POLAND REGULATION OF PRIVATE REMITTANCES FROM THE UNITED 860c.516/40: Telegram STATES1 The Minister in Poland (Gibson) to the Secretary of State WARSAW, February 4, 1921—11 a.m. 26. My telegram number 354, July 8, 6 p.m.2 Rybarski leaves [for] Paris to sign comprehensive agreement on remittance question with Guaranty Trust Company. Have not seen terms but officially informed agreement has been approved by the Department. Request information for my guidance. GIBSON 860c.516/40: Telegram The Secretary of State to the Minister in Poland (Gibson) WASHINGTON, February 25, 1921—8 p.m. 42. Your 26, February 4, 11 A.M. 1. Remittance agreement between Poland and Guaranty Trust Company was examined by Department and certain amendments were suggested and were accepted by Guaranty. Thereupon Department stated that it did not oppose contract, but specifically reserved full liberty of action should undesirable developments occur in the future. Department has not given formal or informal approval. 2. Informed by Bank that contract has been signed. Copy of contract forwarded by pouch. 3. Department's attitude in not opposing agreement was induced by serious depreciation of Polish mark and consequent obstacle to development of American commerce with Poland. For some time to come remittances are likely to constitute an important factor in sustaining Polish-American exchange. Under system now in vogue, commissions and charges of certain types of financial institutions seriously prevent remittances from exerting their full and proper support to Polish exchange, and also are unjust to remitting public. For previous correspondence, see Foreign Relations, 1920, vol. I, pp. 407 ff. 2 Ibid., p. 419. 4. Plan discussed in your 354 of July 8, 6 P.M., contemplated establishment of possible discrimination against certain American citizens and corporations in Poland. This obviously was unacceptable to American Government. Under present plan Polish Government has designated the Guaranty Trust Company as fiscal agent to distribute remittance forms in the United States. "All banks," bankers and other institutions dealing in exchange shall, upon request, be furnished by the Agent (Guaranty Trust Company) with official remittance forms, notified of the basic rate or retail rate then in effect, and informed that such remittances may be made by drawing upon any designated paying agency of the Republic of Poland." Both the American bankers and the remitting public are thus protected from exploitation and from discrimination as to rates of exchange by reason of the carefully limited powers of the Polish Government and its fiscal agent. Provision is made for insuring an equitable rate of exchange. 5. You might point out to proper Polish authorities that this Government reserves right to protest against present agreement if it developes monopolistic or undesirable features either in Poland or in the United States. COLBY 860c.516/42 The Polish Minister (Lubomirski) to the Secretary of State WASHINGTON, February 28, 1921. The Minister of Poland presents his compliments to the Secretary of State, and takes great pleasure in informing him that the Minister of Finance has ratified the contract entered into between the representatives of the Government of Poland and the Guaranty Trust Company of New York, which, it is hoped, will greatly facilitate remittances between the United States and Poland. As soon as the signed contract is in hand, a copy of same will be forwarded to the Secretary of State. 860c.516/44 The Assistant Vice President of the Guaranty Trust Company of New York (De Lima) to the Secretary of State NEW YORK, March 15, 1921. MY DEAR MR. SECRETARY: We attach, for your information, agreement, signed on the 19th day of February, 1921, between the Republic of Poland and the Guaranty Trust Company of New York. We would appreciate an acknowledgment of the enclosure at your early convenience. We have [etc.] [Enclosure] E. DE LIMA Agreement Made by the Republic of Poland and the Guaranty Trust Company of New York, February 19, 1921 This Agreement, dated February nineteenth, 1921, made by the Republic of Poland (hereinafter termed "Republic "), acting by His Excellency Roman Rybarski, Vice-Minister of Finance, of the Republic of Poland, thereunto duly authorized by law, and Guaranty Trust Company of New York, a corporation having its principal place of business in the City of New York, State of New York, United States of America, (hereinafter termed "Agent "). WHEREAS the Republic is desirous of facilitating the remittance of funds from the United States of America to the Republic of Poland; and WHEREAS Owing to the fact that there has been no government regulation in the Republic covering such remittances and, without such governmental regulation, supervision and assistance, the ordinary banking facilities in the Republic are insufficient to insure prompt and adequate service covering the receipt and payment of such remittances; and WHEREAS the Republic has determined to put into effect within ninety days from the date of the agreement rules and regulations covering the receipt of remittances in the Republic of Poland from the United States of America, so that no such remittances may be received and paid unless made on official government forms of the Republic, forwarded to a paying agent appointed by the Republic of Poland, and unless cover against such remittance is placed to the credit of the Republic with an agent of the Republic in the United States of America, and WHEREAS Republic has requested Guaranty Trust Company of New York to assist it in establishing and maintaining an adequate system covering remittances from the United States of America to the Republic and has also requested it to act as its agent as hereinafter set forth; Now, therefore, in consideration of the premises and of the mutual promises herein contained, the parties hereto agree as follows: First. The Republic agrees to adopt and transmit to the Agent official forms of checks, drafts, or