to the State of São Paulo on the grounds that the money might indirectly be used to keep up the price of coffee. Mr. Bailie wished it distinctly understood that his firm was not urging that this loan be approved but would be glad to complete the transaction if it felt that it had the complete approval of the Department. I informed him that I would lay the matter before the Secretary. It seems to me that the question hinges on whether the financing of crops by the bank will result in maintaining an artificially high price or merely a steady normal price. 832.51 Sa 6/26 MORGAN The Secretary of State to Mr. Earle Bailie WASHINGTON, August 21, 1925. SIR: With reference to your visit to the Department on August 19 [sic], during which you inquired whether the Department would have any objection to a projected loan by your firm to the Paulista Institute for the Permanent Defense of Coffee of São Paulo, I beg to say in reply that in the light of the information before it, the Department cannot view this financing with favor. I am [etc.] For the Secretary of State: 832.51 Sa 6/32 Under Secretary Speyer & Co. to the Secretary of State NEW YORK, November 4, 1925. SIR: We are now in negotiation with the State of São Paulo, Brazil, covering a Loan for an amount between $25,000,000 and $35,000,000, to be issued under a law to be passed by the Congress of the State of São Paulo. The Bonds are to carry interest at a rate still to be determined (which will be either 72% or 8% per annum) and will be in the form of Twenty Year or Twenty-five Year Bonds, to be redeemable by means of a Sinking Fund sufficient to retire all of the Bonds at or before maturity. The Bonds will be the direct external obligation of the State of São Paulo, and will be payable in United States gold, free from all Brazilian taxes, and will be secured by a first charge on the railway tax of One Milreis Gold per bag of coffee transported across the State of São Paulo. We are advised by cable that the President and State Secretary of São Paulo have declared as follows: First, that the proceeds of the Loan will be deposited in the São Paulo banks to finance agricultural and commercial interests; second, that the purpose of the Loan is not for coffee valorization. The President and State Secretary further advise that the policy of the Defense of Coffee Institute is to stop speculation and not to valorize coffee. We trust that the Department will find no objection to the flotation of this proposed Loan in the American market, and we shall be obliged if you will so advise us. Respectfully yours, 832.51 Sa 6/32 SPEYER & Co. The Secretary of State to Speyer & Co. WASHINGTON, November 6, 1925. SIRS: I beg to acknowledge the receipt of your letter of November 4, 1925, regarding your interest in a proposed loan to the State of São Paulo, Brazil, in the amount of from $25,000,000 to $35,000,000, for the purposes and under the terms set forth therein, and in reply thereto to state that in view of the policy of coffee valorization followed by the authorities of São Paulo, this Department is unable to view the proposed financing with favor at this time. I am [etc.] 75289-4042 For the Secretary of State: LELAND HARRISON Assistant Secretary BULGARIA CONTINUANCE OF AMERICAN CAPITULATORY RIGHTS IN BULGARIA 711.743/21 The Minister in Bulgaria (Wilson) to the Secretary of State No. 503 SOFIA, July 1, 1924. 1 SIR: I have the honor to report that the French Minister called on me yesterday to inquire whether the exchange of the ratifications of the Bulgarian-American extradition treaty was to be taken as an indication that the United States has definitely relinquished in Bulgaria its capitulatory rights, which by article 175 of the Treaty of Neuilly were specifically retained by all countries signatory to that instrument. 2 Although since I have been in charge of this mission I have on various occasions referred to the capitulations as governing certain rights and privileges of Americans in Bulgaria, I have never received from the Department any definite expression as to its point of view of the matter. In looking over the past records of the Legation, I cannot find that the United States ever relinquished its capitulatory rights, and in fact at times seems to have attached considerable importance to their maintenance, while never actually invoking them. Apparently those countries which have ratified the Treaty of Neuilly intend to maintain their capitulatory rights, and it is on the strength of these rights that the British, French, and probably the Italian Governments are going to insist upon the free customs entry of articles for their respective consuls. (Legation's telegram No. 21, of June 30, 1924).3 In view of the above inquiry of the French Minister, and possibly like inquiries from the Bulgarian Government, I have the honor to request that the Legation may be informed as to the position of the United States Government on the question of capitulatory rights in Bulgaria as affecting American interests in that country. I have [etc.] CHARLES S. WILSON 1 Treaty of Mar. 19, 1924, Foreign Relations, 1924, vol. 1, p. 328. 