VIII. NECESSITY FOR RESERVING TO THE CREDITOR THE RIGHT AND POWER OF ENSURING THAT HE SHOULD NOT BE PREJUDICED BY AN AGREEMENT TO THE DETRIMENT OF HIS RIGHTS MADE BETWEEN HIS DEBTOR AND A THIRD PARTY

14. After the conclusion of a loan and the registration of a mortgage to secure it, the debtor who owns the mortgaged property may possibly make an agreement with a third party to the prejudice of the creditor, an agreement, that is, the carrying-out of which may greatly diminish the value of the security. This is the case, for example, when the debtor grants to a third party, without the knowledge of his creditor, a long lease at a very low rent. The law should secure to the creditor the right to have an agreement of this kind set aside without difficulty or at any rate to obtain a declaration that it does not affect his title. As to mortgage credit companies, legislation should be required to the effect that a lease granted to a third party by the owner of a mortgaged property subsequently to the inscription. of the mortgage cannot, if it has not been accepted by the company, affect its title.

United States

AVIATION

COMMERCIAL AVIATION CONVENTION

On July 17, 1931, the American Ambassador at Habana deposited with the Cuban Secretary of State the instrument of ratification of the United States of the convention on commercial aviation adopted at the Sixth International Conference of American States held in Habana January 16-February 20, 1928.*

CONVENTION RELATING TO THE REGULATION OF AERIAL NAVIGATION

Norway

With a despatch dated July 20, 1931, the American Ambassador in France forwarded to the Secretary of State a note from the Ministry of Foreign Affairs concerning the adherence of Norway to the convention for the regulation of aerial navigation as follows:

The Ministry for Foreign Affairs has the honor to inform the Embassy of the United States of America that the Norwegian Government has decided, on May 11th, 1931, to adhere to the aerial navigation convention signed in Paris on October 13th, 1919, amended by the following protocols:

(1) Protocols of October 27th, 1922, and June 30th, 1923, relative to amendments to articles 5 and 34;

(2) Protocol of June 15th, 1929, relative to amendments to articles 3, 5, 7, 15, 34, 37, 42 and to the fiscal sections of the convention;

'See Bulletin No. 17, February, 1931, p. 9.

(3) Protocol of December 11th, 1929, relative to amendments to articles 34 and 40 of the convention.

Official acknowledgment was given, on July 1st, 1931, of the abovementioned decision of the Norwegian Government.

In conformity with the provisions of article 41 of the convention of October 13th, 1919, the Ministry for Foreign Affairs would feel obliged if the Embassy would be good enough to bring what is stated above to the knowledge of its Government.

PARIS, July 2nd, 1931.

COMMERCE

CONVENTION ON THE EXECUTION OF FOREIGN ARBITRAL AWARDS

British Possessions

According to a circular letter dated June 11, 1931, from the League of Nations, the Secretary of State for Foreign Affairs of Great Britain notified the Secretary-General of the League, in virtue of paragraph 2 of article 10 of the convention on the execution of foreign arbitral awards signed at Geneva September 26, 1927, of the accession to this convention of the following British colonies, protectorates, and mandated territories:

According to a communication dated July 10, 1931, from the League of Nations, the instrument of ratification by His Majesty the King of Rumania of the convention on the execution of foreign arbitral awards, signed at Geneva September 26, 1927, was deposited with the Secretariat on June 22, 1931.

France

COMMERCIAL CONVENTION OF MARCH 24, 1930

According to a communication dated May 13, 1931, from the Acting Legal Adviser of the League of Nations, the instrument of ratification of France of the commercial convention and protocol, signed at Geneva March 24, 1931, was deposited with the Secretariat on May 4, 1931.

Germany

By a communication dated March 30, 1931, the Secretary-General of the League of Nations brought to the notice of the states represented at the Second Conference with a View to Concerted Economic Action, a letter from the German Consul at Geneva in which it was stated that the German Government had decided not to deposit its instrument of ratification of the commercial convention signed at Geneva March 24, 1930, as the conference which met March 16-18, 1931, was unable to reach an agreement with regard to the putting into force of the convention."

According to information furnished by the League of Nations, the convention has been ratified by Belgium, Denmark, Finland, Great Britain, Greece, Italy, Latvia, Luxembourg, Norway, Netherlands, Sweden, and Switzerland. Spain presented a request to be allowed to accede.

