667.003/121: Telegram

The High Commissioner at Constantinople ( Bristol ) to the Secretary of State

190. I believe the time has decidedly arrived when pressure should be brought to bear upon Allied Governments to cooperate with our Government for the regulation of trade in Turkey. A short time [Page 896] ago the Allied High Commissioners issued notice through their Chambers of Commerce that, when specific customs duties on goods of Allied origin exceeded the 11 percent ad valorem, the specific tariffs could be ignored and only the 11 percent ad valorem paid.

Very recently this rule has been made for the benefit of the importers of Allied goods, no matter what nationality of importer may be. Further, if the Turkish customs authorities raise objections to this procedure, importers are instructed to apply to Colonel Woods (a British officer representing British High Commission acting as adviser to the Turkish Government) who will assist importers in having Turkish Government comply with this measure. When Colonel Woods was asked how he was able to have Turkish Government comply with this procedure he stated that he simply directed them to carry out these provisions and it was done. Thus it is evident, as it has been for a long time, that the Allies take advantage of their military occupation and control of Turkish Government to obtain every commercial advantage for their nationals.

At a very recent meeting of the Advisory Trade Commission my delegate asked the Allied delegates if the above decision regarding payment of taxes by Allied nationals applied to specific import taxes that were composed of the direct import tax and a further tariff known as “consumption tariffs”, because our Government would undoubtedly take this position and direct American citizens not to pay more than 11 percent ad valorem import taxes upon the understanding that the import taxes would be considered the total specific taxes, both direct and consumption tariffs. This statement created consternation amongst the Allied delegates thus demonstrating still more conclusively that the Allied representatives here are proceeding without regard for American interests. This procedure is highly discriminatory against American trade in that the bulk of the consumption taxes are imposed on articles chiefly from America. Furthermore it exposes the hypocrisy of the Allies in urging the United States Government to tolerate the consumption taxes for the purpose “of increasing the receipts [of] the Turkish Government”.

This act of the Allied representatives in Constantinople, as well as practically all their acts, for the regulation of trade with Turkey since the blockade was raised over two years ago has been without cooperation from this High Commission, in spite of every endeavor on my part to cooperate with them. By many written communications and frequent personal conferences I have endeavored to obtain concerted action of the Associated Powers (Great Britain, France, [Page 897] Italy and America) for the regulation of trade with Turkey on legal and just basis. I have become convinced that Allied representatives work on the principle of what is for their best interests commercially without regard to legality or justice. This seems to be the principle that actuates the Allies in the whole procedure in conformity with the obtaining of peace in the Near East. My despatches will point out in detail the record of past events.

If possible the immediate adoption of the import tax of 11 percent ad valorem with the understanding that the necessities of the Turkish Government for added inconvenience be provided for by, as a temporary measure, an extra percentage ad valorem tax pending final settlement by treaty. The Turkish Government would oppose a return to the ad valorem system of taxation but I believe it would yield on this point if there was concerted action. Turkey is now taking advantage of the difficulties that exist between the Allies and between the Allies and ourselves. I have made strong representations along these lines to Allied High Commissioners without avail. A decision arrived at on this point would improve whole situation in Near East, and a strong attitude of our Government greatly benefit all American interests.

Bristol