Your 66.  Japanese Peace Settlement.
In his statement on international affairs in the House of Representatives on 26th March the Minister for External Affairs stressed the need for effective supervision of Japan in order to lead to the emergence of a genuinely peace loving and democratic people.
2.We are considering your suggestion that the question be raised in F.E.C. but before reaching a decision we would be glad of your views on the following proposals, particularly concerning supervision.
3. We have been closely considering the form this supervision should take. Our view of the proposed United States 25-year 4- power treaty on disarmament and demilitarisation of Japan  is that not only does it exclude Australia, Canada, New Zealand and other active belligerents in the Pacific war from any share in control of Japan, but that it stressed the negative (disarmament) aspect of the settlement and neglects the positive (democratisation) aspect.
4. In drafting the peace treaty with Japan we consider that the most important part will be that dealing with the control of Japan or the machinery for securing the achievement of the basic objectives of the Allied Powers. In order to accomplish these objectives we have considered the establishment under the terms of Articles 52 to 54 of the Charter of the United Nations a Pacific Regional Security Commission which would consist of all active belligerents in the Pacific war (i.e. F.E.C. countries) and which would supervise the implementation of the terms of the treaty. 
5. We would propose that such a Commission would be guided by the terms of the Potsdam Declaration  and purposes and principles of the United Nations as set forth in Articles 1 and 2 of the Charter, that decisions would be by majority vote and that its powers and functions would include:-authority over the Japanese Emperor and Government, disarmament and demilitarisation, removals of obstacles to democratic tendencies, economic control and recommendations for termination of various controls.