AGREEMENT BETWEEN
THE GOVERNMENTS OF THE UNITED STATES AND THE U. S. S. R. ON THE
DISPOSITION OF LEND-LEASE SUPPLIES IN INVENTORY OR PROCUREMENT IN
THE UNITED STATES
The Government of the United
States and the Government of the Union of Soviet Socialist
Republics, in order to provide for the orderly disposition in their
mutual interests of the undelivered articles which were in inventory
or procurement in the United States, prior to the cessation of
active military operations against the common enemy, for the purpose
of providing war aid to the Union of Soviet Socialist Republics
under the act of Congress of ~1arch 11,1941, as amended, agree as
follows:
Article l
All articles
and services undertaken to be provided by the Government of the
United States under this agreement shall be made available under the
authority and subject to the terms and conditions of the act of
Congress of March 11, 1941, as amended, and any acts supplementary
thereto.
Article II
Within such periods as may be
authorized by law, the Government of the United States undertakes to
transfer to the Government of the Union of Soviet Socialist
Republics, and the Government of the Union of Soviet Socialist
Republics agrees to accept subject to the right of inspection
referred to in article V, those articles which are or will be
available to the Government of the United States for transfer to the
Government of the Union of Soviet Socialist Republics out of
articles that are included in the requisitions set forth in schedule
I~A or in the categories of articles set forth in schedule I-B and
that were in inventory or procurement in the United States for the
purpose of providing war aid to the Union of Soviet Socialist
Republics, but were not transferred, prior to the date of the
signature of this agreement.
The Government of the Union
Soviet of Republics undertakes to pay the Government of the United
States in dollars, for the articles transferred to the Government of
the Union of Soviet Socialist Republics under this article, an
amount to be determined as set forth in schedule II, and interest
thereon, according to the terms and conditions set out in that
schedule. The obligation of the Government of the Union of Soviet
Socialist Republics to make payment in dollars in accordance with
the terms of this agreement may be discharged by the delivery of
gold, which will be valued at the buying price for gold provided in
the provisional regulations issued under the Gold Reserve Act of
1934 as the same may be in effect at the time of each delivery.
Schedule I-A, Schedule I-B,
and Schedule II, which are annexed hereto, are made a part of this
Agreement.
Article III
Changes may be made from time
to time by mutual agreement of the parties in the list of
requisitions and categories in schedule I-A and schedule I-B.
The Government of the Union of
Soviet Socialist Republics shall be released from its obligation to
accept articles under the provisions of article II upon payment to
the Government of the United States of any net losses to the
Government of the United States, including contract cancellation
charges, resulting from the determination of the Government of the
Union of Soviet Socialist Republics not to accept such articles.
The Government of the Union of
Soviet Socialist Republics reserves the right, without payment as
provided in the foregoing paragraph, not to accept articles which
cannot be made available by the Government of the United States in
complete units as specified in the approved requisitions or written
requests of the Government of the Union of Soviet Socialist
Republics, or in the offerings mad e by the United States
Government, relating to such articles and units.
Article IV
Within such periods as may be
authorized by law, the Government of the United States undertakes to
aid in the movement to the Union of Soviet Socialist Republics of
the articles provided under article II by furnishing American flag
shipping and related services so far as it deems necessary to
supplement Soviet flag shipping and so far as it is consistent with
the national interest of the United States, and the G6vernment of
the Union of Soviet Socialist Republics agrees to pay the Government
of the United States for such shipping and related services as may
be made available under the provisions of this article in an amount
and on terms and conditions set forth in schedule II.
Article V
The Government of the United
States will, in lieu of granting any warranty express or implied
with respect to articles transferred to the Union of Soviet
Socialist Republics, assign to the Government of the Union of Soviet
Socialist Republics any assignable rights which it may have against
the suppliers, inland carriers, or other private contracting
agencies for breach of warranty, or any assignable claims for loss
of or damage to articles prior to transfer to the Government of the
Union of Soviet Socialist Republics. The Government of the Union of
Soviet Socialist Republics shall have the right of inspection of
articles prior to delivery. The Government of the United States
undertakes to use its best efforts to provide appropriate assistance
to the Government of the Union of Soviet Socialist Republics to
effectuate a satisfactory settlement with the suppliers, inland
carriers, or other private contracting agencies of any claims of the
Government of the Union of Soviet Socialist Republics covered by the
aforesaid assignment.
