Trading with the enemy

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Title:
Trading with the enemy
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Book
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United States
United States -- Congress. -- House. -- Committee on International Relations. -- Subcommittee on International Trade and Commerce
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Table of Contents
    Front Cover
        Front Cover 1
        Front Cover 2
    Title Page
        Page i
        Page ii
    Foreword
        Page iii
        Page iv
        Page v
        Page vi
    Table of Contents
        Page vii
        Page viii
        Page ix
        Page x
    Part I. A legislative history of section 5(b) of the trading with the enemy act
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    Part II. Presidential proclamations and executive orders issued under the authority of section 5(b) of the trading with the enemy act
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    Part III. Regulations governing financial transactions issued under the authority of section 5(b) of the trading with the enemy act (Title 31 C.F.R.)
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    Back Cover
        Back Cover 1
        Back Cover 2
Full Text







o"th Congre. COXXITTEE PRINT
W lBenmon
qi,i.





TRADING WITH THE ENEMY

( Legislative and Executive Documents Concerning
!1 V. .: o. r I T.," action in
S iqguladon ("f lutenational Transactions in

ii Th'e of. Declared National Emergency
E ia so -' *

4"^vt*....' "PREPARED BY THE

SUBCOMMITTEE ON INTERNATIONAL TRADE
H AND COMMERCE
::'" OF THE ""
I COMMITTEE ON INTERNATIONAL
S....RELATIONS


yiAs H ,: _p > .. '-, .. v / '




NOVEMBER 1976 -



Printed for the uue of the Committee on International Relations
I --









'Ior a by the Superintendent of Document, U.S. Government Printing Office
Washington, D.C. 20402-Price $2.75













COMMITTEE ON INTiUATIONAL RELATIONS
THOMAS &. MORGAN, Pennsylvania, CThirman


CLEMENT L. ZABLOCKI, Wisconsin
WAYNE L. HAYS, Ohio
I H.L FOUNTAIN, North Carolina
DANTE B. FASCELL, Florida
CHARLES C. DIGGS, JB., Michigan
ROBERT N. C. NIX, Pennsylvania
DONALD M. FRASER, Minnesota
BENJAMIN S. ROSENTHAL, New York
LEE H. HAMILTON, Indiana
LESTER L. WOLFF, New York
JONATHAN B. BINGHAM, New York
GUS YATRON, Pennsylvania
ROY A. TAYLOR, North Carolina
MICHAEL HARRINGTON, Massachusetta
LEO J. RYAN, California
DONALD W. RIEGLE, JL, Michigan
CARDISS COLLINS, illinois
STEPHEN J. 80LARZ, New York
HELEN S. MEYNER, New Jersey
DON BONKER, Washington
GERRY E. STUDDS, Massachusetts


WILLAM S. BROOMtL jtchi
EDWARD J. DERWINSKI, lUfiols
PAUL WXNDLEY, Illinois |
JOHN BUCHANAN, fl. Albama
J. HERBERT BURKE, Florida
PIERRE S. mu PONT, Delaware
CHARLEB W. WHALC, Ji.., Ohio
EDWARD 0. BIESTER, JB., Pennylvanla
LARRY WINN, JiL, Kansas
BENJAMIN A. GILMAN, New York
TENNYSON GUYER, Ohio
ROBERT J. LAGOMARSINO, CalfoMrnia


MaIAN A. CZARnxCKa, Chief of Staff


SUBcOMMTTEE ON INTERNATIONAL TRADB AND COMMESOR
JONATHAN B. BINGHAM, New York, Chaimaw


DONALD M. FRASER, Minnesota
ROY A. TAYLOR, North Carolina
DON BONKER, Washington
GERRY E. STUDDS, Massachusetts


EDWARD G. BI STER, J., PenUylvnia
CHARLES W. WHALEN, JB., Ohio


B. Roozm MAAK, Sbcommitee te f Comsltuat
TnMa, E. PopovicH, Mfrtit Subcommfttne Staff ConsUant
SOSaN GUsTAfSON, SSaff AasUftnt
VICTOR C. JOHNON, research Assasta
(Ill


.- dJks-,:: .a,.,,,,..,







I L r.( .;.i .j *'




'T t With theEnmy Act of 1917 has been on the books for
M /60* As amended-'during that period, section 5 (b) has
i e President with progressively broader authority to regu-
hation'sl international (ad domestic) finance during periods
f &ndaional emergency. This section has been construed ov er
.4!MW'1 rbviding statutory authority for "emergency" actions
#s Me "bank holiday" of 1938, an alien property freeze and
g zd'it controls imposed during WorlY War II, foreign
mvieht controls imposed in 1968, and routine export con-
i 2,1974, and 1976. It provides a major statutory basis for
llibargbe currently in effect against North Korea, Vietnam,
lUMId iit t Cuba.
. S : I ' i A,
V9 lt the obvious unport ince of section 5(b), its legislative
Siyll nDever before been assembled and fully reviewed. The pur-
'"S committee print is to provide such a legislative history.
'eedto serve as a set df working documents for the use of the
dmttb on: Intrational Trade and Commerce and of the full
i iAtiokMala Relations Committee. These documents should also be
'7&tWst and use to other Members of Congress working on related
tfr% ,4tond the interested public.
rimakimary 1973, Senate Resolution 9 established a bipartisan
Setk SpOiiAl Committee on the Termination of the National Emer-
'h cMhit a study and investigation with respect to the matter
LEting the national emergency proclaimed by the President
UiteN States on December 16, 1950. * *" This national
proclain)ed to aid in prosecuting the Korean war, had
terminated. The Special Committee soon discovered that
t four "national emergencies" continued in effect, includ-
4 national emergency declared by President Roosevelt on
Si3t, to meet the problems of the depression, and the national
Ideclired by Preside!t.Nixon on March 23, 1970, because
S cOfce strike, and on August 15, 1971, to deal with balance
Saye and other international problems.
eSpeial Committee also discovered that no inventory existed of
pundremSl of statutes delegating powers to the President which
g ted by, -these PresidOntial declarations. In the words of
ir Mathias, Special Committee cochairman, "a majority of the
ift the United States have lited all of their lives under emer-
v)eirnent." The'othe cochairmin, Senator Church, pointed
that the basic question before the Special Committee was "whether
*i possible for a democratic government such as ours to exist under
3 present Constitution and system of three separate branches equal
. power under a continued state of emergency."
mCU (n)






