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EXHIBIT S-69

MEMORANDUM OF GENERAL AGREEMENT BETWEEN BRITISH IRON AND STEEL

FEDERATION AND ENTENTE INTERNATIONALE DE L'ACIER

31st July, 1935

MEMORANDUM OF GENERAL AGREEMENT

CONCLUDED BETWEEN

the BRITISH GROUP represented by the BRITISH IRON AND STEEL FEDERATION,

LONDON, responsible for the Firms and Companies enumerated in Appendix I,

and hereinafter called the “FEDERATION" the one hand

and

on the other hand the FRENCH GROUP represented by the COMPTOIR SIDERURGIQUE DE FRANCE, Sociéteé

Anonyme à Capital Variable, Paris, and responsible for the Firms and Com

panies enumerated in Appendix I: the BELGIAN GROUP represented by the GROUPEMENT DES HAUTS FOURNEAUX ET

ACIERIES BELGES, Société Coopérative, BRUSSELS, and responsible for the Firms

and Companies enumerated in Appendix I: the LUXEMBURG GROUP represented by the GROUPEMENT DES INDUSTRIES SIDE

RURGIQUES LUXEMBOURGEOISES, Société Cooperative, LUXEMBURG, and responsi

ble for the Firms and Companies enumerated in Appendix I: the GERMAN GROUP represented by the STAHLWERKS-VERBANE AKTIENGESELL

SCHAFT DUSSELDORF, and responsible for the Firms and Companies enumer

ated in Appendix I: the aforesaid Groups being represented collectively by the ENTENTE INTERNATIONALE DE L'ACIER, LUXEMBURG, hereinafter called the “E.I.A.

ARTICLE I Object

The aim and object of this Agreement is to establish collaboration between the Federation and the E.I.A. in respect of their general export sales and the protection of their respective interior markets.

It is the intention of the contracting parties to conclude sectional Agreements in respect of iron and steel products other than those ennumerated in Article III, as soon as the interested producers are grouped in the different countries.

ARTICLE II Duration

This Agreement shall come into force on 8th August, 1935, provided that, in the meantime, arrangements shall have been made by the United Kingdom Government whereby the rate of duty applicable to imports covered by the Agreement may be reduced wherever practicable to not more than 20 per cent ad valorem. This Agreement shall continue subject to the provisions of Article III (a) and Article IV (e) hereof and to any modifications that may be found necessary and agreed between the parties from time to time for a period of five years, but either of the contracting parties shall have the right to terminate the Agree. ment on the 7th of August, 1938, upon giving notice of their intention so to do in writing to the other party not later than the 7th of February, 1938.

ARTICLE III Exports

(a) Sectional Export Agreements-in so far as they are not already concluded-shall be concluded in respect of the following products:

(1) Irma material;
(2) Semis (ingots, blooms, billets, slabs, sheet bars, tinplate bars);
(3) Joists, channels and broad flanged beams;
(4) Merchant Bars and sections;
(5) Thick plates (16" & up);
(6) Medium (118" and less than 1);
(7) Large flats or universals (6'' & up);
(8) Hoops and strip;
(9) Tube strip;
(10) Wire Rods, IWECO and other Wire products;

(11) Tinplates;

(12) Sheets less than 18'', black and galvanised, and all sectional Agreements shall be deemed to be an integral part of this Agreement.

The sectional Agreements still to be concluded shall be operated in full from the date of their completion, but in every case the operation of the export quotas for which they provide shall be made to apply from a date not later than the 8th August, 1938.

In the event of failure to reach a sectional Agreement in respect of any of the aforesaid products by 7th January, 1936, either party may, on giving 3 months' notice, terminate both this Agreement and such sectional Agree

ments as have been concluded prior to 7th January, 1936. (b) The export rights of the contracting parties shall be secured by the application to the total exports in any product of the quotas fixed by the sectional Agreement for that product.

