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4. It is understood that the Government of the United Kingdom is obligated to take action in particular instances in accordance with paragraph 3 of Article II only after appropriate investigation or examination.

5. It is understood that the phrase in Article V "after due regard for the reasonable requirements of the United Kingdom for domestic use" would include the maintenance of reasonable stocks of the materials concerned and that the phrase "commercial export" might include barter transactions. It is also understood that arrangements negotiated under Article V might appropriately include provision for consultation, in accordance with the principles of Article 32 of the Havana Charter for an International Trade Organisation,15 in the event that stockpiles are liquidated.

6. It is understood that it should not be assumed from paragraph 2 of Article VI that the existing facilities extended by the United Kingdom to relief goods and packages are inadequate.

7. It is understood that the Government of the United Kingdom will not be requested, under paragraph 2 (a) of Article VII, to furnish detailed information about minor projects or confidential commercial or technical information the disclosure of which would injure legitimate commercial interests. 8. It is understood that the Government of the United States of America in making the notifications referred to in paragraph 2 of Article IX would bear in mind the desirability of restricting, so far as practicable, the number of officials for whom full diplomatic privileges would be requested. It is also understood that the detailed application of Article IX would, when necessary, be the subject of inter-Governmental discussion.

9. It is understood that any agreements which might be arrived at pursuant to paragraph 2 of Article X would be subject to ratification by the Senate of the United States of America.

15

Unperfected. Art. 32(3) of the Havana Charter reads as follows:

"Such Member shall, at the request of any Member which considers itself substantially interested, consult as to the best means of avoiding substantial injury to the economic interests of producers and consumers of the primary commodity in question. In cases where the interests of several Members might be substantially affected, the Organization may participate in the consultations, and the Member holding the stocks shall give due consideration to its recommendations."

MOST-FAVORED-NATION TREATMENT FOR AREAS UNDER OCCUPATION OR CONTROL

Exchange of notes at London July 6, 1948

Entered into force July 6, 1948

Expired in accordance with its terms

62 Stat. 2941; Treaties and Other International Acts Series 1835

The American Ambassador to the Secretary of State for Foreign Affairs

EMBASSY OF THE

UNITED STATES OF AMERICA

No: 2582

SIR:

London, July 6, 1948

I have the honor to refer to the conversations which have recently taken place between representatives of our two Governments relating to the territorial application of commercial arrangements between the United States of America and the United Kingdom and to confirm the understanding reached as a result of these conversations as follows:

1. For such time as either the Government of the United States of America or the Government of the United Kingdom of Great Britain and Northern Ireland participates in the occupation or control of any areas in Western Germany or the Free Territory of Trieste, the other Government will apply to the merchandise trade of such area the provisions of the General Agreement on Tariffs and Trade, dated October 30, 1947,1 as now or hereafter amended, relating to most-favored-nation treatment.

2. The undertaking in paragraph 1, above, will apply on the part of the Government of the United States of America or the Government of the United Kingdom of Great Britain and Northern Ireland to the merchandise trade of any area referred to therein only for such time and to such extent as such area accords reciprocal most-favored-nation treatment to the merchandise trade of the United States of America or the United Kingdom of Great Britain and Northern Ireland, respectively.

3. The undertakings in paragraphs 1 and 2, above, are entered into in the light of the absence at the present time of effective or significant tariff barriers

[blocks in formation]

to imports into the areas herein concerned. If such tariff barriers are imposed, it is understood that such undertakings shall be without prejudice to the application of the principles set forth in the Havana Charter for an International Trade Organization relating to the reduction of tariffs on a mutually advantageous basis.

4. It is recognized that the absence of a uniform rate of exchange for the currency of the areas in Western Germany referred to in paragraph 1 above may have the effect of indirectly subsidizing the exports of such areas to an extent which it would be difficult to calculate exactly. So long as such a condition exists, and if consultation with the Government of the United States of America fails to reach an agreed solution to the problem, it is understood that it would not be inconsistent with the undertaking in paragraph 1 for the Government of the United Kingdom to levy a countervailing duty on imports of such goods equivalent to the estimated amount of such subsidization, where the Government of the United Kingdom determines that the subsidization is such as to cause or threaten material injury to an established domestic industry or is such as to prevent or materially retard the establishment of a domestic industry.

5. The undertakings in this note shall remain in force until January 1, 1951, and unless at least six months before January 1, 1951, either Government shall have given notice in writing to the other of intention to terminate these undertakings on that date, they shall remain in force thereafter until the expiration of six months from the date on which such notice shall have been given. Accept, Sir, the renewed assurances of my highest consideration.

The Right Honorable

ERNEST BEVIN, M.P.,

Secretary of State for Foreign Affairs,

The Foreign Office,

Whitehall, S.W.1.

LEWIS W. DOUGLAS

The Secretary of State for Foreign Affairs to the American Ambassador

YOUR EXCELLENCY,

FOREIGN OFFICE,

S. W. 1. 6th July, 1948

I have the honour to refer to the conversations which have recently taken place between representatives of our two Governments relating to the terri

2

Unperfected; for excerpts, see A Decade of American Foreign Policy, 1941-49 (S. Doc. 123, 81st Cong., 1st sess.), p. 391.

torial application of commercial arrangements between the United States of America and the United Kingdom and to confirm the understanding reached as a result of these conversations as follows:

[For text of understanding, see numbered paragraphs of U.S. note, above.]

I have the honour to be, with the highest consideration,

Your Excellency's obedient Servant,

His Excellency

The Honourable

LEWIS W. DOUGLAS,

etc., etc., etc.,

1, Grosvenor Square,

W. 1.

ERNEST BEVIN

LEND-LEASE SETTLEMENT: JOINT

INSTALLATIONS IN MIDDLE EAST

Agreement signed at Washington July 12, 1948, with appendixes
Entered into force July 12, 1948

62 Stat. 2027; Treaties and Other International Acts Series 1769

Agreement Relating to Settlement of the INTERESTS OF THE GovERNMENT OF THE UNITED STATES AND THE Government of THE UNITED KINGDOM IN JOINT INSTALLATIONS IN THE MIDDLE East

The Government of the United States of America and the Government of the United Kingdom of Great Britain and Northern Ireland (hereinafter referred to respectively as the United States and the United Kingdom), having consulted together in accordance with subparagraph 3 (b) of the Agreement on Lend-Lease and Reciprocal Aid Installations (Agreement VII) of March 27, 19461 regarding the disposal of installations in which the two Governments have a joint interest in the Middle East (defined as the areas listed in Appendix A hereto), hereby agree that the interests of the two Governments in the proceeds of disposal of such installations shall be discharged in accordance with the following conditions:

I. Disposals Prior to November 1, 1947

A. The United States will pay to the United Kingdom the net balance of,

(1) amounts due from the United States to the United Kingdom as a result of disposals by the United States, less,

(2) amounts due from the United Kingdom to the United States as a result of disposals by the United Kingdom.

B. Amounts due from the United States to the United Kingdom as a result of disposals by the United States are agreed, in accordance with figures set forth in Appendix B hereto, to aggregate a total of $1,420,000 (as expressed in United States dollars).

C. Amounts due from the United Kingdom to the United States as a result of disposals by the United Kingdom shall be determined by an accounting statement to be furnished by the United Kingdom to the United States. It is agreed that these amounts shall be those portions of the proceeds realized by

1TIAS 1509, ante, p. 777.

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