An exhaustive 2-year study by the Special Committee, followed by
extensive consideration by the appropriate legislative committees of
each house, has produced the National Emergencies Act, which was
signed into law by the President on September 14, 1976 (Public Law
94-412) .1 The act terminates all powers and authorities possessed by
the executive branch as a result of any declaration of national emer-
gency, and prescribes procedures governing the declaration, conduct,
and termination of any future national emergency. Exempted, how-
ever, from the National Emergencies Act are certain laws deemed
especially important to the functioning of the government Among
these is section 5 (b) of the Trading With the Enemy Act.
Given the jurisdiction of the Committee on International Relations
under the Rules of the House, it is the responsibility of the committm
and its Subcommittee on International Trade and Commerce, pur-
suant to Section 502 of the National Emergencies Act, to conduct a
thorough review of section 5(b) of the Trading With the Enemy Act
and to recommend revisions to the House within 9 months.
Two problems arise in attempting to determine congressional intent
with regard to section 5.(b). The first is that the legislative history
of 5(b) is short and sketchy. There was virtually no discussion of it
at the time of the passage of the original Trading With the Enemy
Act, and subsequent amendments generally occurred in times of crisis
when apparently it was felt that there was no time for the luxury of
extensive debate. The most striking example is that the 1933 amend-
meat, which authorized the President to invoke the powers of 5(b)
simply by declaring a national emergency, was debated and passed by
both houses in 1 day, without hearings and before the bill was even
in print. The second is that the relationship of 5(b) to the zest of the
Trading With the Enemy Act was ambiguous from the beginning, in
that there was no language in that section limiting its application to
the "enemy" in time of "war" as defined in section 2 of the act.
In these circumstances, the subcommittee has sought to include in
this volume all the legislative history which might conceivably be
relevant. Part I includes the following: the text of the entire Trading
With the Enemy Act as originally passed, and those portions of the
floor debates, committee reports, and hearings which pertain to the
general purposes of the bill or to 5(b); the complete legislative history
of all four subsequent amendments to section 5(b) ; the legislative his-
tory of relevant sections of two others acts (the "Knox Resolution" of
1921 and the Gold Reserve Act of 1934) which pertain to.5(b) with-
out actually amending it; and the current status of the entire Trading
With the Enemy Act as it appears in the United States Code
Annotated.
If the legislative history of section 5(b) is short, its executivee his-
tory" is extensive. The authority of 5(b) has been invoked in numerous
Presidential proclamations and Executive orders. These are reprinted
in part II of this volume. Finally, in part III, the current regulations
The text of Public Law 94-412 appears on p. 437.






governing financial transactions, issued under the authority of 5(b),
are reprinted from Title 31 of the Code of Federal Regulations.1
This volume was edited by Victor C. Johnson, of the subcommittee
Staff. The subcommittee wishes to acknowledge the invaluable assist-
ance of Messrs. Grover S. Williams and Walter S. Albano of the
American Law Division, Congressional Research Service, Library of
Congress, in compiling the documents.
JONATHAN B. BINOHAM,
SChairnan, Subcommittee on
1 ........... Internatinal Trade and Commerce.
mI .tbfi *hwbiu comprehensive collections of documents relating to emergency powers
ar si .epliale: U.S. Congress, Senate "Emergency Powers Statutes: Provisions of Ped-
e el Law w tbln Effect Delegating to the Executive Extraordinary Authority In Time of
National BIergieny," report of the Special Committee on the Termination of the National
SEmergency, 8d Congiess, 1st Session (Nov. 19, 1973); U.& Congress, Senate, "Executive
Ordeis in Times of War and National Emergency," report of the Special Committee on
I National Emergencies and Delegated Emergency Powers, 93d Congress, 2d Session (June
i 19T4) ; U.S. Congress, Senate, "Executive Replies" (Part 1: Evaluation of Emergency
SPowers Statutes; Part 2: Summaries of the Executive Branch and Committee Recom-
mendatlous- Part 3: Statutes At Large), prepared by the staff of the Special Committee
. on Nationmi Emergencies and Delegated Emergency Powers, 93d Congress, 2d Session
(November 1T74).













* At S






.3.



~. r








;: a uhi -. .1 > *"-. *. .
I.j :.e .


"ia T .. 1 .. ,
.. CONTENTS
:.". j.. .. 7 . ..
Ail: P l
S. age .
--- ------...--- ---.- ----------- --
4-4 LEGISLATIVE HISTORY OF SECTION 5(O) 'F THE TRADING
WITM THlE ENEMY ACT:
S A.' Trading With the Enemy Act:-
....,,.. 1.Text of Act ---------------------------------- 3
.Z* 2. Conference Report ---------------- 21
4 ,.. 3. & Senate Debate (excerpts)------------- ---------- 82
S.. 4. House Debate (excerpts) ---- --- -- 43
5 B,:i. Senate Report ----------- ----- 158
6. House Report--------------------------------- 179
., ..... 7. Statements of Hon. William G. McAdoo, Secretary of
7;$'A. the Treasury, and Milton, C. Ifltott, Esq., General
A. Counsel, Federail Reierve Board, before the Senate
,..> Committee: on Commerce ---------------------- 184
i.. I .Stat.i ..qts, of Albert Lee Thurman, Solicitor of
Rl the Department of Commerce, and Hon. Milton C.
,( ,.*,.... E.fllibt, General Counsel of the Federal Reserve
..'.i... Board, before the Seiate Committee on Commerce_ 202
S,1i'. a:uplew.ent tor Seownd Liberty, Bond Act:
1. s44 ml4 'raeits ---- 921
....a..a.t....f1--------- -------------------- 231
r.,,: 2. enfwnse Report (excerpts)-------------------- 232
l[W- H3. .ouse Repiort (excerpts)------------------------ 234
i ... C, The Knox Resolution:
., L t-o.f At Ac-4----. ------------------ ------235
-.I,, 1 Ho sD.ebate, (excet)------------- ----------- 237
-;,D. E'lergeny. Baling RBeli Act:
STI . L Partial Text of Act--------------- 241
S:::,* ;. Senate; Delate (excerpts) ------------- 242
t, .- L &3Houae Deb.ate. (excerpts)------ ..., ---------- 247
cl. ...B. iGold Reprve Ac.t ..l34:
+f >.. :, .Partial Text pf Act -- -- ----- 251
a ,':.? r.- r A ouse Debate (excerpts)........ -------- ---- 252
.t.t ..l Hoe, Report (excerpt) .. ....----------------- 257
t. .' ,: bt Rouse Minority Repot .ex -t--------------- 258
-., N,.a.t. t .espolutl of.May 7, oi,- "..,,, .
eL 259
S *, ,.. Tc.ex4t o .Ae.-.----.., -....-- ----- 259
Zr n. f.Sep.. $)e l wte0!-------------.-...- 260
itt- ..... 3.. Senate Debate. (excerpts) -------- ---------------- 261
t -nte p- ..---- 300
G.; 9 Rral t PrLoWeriAt, .1941:w
ran ..... .. .Partial Text of Ac---.....- .,------ 307
,.: "o ^.iEL Senate Debate of J .e.mb. 16,,.41., (ex4cpts)------ 309
Ir, sC4i ,&.. Houe VDetW ofes tier I6i,90 (excerpts)------ 313
....... 4. Seiatt Debate of DeemerW 1 494 (excerpt) ------ 328
Ii :,1, :5. Boume D.dt0,of December 17, 1941 (excerpts)------ 330
|i K i ,tv0.. k 1ens Repw.t ,(excerpt) -,_.--- ------------------- 331
............... Senate Report (ecerpt) .._ -,-------- :- 335
i||| :r a Eadin:.WltitheMnf.ly flt A. Amended:
L|' ] e ,ti.t! ,:a lt ra1t fnltl 12 ;U.SAt.A. ----------- 337
i.a ...Cuait Codificatlon.at 50 U.SlA App 1-44--------- 351
1 0. ":.L H onal laeTealit. AftS; (PltU'e JLaw 94-412%, approved
S; 34 *hIM -------- -0-.-- ------ 437
; t ,...... .. ... q. . .. ) ... _... .; ...*:*. >_ .- ._
-. )