The Government of the United
States agrees that the provisions of article V of the Mutual Aid
Agreement of June 11,1942, shall not apply to supplies made
available to the Government of the Union of Soviet Socialist
Republics under the provisions of article JI of this agreement.
Article VI
The provisions of this
agreement shall not apply to those articles which the Government of
the Union of Soviet Socialist Republics has agreed to purchase and
the United States Government has agreed to transfer under the terms
and conditions of the letter dated May 30, 1945, from the Foreign
Economic Administrator to the Chairman of the Government Purchasing
Commission of the Soviet Union in the United States.
Nothing in this agreement
shall modify or otherwise affect the final determination, under the
act of March 11, 1941, as amended, and the Mutual Aid Agreement
between the two Governments of June 11, 1942, of the terms and
conditions upon which the Government of the Union of Soviet
Socialist Republics has received aid except for the articles and
services made available under the provisions of this agreement.
Article VII
This agreement shall take
effect as from this day's date.
In witness whereof the
undersigned, duly authorized by their respective Governments, have
signed the present agreement in duplicate in Washington on the 15th
day of October 1945.
For the Government of the
United States:
(Signed) LEO
T. CROWLEY.
For the Government of the
Union of Soviet Socialist Republics:
(Signed)
LEONID G. RUDENKO.
SCHEDULE I
(Schedule I-A and Schedule I-B
contain voluminous detailed information concerning the materials and
equipment to be supplied under the Agreement.)
SCHEDULE II
The terms and conditions upon
which articles are to be transferred and shipping and related
services rendered by the Government of the United States to the
Government of the Union of Soviet Socialist Republics under the
provisions of this Agreement are as follows:
A.
Definiiions..-1.
The term
"contract price" means the contract price f. o. b. point
of origin, or the price computed by the United States Government f.
o. b. point of origin in cases in which contracts are written on
terms other than f.o.b. point of origin (confirmed by proper
documents), which is paid by the United States Government to the
contractor. The contract price shall be evidenced by a specific
contract in cases where specific contracts have been entered into by
a United States Government procurement agency in pursuance of an
approved requisition or other written request of the Soviet
Government Purchasing Commission or to fulfill 6fferings made by the
United States to the Union of Soviet Socialist Republics for the war
programs of the Union of Soviet Socialist Republics. In cases where
articles so requested or offered are not procured on contracts
placed by a U.S. Government procurement agency in part or in whole
specifically for the Union of Soviet Socialist Republics but are
procured by a United States Government procurement agency on general
war supply contracts without specification of the particular
ultimate recipient or recipients, the contract price shall be the
average contract price (as computed by the United States Government)
f.o.b. point of origin paid by the United States Government
procurement agency for similar articles.
2. The term "the fair
value of the articles" means: (a) In the case of nonfoodstuffs,
in the aggregate, the contract price less 10 percent of such
contract price; (6) In the case of foodstuffs, the price (as
computed by the United States Government) at which the United States
Government sells similar articles in similar quantities in the
United States to other foreign governments at or about the time of
transfer to the Union of Soviet Socialist Republics.
3. The term "Inland point
of origin" means the factory in the case of articles in
production or under contract for production at the time of the
signing of this agreement and in the case of articles completed at
the time of the sighing of this agreement the point at which such
articles are then situated or their immediate next destination if
the articles are in transit.
