Hearings, Reports and Prints of the Senate Committee on Foreign Relations

#187. Joint Statement of Understanding concerning the Neutrality Treaty Issued following a Meeting between President Carter and General Torrijos, October 14, 1977*

Under the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal (the Neutrality Treaty), Panama and the United States have the responsibility to assure that the Panama Canal will remain open and secure to ships of all nations. The correct interpretation of this principle is that each of the two countries shall, in accordance with their respective constitutional processes, defend the Canal against any threat to the regime of neutrality, and consequently shall have the right to act against any aggression or threat directed against the Canal or against the peaceful transit of vessels through the Canal.

This does not mean, nor shall it be interpreted as a right of intervention of the United States in the internal affairs of Panama. Any United States action will be directed at insuring that the Canal will remain open, secure and accessible, and it shall never be directed against the territorial integrity or political independence of Panama.

The Neutrality Treaty provides that the vessels of war and auxiliary vessels of the United States and Panama will be entitled to transit the Canal expeditiously. This is intended, and it shall so be interpreted, to assure the transit of such vessels through the Canal as quickly as possible, without any impediment, with expedited treatment, and in case of need or emergency, to go to the head of the line of vessels in order to transit the Canal rapidly.

Weekly Compilation of Presidential Documents, v. 13, October 17, 1977, p. 1547.

APPENDIXES

A. Comparison of the Rights and Obligations of the United States under the Terms of the 1903, 1936, and 1955 Treaties with Panama 1

1 Report on United States Relations with Panama, by the Subcommittee on Inter-American Affairs of the Committee on Foreign Affairs, 86th Con

gress, 2nd Session, House Report No. 2218, August 31, 1960 pp. 72-79.

(1621)

HAY-BUNAU-VARILLA TREATY, 1903

RIGHTS RECEIVED

(1) In perpetuity, to a zone of land and land under water 10 miles in width and extending 3 miles into the Caribbean sea and 3 miles into the Pacific ocean, plus certain small islands in the Bay of Panama, for the maintenance, operation, sanitation, and protection of a canal across the Isthmus of Panama.

(2) In perpetuity, the use, occupation, and control of any other lands and waters outside of the zone which may be necessary and convenient for the construction, maintenance, operation, sanitation, and protection of the canal.

(3) All the power and authority within the zone and within the limits of all auxiliary lands and waters which the United States would possess and exercise if it were sovereign, to the entire exclusion of the exercise by the Republic of Panama of any such sovereign rights, power, or authority.

(4) All the rights of the New Panama Canal Company and the Panama Railroad upon purchase of the Company's rights, privileges, properties, and concessions.

(5) At all times and at its discretion to use its police and its land and naval forces or to establish fortifications for the safety or protection of the canal, or of the ships that transit it, or the railways and auxiliary works.

(6) To use the rivers, streams, lakes, and other bodies of water in the Republic of Panama for navigation, the supply of water, or water power or other purposes as may be necessary and convenprotection of the canal. ient for the construction, maintenance, operation, sanitation, and

CONCESSIONS

(1) Guaranteed the independence of the Republic of Panama.

(2) Granted the right to have official dispatches of the Govern-
ment of Panama transmitted over any telegraph and telephone lines
established for canal purposes and used for public and private busi-
ness at rates not higher than those required from officials in the
service of the United States.

(3) $10 million in gold coin of the United States and an annual
payment of $250,000, beginning 9 years after the date of the ex-
change of ratifications.

(4) Granted the Republic of Panama the right to transport over
the canal its vessels and its troops and munitions of war at all
times without paying charges of any kind. The exemption is ex-
tended to the auxiliary railway for the transportation of persons
in the service of the Republic of Panama, or of the police force
charged with the preservation of public order outside of the zone,
as well as to their baggage, munitions of war, and supplies.
(5) United States assumes the costs of damages caused to owners
of private property of any kind by reason of the grants contained
in the treaty or by reason of the operations of the United States,
its agents or employees, or by reason of the construction, mainte-
nance, operation, sanitation, and protection of the canal or of the
works of sanitation and protection provided for in the treaty.

(6) After 50 years, the system of sewers and waterworks con-
structed and maintained by the United States shall revert to and
become the properties of the cities of Panama and Colon.

(7) A monopoly in perpetuity for the construction, maintenance,
and operation of any system of communication by means of canal
or railroad connecting the Carribbean Sea and the Pacific Ocean
across Panamanian territory.

(8) To acquire in the cities of Panama and Colon, by purchase
or by the exercise of the right of eminent domain, any lands, build-
ings, water rights, or other properties necessary and convenient for
the construction, maintenance, operation, and protection of the
canal and of any works of sanitation, such as the collection and
disposition of sewage and the distribution of water in the said cities
of Panama and Colon, at the discretion of the United States.

(9) To impose and collect water rates and sewerage rates which
shall be sufficient to provide for the payment of interest and the
amortization of the principal of the cost of such works within a
period of fifty years, upon which time the system of sewers and
water works shall revert to and become the properties of the cities
of Panama and Colon.

(10) To enforce in perpetuity sanitary ordinances prescribed by
the United States in the cities of Panama and Colon and the ter-
ritories and harbors adjacent thereto in case the Republic of Pana-
ma should not be, in the judgment of the United States, able to
maintain such order.

(11) In perpetuity, to maintain public order in the cities of
Panama and Colon and the territories and harbors adjacent thereto
in case the Republic of Panama should not be, in the judgment of
the United States, able to maintain such order.

(12) To make use of the towns and harbors of Panama and
Colon as places of anchorage, and for making repairs, for loading
unloading, deposition, or transshipping cargoes either in transit
or destined for the service of the canal and for other works pertain-
ing to the canal.

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