VIII


II. PRESIDENTIAL PROCLAMATIONS AND EXECUTIVE ORDERS
ISSUED UNDER THE AUTHORITY OF SECTION 5(b) OF THE
TRADING WITH THE ENEMY ACT:
A. Presidential Proclamations:
1. Proclamation of June 26, 1916 unnumberedd and un- Page
titled) ---------------------------------- 445
2. Proclamation 2039-March 6, 1933: Bank Holiday,
March 6-9, 1933, Inclusive----------------------- 447
3. Proclamation 2040-March 9,1933: Continuing in force
the bank holiday proclamation of March 6, 1933-...-. 449
4. Proclamation 2070-December 30, 1933: The restora-
tion of non-member banks to the jurisdiction of their
own state banking authorities-------------------- 450
5. Proclamation 2497-July 17, 1941: Authorizing a pro-.
claimed list of certain blocked nationals and con-
trolling certain exports-------------------------- 452
6. Proclamation 2725-April 7, 1947: Amending the proc-
lamations of March 6 and March 9, 1933, and the
Executive order of March 10, 1933, to exclude from
their scope member banks of the Federal Reserve
System ---------------------------------------- 454
B. Executive Orders:
1. Executive Order 6073-March 10, 1933: Regulations
concerning the operation of banks----------------- 457
2. Executive Order 6260-August 28, 1933: Relating to
the hoarding, export, and earmarking of gold coin,
bullion, or currency and to transactions in foreign
exchange ------------------------------------- 459
3. Executive Order 6359-October 25, 1963: Relating to
gold recovered from natural deposits------------- 464
4. Executive Order 6556-January 12,1984: Amendment
of Executive Order No. 6260 of August 28, 1933--- 465
5. Executive Order 6558-January 15, 1934: Relating to
receipt of gold on consignment by the mints and
assay offices ----- -----_--_ .------- -- 466
6. Executive Order 6559-January 15, 1984: Amending
the Executive order of March 10,1933, and the proc-
lamation of December 30, 1933, concerning the op-
eration of banks------------------------------- 467
7. Executive Order 6560-January 15, 1984: Regulating
transactions in foreign exchange, transfers of
credit, and the export of coin and currency------- 469
8. Executive Order 8389-April 10, 1940: Amendment of
Executive Order No. 6560, dated January 15, 1984,
regulating transactions in foreign exchange, trans-
fers of credit, and the export of coin and currency- 471
9. Executive Order 8405-May 10, 1940: Amendment of
Executive Order No. 8389 of April 10, 1940, amend-
ing Executive Order No. 6560, dated January 15,
1984 ---------------------------473
10. Executive Order 8446--June 17, 1940: Amendment of
Executive Order No. 8389 of April 10, 1940, as
amended ----------------------------------- 476
11. Executive Order 8484-July 15, 1940: Amendment of
Executive Order No. 8389 of April 10, 1940, as
amended ------------------------------------- 477
12. Executive Order 8498-July 25, 1940: Amendment of
Executive Order No. 8389 of April 10, 1940, a-
amended ------------------------------------- 478
13. Executive Order 8565-October 10, 1940: Amendment
of Executive Order No. 8389 of April 10, 1940, as
amended ----------------------------------- 480
14. Executive Order 8701-March 4, 1941: Amendment of
Executive Order No. 8389 of April 10, 1940, as
amended -------------------------------------- 481





