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All citizens of the Union are liable to compulsory military service. Only workers may be entrusted with the armed defense of the Union. The rest of the population is subjected to other military duties. Compulsory military service begins at nineteen and lasts to the end of the fortieth year. It is divided into (a) preparatory military training, (b) service with the colors, and (c) service with the Reserve. Those who do not belong to the workers' class are passed into the Territorial Reserve.

(a) All males are liable, on completing their nineteenth year, to a period of preparatory military training lasting two years.

(b) Citizens who have completed their twenty-first year are called up to serve with the colors for five years. Service with the colors is performed in the Regular Army or Navy, or in territorial mobile formations, or outside the army. The period of service in the Regular Army and Navy is five years, but from one to three years, depending on the arm of service, are spent on furlough or long leave.

In the territorial mobile formations, the men are trained for three months in the first year, and for a total of eight, six or five months in the next four years, depending on the arm of the service. The period of training outside the Army is six months in all.

(c) After the period of service with the colors, all men are passed into the Reserve Army. Men up to thirty-four are in the First Line Reserve, and men from thirty-four to forty in the Second Line Reserve.

Reservists may be called up for training for a total period of not more than three months.

Men between eighteen and thirty-four may be enlisted as volunteers, serving in the

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UNITED STATES

The armed forces of the United States include the Regular Army, the National Guard, and the Organized Reserves.

The Regular Army is recruited by voluntary enlistment. The limits of age for original enlistments are eighteen and thirtyfive years. Original enlistments are for a period of one or three years, and re-enlistments are for three years.

Original enlistments in the National Guard are for a period of three years, and subsequent enlistments for periods of one year each. When the use of armed land forces in excess of the Regular Army has been authorized by Congress, the President may draft members of the National Guard and the National Guard Reserve into the military service of the United States.

The Enlisted Reserve Corps also consists of persons voluntarily enlisted. The period of enlistment is three years, except for persons who served in the Army, Navy or Marine Corps between April 6, 1917 and November 11, 1918, who may enlist for one year. Enlistment is limited to persons who have had a certain amount of military or technical training. Members of the Enlisted Reserve Corps may be placed on active duty in the discretion of the President; except in time of national emergency, the period of active duty must not exceed fifteen days in one year without the reservist's consent.

In order to provide trained men for the Organized Reserves, several agencies have been established. One of these is the Reserve Officers' Training Corps, established at various schools and colleges. Another agency is the Citizens' Military Training Camps, conducted for a few weeks every summer in various parts of the country.

AREA

Mother country Dependencies

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sq. miles 3,026,789

NAVY

716,740

18

3

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POPULATION (1924)

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League of Nations, Armaments Year-Book, First Year, 1924.

League of Nations, Armaments Year-Book, Second Year, 1925-1926.

Statesman's Year-Book, 1925.

Commercial Year-Book of the Soviet Union, 1925.

161

FOREIGN POLICY ASSOCIATION

Information Service

Fact data on international questions for reference use

VOL. II-NO. 21

DECEMBER 22, 1926

CONTENTS

Origin of the Land and Oil Law Controversy
Discussion of the Mexican Land Law of January 21, 1926
Questions of Alleged Retroactivity of Sections of the Law
The Controversy over the Petroleum Law of December 31, 1925
Position of the United States Defined by Secretary Kellogg
Mexican Government Denies Retroactivity of Law
Status of Vested Rights and Inchoate Petroleum Titles
Further Differences between the United States and Mexico

Alleged Mexican Engagements at the Conference of 1923
The Calvo Clause

Possibility of Arbitral Settlement
Text of Mexican Petroleum Law.

Text of Mexican Alien Land Law

Text of Last Notes Exchanged between United States and Mexico

Page

243

244

244

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246

247

247

248

248

248

249

250

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252

Published by-weekly by the Research Department of the FOREIGN POLICY ASSOCIATION, 18 East 41st St., New York, N. Y. JAMES G. McDONALD, Chairman; Subscription Rates: $5.00 per year; to F. P. A. Members, $3.00; Single Copies, 25c.

