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can bar” on the Rokin and of a so-called "American lunch room” on the Kalverstraat, two of the most important thoroughfares in Amsterdam. Neither place is distinctively American, nor unlike other places of the same kind in Amsterdam which do not have the word "American” on their signs. The “American bar” admits upon inquiry that none of its proprietors or attendants are Americans, but the “American lunch room” evades answering a similar inquiry. The latter has a menu in English, but also in Dutch, French and German. Evidently the Stars and Stripes are displayed at these two places for the purpose of alluring Americans, of whom some 50,000 visit Amsterdam yearly and whose custom is particularly desired by traders of all kinds.

I respectfully submit this matter to the Department of State, for instructions, being unaware of any law or treaty through which this misuse of the American flag can be stopped. However, on page 135, Volume II, of Moore's International Law Digest, a case is cited which seems pertinent, wherein the United States Minister to Brazil, in 1864, after laying the matter before the Brazilian Government and receiving its sanction and approval, issued a circular to the United States consuls in that country prohibiting the flying of the United States flag without his permission, unless by persons in an official capacity. This action, the Digest adds, was approved by the Department of State. I have [etc.]

FRANK W. MAHIN.

File No. 811.015256.

The Secretary of State to the American Minister.

DEPARTMENT OF STATE, No. 62.]

Washington, sugust 9, 1913. Sir: I transmit herewith a copy of a despatch, No. 103 of July 10, 1913, from the Consul at Amsterdam, reporting in regard to the use of the American flag in that city for advertising purposes.

You will please bring this matter to the attention of the Foreign Office with the request that the Netherlands authorities take such steps as may be possible to prohibit the use of the American flag for advertising purposes in this manner. I have [etc.]

For the Secretary of State:

J. B. MOORE.

File No. 811.015256/2.

The American Minister to the Secretary of State.

AMERICAN LEGATION, No. 6.]

The Hague, November 1, 1913. Sir: Referring to the Department's instruction of August 9 last, No. 62, in regard to the use of the American flag in the city of Amsterdam, I have the honor to report that on receipt thereof the matter was brought to the attention of the Foreign Office and that I am

this day in receipt of a note from the Minister for Foreign Affairs, stating that there are no penal provisions in the Netherlands permitting of the prosecution in a court of justice of persons using the flag of a foreign nation for advertising purposes. Jhr. Loudon adds that nevertheless the Minister of Justice has brought the matter to the notice of the Municipality of Amsterdam and suggested that the authorization to fly a flag on the house front should be withdrawn, and that the proprietor of the "American Bar," at the advice of the police, has voluntarily stated that he will remove the flag and no longer use it. I have [etc.]

HENRY VAN DYKE.

NICARAGUA.

MESSAGE OF THE PRESIDENT, ADOLFO DIAZ, TO THE CONGRESS.

File No. 817.032/8.

T'he American Minister to the Secretary of State.

[Extract.)

AMERICAN LEGATION, No. 30.)

Managua, December 17, 1913. Sir: I have the honor to enclose herewith a copy and translation of the message delivered by the President on the occasion of the opening of Congress. I have [etc.]

BENJAMIN L. JEFFERSON.

[Inclosure_Translation - Extract.]

I have been as careful of peace abroad as I have been of internal tranquility and have maintained the best of relations with our sister republics of Central America and with all the nations of the world.

The negotiations with the United States are still pending relative to the convention which conceded to it under conditions very advantageous for Nicaragua an option to construct a canal through our territory by making use of the facilities offered by our great lakes and the river San Juan del Norte. I deem it unnecessary to present to you its preeminent importance which is already realised by all parties peacefully inclined and whose beneficial consequences we perhaps can as yet but little appreciate. So deep rooted is our conviction in this respect that-unheeding unfounded alarms that this treaty has excited among certain foreign governments, who have given grounds not only for mere suspicion but have shown their hostile intentions we have hastened our diplomatic negotiations in favor of the convention, which means inalterable peace among us, a prosperous and civilising development, the guaranty of our sovereign rights, loyally promised by a strong friendly nation.

Another of the most cruel obstacles found in the path taken in search of the good of the country, has been the precarious economic situation. At times when the Government has wished to begin its progressive advances it has met with the insuperable barrier of dire need and general poverty. To remedy this is decided to send the Minister of Finance, Don Pedro Rafael Cuadra, to the United States as financial agent, in order to endeavor to procure funds sufficient to pay the public debt. This has been a chief purpose of the administration, in which it has presevered with earnestness, because we understand that with this payment the prosperity of the business of Nicaraguans would be reestablished after the failure brought on by the State; and immediately derir. ing from this prosperity is the general prosperity and happiness of the country, which is the most beneficent assurance of peace.

Although I cannot yet announce a complete success in these labors of the Government, some good has been attained through the loan contract for one million of dollars celebrated with the bankers Brown Brothers and Co., and J. & W. Selignian & Co. The money acquired has been applied to completing the monetary conversion, to increasing the capital of the National Bank, to the payment of deferred salaries, and a sum of one hundred thousand dollars to the payment of the judgments of the Mixed Commission not exceeding one hundred dollars. The latter, although it establishes a sort of exception or

privilege, has been done in protection of the poor and laboring classes of the country who are the most needy.

