PROPOSED REDRAFT OF PARAGRAPH 9(B) OF THE COUNCIL DEPUTIES REPORT ON EUROPEAN DEFENCE COMMUNITY/NORTH ATLANTIC TREATY ORGANIZATION RELATIONS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00373R000200070011-0
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 8
• Document Creation Date: December 15, 2016
• Document Release Date: April 2, 2003
• Sequence Number: 11
• Publication Date: February 18, 1952
• Content Type: REPORT

DO NOT C13CU L\ E
TMZeeting of Three Foreign Ministers
and German Federal Chancellor
PROPOSED REDRAFT OF PARAGRAPH 9(b) OF THE
COUNCIL DEPUTIES REPORT ON EUROPEAN DEFENCE
-
UNIT, NORTH ATLANTIC TREAPY ORGANIZATION
RELATIONS
(b) Councils: On questions affecting the common objectives of the two
Organizations there would be reciprocal consultation between the North
Atlantic Council and the Council of the European Defence Community and,
whenever either Council decides that it is desirable, combined meetings
of the two Coti..ncils. Whenever any of the parties to the North Atlantic
Treaty or any of the parties to the Treaty establishing the European
Defence Community consider that the territorial integrity, political
independence or security of any of them or the continued existence or
integrity of the North Atlantic Treaty Organization or the European Defence
Community is threatened, a combined meeting will be summoned at the request
of that Party in order to consider the measures necessary to meet the
situation.
OSD REVIEW COMPLETED. NO OBJECTION TO
DECLASSIFICATION AND RELEASE
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 Report to the Three Foreign Ministers
from.the Official roue
RESTITUTION
(a) Obligation of Federal Republic to satisfy restitution judgments against
the former Reich
At the meeting of officials it was agreed that instructions should be sent
to the High Commissioners to ensure that the rate of conversion applicable to
claims against the Reich under the Restitution Laws should be'that laid down
by the Currency Reform Law. This would normally be 10 RM : 1 DM. A very
considerable reduction in. the cost of meeting awards against the Reich in the
British Zone and-in Berlin should result, and the Germans should be satisfied
at the reduced figure for the total estimate of the value of claims against
the Reich.
(b) Composition of Supreme restitution Court
The effect of informing the Federal Chancellor of the steps to be taken
in regard to conversion should be to enable him to agree to the proposal for
an Allied majority on thu) 6uprene Restitution Court. Failing this, Dr. Adenauerrs
offer should be accepted (namely, that each panel of the Supreme Restitution
Court should be composed of.equal numbers of German and Allied judges, with
a neutral Chairman),
19 February 1952 MOG g 1
Re ,wort tothE: Three Foreign Ministers.
from the Group
EXEteTION FROM EC,UALIZATION OF BURDENS
LASTENAU$GLE:ICH LEVY
The meeting of officials considered this problem, and agreed that the
High Commissionors should put the following to Dr. Adenauer in extension of his
offer of 'a six-year exemption:-
the qualifying date for UN nationality, in the case.of natural persons,
should be the date of the contractual settlement;
(ii) exemption should be granted to victims of Nazi persecution in
respect of property restituted to them;
(iii) German companies with 75% UN shareholdings should be exempt, to the
extent of the UN shareholdings. If 75% is not acceptable to Dr.
Adenau.er, he might be asked to give an administrative instruction
under which "wholly UN-owned companies" should be interpreted as
90% or over. (This interpretation was incorporated in an administra-
tive instruction from the Federal Finance Mini,ster to the Finance
Ministers of the Lander, dated 3rd July, 1950, on the administration
of the immediate aid tax).
If Dr. Adenauer is not willing to concede these additional points, in
whole or in part, the High Commissioners should have discretion to accept
Dr. Adenauer's offer, namely 6-year exemption for those persons already
exempted under the Immediate Aid Ordinance,
(i)
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12 February 1952
Report to the Three Foreign Ministers
the Official Group
from
MOG 6 1
COENSATION ?FOR GERMAN EXTERN LL ASSETS TAKEN
IN :3AFEHAVEN COUNTRIES
The Germans are prepared to pay compensation with respect to assets taken
in all countries in accordance with'"financial capacity and the Basic Law".
