662.11241/42
The Ambassador in Germany (Schurman) to the Secretary of
State
Berlin, April 29, 1929.
[Received May
11.]
No. 4504
Sir: I have the honor to refer to the
Department’s cablegram No. 25 of 3 p.m. April 12, 1926, and my despatch
of June 3 of that year87 relative to customs privileges for consular officers
under Article 27 of the Treaty of Friendship, Commerce and Consular
Rights of December 8, 1923.
During the past months consular officers in Germany have been complaining
that the privileges apparently granted to them by the rights of the
Treaty have been denied by the application of internal revenue taxation.
This matter I personally took up with Dr. von Schubert, leaving with him
an Aide Mémoire which is transmitted as enclosure
No. 1 of this despatch. The reply of the Foreign Office is enclosed as
No. 2. It is to be noted that the attitude of the German Government is
that the position of the minor officials of their consular service in
the United States has never been clarified and that their interpretation
apparently is that such officials (mittlerer
Konsulardienst) should be considered on a basis identical with
that of consular officers of career. From the Note
Verbale of the Foreign Office it would
[Page 1108]
appear that this matter is already in course of
negotiation between the German Embassy at Washington and the Department
in order to arrive at a definite premise which would place categorically
consular officers and employees upon a reciprocal basis.
The attitude of the German Government relative to the internal revenue
tax being assessed upon consular officers of career emanates from a
decree of the Eeichsrat of December 7, 1928, (No. II a 15483). This
decree was unknown to consular officers until their requests for free
entry were refused pending the payment of the internal revenue tax. The
consuls certainly should have been apprised of the decree and by
adopting this arbitrary attitude the German Government caused a
considerable amount of ill feeling inasmuch as under the terms of the
Treaty the American Consular Corps had every right to feel that free
entry was a privilege that was accorded them. The Embassy is informed
that the above-mentioned decree has not been published and a copy cannot
be obtained.
The attitude of the Department of State in claiming that neither by
Article 27 nor Article 19 of the Treaty a claim could be based for the
exemption of consular officers from the traffic and consumption taxes
unless such exemption was placed on the basis of a most-favored-nation
clause such as appears in the Spanish-American Treaty of Friendship of
July 3, 1902,88 is not compatible
with the regulations which the German Reich has adopted concerning the
position or capacity of the minor officials employed in their
consulates. Furthermore, it is pointed out in the Note
Verbale that the German Government apparently desires to
declare its position to the Department of State through its Embassy at
Washington within a short period of time.
Consular officers in Germany have been informed that the question of
their exemption from internal revenue taxes (innere
Abgdben) is under discussion and that for the time being it is
not advisable for them to import such articles as are taxable under the
law.
In order to upset the decree of the Reichsrat it would be necessary for
that body to pass a new decree which would have to receive general
support and a member of the Embassy was confidentially informed at the
Ministry for Foreign Affairs that there was little likelihood of this
occurring. The relationship of this matter to the interpretation of the
automotive tax and sick insurance law, as transmitted by despatches in
this pouch should be duly noted.
In view of the above and as the Embassy has no knowledge of the
negotiations pending in Washington to arrive at an agreement, I
respectfully request that I be instructed in the premises.
I have [etc.]
[Page 1109]
[Enclosure 1]
The American Ambassador (Schurman) to the German Secretary of State for Foreign
Affairs (Von
Schubert)
Aide-Mémoire
The American Ambassador informed Dr. von Schubert that from
information he had received from American consular officers in
Germany, a decree had been passed by the Reichsfinanzministerium on
December 7, 1928, which made it necessary for American consuls to
pay duty upon articles imported by them in so far as they were and
are subject to “innere Abgaben.”
Inasmuch as this regulation apparently is contrary to the terms of
the Treaty of December 8, 1923, the Ambassador felt it necessary to
refer to the decree and requested that through the good offices of
the Ministry for Foreign Affairs steps be taken in order that the
privileges accorded by the said treaty be granted to American
consular officers.
Berlin, February 1,
1929.
[Enclosure
2—Translation]
The German Foreign
Office to the American
Embassy
V 526
Note Verbale
Adverting to its Note Verbale of November 7,
1928,—V M 5540—regarding the exemption of Mr. Lester L. Schnare,
American Consul at Breslau, from the internal revenue tax levied on
cigarettes, (Verbrauchssteuer auf
Zigaretten), as well as with reference to the aide memoire of February 1, 1929, regarding exemption of
American Consuls from “innere Abgaben”, presented on that day by His
Excellency the Ambassador of the United States of America, the
Foreign Office has the honor to inform the Embassy of the United
States of America as follows:
Negotiations have been carried on in Washington for some time,
between the German Embassy and the American Department of State
relative to the interpretation of Article XXVII of the Treaty of
Friendship, Commerce and Consular Service between the German Reich
and the United States of America of December 8, 1923.89 In
the course of these negotiations the question was discussed, amongst
others, as to whether and to what extent the Consular Officers of
both parties are to be exempted also from the “innere Abgaben”
(taxes on production, manufacture, consumption and sale) levied
besides customs duty, (cf. note of the Assistant Secretary of State
to the Ambassador
[Page 1110]
of May
31, 1926—VM 3072—).91 Germany assumed at the beginning that, according
to the organization of the German Consular Service, the
uncommissioned consular officials (Konsularbeamte
des mitileren Dienstes), (chancellors, secretaries,
cashiers, file clerks) and higher employees, as for instance
commercial experts, were to be counted as consular officers and
would thus, if occasion should arise, enjoy exemption from the taxes
in question. In the further course of the negotiations the American
government then assumed the standpoint that
- a.)
- consular officers are to be understood as including only
Consuls-General, Consuls, Vice-Consuls, Interpreters,
Student-Interpreters, and Consular Agents, and
- b.)
- that neither on Article XXVII nor on Article XIX of the
treaty a claim could be based for the exemption of consular
officers from the traffic and consumption taxes, but that
the German consular officers in America could be granted
such exemption on the basis of the most-favored-nation
clause in Article XVII of the treaty in connection with
Article XV of the Spanish-American Treaty of Friendship of
July 3, 1902, provided the German Reich granted the
American, consular officers equal rights.
The American interpretation of the term “consular officers” in
Article XXVII of the German-American Treaty is at present being
examined again by Germany, as it does not take into account the
position and work of the officials of the German middle consular
service (mittlere Konsulardienst). The German
Government reserves the right of shortly presenting its objections
in this matter or of declaring its agreement to the American
Government through the German Embassy in Washington.
The German Government agrees with the American Government that
exemption of consular officers from “innere Abgaben” can not be
deduced from the mere wording of the German-American Treaty of
Friendship etc. The German Government, however, for reasons of
organization, is not in a position to adopt the method suggested by
the American Government for the exemption of consular officers from
the “Abgaben” in question. It reserves the right, however, to revise
its point of view, in case the American Government should later
arrive at another, broader, interpretation of the term “consular
officers”. The German Embassy in Washington has been instructed to
inform the American Government in this matter.
The exemption from the cigarette tax applied for by Consul Schnare
could unfortunately not be granted under the circumstances.