(c) If, during the first year of operation, the total exports of the United Kingdom, Germany, Belgium, France, and Luxemburg, under the sectional Agreements enumerated in (a) above exceed the corresponding total of exports for 1934, the following rules shall be applied for the apportionment of the excess:

(i) If the excess is less than or equal to 217,500 tons, it will be divided at the rate of 23rds for the Federation and 13rd for the E. I. A. The apportionment of any balance of the said 23rds remaining to be satisfied after the quotas of all the respective sectional Agreements have been met, shall be applied to the various products so far as practicable in the proportion that they have contributed to the increase of the exported tonnage except that any additional tonnage that would accrue in this way to rails, semis or tinplates shall be taken up in the other products named in (a) above if either party so requires, and on a basis to be mutually agreed;

(ii) If the excess is more than 217,500 tons, the apportionment of a first quantity of 217,500 tons shall be made as stated in (i) above. The division of the tonnage exceeding this first quantity of 217,500 tons shall be made in accordance with the percentages as fixed in the sectional export Agree

ments. This special disposition applies only to the first year of operation, and for the following years the apportionment shall be made in accordance with the percentages as fixed in the sectional export Agreements.

ARTICLE IV

Imports into the United Kingdom

(a) The Works situated in the countries represented by the E. I. A. shall be entitled to import into the United Kingdom under the conditions hereinafter provided a total of 670,000 tons made up of the products and quantities as shown bereunder duris an initial period of 12 months from 8t1 August, 1935, and thereafter a total of 525,000 tons per annum as shown hereunder during each of the four periods of twelve months following:

[blocks in formation]

Irm material
Semis (ingots, blooms, billets, slabs, sheet bars and tinplate bars).
Joists, Channels and broad flanged beams
Merchant Bars and sections (including iron bars)
Thick plates (316" & up).
Medium plates (18"-316').
Large flats or universals (6'' " & up)
Black plates and sheets less than 18" and galvanised sheets
Hoops and strip.
Tube strip.
Wire Rods, IWECO and other Wire products:-

(a) Wire rods

(h) IWECO Products Tinplates...

[blocks in formation]

Total...

670, 000

525, 000

1 Subject to verification of the imports of conduit strip in 1933 having been 13,500 tons and not 10,000 tons.

96347-50-8er. 14, pt. 4b9

(b) Inasmuch as both parties are satisfied that the aforesaid importation into the United Kingdom with reduced rates of duty can only be operated satisfactorily and without detriment to the interests of their respective countries by the insti. tution by the United Kingdom of a system of licensing, the Federation undertake to use their best endeavours to secure the institution of such a system for the products named at the earliest possible date.

(c) In order that the coming into force of this Agreement may not be delayed pending the establishment of a system of licensing and the conclusion of the sectional Export Agreements, the Federation will ask their Government to make the reduction of duties referred to in Article II above for a period of 5 months in the first instance. The E. I. A. undertake that importation from their coun. tries during that period shall not exceed the proper proportion of the respective tonnages prescribed in (a) above, except in so far exchanges of one category for another may be agreed.

(d) The E. I. A. undertake to consult with the Federation as to prices and destination of sales and deliveries during the aforesaid temporary period of 5 months, and to consider the conclusion before the expiration of that period of permanent arrangements under which the Federation may, if they so desire, make collective purchase of the agreed importation on a basis that preserves as far as practicable established channels of distribution. (e) In the event of failure

(i) to continue the provision for reduced import duties for the full term of this Agreement; or

(ii) to institute a system of licensing of imports into the United Kingdom; or

(iii) to reach agreement in regard to the permanent arrangements re

ferred to in (d) above; either party may, on giving three months' notice, terminate both this Agreement and the respective sectional Agreements.

ARTICLE V Co-ordinating Committee

The contracting parties shall establish a Joint Co-ordinating Committee which shall be responsible for the proper carrying out of this Agreement, and for the general supervision of the various sectional Agreements.

ARTICLE VI Arbitration

In the event of any dispute arising between the contracting parties as to either the interpretation or the application of this Agreement or the sectional Agreements it shall in the first instance be submitted to the Chairman of the Federation and the Chairman of the E. I. A. If no settlement is reached, the dispute shall be referred to arbitration, each Chairman nominating an Arbitrator within one month. If the Arbitrators cannot effect a settlement they shall, within a month, either agree upon an Umpire or request the Chairman of the International Cham: ber of Commerce to appoint an Umpire. The contratcing parties undertake to accept without appeal the verdict passed by the Chairman, the Arbitrators or the Umpire as the case may be.

ARTICLE VII

The Agreement is written down both in English and French. It is stipulated that, in case of arbitration, the Arbitrators shall refer to the English text whenever the arbitration is applied for by the Federation and to the French text whenever the arbitration is applied for by the E. I. A.

SIGNED AT LONDON, 31st July, 1935.
On behalf of BRITISH IRON AND STEEL FEDERATION :

(signed) DUDLEY.