THE

The Mexican Land and Oil Law Issue

HE controversy which has arisen between the United States and Mexico over the interpretation of Mexico's alien land law and petroleum law will enter a new phase during January, unless meanwhile some settlement is reached on the points at issue. At the present time the petroleum law is expected to go into effect on December 31, 1926, and the land law on January 21, 1927. On these dates the discussion of American property rights in Mexico which hitherto has been largely theoretic, will become a real issue inasmuch as American and other foreign interests will be required to comply with the provisions of the new laws or run the risk of having their titles confiscated. The latest published note of the State Department, in which Secretary Kellogg said that an "extremely critical situation. would inevitably be created if those laws were enacted and enforced in such a manner as to violate the fundamental principles of international law and of equity . . . " indicates the seriousness with which the Coolidge administration views the present situation.

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Four outstanding differences have arisen from the recent land and oil laws adopted by the Mexican government to carry out the nationalization provisions of the Constitution of 1917.

First: The alleged retroactivity of the land law.

Second: The alleged retroactivity of the petroleum law and the question of the modification of titles to oil lands acquired prior to May 1, 1917.

Third: The nature of Mexican undertakings at the Conference of Mexico City in May, 1923, preceding recognition by the United States.

Fourth: The Mexican government's insistence that foreign property owners bind themselves not to invoke the support of their governments, but submit themselves to Mexican jurisdiction in all disputes where their property interests are concerned on penalty, if they do invoke the support of their government, of forfeiting their property.

The purpose of this report is to review briefly each of the four points at issue and to present the positions held respectively by

the State Department and the Mexican government as revealed in the published official correspondence. While it is not possible in this report to trace in detail the course of American-Mexican relations during the past fifteen years or the effects of the agrarian revolution which led to the promulgation of the 1917 Constitution, it is essential to include a short statement of events bearing directly on the origin of the present controversy.

HISTORICAL SURVEY

The origin of the present differences between the United States and Mexico lies in the provisions of Article 27 of the Constitution of 1917. One of the objects of the revolution of 1910 was the extension of small land holdings through the correction of the system under which the land and natural resources of the country had become the property of a relatively small class of large land holders. The return of the communal lands, or ejidos,* has been the task of every administration since the revolution. The firs attempt was made in 1915 when President Carranza issued a provisional agrarian decree annulling illegal alienation of lands, but it was not until 1917 that this measure was given constitutional status. Article 27 of the Constitution vested in the nation ownership of lands and waters comprising the national territory and sanctioned the division of the large land estates. It also nationalized petroleum deposits and made provisions relative to the acquisition of agricultural property by foreigners and to religious and educational reforms.

Since the adoption in 1917 of the present Constitution relations with Mexico have been strained almost continuously. President Carranza's decree attempting to put into operation the provisions of Article 27 of the Constitution immediately illicited protests from the State Department. The fall of Carranza and the short administration of de la Huerta, who was refused recognition by the United States, did not have the effect of materially relieving the existing tension between the two governments. To the Obregon Government which followed that of de la

* Ejidos common lands, a quantity of which had been taken from the villages.

Huerta in December, 1920, the United States turned with proposals calculated to normalize relations between the two countries. Prior to 1923 Secretary Hughes had tried without success to secure a binding engagement on the part of the Mexican government guaranteeing American property in Mexico against confiscation.

In July 1922 Secretary Hughes in a communication to Chargé Summerlin had opened the way to further negotiations while severely criticising the situation in Mexico as it affected the rights of foreigners. In an answering note of March 31, 1923, Foreign Minister Pani assured Secretary Hughes that Mexico intended to respect the rights legally acquired prior to the date of the Constitution of 1917, pointing to the decisions of the Supreme Court of Mexico in the five amparo* cases which declared in an unmistakable manner the non-retroactive character of Article 27 of the Constitution in that part relative to petroleum.

RECOGNITION OF

PRESIDENT OBREGON, 1923

On May 2, 1923, President Harding "in an effort to reach an understanding with Mexico respecting the questions at issue" appointed Charles Beecher Warren and John Barton Payne as commissioners to meet representatives of the Mexican government. The chief point at issue was the safeguarding of American property rights in Mexico, especially as against confiscatory application of the provisions of the Mexican Constitution of 1917. The questions arising from this issue related to:

1. The restoration of or proper reparation for lands owned by American citizens prior to May 1, 1917.

2. Guarantees against confiscation of such subsoil rights as belonged to the owners of the surface prior to 1917 where the land was owned by American citizens. The United States-Mexican Commission met at Mexico City on May 14, 1923. After prolonged discussion of the questions raised by the provisions of Article 27 of the Constitution relative to the property rights of foreigners, Claims Commissions were created to adjudicate all claims of citizens of the

See note p. 246.

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