merchandise. As indicated above the values or prices stated in invoices would have, in general, little to do with the question of whether or not such stated values or prices are the actual foreign value or export value of the merchandise. Only in very rare cases is there any ground for questioning the sincerity and exactitude of invoices. Furthermore, it should be pointed out that officers of the United States Treasury Department in foreign countries do not fix the value of merchandise, which by law cannot be established until entry of the goods into the United States. Those officers only report the facts for the confidential use of appraising officers. The Government of the United States would perceive no objection, however, were officers of the United States Treasury Department attached in some manner to the American Consulate and in deference to the wishes of the French Government will be happy to give this matter its earnest attention with a view to determining in what way it can most appropriately meet the wishes of the French Government. The Government of the United States would, of course, have no objection were a French exporter to submit proof to the Treasury agent of the sincerity and exactitude of his declaration, but such action on the part of the exporter would serve no useful purpose, because of the fact that only in very rare cases is there any question raised in respect of the sincerity and exactitude of the invoice declarations. Verifications, when made, are made not because the invoice may not correctly state the value at which the particular goods were sold, but because there is some question as to whether that price is, in fact, the foreign value or export value, as defined by American law. The Government of the United States finds, after reconsideration of the question, that there is little that can be added to the statement made in its communication of October last concerning the proposal with regard to verification of value by experts of French nationality. The person making such verification must have a thorough knowledge of the United States Customs law. The verification of information respecting value is an extremely technical matter which can only be satisfactorily accomplished by an officer with long experience in the administration of the Customs law. The courts have construed almost every word and phrase in Section 402 of the Tariff Act and only officers of long experience and practice will claim even a fair knowledge of the subject. Reports would serve no useful purpose if they do not contain the exact information required by the appraising officer. In an effort to meet the views of the French Government, the Government of the United States has given its most earnest consideration and study to this whole matter. In deference to the wishes of the French Government and in an effort to arrive at a satisfactory solution of the present situation, the Department of State and the Treas ury Department have recommended to the Congress of the United States the repeal of Section 510 of the Tariff Act.10 In that section provision is made, which is mandatory upon the Secretary of the Treasury, to prohibit the importation of merchandise from any foreign manufacturer or shipper who refuses, upon request of a representative of the United States Treasury Department, to give the latter necessary information in order that the appraising officer in the United Tariff Act of 1922, 42 Stat. 858, 949. 10 42 Stat. 968. States may be able to find foreign value or export value. The French Government will find that this Section has been eliminated from the pending tariff bill as it was passed by the House of Representatives. Thus, under the new law, if finally enacted, it will be entirely optional with the exporter whether he wishes to give to the United States Treasury Agent information which is necessary to the appraising officer in determining export value or foreign value. Under the proposed law, when an appraiser is unable to ascertain the foreign value or export value of any French merchandise, the Treasury Department will so advise its agent in France, and will instruct the agent to call upon the exporter in order to advise the latter of the situation. The agent will at the same time offer his services to the exporter with a view to obtaining the information required by the appraising officer in the United States. If the exporter desires to avail himself of the foreign value or export value, which are the lowest bases of value, he may do so at no expense to himself, and the exporter may rest assured that any information of a confidential character which it is necessary for the agent to obtain will be held in strictest confidence. The laws of the United States provide severe punishment for any officer who should divulge information of the above character. Treasury agents are under instructions to report facts as they find them whether they favor the Government or whether they favor the exporter. They are glad to assist exporters in correctly invoicing their merchandise in order to avoid misunderstanding when the merchandise is imported into the United States. If it is agreeable to the French Government to permit the return to France of agents of the United States Treasury Department, the Government of the United States will be happy to assure the French Government that such agents will be officers of long standing and experience, fully versed in the French language and who will be in every way acceptable to the French Government." I am [etc.] 611.5131/781 For the Secretary of State: The Chargé in France (Armour) to the Secretary of State No. 9759 PARIS, August 13, 1929. [Received August 21.] 11 SIR: With reference to my telegram No. 380 of yesterday " I have the honor to transmit herewith in copy and translation the text of the note from the Foreign Office, dated August 9, 1929, replying to our note of July 26,12 concerning customs evaluations. As set forth in my telegram under reference, in conversations at `the Foreign Office the Division of Commercial Relations stated that there was no present intention of exercising the right of reciprocity requested with respect to the assignment and activities of French customs agents; the Division indicated that this stipulation was inserted in order to satisfy the amour-propre of various interested parties here. It will be observed that it is the understanding of the French Government that our Treasury agents should be attached to the American consulates. The Department's note-embodied in its instruction No. 4161 of July 13-refers on page 6 to the French proposal as being "that officers of the United States Treasury Department be attached to the American Consulate," and