265 Critchley to Department of External Affairs

At midnight on October 4th the Netherlands Delegation presented an oral note [1] to Cochran outlining a basis for a settlement and countering Republican conditions [2] for resumption of negotiations with conditions of their own.

2. Cochran is keeping contents of note to himself pending clarification by Dutch of number of points. He has promised to let me have a copy as soon as this clarification is obtained.

3. I understand from Dutch sources that proposals represent maximum concessions which the Dutch feel they can make and include suggestions consistent with draft bill for an interim Government [3] which is being prepared at The Hague in consultation with 'Federalists' (details of bill are not available but it is believed to provide that executive authority in interim period would rest with a selected directorate of three or five Indonesians. Veto powers would be retained by a High Commissioner who would also control Netherlands armed forces). American reluctance to pass on proposals suggests there may be last minute changes.

4. There are indications that the Dutch are determined to obtain a settlement by negotiation or force in the near future.