This in fact means only partial compensation, which, in the case of certain
Safohaven countries, would '::o less than that provided for in the existing
agreements to which the three Powers are parties.
The Chancellor has proposed that the Federal Government be permitted to
negotiate with the Safehaven countries involved, with the Allies participating
in the negotiations.
It is recommended that this proposal be accepted, with the modification
that the Allies should have the right, but not the obligation, to participate
in the negotiations.
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Meeting of the Thre Foreign ;!tijiinisters
and the German Federal Chancellor
A. .agreed text of letter to be sent by the German Federal Chancellor
to .Governments
Having regard to the existing international tension and to the
fact that the Federal IZep')ublic is in a strategically exposed position
in the sense of Irticle )4(d) of the Treaty establishing the European
Defense Community, the Federal Govornment will not consider it a case
of discrimination that the European Defense Commissariat in issuing
licenses for the production of such ariiiaments as are enumerated in List 2
of the Treaty will not place any orders with plants in th Federal
Republic except in conformity with. 'a goneral instruction of the Council
of %: inistors' . This, ho,vever, is based on the auppos .tion that the
German contingents in the Europe--.n Dofonse Cormnunitir will not be treated
on a less favorable basis in respect of tiieirsupply with armaments of
the above types which are necessary to fulfil their assigned tasks
in the defense of Europe than the contingents of other member states
of the European Defense Comriuriity, irrespective of the; sources from
which they will be sup Iied.
"With regard to research in the fields of the above armal~ents,
the Federal Government is likewise prepared to prevent such research
except as it may be requested by the European Defense Community. This
does not apply, of course, to scientific research directed towards
medical, industrial and other non-military developments in pure end
practical science.
B. geed Text of letter to b, sent by the Gerrian Federal Chancellor
to the British and Unitc;d States Governments
Upon ratification of the Treaty establishing the E.D.C. the content
of the Treaty will become German domestic law. This accordingly applies
likewise in regard to the provisions concerning the limitation of arma-
ments production in the member states of the E.D.C. The prohibitions
laid down also have effect as regards the United Kingdom and the United
States.
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 .`. )FAX
PrIEETING OF FOREIGN 1ISTERS OF THE UNITED KINGDOM, 1111 UN TLD STATES OF Ai.IR.IC, i~'I3.INU11,, AND THE CHANCEIIOFZ Cff~
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FOR I f--tDIATE RELEASE AT 1600 OURS 003- ON TUESDAIL 744525
19th_F"~RUARy 19 .
Am-
01. "M
Cr 01 war ---
They reviewed the report made by the Executive Bureau of
~--. the Temporary Council Committee of the North Atlantic Treaty Organi-
CS cation, on the financial contribution of the Federal Republic to
Western defence. The iclinistots agreed that this report, which
,.~ reached them on 16th February, should be published tonight. There
CZj is every prospect that an agreed decision on the total financial
contribution of the Federal Repubptl`~~ionsf oncotherll~.atterscaris-y
the end of the current week. 11e,~
ing out of this report, includ.:..ng the distribution of the Federal
Republicts contribution, will proceed at once in Bonn between
representatives of the German Federal Republic and of the Three
Powers,
The Four Ministers welcome the progress made tavards the
conclusion of the Treaty for the establishment of the European
Defence Community which will provide a solid foundation for the
agreements to be concluded between the three Western Powers and the
Federal Republic of Germany. This Treaty and the agreements will
constitute -a single structure designed to bring about the associa-
tion of the Ferieral. Republic with the free world and to solidify
the defence of Western Europe. The Four L-inist ers discussed the
relationship between the European Defence Community and the North
Atlantic Treaty Organisation and agreed on certain recommendations
to the North
which will be __.ado by the Three Foreign t:inistcrs
It will be the con-
Atlantic Council for settling this question.
cern of the Four Govcrruacnts, together with the, other interested
Governments, to ensure the preservation and the progressive strength-
ening of the European Dofenco Conaunity which, as a part of the wider
Atlantic community, creates a partnership for peace.