such other remittance forms as may be necessary or advisable, to be used in the remittance of funds from the United States of America to Poland within ninety days. after the date of this agreement. Such forms shall be printed in the Polish and English languages, and shall call for payment at the paying agencies of the Republic in Poland appointed as hereinafter set forth. The Republic will appoint a sufficient number of banks and reliable paying agencies in Poland, to act as agents for the payment of such drafts and remittances as may be sent from the United States of America. From time to time the Republic will notify the Agent of the names of such paying agencies in Poland, of new appointments, and of revocations of appointments, so that at all times the Agent shall have a full and correct list thereof. Second. The Agent from time to time will compute the rate of exchange (such computations to be submitted to the representative of the Minister of the Republic in the United States of America or of the acting head of the Legation of the Republic in the United States of America for his concurrence and approval) based on which remittances covered by the terms of this agreement are to be settled. The Basic Rate as computed by the Agent shall, after the concurrence of the Minister's Representative has been received, be reported to the Governor of the Federal Reserve Bank, New York, or to such other person as may be mutually agreed upon by the parties hereto, who shall have power to amend same if in his opinion it is out of proportion with the current market rate. The Governor of the Federal Reserve Bank or such other person as may be mutually agreed upon shall also have authority to compute the Basic Rate should the Agent and the Representative of the Minister fail to agree on same, but shall be under no liability whatsoever for any action taken by him in computing or amending the Basic Rate. This rate of exchange, both for checks and cables, hereinafter called the "Basic Rate" or "Wholesale Rate" shall be based from time to time on current market rates for remittances from other countries to Poland, and shall not be increased unreasonably over such market rates. The Basic Rate of exchange shall be fixed as frequently as variations of the market make necessary. The Agent will use its best efforts to compute the Basic Rate as above set forth, but shall be under no liability for any mistake of judgment so long as it uses good faith in computing the Basic Rate as aforesaid. In case the Minister of the Republic or the acting head of the Legation shall fail to appoint a representative to whom the Agent may submit in New York the computation for the Basic Rate for the concurrence and approval of such representative, the Agent itself may compute and announce such Rate without having the concurrence and approval of any representative of the Republic. The Agent is authorized to make from time to time reasonable rules and regulations covering the computing and announcement of such rate, the distribution of remittance forms, receipt of monies covering remittances, and other matters covered by this Agreement. The "Basic Rate" or "Wholesale Rate" is the rate which shall be charged as hereinafter provided in Article Seventh of this Agreement to banks, bankers and or other institutions having what is known as a "Country Bank Drawing Service "; the rate to be charged all other banks, bankers, financial or other institutions or persons shall be an amount five per cent. (5%) Minimum 25 cents U.S. Currency per remittance in excess of the Basic or Wholesale Rate and shall be known as the "Retail Rate”. Third. All banks, bankers and other institutions dealing in exchange shall, upon request, be furnished by the Agent with official remittance forms, notified of the Basic Rate or Retail Rate then in effect, and informed that such remittances may be made by drawing on any designated paying agency of the Republic of Poland, and remitting, at the time such remittances is forwarded, to the Agent in New York City for the account of the Republic an amount of dollars in New York funds calculated upon the Basic Rate or Retail Rate, as the case may be, then in force equal to the amount so remitted. Similar forms shall be furnished upon request, and information given as to the remittances by draft or cable transfer. The dollars so received by the Agent to cover such a remittance or draft or cable transfer shall be held in a special account until the Agent has been notified of the payment in Poland of such draft; after such notification, such dollars, less the Agents remuneration, shall be transferred to the general checking account of the Republic with the Guaranty Trust Company of New York. The Republic agrees that at least 20% of the dollars received and placed to its general account shall be used for the purchase of merchandise and supplies in the United States, or for the payment and discharge of obligations incurred by the Republic in the United States of America. Fourth. The Republic hereby appoints Guaranty Trust Company of New York its official agent in the United States of America for the distribution of official remittance forms, the quotation of the Basic Rate and Retail Rate, and the handling of all transactions subject to this agreement and in any way connected with the remittance of money (except United States Post Office Orders) from the United States of America to Poland. Within ninety days after the date of this agreement, the Agent will create and maintain in New York City an adequate department for the handling of all business covered by this agreement. The Agent will also furnish to the Republic advisory assistance for the creation of departments in paying agencies nominated by the Republic in Poland for the handling of such remittances when received in Poland, and the Republic will allow proper facilities in Poland and will provide office accommodations for such representatives as the Agent may employ in Poland. 115367-36—vol. II—44 |