25. REPORT BY THE SECRETARY OF STATE TO THE PRESIDENT, MAY 27, 19551 I

I have the honor to submit to you the Austrian State Treaty, with a view to transmission to the Senate for its advice and consent to the ratification thereof. There is also transmitted herewith a summary of the treaty, which outlines the subjects dealt with therein.

This treaty was signed at Vienna on May 15, 1955, by Austria, France, the United Kingdom, the Union of Soviet Socialist Republics, and the United States of America. This marked the completion of over 8 years of arduous negotiation by the United States, the United Kingdom, and France with the Soviet Union. When the treaty comes into force, it will redeem one of the major war pledges made by the Allies, namely, that expressed in the Moscow Declaration of November 1, 1943, that Austria should be made "free and independent."

II

It is of interest, I believe, to review the history of the Austrian Treaty negotiations.

By the Moscow Declaration above referred to, the Governments of the United States, the United Kingdom, and the Soviet Union expressed agreement

that Austria, the first free country to fall a victim to Hitlerite aggression, shall be liberated from German domination.

The three Governments, on this occasion, further declared that they wished

to see reestablished a free and independent Austria, and thereby to open the way for the Austrian people themselves, as well as those neighboring states which will be faced with similar problems, to find that political and economic security which is the only basis for lasting peace.

The French Committee for National Liberation, on behalf of France, adhered to the Moscow Declaration 2 weeks later.

Secretary of State Byrnes first urged consideration of an Austrian Treaty in April 1946 at the Council of Foreign Ministers in Paris.3 The British and French Foreign Ministers agreed, but Soviet Foreign Minister Molotov objected, giving as his reason that he had not had time to consider it. The Soviet Government finally agreed, however, at the Council of Foreign Ministers' meeting in New York, in the fall of 1946, to a United States proposal for the appointment of special Austrian Treaty Deputies. They reported to the Council of Foreign Ministers at their meeting held in Moscow in the spring of 1947. At that time considerable progress was recorded. However,

Soviet delaying tactics soon emerged and, despite many additional meetings of the Deputies, it was not until the Paris meeting of the Council of Foreign Ministers in 1949 that any further substantial progress was made toward the conclusion of the treaty.

At that time the principal obstacle was the issue of so-called "German assets" in the Soviet Zone of Austria. These the Soviet Government had seized and operated for its own benefit, under the Potsdam Agreement of 1945,2 which, while not permitting "reparations" to be exacted from Austria, made provision for the use of "German foreign assets" located in Eastern Austria as one of the sources of reparations from Germany. These Soviet seizures comprised, in the main, oil and shipping properties and some 300 business and industrial enterprises, control of which the Soviet Government was unwilling to relinquish. The Governments of the United States, the United Kingdom, and France had, on their part, indicated a willingness to turn over to Austria all "German assets" in the Western Zones of Austria.

The issue of German assets and other controversial issues appeared to have been resolved at the Paris meeting, and the Foreign Ministers, in June 1949, directed the Treaty Deputies to resume their work promptly for the purpose of reaching agreement not later than September 1, 1949, on the draft treaty as a whole. On the question of German assets, the 1949 Foreign Ministers' agreement provided for the relinquishment to Austria of all properties held or claimed as German assets, with the exception of oil and shipping properties which were to remain under Soviet control for a specific number of years. The Austrian Government would be required to pay $150 million to the Soviet Government, over a period of 6 years, for the properties it was to receive under this agreement.

Despite persistent efforts on the part of the Governments of the United States, the United Kingdom, and France to conclude a treaty on the basis of the 1949 agreement, these efforts failed because of Soviet insistence on writing into the treaty provisions which went beyond the terms of the 1949 agreement. By the end of 1949 agreement was finally reached on the German assets question and only five articles of the treaty remained unagreed. However, one excuse after another was used by Soviet representatives to delay final action on the treaty, and it became apparent that the Soviet Government was basically unwilling to grant Austria its promised freedom. It was unwilling to withdraw its troops from Austria or to give up the benefits it had been deriving from the Austrian economy since 1945. At one point in the negotiations the Soviet Government prevented further progress by refusing to agree to an article in the draft treaty in the exact terms which it had itself proposed.