~ix
n MttiT3L PROoCLAMATIOxS AND EXECUTIVE ORDERS
Si u UwN ER TfE AUTHORITY OF SECTION 5(b) OF THE
| TRADING WITH TIE ENEMY ACt-tAonti.t.ued
11 : :B? executive Orders-Continued
S 15, ExecutIve Order 8711-March 13,1941: Amendment of
Executive Order No. 8389 of April 10, 1940, as Pagse
bl ........ :..... .. .. 48
--amend----- --------- ----482
li & L 16. Executive Order 8721-Mateh 24,1941: Amendment of
Executive Order No. 8389 of April 10, 1940, as
ll amended 483
& *" 17. Executive Order 87T46-April 28, 1941: Amendment of
.. Executive Order No. 8889 of April 10, 1940, as
amended: -.-- ------------- 484
... .... .... ....... & Executive Order 8785-Juie t14, 1941: Regulating
S '" transactions in foreign exchange and foreign-owned
o .ciri 'property, providing for the reporting of all foreign-
.J ,owned property, and related matters---.---------- 485
S to f,' .I. Executive Order 8882-July 26, 1941: Amendment of
........... Executive Order No. 8389 of April 10, 1940, as
'u .. . amended- ------------- -----------490
....... W.......2.k Executive Order 884' -AUgust 9, 1941: Regulation
. 9 Consumer Credit --------------. ------------491
rpIyH 'f 2 Rxecutivi3 Order 8968-December 9,1941: Amendment
..... .. qf Executlvq,.Order No. 8889 of April 10, 1940, as
> '"r ...."nended ------------------ 496
.. 2. Executive Order 8998-December 26, 19*1: Amend-
:.... i .. as amended _--------------_--------- ------- 497
m, e.O r E*NecotiveiOder o95-pMarch 11, 1942: Establishing
S;rr gA the Office of Alien Property Custodian and defining
rI 2p/ ErnuteOre 35Mac 1,'92:Etalshn
iI .... its function and duties --------- 498
." L Y' I i :etI Order 9142-April 21, 1942: Transferring
".I. ertain Functions, Property, and Personnel from
^"io.i ~D n r-m ta.-tme of Suelce to -the Alien Property
., *KIg I. 1utdan ---r-....---------------____ 500
i 25. executive Order .9193-July 6, 1942: Amending Exec-
.. .... ; ,. utive Ordnr No.,9095 esfblishing the Office of Alien
a ... . Property OustrdCan and defining its functions and
........ dutfes and related matters ------------- 502
.......; .., : Executive Order 9567-Jui 8 1945: Amending Exec-
4, . ;utive Or(let NO. 90.5 as amended by Executive Or-
i ) "' der ko. 9193, to'aefle further the functions aO
r * duties of the Alien Property Custodian with respect
i':, to property of Germany and Japan and nationals
,,B . ....... .. ... ....... tfliereog .-'-._- "---- 507
1411. 4. fft: tiecutivb Order 9747-July 3, 1946: Continuing the
S. .. ... ". .-fnetions of the Alien Property Custodiai and the
., *.. ...Deatttoattet!i Treasury In the Philliplines-- 508
t wna C r" : 2 te *utive-Otde 0 T60--Jtly 23, 1946: Conferring cer-
... .. tai. authority uion the Secretary of State with
!reg'ard't plztom atlc.and consular property of Ger-
S....... ... ny it&d Qan within the Untd States-------- 509
.... ..2.. fta k tivj Order 90898-Augutt 20,1948: Transferring
....... :1 ?l;o e 'bjluk Oyr locekd aef. to the Attorney
d."-uo") al Mi '. ..l--._--- --------------- 510
........... -Executt- Oe. 9788--Oetober 1, 1946: Terninating
.......I........r.. ... Afl todlian and traq fer-
", .......... 'Tlis..i ttt rney General--- -.'.--- 512
: 31. Executive Order 10848-April 26, 1952: Continuing in
| force orders and regulations relating to blocked
ili property---------------------------------- 513
ii 32. Executive Order 10896-November 29, 1960: Amend-
Il..!; ment of Executive Order No. 6260 of August 28,
I 198 ----------------------- 514
3:8 "."U Executive Order 10905-January 14, 1961: Amend-
Il," ment of Executive Order No. 6260 of August 28,
S193388, as amended---------------------------- 515






II. PRESIDENTIAL PROCLAMATIONS AND EXECUTIVE ORQE S ,
ISSUED UNDER THE AUTH IfTY OF SECTION 5(b) OF 4'E
TRADING WITH THE ENEMY ACT-Continued ,
B. Executive Orders-Continued Page
34. Executive Order 11037-July 20, 1962: Amendment of
section 12 of Executive Order No. 6260 of August
28,1933, as amended--------------------------516
35. Executive Order 11281-May 13, 1966: Transferring
jurisdiction over certain blocked assets from the
Attorney General to the Secretary of the Treasury_ 517
36. Executive Order 11387-January 1, 1968: Governing
certain capital tranafers abroad----------------- 520
37. Executive Order 11677-August 1, 1972: Continuing
the Regulation of Exports-----.----------------- 522
38. Executive 'Order 11683-August 29, 1972: Revoking
Executive Order No. 11677 of August 1, 1972, and
continuing in effect Executive Order No. 11533 of
June 4, 1970, relating to the administration of
export controls--_..... ------------------------523
39. Executive Order 11796-July 30, 1974: Continuing the
regulation of exports------------------------- 524
40. Executive Order 11798-August 14, 1974: Revoking
Executive Order No. 11796 of July 30, 1974, and
continuing in effect Executive Order No. 11533 of
June 4, 1970, relating to the administration of
export controls----------------------------- 525
41. Executive Order 11810-September 30, 1974: Con-
tinuing the regulation of exports--------------- 526
42. Executive Order 11818-November 5, 1974: Revoking
Executive Order No. 11810 of September 30, 1974,
and continuing in effect Executive Order No. 11533
of June 4, 1970, relating to the administration of
export control------------------------------ 527
43. Executive Order 11825-December 3, 1974: Revoca-
tion of Executive Orders pertaining to the regula-
tion of the acquisition of, holding of, or other
transactions in gold-------------------------- 528
44. Executive Order 11940-September 30, 1976: Con-
tinuing the regulation of exports--------------- 529
HI. REGULATIONS GOVERNING FINANCIAL TRANSACTIONS
ISSUED UNDER THE AUTHORITY OF SECTION 5(b) OF THE
TRADING WITH THE ENEMY ACT (TITLE 31 C.F.R.):
A. Part 121-Emergency Banking Regulations ------------ 588
B. Part 122---General Licenses Issued Under Exeeutive Order
6073, As Amended ----------------------- 541
C. Part 127-Executive Order of January 15, 1934, Regulating
Transactions in Foreign Exchange, Transfers of Credit, and
Export of Coin and Currency----------- -------- 542
D. Part 128-Transactions in Foreign Exchange, Transfers of
Credit, and Export of Coin and Currency--------------- 549
E. Part 500-Foreign Assets Control Regulations ------------- 557
F. Part 505-Regulations Prohibiting Transactions Involving the
Shipment of Certain Merchandise between Foreign Coun-
tries -------------------------------- 603
G. Part 515-Cuban Assets Control Regulations--------------- 605
H. Part 520-Foreign Funds Control Regulations------ --------646

















&. ;,.
V,.









Ei

l

S: ..
a.: ;.. ,. . .=















': PART I


A& LEGISLATIVE HISTORY OF SECTION 5(b) OF THE

TRADING WITH THE ENEMY ACT
ui i .;."

E ","l .:tt ~i .::..

, ,|: .. .