COPYRIGHT

INTERNATIONAL UNION FOR THE PROTECTION OF LITERARY AND ARTISTIC WORKS

CONVENTION AS REVISED AT ROME, JUNE 2, 1928

On July 3, 1931, the American Ambassador to Italy reported that he had been informed by the Italian Foreign Office that during the last fifteen days of June, ratifications of the copyright convention as revised at Rome June 2, 1928, were deposited by the following countries: Canada, Finland, Great Britain, India, Italy, Japan, the Netherlands, Norway, and Sweden."

FINANCE

INTERNATIONAL CONVENTION FOR THE SUPPRESSION OF COUNTERFEITING CURRENCY

Greece

The American Minister to Greece reported in a despatch dated June 19, 1931, that the Official Gazette of Greece for June 13, 1931, published a law ratifying the international convention for the suppression of counterfeiting currency signed at Geneva April 20, 1929.

MORATORIUM ON INTERGOVERNMENTAL DEBTS

On June 20, 1931, the President made an announcement of which the following is the first paragraph:

The American Government proposes the postponement during one year of all payments on intergovernmental debts, reparations and relief debts, both principal and interest, of course not including obligations of governments held by private parties. Subject to confirmation by Congress, the American Government will postpone all payments upon the debts of foreign governments to the American Government payable during the fiscal year beginning July 1 next, conditional on a like postponement for one year of all payments on intergovernmental debts owing the important creditor powers.

Other interested governments having signified their acceptance of this proposal, the French Government, after an exchange of views at Paris between its representatives and representatives of the American Government, announced on July 6, 1931, that it also was in agreement with the United States on the essential principles of the proposal. The text of the agreement reached by the American and French negotiators is as follows:

1. The payment of intergovernmental debts is postponed from July 1st, 1931 to June 30th, 1932.

2. However, the Reich will pay the amount of the unconditional annuity. The French Government agrees insofar as it is concerned, that the payments thus made by the Reich shall be placed by the B.I.S. in guaranteed bonds of the German railways.

3. All suspended payments shall be subject to interest in accordance with the conditions suggested by the American Government payable in ten annual installments beginning with July 1st, 1933.

4. The same conditions shall apply to the bonds to be issued by the German railroads.

On the three points which it is recognized do not directly concern the American Government, the French Government makes the following observations:

T

(a) A common action by the principal central banks acting through the medium of the B.I.S. shall be organized to assist the countries of Europe which would be particularly affected by the postponement of the payment as proposed.

(b) A preliminary understanding should take place between France and the B.I.Š. in order that France shall not supply the guarantee fund provided for in the Young Plan in the event of a moratorium except by monthly payments in accordance with the acknowledged rights of the creditor states after the actual transfer of payments by Germany.

Bank for International Settlements.

(c) The question of deliveries in kind and the various modifications which will become necessary as a result of the application of the American proposal and the present agreement shall be studied by a committee of experts named by the interested powers which shall reconcile the material necessities with the spirit of President Hoover's proposal.

France reserves the right to request of the German Government indispensable assurances concerning the utilization for exclusively economic purposes of the sums freed to the Reich budget.

Discussion of the German financial situation having been continued among representatives of governments chiefly concerned, and with representatives of the smaller countries having special debt questions, a conference of representatives of the United States of America, Belgium, France, Germany, Great Britain, Italy, and Japan, held at London, agreed on July 23, 1931, upon the following declaration:

The recent excessive withdrawals of capital from Germany have created an acute financial crisis. These withdrawals have been caused by a lack of confidence, which is not justified by the economic and budgetary situation of the country.

In order to insure the maintenance of the financial stability of Germany, which is essential in the interests of the whole world, the Governments represented at the Conference are ready to cooperate so far as lies within their power, to restore confidence.

The Governments represented at the Conference are ready to recommend for the consideration of the financial institutions in their respective countries the following proposals for relieving the immediate situation:

1. That the Central Bank credit of one hundred million dollars recently granted to the Reichsbank under the auspices of the Bank for International Settlements, be renewed at maturity for a period of three months;

2. That concerted measures should be taken by the financial institutions in the different countries with a view to maintaining the volume of the credits they have already extended to Germany.

The Conference recommend that the Bank for International Settlements should be invited to set up without delay a committee of representatives nominated by the governors of the central banks interested to inquire into the immediate further credit needs of Germany and to study the possibilities of converting a portion of the short term credits into long term credits.

The Conference noted with interest a communication from Dr. Bruening relative to the joint guarantee recently placed by German industry at the disposal of the Gold Discount Bank. The Conference are of the opinion that a guarantee of this description should make it possible to provide a sound basis for the resumption of the normal operations of international credit.

The Conference consider that, if these measures are carried through, they will form a basis for more permanent action to follow.