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The German Government must protest against the addendum to the Trading with the Enemy Act of October 6, 1917, in the Urgent Deficiency bill, which empowers the President of the United States to dispossess the North German Lloyd and the Hamburg-American Line of their establishments in New Jersey. The condition put upon the dispossession which is left to the discretion of the President, that it shall be necessary for the national security and defence, cannot be accepted as a valid ground for such rule, since the abovestated ground can always justify a seizure for use during the war but not a lasting acquisition of the property. Supposing it, however, to be a valid ground, it should then be held, as it is against the German companies, against all the other American and other steamship companies and enterprises established at similar places. As this is obviously not contemplated and the case is rather one of discrimination against German private property, appended to the Trading with the Enemy Act, the German Government must, in case the President of the United States exercises the power conferred upon him, see therein an attempt antagonistic to the spirit of the treaties of 1785, 1799, and 1828, and in no wise warranted, to shackle, through measures of force, the opportunities of German shipping interests to develop in the future.
When farther on the amendment to paragraph 4 of section 12 of the Trading with the Enemy Act of October 6, 1917, also contained in the above-mentioned bill, vests the Alien Property Custodian with the power of disposing of all the property in his care, money excepted, to American citizens, there lies therein another measure consciously aimed to do lasting injury to German economic existence, which is not in the least affected in its contemplated operation by the assuaging Alien Property Custodian's declaration of March 28, of this year. The German Government is constrained to repeat what it said on the subject in its note verbale IIIa-4532 of March 10, of this year;? it again lays emphasis on the statement that it cannot but be guided in the enforcement of the retaliatory orders that have been issued against American property in Germany by the manner in which the United States of America will proceed against German property.
The Foreign Office would be thankful to the Swiss Legation if it would make the foregoing known to its Government with a request to communicate this protest of the German Government to the Government of the United States of America through the Swiss Legation at Washington.
BERLIN, June 11, 1918.
File No. 763.72113/670
The Secretary of Stute to the Alien Property Custodiun (Palmer)
WASHINGTON, September 10, 1918. Sir: The Department acknowledges the receipt of your letter of August 30, 1918,1 in which you state that the question has arisen as to the present effectiveness of the treaties with Austria-Hungary and the various states composing the German Empire, “ which permit subjects of those states to take or hold real property in the United States," and request that the Department indicate the attitude it is disposed to adopt in regard to these treaties.
The Department assumes that you refer to the provisions in article 2 of the convention of 1848 with Austria-Hungary:
Where, on the death of any person holding real property, or property not personal, within the territories of one party, such real property would, by the laws of the land, descend on a citizen or subject of the other were he not disqualified by the laws of the country where such real property is situated, such citizen or subject shall be allowed a term of two years to sell the same; which term may be reasonably prolonged according to circumstances; and to withdraw the proceeds thereof, without molestation, and exempt from any other charges than those which may be imposed in like cases upon the inhabitants of the country from which such proceeds may be withdrawn. and to the somewhat similar provisions in article 14 of the convention of 1828 with Prussia, to article 2 of the convention of 1845 with Bavaria, and to similar articles in conventions with other states of the German Empire which were regarded as in force on the dates of our entrance into a state of war with Austria-Hungary and Germany, respectively.
In reply to your inquiry as to the present effectiveness of these provisions of the treaties with Austria-Hungary and the various states composing the German Empire, you are informed that in view of the present state of war between the United States and Austria-Hungary and Germany, the Department does not regard these provisions as now in operation.
In this relation it may be pointed out that in the absence of applicable treaty provisions the right of an alien to take or hold real property by descent or purchase, or otherwise, in the United States, would, it appears, depend upon the law of the state or territory in which the property may be situated. I am [etc.]
F'ile No. 763.72113/682
The Swiss Chargé (Hübscher) to the Secretary of State
The Chargé d'Affaires a. i. of Switzerland, representing German interests in the United States, presents his compliments to the Secretary of State, and, has the honor to submit to His Excellency copy of a note verbale from the German Government dated July 14, 1918, transmitted to this Legation by the Swiss Foreign Office, regarding a statement alleged to have been made by Mr. Lee Bradley, legal advisor, of the Alien Property Custodian, to the Interstate Commerce Commission. WASHINGTON, September 10, 1918.
[Received September 11.]