In an effort to break the deadlock over the negotiations and to provide Austria the freedom promised in the Moscow Declaration of 1943, the Government of the United States drafted and, with the

1 Ibid., pp. 110-114.

2 Ibid.,
pp. 34-48.

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concurrence of the Austrian Government and the Governments of the United Kingdom and France, submitted to the Soviet Government on March 13, 1952, a short treaty of but eight articles (the longdraft State Treaty had contained more than 60 articles plus a number of annexes), providing in the simplest possible terms for the reestablishment of a free and independent Austrian State. This United States proposal included provisions for the relinquishment to Austria of all property, real and personal, of whatever description, held or claimed by the occupying powers as German assets or war booty in Austria. The Soviet Government refused to participate in any meetings or even to discuss the Austrian Treaty until this proposal had been withdrawn. In the hope of resuming negotiations, the Western Powers finally agreed to revert to the long-draft State Treaty, but the Soviet Government continued its refusal to negotiate. Austria submitted its case to the United Nations in the summer of 1952, and the response of that organization was prompt and firm. By a resolution proposed by Brazil and adopted on December 20, 1952,2 by a vote of 48-0 (the Soviet Union abstained), the United Nations General Assembly called upon the Governments concerned to make a renewed and urgent effort to terminate the occupation and restore Austria's full sovereignty. Despite the persistent efforts of the Governments of the United States, the United Kingdom, and France, recorded in UNGA Document No. A/2798, November 22, 1954, the Government of the Soviet Union continued unwilling to give serious consideration to the conclusion of the Austrian Treaty, and it was not until the meeting of the Foreign Ministers in Berlin in 1954 that the Soviet Government was willing to resume discussion of the question. Negotiations were renewed at Berlin, in February 1954, with Austrian participation. The Soviet Foreign Minister raised insurmount able objections, however, to the conclusion of a treaty in terms which would have granted Austria its long-promised freedom. He continued to do so even though the Western Allies proposed acceptance of the Soviet version of the then unagreed articles of the treaty, and despite the fact that Austria declared that it would exercise its freedom to follow a path of neutrality. In that connection I declared on behalf of the United States that such a free choice by Austria would be respected by the United States. Nevertheless, the Soviet Foreign Minister refused to agree to the withdrawal of the Soviet armed forces at any specified date and insisted upon the right to retain the Red Armies in Austria, after the treaty came into force, for a period that the Soviet Union could have indefinitely prolonged.

3

5

The Soviet proposals were unacceptable to the Austrian Government or the Governments of the United States, the United Kingdom,

1 Infra, pp. 1829-1832.

2 General Assembly Res. 613 (VII), Dec. 20, 1952; infra, pp. 1834–1835. 3 See infra, pp. 1850-1871.

See Secretary Dulles' statement of Feb. 13, 1954; infra, pp. 1858-1861.

5 See Mr. Molotov's statement of Feb. 14, 1954; Foreign Ministers Meeting: Berlin Discussions, January 25-February 18, 1954 (Department of State publication 5399; 1954), pp. 196-197.

and France. Therefore, the Berlin Conference adjourned without any constructive accomplishment with reference to the Austrian State Treaty.

III

At the conclusion of the Berlin Conference in 1954, the attainment by Austria of its freedom was not foreseeable. The Austrian Treaty had been considered and discussed at 379 separate sessions of the Foreign Ministers, Treaty Commission, and Treaty Deputies, but the Soviet Government remained unwilling to fulfill the pledge which it had made in the Moscow Declaration of 1943, and Austria continued to endure foreign occupation and exploitation.