ANDREW R. DUNCAN.

W. J. LARKE. On behalf of ENTENTE INTERNATIONALE DE L'ACIER:

(signed) AL. MEYER.

TH. LAURENT.
E. POENSGEN.
A. D'HEUR.

EXHIBIT S-701

ACCORDS AVEC LE GROUPE AMERICAIN-EVOLUTION

Lère période.-Février-octobre 1937: Les accords du 19/2/37 restent lettre morte.

2ème période.-Octobre 1937–15 Juin 1938: Première tentative de cooperération; graves difficultés.

3ème période.-Juin 1938-fin Octobre 1938: Confirmation des arrangements. La mise en marche des accords s'avère pourtant très pénible; difficultés aux Etats-Unis.

4ème période.—Novembre 1938–Mars 1939: On reporte la date de départ des arrangements au 1/11/38, la signature des usines adhérentes n'ayant été obtenue qu'en octobre.

5ème période.—Mars à Août 1939: Le Comité de Londres est constitué; on rend la liberté aux groupes pour les marchés de l'Asie N-E; on met en suspens les avances et retards de la période ler novembre 1938 au 20 avril 1939 pour repartir à zéro à cette date. Certains progrès sont réalisés mais la situation demeure très peu satisfaisante.

NÉGOCIATIONS ET ACCORDS AVEC LES PRODUCTEURS AMÉRICAINS Abstraction faite des accords particuliers relatifs aux rails, aux fers blancs et aux tubes, les Groupes européens n'ont eu aucun rapport officiel avec les pra ducteurs américains jusqu'en 1936. C'est en mai 1936 que Sir Andrew Duncan a fait part au Joint Co-ordinating Committee de son intention de remettre aux Américains, à l'occasion d'un voyage qu'il devait faire avec Lord Dudley et Mr. Elliot aux Etats-Unis, une invitation à venir discuter leur particpation aux accords conclus entre l'E. I. A. et la B. I. S. F. M. Meyer accepta cette idée en soulignant l'intérêt qu'il y aurait à conclure d'abord un accord relatif à l'importation aux Etats-Unis. A son retour d' Amérique, en juillet, Sir A. Duncan nous informa que la situation existant aux Etats-Unis et en particulier la tension des rapports entre l'industrie américaine et le Gouvernement ne permettait pas d'envisager un arrangement.

Au début de 1937 pourtant, MM. Bash (Bethlehem) et Mundle (U. S. Steel Products), qui se trouvaient à Londres, se déclarèrent prêts à discuter les bases d'une coopération. On mit au point, à cette époque, un mémorandum qui firait les bases sur lesquelles on pouvait envisager la constitution d'accords. mémorandum, ainsi que des notes sur les conversations du 19 février, sont joints en annexe N° 1.

L'analyse de ce document est vte faite. Il prévoit en ordre principal:

1°) que les quotes-parts du Groupe américain doivent être calculées sur la base des réalisations de 1934 (quotes minima en-dessous desquelles jouent les compensations pour déficits éventuels américains) et de 1936 (quotes maxima applicables en cas de dépassements américains pour le calcul des indemnités). Nous avons toujours été d'avis que la base réelle était 1934, les quantums établis sur la référence 1936 ne constituant qu'une tolérance de dépassement.

Pour les aciers marchands, les poutrelles et les poutrelles à larges ailes, les fournitures au Canada sont complètement exclues, les usines améicaines acceptant pourtant d'observer les prix convenus pour ce pays, sans limitation de tonnage.

Une réserve libellée comme suit fut introduite à la demande des négociateurs américains (clause 5):

“For the purpose of accounting the Americans agree to report deliveries made on or after 1st February 1937, but this agreement is conditional upon the acceptance of the principle that no penalty shall apply to deliveries made by any Group in excess as a result of other Groups being unable to make the deliveries required of them. The application of this principle to be mutually agreed.”

Mr. Elliot, dans une lettre à M. Meyer du 10 mars 1937, l'expliqua de la façon suivante :

"The Americans are afraid that if they report deliveries against orders taken before February 1st they will find themselves immediately in excess and might be called upon to cease selling altogether. I have explained to them that although they may be in excess on such deliveries they will not be called upon immediately

1 Exhibits S-70 through S-91 were found grouped together in a single folder in the files of the International Steel Cartel.

to quote protective prices in any market on that account. In the present state of the order books both in Europe and in America it appears to me that if they go into excess immediately it will simply be on account of other Groups being unable to deliver, and this situation is fully covered in the first part of the same paragraph: however, they asked that the last sentence should be added, and I raised no objection to it. Incidentally, they tell us that they do not book business for delivery more than six months ahead and, therefore, any orders that were on their books before February 1st will be worked out by July 31st, when our accounting year ends."