B. Unless otherwise provided
by mutual agreement, transfers of articles to the Government of the
Union of Soviet Socialist Republics shall take place, in the case of
nonfoodstuffs, immediately upon delivery of the articles at the
inland point of origin, and in the case of foodstuffs, immediately
upon the loading of the articles on board ocean vessels in a United
States port, and title and risk of loss with respect to articles
shall pass upon transfer to the Government of the Union of Soviet
Socialist Republics; provided, that any article which shall not have
been transferred to the Government of the Union of Soviet Socialist
Republics as above set forth prior to 3 months following the time of
the signing of this agreement or 3 months following the time of
notice to the Government of the Union of Soviet Socialist Republics
of the availability of the articles, whichever is the later, shall
be deemed to be transferred to the Government of the Union of Soviet
Socialist Republics upon such date, and the Government of the Union
of Soviet Socialist Republics shall thereafter assume complete
financial responsibility for the articles.
All articles made available
shall be properly packed or prepared to meet the requirements of
ocean shipping. The invoice delivered by the Government of the
United States as certified by authorized officials of the Government
of the Union of Soviet Socialist Republics with respect to articles
transferred under article II shall be final. The Government of the
Union of Soviet Socialist Republics shall, with respect to
foodstuffs transferred, supply the Government of the United States
with the necessary number of ship manifests and signed on-board
bills of lading with related invoices, packing lists, and other
documents, whenever the foodstuffs are transported on a vessel not
under the control of an agency of the Government of the United
States.
C. The amount, which the
Government of the Union of Soviet Socialist Republics shall pay the
Government of the United States, for articles transferred under the
provisions of article II of this agreement, shall be the sum of the
following items set forth in subparagraphs 1 and 2:
1. The fair value of the
articles.
2. The costs incurred
subsequent to transfer for storage, inland transportation, inland
accessorial charges, and port accessorial charges normally incurred
by cargo in accordance with the custom of the port.
In the case of nonfoodstuffs,
such costs shall be evidenced by bills of lading, warehouse receipts
or other appropriate invoices, which shall be certified by the
Government of the Union of Soviet Socialist Republics to represent
true charges. Upon presentation of such documents to the Government
of the United States by the Government of the Union of Soviet
Socialist Republics the Government of the United States will pay the
carrier, warehouse or other contracting agency, as the case may be.
The Government of the Union of Soviet Socialist Republics undertakes
to identify by marking on the bill of lading, warehouse receipt, or
other documents involved, the requisition and contract numbers and
shipping marks or a description of the articles covered by such
documents.
In the case of foodstuffs,
such cost is included in the fair value of the article determined in
accordance with subparagraph (1) above.
D. The amount which the
Government of the Union of Soviet Socialist Republics shall pay the
Government of the United States for shipping and related services
made available under the provisions of article IV of this agreement
shall be determined on the basis of applicable rates established by
the Government of the United States, which shall be subject to
acceptance by the Government of the Union of Soviet Socialist
Republics.
E. Payment of the total amount
determined as set forth above in paragraphs C and D shall be made by
the Government of the Union of Soviet Socialist Republics, on or
before July 1, 1975, in 22 annual installments, the first of which
shall become due and payable on July 1, 1954. The amounts of the
annual installments shall be as follows:
Each of the first 4
installments shall be in an amount equal to 2.5 percent of the
amount determined as set forth above; each of the second 4
installments shall be 3.5 percent of said determined amount; each of
the third 4 installments shall be 4.5 percent of said determined
amount; each of the fourth 4 installments shall be 5.5 percent of
said determined amount; and each of the last 6 installments shall be
6 percent of said determined amount.
Nothing herein shall be
construed to prevent the Government of the Union of Soviet Socialist
Republics from anticipating the payment of any of the installments,
or any part thereof, set forth above.
If by agreement of both
Governments it is determined that, because of extraordinary and
adverse economic conditions arising during the course of payment,
the payment of a due-installment would not be in the joint interest
of the United States and the Union of Soviet Socialist Republics,
payment may be postponed for an agreed upon period.
Interest on the unpaid balance
of the total amount determined as
set
forth above in paragraphs C
and D shall be paid by the Government of the Union of Soviet
Socialist Republics at a fixed rate of 23/8 percent per
annum accruing from July 1, 1946. Interest shall be payable
annually, the first payment to be made July 1, 1947.
For the Government of the
United States:
(Signed) LEO
T.
CROWLEY.