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A. Trading With the Eney Act
"N Stea a%. n usJ3C in., a VsS. Auw 1-44 w wid Oueha. L 3191
S'1. LText Of Act
WrA Tb dOft relate, ad pm l t&dMi witM the eamy, nd fr otew

.m ted the Ren.wend H ofueej Repnuntatdwe.f ths
series Caosgiw Led, That this Act shall
benwa uas the "Trading With the Enemy Act,"
. 2. That the wor enemy," as used herAin, shall be deemed
for the 0 Wf and of this Act.-
jws ir lb. ofe trdneeg een
An )*vy individu, partnufp, or other body of individuals, of
N r resid within the territory includingn that oocu-
nIld by mfitary and naval forcs) of any nation wit which the
M States is at war, or resident outside the United States and
b ness within such territory, and any corporation incorpo-
s wis n such tritry of any nation with which the United
t is at war or incorpoat-ated wthin any country other than the
Md States and doin business witin such territory.
!%b) The government o any nation with which the United States is
Sw g, or any political or muncill subdivision thereof, or any officer,
I ci ant, or agnc thereof.
Suh other indivi ual, or body or class of individuals, as may
Sik citizens, or subjects of any nation with which the United
Sta is at war, other than citizens of the United States, wherever
= t or wherever doi'n business, as the President, if he shall find
I s of the United States or the muaesfu1 prosecution of the
*w salso require, may, by proclamation, include within the term
u words "ally of enemy, as used herein, shall be deemed to
W individual, partnersh, or othr body of individuals, of
resident within the (iOWud that oce-
litary and naval force) of Oay nation wich is an ally
Stwhich the United Stat is at war or resident outside
Stas and doir busineh s witnia suh territory, ad pay
incrporated within such tenitory ot muck aly nation, or
Swithain any country other tan the Ulnited States and
ess within such territoy ,
renmntMfan na irm .nc iLS,,2 analy of a nation
T united States a A war o any oi auncy
eaho such ayll Ma6ion, 4 .re, ofa gent, or agency
hner indiM usk" body or cau of indivima m as
citizens or subjects of any nation which isp y of aa
U 1:: 4 .!**/* ^ f :'" ~






nation with which the United States is at war, other than citizens
of the United States, wherever resident or wherever doing business,
as the President, if he shall find the safety of the United States or the
successful prosecution of the war shall so require, may, by proclama-
tion, include within the term. "aUlly of enemy."
The word "person," as used herein, shall be deemed to mean an
individual, partnership, association, company,, or. other. unjncqipo-
rated body of individuals, or corporation or body politic. '
The words "United States,"' as used herein, shall be deemed to
mean all land and water, continental or insular, in any way within
the jurisdiction of the United States or occupied by the military or
naval forces thereof.
The words "the beginning of the war," as used herein, s*aJl be
deemed to mean midnight ending the day on which C9 'gress h ,p
declared or shall declare war or the existence of a state of wa.. r
The words "end of the war," as used. herein, shall bl: deemed. to
mean the date of proclamation of exchange of ratifications:of the
treaty of peace, unless the President shall, by proclamation; declare
a prior date, in which case the date so proclaimed shill be deemed
to be the "end of the war" within the meaning of this- Act'.
The words "bank or banks," as used herein, shall be. demed tp
mean and include national banks, State banks, trust companiesN or
other banks or banking associations doing business under the, vs
of the United States, or of arTy State of the United States. ....
The words "to trade," as uked herein, shall be deemed to mean-
(a) Pay, satisfy, compromise, or give security for the payment or
satisfaction of any debt or obligation.
(b) Draw, accept, pay, present,..for acceptance or payment, .or
indorse any negotiable instrument or chose in action.. "....
(c) Enter into, carry on, complete, or perform any contract, agre-
ment, or obligation. ,
(d) Buy or sell, loan or extend credit, trade in, deal with, exchange,
transmit, transfer, assign, or otherwise dispose of, or receive any frm
of property. ,
(e) To have any form of business or commercial commu'micatiOqn
or intercourse with. .
SEC. 3. That it shall be unlawful-
(a) For any person in the United States, except with the lepse
of the President, granted to such person, or to the enemy., .w 41y
of enemy, as provided jn this Act, to trade,' or attempt to rade,
either directly or indirectly, with, to, or from, or for, or .on Accout
of, or on behalf of, or for the benefit of, any other., perspon,'ith
knowledge or reasonable cause to believe that such other person is
an enemy or ally of enemy, or is conducting or taking parts'in., such
trade, directly or indirectly, for, or on account of, or on. -eha if4
or for the benefit of, an enemy or ally ,of enemy. ,
(b) For any person, except witJ the license of the President, to
transport or attempt to transport into or from the United Sta*,
or for any owner, master, 'or other person in charge of a ves, .qf
American registry to transport or attempt; to transport. from any
place to any other place, any subject ori citizen of i'n enemy or ally
of enemy nation, with knowledge'or reasonable cause to believe that
i





son'transported or attempted to be tra mportd i ach sub.
any person (other than a person in the service af the
I ttes Government or of the Government of any nation,
lf an enemy oa ally of enemy nation, and other than
rii6ns or classes of -perins as may be exempted hereunder by
pidaut or by such person as he may direct) tW send, or take out
!th4n iito, or attempt to send, or take out of' or bring into the
_aites, any letter o other. writing or tangible form of bem-
i except in the regular course of the mail; and it shall be
FI forany person to send, take, or transmit, or attempt to send,
fosmit out of the United States, any letter or other writing,
sapj plan,.or other paper, picture, or any telegram, cablegram,
tes me!sae, or other form of communication intended for or
e1Vred, directly or indirectly, to an enemy or ally of enemy:
w. Asdmever, That any person may send, take, or transmit out of
WW States anything herein forbidden if he shall first submit
6. td the President, or to such officer as the President may
%toishall obtain the license or consent of the President, under
tleh and regulations, and with such exemptions, as shall be
hity the President.
Whenever, during- the present war, the President shill deem
"bHc safety demands it, he may cause to be censored undei
0i and regulations as he may from time to time establish,
kctions by mail, cable, radio, or other means of transmission
hbetwe e United States and any foreign country he may
Owi to time speeify, or which may be -eaied by any vessel or
Ws of transportation touching t any port, place, or territory
United States and bound to or rom any foreign country. Any
WIf willfullyy evades or attempts to evade the submissioni of
phiumunication to such censorship or willfully uses or at-
4tti e any code or other device for the purpose of concealing
taScensorship the intended meaning of such communication
i paished as provided in section sixteen of this Act.
4. (a) Every enemy or ally of Inemy insurance or reinsurance
L, and every enemy or aly of enemy, doing business within
IA States through an agency or branch office, or otherwise,
rithi thirty days after the passage of this Act, aplpy to tup
st for a license to continue to do business; and, within thirty
Her such application, the President ma enter an order either
S:or refusing to grant such litse. The licenses if granted,
| oft.eip rr o otherwise, and for such period of time, andmy
provisions aMd conditions regular the inmhegs, ggerF.
flagers and trustees and the control and :ispositiln d the
of. the company, or of such enemy or ally .'ueaey_ a the
%hxaUl deem neceary for the saety 'ofh Uoro.td Stbtes;
yheease granted hereude mAay be reted r 7 ted or
&t 0ch manner and t Ist&*' t ames a the t ihala
gWA:tPe, Aotwi'lte h dsonatle notc of his" htent
e^bto gmntt lets *tSt# ti teIi
6QcompafljshallrWbiiflve by hj^ v>I isua companies
itats lown :to the Piesideht