A la lumière des expériences faites par la suite, nous avons des raisons de croire que les Américains n'interprétaient pas cette clause d'une facon aussi honnête et étroite que le faisait Mr. Elliot.

2°) Sous réserve d'examen et de confirmation ultérieure par les Américains, les arrangements définitifs à conclure seront établis sur la base des clauses et conditions du “Main Agreement” entre l'E. I. A. et la B. I. S. F. Ceci revient à dire que la participation américaine devait être régie par des conventions d'esportation analogues à la "Model Form for Sectional Export Agreements" admise entre les Britaniques et nous.

3°) Il est entendu que par "exportations” on ne comprend que les fournitures considérées comme telles aux termes de l'Export Trade Act (Webb-Pomerene Act). Ceci signifie que les Philippines, Hawai, l'Alaska et Portorico, font partie du marché intérieur américain et que les lois antitrust (Sherman Law) s'appliquent aux livraisons vers ces pays. Toute possibilité de conclure un accord formel relatif à nos importations aux Etats-Unis et les territoires qui viennent d'être cités nous a ainsi été enlevée. On était pourtant convenue avec les Améri. cains de conclude un accord verbal à ce propos. Les Américains avaient proposé que nos importations soient limitées aux chiffres de 1934, alors que nous proposions la base 1935 qui plus tard a été admise en principe, sans pourtant qu'on discute plus amplement la question ou qu'on étasblisse un contrôle de l'ctivité des Groupes.

Les interpénétrations devaient être exclues du calcul, dans les mêmes conditions que dans les accords EIA/BISF.

Ce mémorandum a été signé au mois de juin 1937 par Mr. Bash (Bethlehem Steel Export C°) et Mr. Mundle (U. S. Steel Products Co) du côté américain, et par M. Meyer, M. Th. Laurent, M. Poensgen, M. D'Heur, Sir Charles Wright, pour les Groupes européens. Aucene suite pourtant n'a été donnée à cette signature avant la fin de l'année, une ratification par les autres usines américaines n'ayant pu être obtenue. En octobre/novembre, des télégrammes vinrent nous annoncer que l'U. S. Steel et la Bethlehem seraient prêtes malgré tout à accepter à dater du ler décembre 1937 l'accord en prenant la responsabilité des dissidents; les feuillards, bandes à tubes, tôles fines et galvanisées resteraient provisoirement libres. Nous nous trouvions à cette époque en face d'une véritable offensive de prix de la part des usines américaines. Sur les marchés d'Extrême-Orient comme en Europe nous rencontrions des cotations extrêmement basses pour le matériel naval, les demi-produits, les aciers marchands, le fil machine. Mr. Outwater, représentant américain à Londres, donnant suite aux télégrammes reçus de New-York, se mit en rapport avec nous pour la discussion des prix et participa dès lors aux réunions de nos Comptoirs. On échangea les listes de prix et d'extras. Le Groupe américain se dit prêt en principe à respecter les prix convenus. Etant donné la situation difficile des usines américaines, Mr. Outwater proposa que l'on procède par étapes : 1°) respect des prix; 2°) échange de chiffres 3°) discusson du mécanisme des accords (machinery). Il ne cacha pas que la situation était difficile et fit des appels répétés à notre patience. Voici ce qu'll déclara le 23 novembre:

"Le Groupe américain qui a été constitué et qui accepte la responsabilité de toutes les usines américaines, contrôle en fait 98% de ses exportations, mais étant donné le nombre de producteurs de ce pays (174) dont la majorité n'a pas de références à l'exportation ,il est impossible de songer à établir entre eux une discipline analogue à celle qui existe en Europe. Pour éviter des troubles, il faut que les prix d'exportation ne dépassent pas sensiblement les prix du marché intérieur américain."

La patience des Groupes auropéens fut en effect mise à rude épreuve durant toute cette période (octobre 1937 à février 1938) aussi bien que par la suite, ainsi qu'on le verra. A nos plaintes relatives aux sous-cotations que nous rencontrious partout, Outwater répondit en disant que l'occupation dans les usines

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