Papers Relating to the Foreign Relations of the United States, 1927, Volume III

711.582/22

The Swedish Legation to the Department of State

Memorandum regarding certain stipulations in the draft or a Treaty of Friendship and Commerce between Sweden and the United States

Article I

Par. 1.

a) What is the meaning of the term “local laws and regulations”?

b) It is understood that the word “hereafter” has reference to all privileges granted the most-favored-nation, whether before or after the signing of the treaty.

c) It is understood that the concluding sentence of Paragraph 1 (“submitting themselves to all local laws and regulations duly established”) refers to the entire contents of Article I, Par. 1.

d) It is further understood that, whereas the treaty only confers the right to own buildings within the territory of either High Contracting Party to the nationals of the other, it does not exclude such nationals from the right to own land, so far as the local laws permit that land may be owned by foreigners.

Par. 2.

An explanation is desirable with regard to the term “internal charges or taxes.”

Par. 5.³

The view is expressed that the word “immigration” does not include tourist traffic, that is traffic which according to general practice can not be regarded as immigration and which takes place outside the quota. As a consequence, the stipulation in Par. 1 according most-favored-nation-treatment has to be applied. It is understood, however, that there will be no objection on the part of the United States to an explanation in a supplemental memorandum to the effect that the High Contracting Parties reserve the right to issue special regulations for the visa of passports.

Article II

It is understood that the United States is willing to consider the conclusion of a separate agreement with Sweden governing mutual workmen’s compensation.

Article IV

According to Swedish law no restrictions exist similar to those which are assumed in this paragraph. A foreigner who comes into possession of real or other immovable property, either as an inheritance or by testamentary disposition, has in Sweden the sole right to own and dispose of it. It would seem that from a logical point of view it would be preferable to have the construction of this paragraph in the following way:

• First, it should be expressly stated that the nationals of the two High Contracting parties have the right, generally speaking, to dispose of both immovable and personal property by testament, donation, or otherwise,
• Second, it should be stated that the nationals of the High Contracting Parties have the right to succeed to both immovable and personal property, provided, however,

  a) with regard to immovable property, a certain period of time within which to sell the same shall be stipulated (with a most-favored-nation-clause);

  b) with regard to the personal property, that the nationals of the High Contracting Parties shall have national treatment.

Article V

a) According to Swedish law congregations of the Christian faith only have the right to exercise public worship. The view is expressed, however, that a reservation to this effect is not necessary on the part of Sweden, as said reservation is covered by the stipulation in Article I, Par. 1 (“submitting themselves to all local laws and regulations duly established”).

b) What is the meaning of the term “at liberty” as used in this article?

Article VII

Par. 1 and 2.

a) It is understood that the wording of Par. 1 and 2 aim to cover the most-favored-nation-principle in its unconditional form, whereby all discrimination against the other party is eliminated. The reservation made—”nothing in this treaty shall be construed to restrict the right of either High Contracting Party to impose, on such terms as it may see fit, prohibitions or restrictions of a sanitary character designed to protect human, animal, or plant life, or regulations for the enforcement of police or revenue laws”—refers to exceptions which would be deemed justified for special reasons, as for instance the prohibition on the importation of liquor, drugs etc.

In view of the great importance of the stipulations in this article it is imperative to have a wording which eliminates any doubt concerning the true meaning of the unconditional most-favored-nation-clause. It appears as if the article in its present form leaves room for some doubt as to whether or not discrimination in violation of the terms of the treaty may be considered as having taken place, and a full explanation on this point would therefore seem warranted.

Particular reference is made to the term “or revenue laws” at the end of Par. 1. The view is expressed that, even if “revenue laws” include the tariff law, the term covers only such parts of the tariff law as contain stipulations of a sanitary character or prescribe that all imported goods shall be subjected to customs examination, or others of a general character, but should not be considered as comprising the special tariff rates in the law. According to this view the assessment of special dumping duties—prescribed in the Antidumping Act at present in force—on Swedish goods would constitute a discrimination and, consequently, a violation of the stipulations set forth in this article, unless said duties were at the same time levied on similar goods from all other countries. Likewise, an application of the principle of reciprocity embodied in certain sections of the Tariff Act of 1922⁴—for instance Par. 1543—against Swedish cement would be considered a discrimination.