to be doing business with such reinsurance company: Provided fur-
ther, That no insurance company, organized within the United St.tes,
shall be obligated to continue any existing contract, entered into pnor
to the beginning of the war, with any enemy or ally of enemy insur-
ance or reinsurance company, but any such company may abrogate
and cancel any such contract by serving thirty days notice in wriang
upon the President of its election to abrogate such contract. "
For a period of thirty days after the passage of this Act, and further
pending the entry of such order by the President, after application
made by any enemy or ally of enemy insurance or reinsurance com-
pany, within such thirty days as above provided, the provisions of
the President's proclamation of April sixth, nineteen hundred and
seventeen, relative to agencies in the United States of certain insur-
ance companies, as modified by the provisions of the President's
proclamation of July thirteenth, nineteen hundred and seventeen,
relative to marine and war-risk insurance, shall remain in full force
and effect so far as it applies to such German insurance companies,
and the conditions of said proclamation of April sixth, nineteen
hundred and seventeen, as modified by said proclamation of July
thirteenth, nineteen hundred and seventeen, shall also during said
period of thirty days after the passage of this Act, and pending the
order of the President as herein provided, apply to any enemy or
ally of enemy insurance or reinsurance company, anything in this
Act to the contrary notwithstanding. It shall be unlawful i for any
enemy or ally of enemy insurance or reinsurance company, to whom
license is granted, to transmit out of the United States any funds
belonging to or held for the benefit of such company or to use any
such funds as the basis for the establishment directly or indirectly
of any credit within or outside of the United States to. or for the
benefit of, or on behalf of, or on account of, an enemy or ally of enemy.
For a period of thirty days after the passage of this Act, and further
pending the entry of such order by the President, after application
made within such thirty days by any enemy or ally of enemy, other
than an insurance or reinsurance company as above provided, it
shall be lawful for such enemy or ally of enemy to continue to do
business in this country and for any person to trade with, to, from,
for, on account of, on behalf of or for the benefit of such enemy or
ally of enemy,-anything in this Act to the contrary notwithstanding:
Provided, however, That the provisions of sections three and sixteen
hereof shall apply to any act or attempted act of transmission or
transfer of money or other property out of the United States and to
the use or attempted use of such money or property as the basis for
the establishment of any credit within or outside of the United States
to, or for the benefit of, or on behalf of, or on account of, an enemy
or ally of enemy.
If no license is applied for within thirty days after the passage aof
this Act, or if a license shall be refused to any enemy or ally of enemy,
whether insurance or reinsurance company, or other person, making
application, or if any license granted shall be revoked by the Presi-
dent, the provisions of sections three and sixteen hereof shall forth-
with apply to all trade or to any attempt to trade with, to, from, for,
by, on account of, or on behalf of,-or for the benefit of such company






L ,I.pe.-son: Provided, however, That after such refusal or revo-
i, anything in this Act to the contrary notwithstanding, it shall
,fru4 f:or a policyholder or for an insurance company, not an
Pyr Ally of enemy, holding insurance or having effected reinsur-
eo r .with such enemy or ally of enemy insurance or reinsurance
W..IU. :*o receive payment of, and for such enemy or ally of
i|Jaruace or reinsurance company to pay any premium, re-
p r umr, claim, money, security, or other property due or
.i.ay become due on or in respect to such insurance or reinsur-
#~uf e.e at the date of such refusal or revocation of license; and
gin this Act shall vitiate or nullify then existing policies or
....of insurance or reinsurance, or the conditions thereof; and
q* ihpolicy holder or insurance company, not an enemy or ally
.hy,having any claim to or upon money or other property of
i y or ally of enemy insurance or reinsurance company in the
lit Me for, or of the Treasurer of the United States, may make appli-
is r the payment thereof and may institute suit as provided in
ll t, during the present war, no enemy, or ally of enemy, and
ewhi p of which he is a member or was a member at the be-
flt f the war, shall for any purpose assume or use any name
| t that by which such enemy or partnership was ordinarily
OWp.at the beginning of the war, except under license from the
Sin (r, during the present war, in the opinion of the President
Ai safety or pubic interest requires, he President may pro-
yor ~all foreign insurance companies from doing business in
States, or the President may license such company or com-
| do business upon such terms as he may deem proper.
S.. (a) That the President, if he shall find it compatible with the
df 1the United States and with the successful prosecution of
Wwlarny, by proclamation, suspend the provisions of this Act so
r Iey apply to an ally of enemy, and he may revoke or renew such
uq"ll|n from time to time; and the President may grant licenses,
Jim .. general, temporary or otherwise, and for such period of
H e containing such provisions and conditions as he shall pre-
to any person or class of persons to do businessm as provided
IAeetion (a) of section four hereof, and to perform any act made
abwfrl without such license in section the hermeof, and to file and
W.lute applications under'subsection (b) of section ten hereof; and
Iy revolte or renew such licenses from: ime to time, if he shall
bpmnion that such grant or revocation or renewal shall. be com-
Bw itkh the safety of the United Stateb and with the successful
*u of the war; and he may make such riles and regulations,
osistent with law, as may be necessary and prper to carry
,: provisions of this Act; and the Prwident may .exercise any
MIvbr authority conferred by this Act through suc o vri o S-
Tre sPreident shall have flaBatalI ento te believe tht any
fltout to he performed in violataoseawction thre bereod he
alfl Jn authority to order the I0st4, ft of the perfo ane
"~U 1 i" : r .: .,: J .-, .. .. ,.. *: .
:t ' i:, ] ...


