OIL CONTROVERSY

Northern Advocate, 21 December 1932, Page 5

OIL CONTROVERSY

CASE FOR BRITAIN HIGH-HANDED CANCELLATION NO ALTERNATIVE SOUGHT. INTERNATIONAL LAW VIOLATED. (British Official Wireless.) (Received 9 a.m.) RUGBY, December .19. The dispute between the British, and Persian Governments with reference to the cancelled concession of the Anglp-Persian Oil Company, which w’as referred to the League of Nations by the British Government under- Article 15 of the Covenant, came before the Council of the League at Geneva today.

Britain hpd proposed submitting the dispute to the International Court of Arbitration at The Hague,, but as the Persian Government. disputed the competence of that tribunal to deal with the case, the British Government, to prevent waste of time, brought, it before the League .Council. The British memorandum traces the history of the concession, which does not expire until 1961, and contains no provision for unilateral cancellation. The Persian Government, up to the end of last year, received over £11,000,000 in royalties. The situation earlier this year was that a preliminary agreement for modifying the existing basis on which the royalty was calculated, had been reached between the Persian Government and the company, and approved by the Persian Government Council of Ministers, and the formal agreement to give it effect had been already negotiated and initialled- by representatives of the parties, and had been for some months under the consideration of the Persian Government. Compact Disregarded. Although apparently dissatisfied with the proposed agreement, no alternative proposal to the company was actually made by the Persian Government, The company would have been perfectly prepared to consider such proposals on receiving, them, and if no agreement had been possible, any claims by the Government against the company should have been submitted to arbitration in accordance with the terms of the concession.

The Persian Government, however, instead of taking such a coarse, sent a communication to the company announcing its decision to cancel the concession. The company replied disputing the legality of such unilateral action. - ,

On being informed of the situation, the British Government took up the; case in exercise of its right to protect British nationals when injured by acts contrary to international Jaw committed by another State. - Serious View Enforced. After giving the text of thq Notes exchanged, the memorandum says that the British'Government was compelled to take a serious view of the situation created by the Persian Government’s, action, which could only be regarded as a unilateral act of confiscation, contrary to international law, and constituting, in this ease, an international wrong" done to the United Kingdom in the person of the British 'Company. Moreover, if this action was to be followed by an attempt to take possession of the company’s extensive and immensely valuable properties in Persia, or should any action or inaction by the Persian Government lead to serious injury to the properties or personnel of the company, a situation of utmost gravity would arise. ■ It was a matter of disquietude that the Persian Government refused to accept responsibility for any loss or damage, although the terms of .the concession bound the Persian Govern: ment to take the necessary measures for the protection of the property and ■ the employees. Matter of Urgency. The British Government, continues the memorandum, was most anxious that the difficulties between the Persian 'Government and the company should be settled by an amicable . and fair agreement. It emphatically repudiated the allegation that it ..had done anything to impede such ,an agreement, and in fact took no steps in the matter at all until the Persian Government created the present situation by the illegal step of cancelling the concession.

Obviously, negotiations could not bo fruitfully pursued ■while ■ the Persian Government claimed to treat the concession as having terminated by its own unilateral act. The British Government would do everything in its power to co-operate-with the Council in taking appropriate steps to ensure the maintenance of the status quo'and to prevent the interests of the company from being prejudiced pending the proceedings before the Council-

Sir AVilliam Malkin, in presenting the case to the Council, said the Government felt the situation contained elements which required the Council to deal with.it as a matter of urgency. He hoped the matter would be ready for consideration at the Council meeting to bo held on January 28.