Foreign Relations of the United States Diplomatic Papers, 1940, The American Republics, Volume V

839.51/4838: Telegram

The Secretary of State to the Minister in the Dominican Republic (Scotten)

Washington, August 26, 1940—8 p.m.

122. Your 143, August 25,¹² and in further reference to Finley’s telephone call¹³ to Briggs,¹⁴ the following is our suggestion for a draft of Article III:

“The Government of the United States of America and the Government of the Dominican Republic, in common accord, shall designate a bank, with establishment in the Dominican Republic, as sole depository of all revenues of the Dominican Republic and agree to designate, also by common accord, an official who shall act in the said bank as representative of the holders of the bonds of the External Debt of 1922 and 1926 in all matters that concern the service of the said external debt. If at any time the bank so designated ceases for any reason to function in this capacity, or if either of the High Contracting Parties deems a change advisable, a successor shall be designated under the procedure outlined above. If the official who shall act in said bank as representative of the holders of the bonds of the External Debt of 1922 and 1926 ceases for any reason to serve in such capacity or if either of the High Contracting Parties deems a change advisable, his successor shall be designated by the same procedure established for the original designee. In the event that it becomes necessary to designate a successor either to the bank or the official representing the holders of the bonds of the External Debt of 1922 and 1926 and in the further event that the Government of the United States of America and the Dominican Government are unable to reach mutual accord on such designation within a period of three months, the Foreign Bondholders Protective Council, Incorporated, shall then nominate said successor, and in the event that the Foreign Bondholders Protective Council, Incorporated, is unwilling to make such nomination, the President or a Vice President of the American Bankers Association or his duly authorized representative shall be requested to make the nomination. The High Contracting Parties in this event undertake to appoint such designee to office. The official representing the holders of the bonds of the External Debt of 1922 and 1926 shall designate a deputy to serve in his stead in the event of his temporary absence or incapacity.”

It is believed that a provision for pensions should be included in the new draft convention, perhaps with the details to be contained in an exchange of notes rather than in the convention itself.

The Department does not recommend that the matter of the floating debt be included in the convention itself, although should you desire to exchange notes on this subject the Department would be pleased to consider your draft text.

Hull

12. Not printed. In it Mr. Wilson submitted a tentative draft for article III which, with minor verbal differences, was the same as draft contained in this telegram except that where the holders of bonds of the External Debt of 1922 and 1926 are mentioned, the draft in telegram No. 143 read “The Foreign Bondholders Protective Council, Incorporated.”
13. No record of conversation found in Department files.
14. Ellis O. Briggs, Assistant Chief, Division of the American Republics.