In order to make the point above referred to quite clear it would seem as if a more specific wording than is now contained in the last sentence of Par. 1 would be desirable, for instance by adding: “regulations for the enforcement of police and revenue laws relating to merchandise, the importation or transportation of which is prohibited or regulated by law, without discriminating against the other party.[”]

b) It is understood that the word “like” article in Par. 2 refers to the same article as previously mentioned in the sentence.

Par. 7.⁵

It is suggested that the words “and merchandise” should be added at the end of the paragraph in order to make the sentence complete.

Par. 8.⁶

a) It is suggested that to Par. 8 a sentence be added to the effect that the privileges granted Cuba and the dependencies shall be excepted only as long as the same privileges are not also granted a third power.

b) On the part of Sweden reservations have to be made, first, for the privileges which Sweden has already granted and might in the future grant neighbouring countries in order to facilitate trade on the border, and, second, for the privileges which Sweden has granted or might in the future grant Norway or Denmark, or both of these countries, as long as the same privileges are not granted a third state.

Article VIII

a) An explanation is desirable as to whether or not the transit duties mentioned in Article VIII refer to the same kind of duties as are mentioned in Article XVI.

b) Reservations are necessary on the part of Sweden with regard to certain regulations in the Swedish law, which stipulate a special tax for:

1. Alcohol produced from foreign raw materials in contrast to Swedish raw materials (not from foreign rye, however);

2. Starch produced from foreign raw materials (not from foreign wheat, however).

3. Manufactured tobacco.

Article IX

a) As there is no general clause in this article giving full equality in every instance between the vessels of the High Contracting Parties, the suggestion is made that the article begin as follows:

“The vessels and their cargo of either of the High Contracting Parties shall, within the ports and the territorial waters of either country, in all instances enjoy the same treatment as national vessels and their cargo, from whatever place they may arrive, and whatever may be their place of destination, and regardless of the origin of the cargo or its destination.”

b) The present wording of Article IX requires reservations on the part of Sweden, so that the stipulations in the article do not extend to: 1. coastal trade, 2. certain facilities granted Swedish fishermen, and 3. certain privileges accorded Finland with regard to the obligation of the use of pilot.

c) As Article IX shall have only a short duration (12 months) it is desirable to have inserted the same general most-favored-nation-clause as suggested in Article VII, Par. 5.

Article XI

a) For reasons given verbally, Sweden desires to have the last sentence in this article stating most-favored-nation-treatment with regard to coastal trade stricken out.

b) On account of the shorter duration of this article it would be desirable to have the same general most-favored-nation-clause inserted as suggested in Article VII, Par. 5.

Article XIV and XV

It would be preferable on the part of Sweden to substitute the present detailed wording of Articles XIV and XV with a more general clause stating most-favored-nation-treatment similar to that contained in the treaty between the United States and Esthonia.⁷

Article XVI

Sweden being a member of the Barcelona Convention of 1921⁸ has to make reservations in conformity with the stipulations in said convention.

Article XXX

In case the stipulations in Par. 3, Article XXX,⁹ describing a shorter duration of certain articles in the treaty, should go into effect, Sweden would like to have the assertion that she be granted most-favored-nation-treatment in the points covered by Article VII, Par. 5 and 6, and Articles X and XI.

Washington , March 24, 1927.

3. The fifth paragraph reads: “Nothing contained in this Article shall be construed to affect existing statutes of either of the High Contracting Parties in relation to the immigration of aliens or the right of either of the High Contracting Parties to enact such statutes.” This paragraph embodied a reservation by the Senate to the treaty with Germany, Dec. 8, 1923; see bracketed note, Foreign Relations, 1923, vol. ii, p. 45.
4. 42 Stat. 858.
5. Sixth paragraph of art. vii of treaty with Germany, Dec. 8, 1923; Foreign Relations, 1923, vol. ii, p. 33.
6. Seventh paragraph of art. vii of treaty with Germany, Dec. 8, 1923; ibid.
7. Foreign Relations, 1925, vol. ii, p. 70.
8. League of Nations Treaty Series, vol. vii, p. 11.
9. Par. 3 reads as follows: “The fifth and sixth paragraphs of Article VII and Articles IX and XI shall remain in force for twelve months from the date of exchange of ratifications, and if not then terminated on ninety days’ previous notice shall remain in force until either of the High Contracting Parties shall enact legislation inconsistent therewith when the same shall automatically lapse at the end of sixty days from such enactment, and on such lapse each High Contracting Party shall enjoy all the rights which it would have possessed had such paragraphs or articles not been embraced in the Treaty.”