[Enclosure-Translation] The German Foreign Office to the Swiss Legation at Berlin IIIa-14059 105046
NOTE VERBALE The Foreign Office has the honor to inform the Swiss Legation that it appears from a news item in the New York Times of the 5th of this month that Lee Bradley, legal adviser of the “ Alien Property Custodian” made a statement in the Congressional Committee on Interstate Commerce as to the extremely harsh manner in which the liquidation of American and other enemy property was conducted in Germany. It was to the effect that while the property of German residents of the United States had not been interfered with in that country, all enemy property in Germany, regardless of the owner's residence, was sold at very low prices; that even personal effects were sold without notice and the proceeds were turned into the Government fund for the prosecution of the war against the United States and its allies.
The assertions are, as the Swiss Legation well knows, made of thin air and wholly unfounded. No piece of American property in Germany has yet been sold, while in the United States, on the contrary, the most marked invasion of German property rights has been already planned or begun. In the whole matter of economic warfare, Germany has heretofore always followed the example set by her enemies. The measures that have been or will be taken against American private property in Germany are therefore mere acts of reprisal for orders previously issued by the Americans. Even in the way of reprisal, Germany, opposed on principle to warfare on private rights, has until now hesitated to follow.
These facts must be well known to an American jurist who is engaged in affairs of commercial war. If we are not dealing with malicious calumny intent on making bad blood, the case must be described as one of gross carelessness.
The Foreign Office has the honor to beg the Swiss Legation to make the foregoing known to the American Government by cable and to obtain a public statement of the condition of things.
BERLIN, July 14, 1918.
File No. 763.72113/679
The Ambassador in Spain (Willard) to the Secretary of State
SAN SEBASTIAN, August 11, 1918.
[Received September 10.] Sir: Referring to the Department's instruction No. 786, April 18, 1918, directing the Embassy to secure information in regard to property in Germany of American citizens, etc., I have the honor to enclose herewith a copy of a note verbale from the German Ministry of Foreign Affairs to the Spanish Ambassador in Berlin in reply to the latter's inquiry on this point. I have [etc.]
JOSEPH E. WILLARD
The German Forcign Office to the Spanish Embassy at Berlin IIIa.11559 109057
In reply to your verbal note of the 1st instant (Am. Div. No. 2985– 12783) concerning the treatment of American private property in Germany, the Department of Foreign Affairs has the honor to inform you as follows:
The German decrees on the private property of citizens of the United States, that is, the proclamations of August 9, November 10, December 13, and December 31, 1917, and of January 30 and March 4, 1918 (Imp. Law Bul., 1917, pp. 707, 1047, and 1105, and 1918, pp. 5, 67, and 111), were issued solely by way of reprisal after the American Government had in advance published decrees against German private property. The Imperial Government declared several times that these decrees would not be enforced unless the American Government took measures against German property in America. The Department takes the liberty to refer in this regard to the verbal notes of March 23 1 and April 18,2 Nos. IIIa-5772 and 5682.
* Ante, p. 294.
After German property in the United States had been taken into custody by the American Government, the German Government took similar measures against the American enterprises in Germany.
Meanwhile the Imperial Department received, in reply to its inquiry regarding the treatment of German property in America addressed to the Government at Washington through the Swiss Government, the information that the “ Treasury Department” had ordered the liquidation of the insurance companies and that the liquidation of German private property, especially commercial enterprises, is taking place under the direction of the “Alien Property Custodian."
Furthermore, an “ Urgent Deficiency bill ” was passed in America authorizing the President of the United States to expropriate the establishments of the German maritime companies, the “ Norddeutscher Lloyd" and the “Hamburg-Amerika-Linie” in New Jersey near New York, and containing besides an additional note to the
Trading with the Enemy Act” which gives to the Alien Property Custodian authority to liquidate all enemy property subject to his administration. The Imperial Government protested through the Swiss Government against this mode of action and declared again that the measures which Germany would take against American private property would depend on the manner in which the United States proceeded against German private property.
Pending final information on the treatment of German private property in America, the Imperial Government has thus far abstained from liquidating American property in Germany.
As regards the question of the treatment of the property of American citizens domiciled in or outside of Germany, no difference is made in this regard in the German legislation as already explained in the verbal note of April 18, No. IIIa-5682, with the sole exception that Americans domiciled in Germany may make disposal of their property in Germany in accordance with the provisions contained in the proclamations of November 10, 1917, and October 7, 1915 (Imp. Law Bul., pp. 1050 and 633).
The Department of Foreign Affairs would be much obliged to the Royal Spanish Embassy if it would bring the foregoing to the
* See extract in telegram of Apr. 25 from the Minister in Switzerland, ante, p. 296.
'Not printed; summarized in telegram of May 13 from the Minister in Switzerland, ante, p. 298.