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

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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 Austria and to confirm the understanding reached as a result of these conversations as follows:

1. For such time as the Government of the United States of America participates in the occupation or control of any areas in Western Germany, the Free Territory of Trieste, Japan or Southern Korea, the Government of Austria will apply to the merchandise trade of such area the provisions relating to the most favored nation treatment of the merchandise trade of the United States of America set forth in the Treaty of Friendship, Commerce and Consular Rights, signed at Vienna, June 19, 1928,2 and agreement supplemental thereto signed at Vienna, June [January] 20, 1931,3 or, for such time as the Governments of the United States of America and Austria may both be contracting parties to the General Agreement on Tariffs and Trade, dated October 30, 1947, the provisions of that agreement, as now or hereafter amended, relating to the most favored nation treatment of such trade. It is understood that the undertaking in this paragraph relating to the application of the most favored nation provisions of the Treaty of Friendship,

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1 An identical note, addressed to the American Minister, was signed by the Minister of Foreign Affairs, Karl Gruber, on the same day, July 2, 1948, at the time of the signing of the Economic Cooperation Agreement between the United States and Austria (TIAS 1780, ante, p. 404).

'TS 838, ante, p. 341.

'TS 839, ante, p. 372.

TIAS 1700, ante, vol. 4, p. 641.

Commerce and Consular Rights and agreement supplemental thereto shall be subject to the exceptions recognized in the General Agreement on Tariffs and Trade permitting departures from the application of most favored nation treatment; provided that nothing in this sentence shall be construed to require compliance with the procedures specified in the General Agreement with regard to the application of such exceptions.

2. The undertaking in point one above will apply 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 Austria.

3. The undertakings in points one and two above are entered into in the light of the absence at the present time of effective tariff barriers to imports into the areas herein concerned. In the event that such tariff barriers are imposed, it is understood that such undertaking 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.

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4. It is recognized that the absence of a uniform rate of exchange for the currency of the areas in Western Germany, Japan or Southern Korea referred to in point one 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 point one for the Government of Austria to levy a countervailing duty on imports of such goods equivalent to the estimated amount of such subsidization, where the Government of Austria 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 Honorable

KARL GRUBER,

Minister of Foreign Affairs,

Vienna.

JOHN G. ERHARDT

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

No. 13

SIR:

RELIEF ASSISTANCE

Exchange of notes at Vienna February 3 and 11, 1949
Entered into force February 11, 1949

Amended by agreement of July 1 and 31, 1952 1

63 Stat. 2420; Treaties and Other International Acts Series 1922

The American Minister to the Minister of Foreign Affairs

AMERICAN LEGATION, Vienna, February 3, 1949

Pursuant to the instructions of my Government, I have the honor, in conjunction with Clyde N. King, Chief of the ECA Mission for Austria, to propose that for the purpose of giving effect to Article V, paragraph 2, read with Article IV, paragraph 5, of the Economic Cooperation Agreement between the Governments of Austria and the United States of America, signed on July 2, 1948, the Governments of Austria and of the United States agree as follows:

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1. The Government of Austria shall accord duty-free entry into Austria of:

(a) Supplies of relief goods or standard packs donated to or purchased by United States voluntary nonprofit relief agencies qualified under Economic Cooperation Administration (hereinafter referred to as ECA) regulations and consigned to such charitable organizations (including Austrian branches of these agencies), as have been or hereafter shall be approved by the Austrian Government.

(b) Relief packages originating in the United States and sent by parcel post or other commercial channels addressed to an individual residing in Austria whether privately packed or by order placed with a commercial firm. (c) Standard packs put up by United States voluntary nonprofit relief agencies, or their approved agents, qualified under ECA regulations, to the

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order of individuals in the United States and sent for delivery addressed to individuals residing in Austria.

2. For the purpose of this agreement, the term "relief goods" (subparagraph (a), above) shall not include tobacco, cigars, cigarettes, or alcoholic liquors; "relief packages" (subparagraph (b), above) shall include only such goods as are qualified for ocean freight subsidy under the ECA Act and regulations issued by the Administrator thereunder and shall not exceed 44 pounds (20 kilograms) gross weight; and "standard packs" (subparagraph (c), above) shall contain only such articles which qualify under ECA regulations and are approved by the Government of Austria.

3. Transportation charges (as defined in paragraph 5 of Article IV of the Economic Cooperation Agreement) in Austria on "relief goods”, “relief packages", and "standard packs", all as defined in paragraph 1, above, shall be defrayed as follows:

(a) The amount of such charges for all such shipments which are sent by U.S. parcel post addressed to individuals in Austria will be computed by the Austrian postal service in the manner now or hereafter provided by the applicable agreements, rules and regulations of the International Postal System. Such charges shall be reimbursed to the Austrian postal service out of the special account provided for in Article IV of the Economic Cooperation Agreement between the United States of America and Austria (hereinafter referred to as the special account) and no claim for such charges will be made against the United States.

(b) With respect to shipments which are originally despatched from the U.S. by any regular established commercial channels and forwarded in Austria by an approved agent of the shipper to the ultimate beneficiary by Austrian parcel post, such items shall be accepted by Austrian postal services without payment of postal charges by such agent. The Austrian Government shall be reimbursed for such parcel post charges out of the special account upon presentation of adequate documentation.

(c) With respect to shipments which are originally despatched from the U.S. by any commercial channel and forwarded in Austria by an approved agent of the shipper to the ultimate beneficiary by Austrian common carrier or contract carrier, or other means of transport arranged by such agent, such items shall be accepted by such Austrian carrier with or without payment of charges therefor by such agent. The Austrian Government shall reimburse such agent or Austrian carrier, as the case may be, out of the special account upon presentation of adequate documentation.

(d) With respect to any such charges which may be incurred by an agent of a shipper under subparagraphs (b) and (c), above, other than parcel post charges and carrier charges, such approved agent shall be reimbursed by Austria out of the special account upon presentation of adequate documentation.

4. The Austrian Government shall make payments out of the special account for the purposes mentioned in subparagraphs (a), (b), (c), and (d) of paragraph 3, above, and shall submit to the ECA Mission in Austria with a copy to Controller, ECA Washington, monthly statements of the amounts so expended in form mutually satisfactory to the Austrian Government and said Mission, provided that each such statement shall at least show total weight carried and charges therefor and adjustments shall be made to said fund if shown to be required by ECA audit.

5. So far as practicable, effect shall be given to Paragraphs 3(b), 3(c), 3(d), and 4 as though they had come into force on April 3, 1948.

This arrangement, except as otherwise specified herein, shall come into effect immediately and shall remain in force, subject to such prior termination or modification as may be agreed upon between the competent authorities of the Governments of the United States and Austria, for the same period as the said Agreement of July 2, 1948.

If the above proposal is acceptable to the Government of Austria, I have the honor further to propose that this note and your reply to that effect shall constitute an Agreement on the above terms between the two Governments. Accept, Sir, the renewed assurances of my highest consideration.

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With reference to your Note No. 13, regarding an Arrangement concerning the duty free entry into Austria and the defrayment of transportation charges for relief goods, relief packages and standard packs, forwarded from the United States of America to Austria, I have the honour to inform you that the Austrian Federal Government are agreed on the following text of the Arrangement:

[For text of arrangement, see U.S. note, above.]

Accept, Sir, the renewed assurance of my highest consideration.
Ihr aufrichtiger [Sincerely yours].

His Excellency

Mr. JOHN G. ERHARDT

Envoy Extr. and Minister Plenipotentiary

of the United States of America

Vienna.

FIGL

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