In 1955, a change of Soviet policy with respect to Austria occurred. The Soviet Government suddenly became willing to conclude an Austrian Treaty. Austrian Chancellor Raab, at Soviet invitation, visited Moscow in April of this year and the resultant Soviet-Austrian understanding, recorded in a memorandum of agreement, dated April 15, 1955, provided the immediate impetus for agreement on the Austrian Treaty. The text of this memorandum is attached hereto.2 The cause of this change of policy on the part of the Soviet Government can only be conjectured. Certainly it is not without significance that this change coincided with assurance that the Paris pacts 3 would be ratified, Western Europe consolidated, and a free and independent Federal Republic of Germany brought into NATO.

The reversal of Soviet policy regarding Austria is highly significant. It will involve the first withdrawal in Europe of Soviet troops from the forward positions which they occupied in 1945. Also, this liberation of Austria will open new frontiers of freedom with Czechoslovakia and with Hungary and otherwise set an example which will stimulate the aspirations of other peoples for a freedom which has not yet been realized.

IV

The treaty herewith submitted is a much more satisfactory instrument than the draft treaty as it existed following the 1949 negotiations. Provisions of that draft which were either obsolete or in derogation of Austrian sovereignty were eliminated during the final days of the negotiations in Vienna.

The treaty calls for the ending of the occupation and the reestablishment of Austria, within the borders as they existed on January 1, 1938, as a sovereign, independent, and democratic State. All occupation troops will be withdrawn within 90 days after the coming into force of the treaty, and so far as possible not later than December 31, 1955. The signatories of the treaty declare their intention to respect Austria's independence and territorial integrity as established by the treaty. Anschluss with Germany is prohibited.

In general, the treaty conforms to the principles put forward by the United States in the short treaty draft of 1952, in that it provides

3

1 S. Exec. G, 84th Cong., 1st sess., pp. 42-43.

Not reprinted here.

Agreements of Oct. 23, 1954; see supra, pp. 483-612, and infra, pp. 972-989

for a completely free Austria, the constant objective of the Government of the United States. Under the terms of the treaty the Soviet Government will relinquish all control over the extensive oil and shipping properties, other business and industrial enterprises and agricultural lands which it now operates and controls in Austria. The Austrian Government has agreed to compensate the Soviet Government for the properties thus relinquished. Under the terms of the treaty and of the Soviet-Austrian memorandum of April 15, 1955, Austria will pay to the Soviet Government $150 million in goods over a period of 6 years for the return to Austrian control of German assets in Austria other than oil and shipping properties, 1 million tons of crude oil annually for a period of 10 years for the return of the oil properties, and $2 million for the return of the Danube Shipping Co. properties in Eastern Austria.

One article of the draft treaty (then known as art. 16) had given rise to apprehension that Soviet pressures would be exercised to compel the repatriation of displaced persons and refugees in Austria. The elimination of this article was requested by the Austrian Government, with the full support of the Governments of the United States, the United Kingdom, and France. The Soviet Government finally acquiesced in the deletion of this article.

Limitations which would have been imposed upon the size of Austrian armed forces were removed from the treaty. The treaty thus leaves Austria free to devote her full capabilities to defense of her independence.

V

The Austrian Government has indicated an intention to declare its perpetual neutrality and not to join any military alliances or permit any military bases on its territory. It is anticipated that the Austrian declaration of neutrality will be given effect by constitutional action of the Austrian Parliament. The Austrian Government plans to seek international recognition of its neutral status.

The Austrian Government has indicated its intention to defend Austrian neutrality with armed force. It does not plan or seek a demilitarized status but rather plans to be prepared to defend and preserve its newly won freedom by all the resources at its command.

Those who have observed the conduct and demeanor of the Austrian people during recent years can, I think, have little doubt that this present intention of the Austrian Government will become the permanent will of the Austrian people. They have shown a courage and steadfastness which is remarkable in the face of repeated disappointments of their hopes. Despite, or perhaps because of, the occupation of much of their land by the Soviet Union and despite intensive efforts by the Soviet Communists in developing a Communist Party in Austria, that party has never been able to rally more than 5 percent of the vote. Despite the drain year after year of

1 The declaration was made in a note of Nov. 14, 1955 (Department of State Bulletin, Dec. 19, 1955, pp. 1011-1012); see also the reply of the United States of Dec. 6, 1955 (infra, pp. 1777-1778).