The Four Ministers are agreed that continuing efforts should
be made to accomplish thu unification of Germany through democratic
and peaceful moans.
The Four Ministers are convinced that their meeting has removed
the obstacles which have hitherto delayed the conclusions of the nogo-
tiationss and has thus marked a decisive advance in the cause of peace.
---! of meetings which they .'c cony l stion
0) TMV reached a ;reeLlent on methods f orTdealing with the que
of arms production in sta uc a o.
they have reached certain conc3~ta,n+swill producedspoedy results.
The Foreign Ministers of the Unia the at es, France rand
l
the, United Kingdoms and the Chancellor/of
Republic, met for discussions in the Foreign Office on 18th ra and
parallel
19th i~ ebruary. They reviewed the position reached in the negotiations in Paris and in Bonn, now approaching a successful
conclusion, for the establishment of the European Defence Com-
munity and for the creation of a new relationship between the
three Western Powers and the Federal Republic of Germanys based
on. a series of freely negotiated Conventions.
The Foreign Ministers and the Chancellor are well pleased
with the results of their work, They reached agreement on out-
'standing issues arising from the negotiations in Bonn. The ques-
tion of` Germany's financial con ribntioblto E Eurpean defence isre
dealt with below. On the
interusts of
regulation and distrlbut7.c.:riathe
Defence Comi-aunity
}' 19th. February 1952
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19th February 12
744526
M'W,ETIING OF THREE FOREIGN MINISTERS
GERMAN FINsNCI.1 CONTRIBUTION TO DEFENSE
INSTRUCTION TO LIED HIGH COMMISSION
At their meeting in Lot._ n on 17th February, 1952, the Foreign Ministers
took the following action on the questions raised by the High Commissioners
regarding the German financial contribution to defense in their report of
12th February, 1952: the answers to questions 1, 5 and 7 are contained in
a paper adopted by the Foreign Ministers of 16th February, copy attached).
this subject with Dr. Adenauer (MOG.4
2. Q estion 2
The uses to which the contribution should be devoted in 1952/53 (i,eo
the twelve months period from the date of entry into force of the contract)
should be finally negotiated at Bonn and written into the contract. The sum
to be requested for the support of the Allied forces should not exceeed'lthee
non-
amount of DM 6.8 billion submitted by the various national. forces.
military items should be eliminated from the Allied costs,. and the Allied
authorities should use their best efforts to effect the maximum possible
economies in these costs. Particular attention should be paid to those costs
which are politically objectionable in Germany.
3. The High Commissioners should seek to obtain agreement as soon as possible
with the Federal Government on the amount to be provided for the support of
the allied forces in 1952/53, They should make a progress report to the
Ministers so that if necessary the position can be again examined by them
before their departure from Lisbon,
4. Question 3
The Ministers agree in principle that payment of the costs of non-E,D.C.
forces, while remaining an obligation of the Federal Republic, may be effected
through the agency of E.D.C. It should be understood that the E.D,.C, will not
consider the amounts of the payments to be made .or purposes for which they will
be used (which will be determined.by the contractual arrangements) but will
merely act asa transmitting agency. The consent of the other countries par-
ticipating in the E.D.C. will have to be obtained.
5, Questions 4 and -6
After the first twelve months period, the amount of the Federal Republic's
contribution for the support of forces on assignment in Germany of non-E.D,C.
nations will be determined by negotiations in which the Germany, and
the non-E.D,C. nations will participate, The amount will be distributed among
non-EDC forces on the basis of their relative troop strengths, taking into
account, the variance in cost of the silitarervice # ctors..
air, , ground and their logistic suppo ,
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16 February 1952 MOG/4 Final
Report to the Three Foreign Ministers
from the Official Group
GERIIIVIAN FINANCIAL CONTRIBUTION TO DEFENSF
1. The Official Group has considered the questions on the above subject
contained in the report of the Allied High Commission on contractual nego-
tiations. They consider that it would be valuable if the Foreign Ministers
took the opportunity of the meeting with Dr, Adenauer to deal with three of
the questions referred to, These are;
(a) German acceptance of the advice of the Three Wise Men on the
total German contribution in 1952/53;
(b) Method of fixing the German total contribution in subsequent
years;
(c) The need for special continuing arrangements for the material
support of the Allied forces in Germany) although these may
differ from arrangements in the European Defenee Community;
The Foreign Ministers could also usefully urge Dr. Adenauer
to speed up the negotiations in Bonn.
