740.00119 (Potsdam)/7–2545

United States Delegation Memorandum1

top secret

Status of Problems Before the Conference July 25, 1945

i. problems on which substantial agreement has been reached

1.
Council of Foreign Ministers. The final text of the agreement in regard to the Council of Foreign Ministers, a draft passage for inclusion in the final protocol and communiqué, and telegrams on the subject to the Governments of China and France have all been approved.2
2.
Authority of the Control Council for Germany in Political Questions. The draft on this question has been approved3 but the British have asked for the inclusion of two additional paragraphs4 which the Russians did not believe were appropriate for the economic agreement concerning Germany.
3.
Disposition of the German Fleet and Merchant Marine. It has been agreed in principle that the fleet and merchant marine shall be divided in three parts. It is also agreed, however, that (1) a substantial [Page 393] proportion of the submarines shall be destroyed and (2) all of the merchant marine, including the Russian share, shall be available for the prosecution of the war against Japan. The Russians are, however, asking for a specific and definitive agreement on this subject.
4.
Austria and Vienna. The Soviets have agreed that U. S. and British forces may immediately occupy their zones. The Soviets have also agreed to continue to feed the populations of the U. S. and British zones until the U. S. and British are ready to assume this responsibility. The U. S. and British moreover have agreed in principle that the administrative authority of a central Austrian government should be extended throughout Austria and that this question should be first on the agenda of the Control Council when we enter Vienna.
5.
The Polish Question,—Liquidation of the London Government and Implementation of the Yalta Agreement. A document on this matter5 has received final approval.
6.
Trusteeship. It has been agreed that the disposition of the Italian colonies will be dealt with by the Council of Foreign Ministers in London in connection with the negotiation of a peace treaty with Italy.
7.
Turkey and the Straits. No tripartite agreement was reached on this subject but it was dropped with the understanding that each of the three Powers would consult the Turks, the British and Americans with a view to establishing an international guarantee of free passage of the Straits for all nations at all times; the Russians presumably with a view to obtaining either exclusive Soviet-Turkish control of the Straits or Soviet-fortified bases on the Straits.
8.
Withdrawal of Troops from Iran. It was agreed that troops of the three Powers should be withdrawn from Tehran at once. It was also agreed that further withdrawals would be discussed by the Council of Foreign Ministers in September, though it was recognized that troops might according to the treaty remain until six months after the close of the Japanese war. The U. S. stated its intention to withdraw its troops within 60 days.
9.
Tangier. It was agreed that Tangier should remain international and that the three Governments would participate with France in preliminary discussions of this question to be held in Paris in the very near future.
10.
Syria and Lebanon. After hearing the British explanation of their position in regard to this matter, the Soviets withdrew the proposal6 which they had made.
11.
The Transfer to the Soviet Union of the Koenigsberg Area in East Prussia. There was agreement in principle that this area should be transferred to the Soviet Union, with the understanding that the transfer would have to be finally confirmed by the Peace Conference.

ii. problems pending for consideration before the heads of governments or foreign ministers

1.
German Economic Questions. The subcommittee has presented a first report7 on these questions, some portions of which have been approved by the Foreign Ministers. Other parts, however, on which no agreement could be reached have been referred to the Big Three. The subcommittee is in the meantime continuing its work.
2.
German Reparations. The subcommittee is still at work on this question.
3.
Italian and Austrian Reparations. The subcommittee is considering Soviet papers8 which have been presented on these matters.
4.
Oil for Western Europe. The Economic Subcommittee is still considering a U. S. paper9 on this subject.
5.
Admission to the United Nations. A paper10 has been under consideration by the Foreign Ministers and the Big Three expressing the support of the three Governments to the admission to the United Nations Organization of Italy, Rumania, Hungary, Bulgaria and Finland, when peace treaties have been concluded with the recognized governments of those countries, and of neutral countries when they can comply with the requirements for admission to the United Nations, but opposition to the admission of Franco Spain as long as the present regime remains in power. Though general agreement on this paper seems to have been reached it has been referred back to the Foreign Ministers for reexamination.
6.
Implementation of the Yalta Declaration on Liberated Europe and Satellite States. A subcommittee is working on paragraphs 2 and 3 of the U. S. paper11 on this subject dealing with the freedom of the press and the Control Commissions. There seems no likelihood of reaching agreement on paragraph 1, which deals with observation of elections.
7.
Italy and the other Satellite States. The U. S. has presented two papers, one on policy toward Italy12 and the other on policy toward Rumania, Hungary, Bulgaria, and Finland.13 It had originally been intended to refer these papers to a subcommittee, but Marshal Stalin [Page 395] has now taken the position that, unless the U. S. and Britain are prepared to recognize the present governments of Rumania, Hungary, Bulgaria and Finland, this question should not be discussed further.
8.
Oil Equipment in Rumania. The British have presented a new paper14 proposing an examination by representatives of three neutral countries of the ownership of the oil equipment in question.
9.
The Western Boundary of Poland. This question is still being discussed by the Big Three, to whom the Foreign Ministers have reported the views of the Polish Provisional Government.
10.
Cooperation in Solving Immediate European Economic Problems. A U. S. paper15 on this subject, urging Soviet participation in the EEC, ECO and EITO [ECITO] is still being considered by a subcommittee.

iii. questions on the original agenda of the three powers which have not yet been discussed by the conference

1.
British Proposals.
a.
War Crimes
b.
Transfer of German populations from Poland and Czechoslovakia
2.
All items on the original U. S. and Soviet agenda have now been raised before the Conference.