8-O02--T76--2






of such act for a period not exceeding ninety days, pending idWf igkg-
tion of the facts by him.'
(b) That the President may investigate, regulate, or proilb&d!'ut*
such rules and regulations as he may prescribe, by means oflka
or otherwise, any transactions in foreign exchange, export *S'
markings of gold or silver coin or bullion or currency, traui;ts of
credit in any form (other than credits relating solely to trahisactisfl
to be executed wholly within the United States), and transfers I
evidences of indebtedness or of the ownership of property bet6*
the United States and any foreign country, whether enemt, illy of
enemy or otherwise, or between residents of one or more faoeig
countries, by any person within the United States; and he may i 'ivir
any such person engaged in any such transaction to furnish, uider
oath, complete information relative thereto, including the produe'-
tion of any books of account, contracts, letters or other papers, i1
connection therewith in the custody or control of such person, either
before or after such transaction is completed. ,
SEC. 6. That the President is authorized to appoint, prescribe the
duties of, and fix the salary (not to exceed $5,000 per annum) of'an
official to be known as the alien property custodian, who shall be
empowered to receive all money and property in the UnitedStats
due or belonging to an enemy, or ally of enemy, which may bepaid,
conveyed, transferred, assigned, or delivered to said custodial umikr
the provisions of this Act; and to hold, administer, and accouMt fof
the same under the general direction of the President and as'provided
in this Act. The alien property custodian shall give such bond or
bonds, and in such form and amount, and with such security as -ab
President shall prescribe. The President may further employ in,'tfB
District of Columbia and elsewhere and fix the compensatidOl of -smit
clerks, attorneys, investigators, accountants, and other ediphysew
as he may find necessary-for the due administration of the pra bls
of this Act: Provided, That such clerks, investigators, accountants
and other employees shall be appointed from lists of eligibles to :t
supplied by the Civil Service Comrmission and in aecordaneeiwith t&
civil-service law: Provided further, That the President shall.eam-t
detailed report to be made to Congress on the first day of Janiryot:f
each year of all proceedings had under this Act during the year.pre-
ceding. Such report shall contain a list of all persons, appotntddxer
employed, with the salary or compensation paid to each, and a stats
ment of the different kinds of property taken into custody-and the
disposition made thereof. '
SEC. 7. (a) That every corporation incorporated within the United
States, and every unincorporated association, or company, 6r trs6t ,
or trustees within the United States, issuing shares or certfieats
representing beneficial interests, shall, under such rules and regul-
tions as the President may prescribe and, within sixty days after the
passage of this Act, and at such other times thereafter as the. Pi-a-
dent may require, transmit to the alien property custodian a fullist,
duly sworn to, of every officer, director, or stockholder Inown toJ'be,
or whom the representative of such'. corporation, association, tbbm-
pany, or trustee has reasonable cause to believes to be an enemynor
ally of enemy resident within the territory, or; a subject or citizen
residing outside of the United States, of any nation with which the





States- is at war,'or resident within the teititory, or a subject
.. reading outside of the United States, of any ally of any
'6th w hih the United States is at tar, together with the
F!.tdWk or shares owned by each such officer, director, or
Lder oiin which he has any interest. : '
President may also require a similar list to bp transmitted of
ks: r 'sares owned pri February third; nineteen hundred and
Vjk, by'any person now defined as at enemy 6r ally of enemy,
i6 .anyy such person had'any interest; and he may also require
1ibe transmitted of all cases in which said corporation, associa-
knipany,"or trustee has reasonable cause 'to believe that the
i shares on February .third, nineteen hundred and seventeen,
ned or are owned by such hemy or Ally of enemy though
bon thib books in the name of another: Provided, Aowever,
Oe name of any such officer, director,'or -stockholder shall be
L Oetxmanently or temporarily from such list by the ,alien
' custodian when he shall be satisfied that he is not such
'aly of enemy.
person in the United States who holds or has or shall hold or
etody or control of any property benficial or otherwise, alone
"y with others, of, for, or on behalf oft an enemy or ally of
or of any person whom he may have reasonable cause to
to be an enemy or ally of enemy and any person in the United
hb is dtshall be indebted in any way to an enemy or allj of
9 5 'ki^y person wh6min lhe niay have reasonable caube to
tobf6 an enemy or ally of enemy, shall; with such exceptions
ldr such rules and regulations as the President shall prescribe,
Wit thirty days after the pAssage of this Act, or within thirty
ter such property shall come within his custody or control,
rkliuch debt shall become dde, report the fekct to the- alien-
f 'cutodian by y*rittenh statement under oath containing such
irs 'as said custodian shall require. The President may also
a similar report of all property so held, of, for, or on behal
'of all debts so6 owed to, any person now defined' as dn enemy
f.I enemy, on February third, nineteen hundred and seventeen;
ic. That the name of any person shall be stricken from the .sid
by-14the ailien-property' cupuStodilin, either temporarily or per-
ly, when he shall be sati fid that such petSonris hot an enemy
of enemy. The Prehid nt may extend the tihe for filing the
$xportas quired by this sectionn for an additional period: not
tAi nety S ys."-:' '
(fbling in this Act cdMftined shall render valid or legal, or be
Md to recognize as valid dr legal, 'an.y a:t or transaction coli-
gtrade with, to, from, for or on accowa Af, or o behalf or
benefit of antbhemy perfo ted 6r enged in: ice the begin-
'ff& war and prior to th e ptssge f1 thi Act, or any such act
sa--On -hereafter peformd18 or engaged h-af xept as author-
euadetr which would othrwviM' hawbeMi or be void, illegal,
lds at law.. No conveyance, transfer, delery, &ams tV or
*3(*itbtd theta prdperthv in riMa~ota or! ~teeon trehereof,
fttr t. passage of tMs'AIt tt-nd tAbIherliene aS. herein
d Vhalttonf. or ereatt autyefgt* MaT Me ty in rspectthe reof;
'Arsonf shhll -by vi:tua of' 'anasd6gfHtihtj indorsemednt, or






