811.20 Defense (M)/7385
The Minister in Costa Rica (Scotten) to
the Secretary of State
No. 401
San José, June 19,
1942.
[Received June 22.]
Sir: I have the honor to refer to the
Department’s instruction No. 131 of May 27th, 1942 and the Department’s
telegram No. 219 of June 1st, 1942, 10 p.m.,9 which transmitted the draft text of the
Agreement between the Rubber Reserve Company and the Government of Costa
Rica for the exploitation of rubber. Reference is made also to the
Department’s telegram No. 234 of June 10th, 1942, 10 p.m.10 which authorized Mr. W. E.
Klippert to execute the Agreement on behalf of the Rubber Reserve
Company and which requested me to forward copies of the Agreement as
executed.
In accord with these instructions, there are transmitted herewith copies
of both the English and Spanish texts of the Agreement which were signed
in my presence on June 16th, 1942 by Mr. W. E. Klippert on behalf of the
Rubber Reserve Company and by His Excellency Mr. Jorge Zeledón Castro,
Minister of Fomento, on behalf of the Government of Costa Rica.
Respectfully yours,
[Enclosure]
Memorandum of Agreement
This agreement, made and entered into as of this 16th day of June
1942, by and between Rubber Reserve Company (hereinafter called
“Reserve”), an Agency of the United States Government and a
corporation existing under the laws of the United States of America
and having its office for the transaction of business in Washington,
D.C., party of the first part, and the Republic of Costa Rica
(hereinafter sometimes called “Costa Rica”) party of the second
part;
[Page 234]
Witnesseth
- 1.
- Reserve agrees to establish or cause to be established an
Agency which shall be authorized to assist in developing the
rubber resources of Costa Rica and to acquire and sell rubber of
any kind produced within the territory of the Republic of Costa
Rica. Reserve and Costa Rica agree that the Agency shall have
all powers necessary and appropriate to the performance of these
functions.
- 2.
- Costa Rica recognizes the large rubber requirements of the
United States for the War emergency and agrees that the Agency
shall have the exclusive right to purchase for export from the
Republic of Costa Rica all crude and manufactured rubber.
- Costa Rica agrees to use its best efforts to bring about the
maximum production of rubber and to cause it to be sold to the
Agency, including the taking of effective measures to prevent
hoarding of rubber or rubber products.
- 3.
- Reserve agrees that the Agency will buy and Costa Rica agrees
that it will cause to be sold to the Agency all the rubber
produced within the territory of the Republic of Costa Rica
which is not required by the Republic of Costa Rica for domestic
use or consumption. The amount of crude rubber and rubber
products required by the Republic of Costa Rica for domestic use
or consumption is hereby fixed at not more than 30 tons a year;
but it is understood and agreed that this amount shall be
increased by agreement of the parties if it shall be shown that
a larger amount is required to meet Costa Rica’s justifiable
needs.
- 4.
- Reserve and Costa Rica agree that the base price to be paid by
the Agency for purchases of rubber hereunder shall be 33 cents
U.S.A. currency per pound f.o.b. Puerto Limón or Puntarenas, for
usual good quality Castilloa scrap (as understood in New York
City), with appropriate differentials for other types and grades
(said base price, together with said differentials, being
hereinafter referred to as the “fixed price”). The price to be
paid by the Agency for purchase of rubber at inland locations
shall be the fixed price less appropriate differentials to cover
transportation to ocean carrying vessel and customary handling
charges. It is understood that the purchases of rubber by the
Agency f.o.b. Puerto Limón or Puntarenas shall be on the basis
of cash against shipping documents endorsed “on board” ocean
carrying vessel at the designated port destined for the United
States of America continental ports; provided however, that in
the event the shipping space to be provided by the Agency in any
such case is not available within 30 days after notice to the
Agency of the readiness of the rubber for shipment, the rubber
shall be stored in a place at the place to be designated by the
Agency and the Agency
[Page 235]
will arrange for the payment for the rubber against warehouse
warrants or receipts or other documents of title (in lieu of
ocean bills of lading) acceptable to the bank negotiating the
payment draft; and in any such case such payment shall be at the
f.o.b. price less any export duties and taxes and charges for
loading on board ship in effect at the date such payment is
made.
- 5.
- Costa Rica will cause to be established the Fixed Price for
all sales of rubber for domestic consumption or use in the
Republic of Costa Rica.
- 6.
- During the term of this agreement such sums shall be expended
by the Agency as it deems desirable and necessary to increase
and develop the production and improve the quality of wild
rubber in the Republic of Costa Rica.
- 7.
- Costa Rica, in order to achieve maximum production of rubber,
agrees to take effective measures to assure that gatherers of
rubber receive a fair proportion of the prices paid by the
Agency for rubber and that the prices paid by such gatherers for
supplies are fair and equitable, and to this end, after
consultation with the Agency, shall fix prices to be paid to and
by the gatherers, and provide for the publication of such prices
in all communities in the rubber producing region. Reserve
agrees to collaborate fully with Costa Rica in effecting these
purposes and to consult, through the proper channels, with the
Ministry of Labor with respect to the inclusion in contracts of
provisions for effecting these purposes as well as other methods
of improving the condition of the gatherers of rubber.
- 8.
- The term of this agreement shall be for a period beginning
with the date hereof and ending December 31, 1946, unless sooner
terminated by the mutual consent of the parties hereto.
Rubber Reserve Company
By (signed)
W. E. Klippert
Republic of Costa Rica
By (signed)
Jorge Zeledón C.