lower on the same page the singular, "American Consulate," is again used. In discussing this point the Foreign Office referred to the draft agreement enclosed with its note of March 6, 1929, which proposes attaching Treasury agents to the "autorités consulaires américaines." It inquired whether the use of the singular in our note was deliberate and, in that event, whether it meant the Consulate General in Paris. In this connection the Division of Commercial Relations referred somewhat vaguely to a conversation had by M. Claudel in the Department, in the course of which recognition was voiced of the idea that it might be advantageous to have a larger number of Treasury agents than heretofore operating in France. Considering how desirous the French were of getting every single American Treasury agent out of France, the foregoing is interesting to say the least. The remaining sentence in the paragraph of the French note above referred to states that "It is, indeed, desirable that in the exercise of their new functions they (the Treasury agents) should be officially accredited in France." The Department, however, may take it for granted that the French Government thereby in no way envisages according these agents diplomatic status; consequently, this question, which in the past has occasioned a considerable amount of difficulty, cannot be deemed raised by this portion of the French note. I have [etc.] [Enclosure Translation] NORMAN ARMOUR The Director of Political and Commercial Affairs of the French Ministry for Foreign Affairs (Corbin) to the American Chargé (Armour) PARIS, August 9, 1929. MR. CHARGÉ D'AFFAIRES: By letter dated July 26, 1929, you were good enough to convey to me a communication from the Government of the United States which concluded as follows: (Then follows a translation in French of the text of our note embodied in the Department's instruction No. 4161 of July 13, as set forth on pages 8 and 9 thereof, with the exception of the first sentence on page 8. That is to say, beginning with the words "In deference to the wishes of the French Government," down through the end of the note.) In acknowledging the receipt of this communication I have the honor to inform you that the French Government has appreciated the friendly spirit in which the Government of the United States has sought the solution of the difficulties relative to the evaluation of French merchandise exported to the United States. The French Government especially notes with satisfaction that Section 510 of the Tariff Act may be expected to be abrogated and that the role of the Treasury agents would consequently be limited to offering their services to the French exporter in order to give the latter, by furnishing the information required by the American customs administration, the opportunity of claiming the benefit of the foreign value or export value of his merchandise. Moreover, you are good enough to give me the assurance that the instructions which will be given to the new agents, along with the discrimination in their selection, will make of them collaborators of our exporters and will render their activity acceptable in every way to the French Government. In view of the essential modifications which the abrogation of Section 510 and the assurances above set forth would effect in the powers of American customs agents, the French Government would see no objection to the return of these agents in France, it being well understood that their activity would be exerted strictly under the conditions explicitly defined in your communication above set forth. As the American Government is good enough to agree, these agents would be attached to American consulates. It is, indeed, desirable that in the exercise of their new functions they should be officially accredited in France. Moreover, and by way of reciprocity, the French Government requests that the Government of the United States should consent, as was proposed by it in its note of October 19, 1928, to representatives of the French customs being assigned to the United States with powers identical to those with which American customs agents in France will be invested. I should be obliged to you to let me know if the Government of the United States gives its definitive approval to the preceding propositions. In case the Government of the United States should judge it possible forthwith to apply the arrangement resulting from your communication and the present letter, the French Government is ready to accept the immediate return to France of the American Treasury agents. It remains understood that the present agreement would become null and void if, in the event that Congress should have reenacted the former article 510, the Administration of the United States would have recourse to the reprisals there envisaged. Please accept [etc.] CHARLES CORBIN EXEMPTION FROM TAXATION OF UNITED STATES TRADE COMMISSIONERS AND CUSTOMS REPRESENTATIVES IN FRANCE 102.8102 Taxation/3: Telegram France The Secretary of State to the Ambassador in France (Herrick) WASHINGTON, May 19, 1928-noon. 142. Department informed by Department of Commerce that Kelly, Canty and Green, Trade Commissioners in Paris, are being required to pay income, personal and local taxes and that failure to pay local taxes would subject them to supertax. Please bring matter immediately to the personal attention of the appropriate French official stating that this Government would be gratified if the French authorities concerned will postpone action in these cases and that of O'Neill, Customs Attaché, in order that the whole question of taxation of American Government officials in France may be discussed with French Government. You may point out that officials of foreign governments in the United States are exempt from the payment of Federal income tax on compensation paid to them for services rendered in connection with exercise of essential governmental function of the state or political subdivision. Cable briefly result of your representations and submit report by mail after conferring with Commercial Attaché. KELLOGG 102.8102 Taxation/7 France The Ambassador in France (Herrick) to the Secretary of State No. 8635 PARIS, May 25, 1928. [Received June 4.] SIR: I have the honor to refer to the Department's telegraphic instruction No. 142 of May 19 and to my answering telegram No. 130 of May 23, 1928.18 A note based on the Department's said instruction was personally delivered to the competent official at the Foreign Office and the question argued at length. This official was disposed to suggest, as an easy solution, that the Embassy add the names of the three Trade Commissioners to its list of officials accredited to the Foreign "Latter not printed. |