Even though this small loan has produced some relief to the economic situation, and has redeemed our internal revenues, we do not think that the mission of our financial agent is as yet concluded. He continues to remain there to negotiate another larger loan which will place us in a position to pay our floating debt. To this end we requested authority of the National Assembly, during its recent extraordinary sessions, for the emission of bonds to liquidate this debt, either all or the part which may remain unpaid after paying the other part in cash,

The chief points in the success of these negotiations consist in the bank

Su institution is strengthened which is necessary to the commerce of the country and assures definitively the prestige of the new money of Nicaragua.

By these same contracts, with the previous authority of the honorable Assembly, the sale was made for one million dollars of 51% of the shares of the Compañía Ferrocarril del Pacífico, the Government keeping in its possession the remaining 49%; and the same company was given a concession for the construction of a railway within five years from San Juan del Sur on the Pacific to San Jorge, a port on the Great Lake. The economic interest of the bankers, tied up in this enterprise, will redound to our advantage by virtue of the improvements in the railway; and as far as the railway from San Juan del Sur to San Jorge is concerned it is most opportune, because in addition to being the beginning of rapid communication with the southern Department which it will most directly benefit, it will be the natural terminus of the mixed interoceanic route in connection with the projected railway to the Atlantic.

PROPOSED INTEROCEANIC CANAL TREATY BETWEEN THE UNITED STATES AND NICARAGUA, AND PROTESTS OF SALVADOR AND COSTA RICA IN RELATION THERETO.

INTRODUCTORY NOTE. On December 15, 1912, the American Minister notified the Department (File No. 817.812/5) that the Government of Nicaragua desired to negotiate a treaty with the United States giving to the latter a thirty-year option to acquire a strip of land for canal purposes under conditions similar in form to those of Panama, the consideration being: (1) payment by the United States of three million dollars gold at the time of the exchange of ratifications, and an additional sum to be agreed upon, together with an annual rent charge, at the time of the exercise of the option; (2) grant to the United States pending the negotiations of a discretionary right to let a subsidiary privilege of putting the existing waterway into navigable condition for light-draught vessels; and (3) grant to the United States of a naval station in the Gulf of Fonseca and one on Corn Island, if these should be desired. The advantages to Nicaragua besides the cash payment were the guaranty of the peace and independence of the Republic, the development of its great resources through capital attracted by the definite settlement of the question, the prospect of eventual construction of the canal, and elimination of a constant European incentive to revolution. The advantages to the United States were the preparation for further growth of its coastwise commerce, elimination of foreign political influence, the service of a caveat against any more canal concessions or territorial privileges such as had been attempted with European and Asiatic powers, an additional important defense of the Panama ('anal, and an effective means for guaranteeing the Washington conventions.

This proposal resulted in the signing of a treaty between the United States and Nicaragua, February 8, 1913, which was submitted to the Senate on February 24, 1913. It is this treaty to which reference is made in the following communications.

File No. 817.812/22.

The Minister of Costa Rica to the Secretary of State.

[Translation.)

LEGATION OF COSTA RICA,

Washington, April 17, 1913. MR. SECRETARY: My Government has learned, although in an informal way, that during the latter part of February last there was submitted to the consideration of the Senate of the United States a contract made between the Governments of Nicaragua and Washington for the construction of an interoceanic canal through the former Republic.

This information has caused great surprise to my Government, as the transaction to which it refers could not have been carried out without flagrant violation of the clear treaties now in force which estop Nicaragua from entering into any interoceanic canal agreement without previously consulting Costa Rica in one instance and without its consent in another.

Article 8 of the boundary treaty entered into between Costa Rica and Nicaragua on April 15, 1858, reads as follows:

If the contracts for canalization or transit entered into by the Government of Nicaragua previous to its being informed of the conclusion of this treaty should happen to be invalidated for any reason whatever, Nicaragua binds herself not to enter into any other arrangement for the aforesaid purposes without first hearing the opinion of the Government of Costa Rica as to the disadvantages which the transaction might occasion the two countries; provided that the said opinoin is rendered within the period of 30 days after the receipt of the communication asking for it, if Nicaragua should have said that the decision was urgent and if the transaction does not injure the natural rights of Costa Rica, the opinion asked for shall be only advisory.

The arbitral award made by His Excellency Grover Cleveland, President of the United States of America, on March 22, 1888, declares, first, that the said boundary treaty of 1858 is valid, and, next, after duly construing the tenth point of the eleven of doubtful meaning which Nicaragua proposed in the controversy, decides as follows:

10. The Republic of Nicaragua remains bound not to make any grants for canal purposes across her territory without first asking the opinion of the Republic of Costa Rica, as provided in Article 8 of the Boundary Treaty of April 15, 1858. The natural rights of the Republic of Costa Rica alluded to in the said stipulation are the rights which, in view of the boundaries fixed by the said treaty, she possesses in the soil thereby recognized as belonging exclusively to her: the rights which she possesses in the harbors of San Juan del Norte and Salinas Bay, and the rights which she possesses in so much of the River San Juan as lies more than three English miles below Castillo Viejo, measuring from the exterior fortifications of the said castle as the same existed in the year 1858; and perhaps other rights not here particularly specified. These rights

1 Not acted upon by the Senate during 1913; in the course of the year amendments were proposed by Nicaragua which led to negotiations for replacing it with a new one, a draft of which was received by the Department on October 31, 1913 (File No. 817.812/54).

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