414 Australian Government to Commonwealth Relations Office

Cablegram 23, CANBERRA, 9 February 1949, 4.40 p.m.

CONFIDENTIAL

GENTLEMEN'S AGREEMENT We have again considered the position in respect of commitments under Ottawa and subsequent agreements arising out of the application of the General Agreement on Tariffs and Trade, which Commonwealth delegations discussed at Geneva in 1947.[1] In this consideration, attention has been directed to the possibility of accept[ance] by Australia of the text of the minute put forward by United Kingdom representative at Geneva. You will recall that at that time we found certain difficulties in that text, which were indicated in the letter dated (?7th.) October, 1947, addressed at Geneva to Helmore[2] by Morton.[3]

2. The matter has again been discussed with Ministers and their view is that it would assist them considerably if two points of interpretation of the text put forward by your representative at Geneva could be clarified.

3. The first point concerns the phrase 'sympathetic consideration'.[4] This appears susceptible of too wide an interpretation and we would wish to be clear that although those words certainly involve a careful review conducted in a spirit of goodwill they do not involve any implication of prior commitment or any obligation to accede to any particular request.

4. The second point relates to the following passage:-

(B) That in any case where a Government enjoying rights is not having regard to all relevant considerations materially interested in the product concerned and particularly has not been materially interested in the export of the product concerned to the territory of the Government making those representations consent to the modification of the rights enjoyed under the Ottawa and subsequent trade agreements shall in general be granted.

This appears to us to leave room for a difference of view as to whether the Government enjoying the rights is or is not 'materially interested' in any particular product and in the event of such a difference of view the text leaves it to implication that it is the Government enjoying the rights (i.e. the Government of the exporting country) which determines the question. We would not wish to press for any alteration of the text however if it were mutually agreed that in any reference under the passage quoted above there would be no question but that the Government enjoying the rights concerned would ultimately be free itself to decide whether consent to modification of those rights should be granted.

5. If you could indicate that the interpretations set out in paragraphs three and four above are in accord with your understanding of the text put forward by your representatives at Geneva the main obstacles to acceptance of that text by Australia would be removed.

6. With regard to Australia's obligations under (Articles 8, 10, 11, 12 and 15 of) the United Kingdom - Australia trade agreement we understand from a letter addressed to Coombs by McGregor of Board of Trade on 11th November, 1948 that the United Kingdom Government recognises that these obligations require separate treatment and that they have confirmed the understandings reached in the meeting of 10th October, 1947 between the United Kingdom and Australian Delegations to the Second Session of the United Nations Preparatory Committee on Trade and Employment in relation to these obligations.

[1] For the discussion on 10 October 1947 see Volume 12, Document 141.

[2] J.R.C. Helmore, Joint Second Secretary, UK Board of Trade; member of the UK delegation.

[3] C.E. Morton, Assistant Comptroller-General (Tariffs), Department of Trade and Customs; member of the Australian delegation. Presumably the letter referred to was the 'draft minutes' mentioned in Volume 12, Document 142.

[4] See Volume 12, Document 141, paragraph (a).

[AA : A3318, L48/3/3/3/10/1]