536 711.743/21 The Secretary of State to the Minister in Bulgaria (Wilson) No. 141 WASHINGTON, September 23, 1925. SIR: The Department refers to your despatch No. 503, of July 1, 1924, regarding an inquiry by the French Minister at Sofia as to whether the exchange of the ratifications of the Extradition Treaty between the United States and Bulgaria was to be taken as an indication of the relinquishment by this country of its capitulatory rights in Bulgaria. You state that apparently the countries which have ratified the Treaty of Neuilly intend to maintain their capitulatory rights and that upon examining the past records of your Legation you have been unable to find that the United States has relinquished its capitulatory rights in Bulgaria. The Department does not perceive that there is any direct relation between the capitulatory rights enjoyed by the United States in Bulgaria and the provisions of the Extradition Treaty between the two countries. As noted in Moore's Digest of International Law, Volume IV, page 259, the United States has not generally followed the practice of certain Powers in seeking to obtain the recovery of fugitive criminals through the action of their ministers and consuls in countries in which such ministers and consuls are by treaty invested with judicial powers. This country has, on the other hand, in two cases, that of the Ottoman Empire, in 1874, and Japan, in 1886," entered into extradition treaties with countries in which citizens of the United States were entitled to capitulatory privileges. "The Government of the United States," Mr. Moore observes, "has been induced to take this position not only by reason of doubts as to the applicability of the extraterritorial stipulations to extradition, but also because the statutes passed to carry such stipulations into effect confer upon the ministers and consuls no authority for that purpose." Inasmuch as the United States has not ratified the Treaty of Neuilly, it is of course not in a position to rely directly upon the provisions of that Treaty as a basis for any claim which it may care to assert in regard to the continued enjoyment of capitulatory rights in Bulgaria. On the other hand, it does not appear that this country has at any time relinquished its capitulatory rights in Bulgaria and, accordingly, those rights may be said to be still subsistent. For your confidential information and guidance it may be added that the Department's interest in this matter is that of assuring to American nationals in Bulgaria treatment as favorable as that which may be accorded to nationals of the most favored nation. The Department would therefore, under present circumstances, be disposed to press for rights of a capitulatory character only in the event that other Powers advance claims by virtue of the capitulations. Your comments on the present situation and on the attitude of the various capitulatory Powers would be appreciated. I am [etc.] FRANK B. KELLOGG 711.743/23 The Chargé in Bulgaria (Cable) to the Secretary of State No. 743 SOFIA, December 6, 1925. SIR: I have the honor to acknowledge the receipt of the Department's Instruction No. 141 of September 23, 1925, relative to the attitude of the various capitulary [sic] powers in Bulgaria. Inasmuch as the Capitulations in Bulgaria are a legacy of the Ottoman Empire and as the historical point of view arises even to-day, it appears best to take up the case from its inception. The Treaty of Berlin of 1878, which marks the first real step in the independence of Bulgaria, stipulates that the Capitulations in force under Turkish domination shall remain in vigor. (Art. 8) Of necessity the signatories to the Treaty of Berlin were the nations to enjoy the rights exercised thereunder. However, other nations who enjoyed capitulary rights in the Ottoman Empire claimed them also in Bulgaria and obtained them. (Holland, Spain, etc.) The Bulgarians claim that by actual right only the signatories of the Treaty of Berlin have a right to Capitulations in Bulgaria, that other nations have acquired that position during the formative period of the country, and only enjoy the privileges due to the complaisance of the signatories. In reality the Capitulations are a charge imposed on Bulgaria by the Great Powers with the original accord of the Sublime Porte. From the terms of the Treaty of Berlin it would appear that for Bulgaria to receive modifications in the Capitulations it would take unanimous action on the part of the signatories. Serbia, by various conventions, agreements and treaties has accomplished this very end, inasmuch as the various nations interested had some definite end to gain. In 1891 the French Government invoked its Capitulary right when the Bulgarian Government attempted to expel a Mr. Chadbourne, a French correspondent who had criticized Bulgarian politics. Carnot's Government, de Freycinet was Premier at the time, broke diplomatic relations with Bulgaria and recalled Lanel, the French "British and Foreign State Papers, 1877-1878, vol. LXIX, p. 749. |