secretary General of United Nations, by US Government or by a negotiating Committee under cover of further debates in Security Council? We doubt that further governmental negotiations whether handled within or outside of Security Council would be likely to achieve at present time any improvement in the Egyptian position. We likewise doubt that Secretary General would be of assistance in the present situation. US for its part does not desire to undertake negotiations at this time.⁵ We consider, however, that SCUA might usefully explore what might be possible to facilitate implementation of the Egyptian statement in Article 4 of its Declaration that GOE “would welcome and encourage cooperation between the Suez Canal Authority and representatives of shipping and trade,” particularly in connection with para 3B of Egyptian Declaration (negotiation respecting tolls), para 4 itself, para 5C (development), para 6 (Canal Code alterations), and para 7D (factfinding, etc. on complaints). This presumably refers to representatives of private shipping interests and SCUA might be helpful in determining how such a representation might be organized and how it could best make contact with GOE. US must of course reserve its position if SCUA consideration results in association of private shipping interests so far as US shipping interest participation is concerned, in view of possible anti-trust implications. Foregoing views do not mean US regards Egyptian Declaration in its present form as fully meeting six requirements of Security Council, and as noted in US statement before Security Council April 26 fundamental difficulty lies in fact there is no provision for organized cooperation between Egypt and users. As a result there is no assurance six requirements will in fact be implemented. Any de facto acquiescence by US is provisional and we reserve right to express ourselves further on matter in future.

Granted a de facto acquiescence in Egyptian arrangement there remains number practical arrangements which will have to be worked out in giving effect to Egyptian Declaration. Salient practical fact is question whether confidence among users of Canal can be reestablished; this will depend on manner in which Egyptian Declaration is implemented. Perhaps no final judgment however can be made regarding regime proposed by Egypt until we able see what happens in actual practice which may also suggest lines useful negotiation.

2) Do users favor maintenance of boycott meanwhile? Have Governments power to enforce a boycott? If not, will their shipowners be prepared organize it on voluntary basis? With Canal open for traffic and vessels nearly 30 nations already using Canal, including some SCUA members, US doubts whether principal maritime countries would wish to assume cost and economic impact of policy of non-use. While some Governments may have effective means for enforcing embargo, others may not; and where Governmental measures are inadequate shipowners not likely to cooperate over extended period of time in a voluntary program. US would be interested in views other delegations this regard.

3) Should users acquiesce in Egyptian system as de facto arrangement under which ships would transit Canal without prejudice to terms of final settlement? If so, how should they make it clear that they are using Canal without subscribing to Egyptian Declaration? US believes most practical policy to follow in present situation would be one in which users acquiesce in present Egyptian regime as de facto arrangement reserving right express themselves in future having particularly in mind practical manner in which Egyptian Declaration is implemented. In this connection SCUA members may wish to act similarly to US practice permitting payment tolls under protest. UK has in fact proposed such resolution to Executive Committee SCUA. Department wonders whether it would be wise for UK or any other SCUA member to press for adoption such resolution by Council due many differing views within SCUA and possibility Egypt will resist system growing out of what may be interpreted as effort to “gang up” on Egypt. It might be better for discussion this subject to be handled in such a way that Chairman at conclusion of session could summarize what appears to be consensus and if this appears support principle using Canal by paying tolls under protest that implementation then be left to individual countries including matter of publicity and manner of giving effect to policy. In this framework Italian proposal under which Italian shipowners would make a one-time declaration to Egyptian authority to effect that in paying dues for transitting Canal they reserve all rights as regard third parties and as regards legal situation created by final settlement could probably be considered adequate implementation this concept.

Council session might be concluded with proposal that Executive Committee and Administrator be requested follow closely experience of SCUA members in using Canal and practical measures taken by Egypt to implement six requirements.

AmEmbassies Paris and Rome should convey to Foreign Office substance of above with respect to questions which UK likely to raise at SCUA Council Meeting Tuesday. AmEmbassy London should inform Turkish representative US views and may inform representatives other countries who may inquire.

Dulles

1. Source: Department of State, Central Files, 974.7301/4–1657. Confidential; Priority. Drafted by Shaw; cleared by Moline, De Palma, Rountree, Meeker, and Metzger; and approved by Dillon who signed for Dulles. Repeated Priority to Rome and Paris.
2. Telegram 5869 from London, April 29, contained a summary of a circular telegram, dated April 27, from the British Government to its missions in the 17 member countries of SCUA. The circular telegram stated that the British Government had requested a meeting of the SCUA Council for April 30 to consider the Egyptian declaration and to ascertain user views on the three questions contained in telegram 7627. The British Government did not intend to table a draft resolution, because the French Government remained opposed to an earlier British draft resolution tabled on April 12 (see Document 282). (Department of State, Central Files, 974.7301/4–2957)
3. Telegram 4180, April 16, reported that the Italian Government was prepared to support the April 12 British draft resolution. (Ibid., 974.7301/4–1657)
4. The note from the British Embassy is ibid., 974.7301/4–2757. The meeting was requested for April 30.
5. During Secretary Dulles’ Staff Meeting that morning, Dulles “endorsed Mr. Dillon’s statement that the U.S. should definitely not undertake the [Canal] negotiations for a number of reasons including the fact that it inhibits our freedom of action on other matters. The Secretary speculated as to whether we could bring about an organization of shippers to negotiate with the Egyptians as was suggested by the Egyptians or whether we could get SCUA into direct contact with the Egyptians. On the latter point he thought that 90 percent of users should be a convincing basis and that the approach to Egypt might bring a real test of good faith.” (Tentative Notes, April 29; ibid., Secretary’s Staff Meetings: Lot 63 D 75)