2. It is suggested that the Foreign Ministers might speak along the fol-
lowing lines:
(a) Total German Contribution for Defense in 152/53
At the request of Dr. Adenauer, the Allied High. Commission, with
the agreement of the three Governments,.ivas able to arrange for German
capacity to make a contribution for 1952/53 to be examined by the Three
Wise Men. The purpose of-this was to ensure that the German capacity was
considered in accordance with the same standards, which took political
as well as economic factors into account, as were applied to the defense
efforts of NATO countries, The Federal Government was given the oppor-
tunity of presenting a written statement on its position, and two
hearings of the German Ministers concerned were held by the Three Wise
Men. Their report has now been received and Dr. Adenauer will have
received a copy of it, This report is in the form of recommendations
to the'High Commission and three Governments on the one hand and to
the Federal Government on the other. The Foreign Ministers assume
that as this procedure was undertaken at the request of Dr. Adenauer
he, on behalf of the'Federal Government, is prepared to accept the
recommendations. It is hoped that he will be in a position to provide
immediate confirmation of this. If he does so, then the three Govern-
ments would also be prepared to accept the recommendations,
Dr. Adenauer may bring up the question of whether Federal expendi-
ture in support of the economy of Berlin should not count as expenditure
on defense and so against the total figure recommended by the Three Wise
Men. If he does so it is suggested that the Foreign Ministers should
point out to him that the question of Berlin has been dealt with in the
Three Wise Mens' report. To the extent that Federal expenditure on
Berlin is devoted to defense uses, recognized as such under rules which
have been accepted by all NATO countries, then it would count; the
principal example of this is Occupation Costs, On the other hand, the
very substantial support given by the Federal Government to Berlin to
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bolster up its economy would not constitute a defense expenditure under
NATO criteria and should not, therefore, count against the German total.,
The Three Wise Men, when deciding on this final figure, took into
account the special burden borne by the Federal Republic in helping
Berlin.
(b) Method of fixing German total contribution in subsequent years
The Three Foreign Ministers have been impressed with the value of
using the machinery of the Wise Men to assist in arriving at the figure
for the German total contribution in 1952/53 which was adopted at Dr.
Adenauer's suggestion and believe that the four Governments should con-
template a similar procedure in subsequent years, using whatever machinery
is set up in NATO to replace the Wise Men. The exact method by which this
would be achieved could be settled at the appropriate time, but there
might be advantage in having some general provision written into the
Convention. It would have to be made clear that this does not in any
way prejudge the question of the Federal Republic's entry into NATO.
(c) Material support for the Allied Forces in Germ
The Foreign Ministers might point out to Dr, Adenauer that there
are, and are likely to remain, considerable Allied forces in Germany,
and this fact will undoubtedly necessitate continuance of special
arrangements to provide for their material support;, covering such matters
as supply, transport, communications and housing. These special arrange--
ments will not necessarily be the same as those which will be worked out
in the European Defense Community nor which exist when forces of one
NATO country are stationed in another, which vary from place to place
and involve much smaller forces. It is essential that our forces in
Germany should,not only be sure of obtaining the facilities they need
but should have security over a period so that they can make their
administrative plans on a durable basis, They trust that Dr. Adenauer
recognizes the circumstances which make these special facilities neces-
sary and will hive this in mind when considering the proposals in the
draft Convention which the High Commission has communicated to the
German representatives in Bonn.
(d) Negotiations in Bonn
The Foreign Ministers might conclude by pointing out that there are
numerous other questions which remain to be settled in the Convention
on the financial arrangements for defense, on which proposals have been
made to the Federal Republic by the Allied negotiators in Bonn, They
hope that now that the recommendations of the Three Wise Men have been
received, it will be possible for the negotiators in Bonn to make mpi.d
progress in agreeing on the Convention.
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