delivery to him of any debt, bill, note, or other obligation or chose
in action by, from, or on behalf of, or on account of, or for the benefit
of an enemy or ally of enemy have any right or remedy against the
debtor, obligor, or other person liable to pay. fulfill, or perform tlhe
same unless said assignment, endorsement, or delivery was ade
prior to the beginning of the war or shall be made under license as
herein provided, or unless, if made after the beginning of the war
and prior to the date of passage of this Act, the person to whom the
same was made shall prove lack of knowledge and of resoable
cause to believe on his part that the same was made by, from or on
behalf of, or on account of, or for the benefit of an enemy or ally of
enemy; and any person who knowingly pays, discharges, or satisfies
any such debt, note, bill, or other obligation or chose m action shall,
on conviction thereof, be deemed to violate section three hereof:
Provided, That nothing in this Act contained shall prevent the
carrying out, completion, or performance of any contract, agreement,
or obligation originally made with or entered into by an enemy or
ally of enemy where, prior to the beginning of the war and not in
contemplation thereof, the interest of such enemy or ally of enemy
devolved by assignment or otherwise upon a person not an enemy or
ally of enemy, and no enemy or ally of enemy will be benefited by
such carrying out, completion, or performance otherwise than by
release from obligation thereunder.
Nothing in this Act shall be deemed to prevent payment of money
belonging or owing to an enemy or ally of enemy to a person within
the United States not an enemy or ally of enemy, for the benefit of
such person or of any other person within the United States not an
enemy or ally of enemy, if the funds so paid shall have been received
prior to the beginning of the war and such payments arise out of
transactions entered into prior to the beginning of the war, and not
in contemplation thereof: Provided, That such payment shall not be
made without the license of the President, general or special, as
provided in this Act.
Nothing in this Act shall be deemed to authorize the prosecution
of any suit or action at law or in equity in any court within the United
States by an enemy or ally of enemy prior to the end of the war,
except as provided in section ten hereof: Protvided, however, That an
enemy or ally- of enemy licensed to do business under this Act may
prosecute and maintain any such suit or action so far as the same
arises solely out of the business transacted within the United States
under such license and so long as such license remains in full farce
and effect: And provided further, That an enemy or ally of enemy
may defend by counsel any suit in equity or action at law which may
be brought against him.
Receipt of notice from the President to the effect that he has
reasonable ground to believe that any person is an enemy or ally of
enemy shall be prima facie defense to any one receiving the same, in
any suit or action at law or in equity brought or maintained, or to
any right or set-off or recoupment asserted by, such person and based
on failure to complete or perform since the beginning of the war any
contract or. other obligation. In any prosecution under section six-
teen hereof, proof of receipt of notice from the President to the effect
that he has reasonable cause to believe that any person is an enemy






of enemy shall be prima facie evidence that the person receiv-
Uh.notice has reasonable cause to believe such other person to
tanemy or ally of enemy within the meaning of section three
S1f &b President shall so require, any money or other property
g t belonging to or held for, by, on account of or on behalf of,
Sthis benefit of an enemy or ally of enemy not holding a license
SW the President hereunder, which the President after inves-
tahdll determine is so owing or so belongs or is so held, shall
*yed, transferred, assigned, delivered, or paid over to the
: custodian.
Sf not required to pay, convey, transfer, assign, or deliver
Sthe provisionss of subsection (c) hereof, any person not ad
9 ally of enemy who owes to, or holds lot, or on account of,
t BlIlf of. or for the benefit of an enemy or of an ally of enemy
W ia license granted by the President hereunder, any money
IJ property, or to whom any obligation or form of liability to
htmyor ally of enemy is presented for payment, may, at his
',qith the consent of the President pay, convey, transfer,
I otdelfiver to the alien property custodian said money or other
J under such rules and regulations as the President shall
I~~ erson shall be held liable in any court for or in respect to
done or omitted in pursuance of any order, rule, or regula-
uade by the President under the authority of this Act.
yment, conveyance transfer, assignment, or delivery of
, ". 'propertymade to the alien property custodian hereunder
67It: full acquittance and discharge for all purposes of the obliga
If IM person making the same to the extent of same. The alien
"btiustodian and Auch dther persons as the President may ap-
'll have power to execute, acknowledge, and deliver any such
teftt dr instruments as may be necessary or proper to evidence
t recrd or otherwise such acquittance and discharge, and shall,
. of payment to the alien property custodian of any debt or obli-
V.Wd to an enemy or ally of enemy, deliver up any notes, bonds,
W# evidences bf indebtedness or obligation, Or any security there-
*fMeltluch enemy or ally of enemy had any right or interest that
l come into the possession of the alien property custodian,
Illh effect as if he or they, respectively, were duly appointed b
yor ally of enemy, creditor,: or obligee. The President shall
ry person so appointed aR certificate of the appointment and
f such person, and such certificate shall be received in evi-
illcourts within the United States. Whenever any such cer-
b ltuithority shall be offered t' any rr, clerk, or others
h ffi.er, Federal or otherwise, wihin the United States, such
t record the stame iii like maner as:a power of attorney, and
Rd.. obr a duly certified copy thereof shall'- be received in evi-
hin all courts of the United States othet courts within the
&rte. : S t ''s :: t *
L. '(!)4 That any peron nt an enty or ally of enemy hldijg
,Bl..noxtgage, plge. o lien, or other A&t in the nature of
S-in7toperty of An *nmy or a.y of dnemy which, by law or






by the terms of the instrument creating such mortgageQ pledge, qr lieR,
or right, may be disposed of on notice or presentation or dem- U
any person not an enemy or ally of enemy who is a party to ainy l wl
contract with an enemy or ally 'of enemy, the terms of which p'4j.i
for a termination thereof upon n4t;ce or for acceleration o maturity
on presentation or demand, may continue to hold said property, p4,
after default, may dispose of the property in accordance with, aw o
may terminate or mature such contract by notice or presenttioa Tr
demand served or made on the alien property custodian in accobt
with the law and the terms of such instrument or contract a .n4wdS
such rules and regulations as the President shall prescribe; and s'san
notice and such presentation and demand shall have, in all repetthe
same force and effect as if duly served or made upon the enemy orly
of enemy personally: Provided, That no such rule or regulation
require that notice or presentation or demand shall be served oriape
in any case in which by law or by t'e terms of said instrumwit pr cQU
tract, no notice, presentation, or demand was, prior to the passage of
this Act, required; and tnati i case where, by law or by the tpprs of
such instrument or contract, notice is required, no longer pepdt 6
notice shall be required: Provided further, That if, on any such p-
sition of property, a surplus shall remain after the satisfaction of.
mortgage, pledge, lien, or other right in the nature of security, nt1e
of that fact shall be given to the President pursuant to such rplesyand
regulations as he may prescribe, and such surplus shall be held subject
to his further order.
(b) That any contract entered into prior to the beginning o the
war between any citizen of the United States or any corporation orga
nized within the United States, and an enemy or ally of an enemy, th
terms of which provide for the delivery, during or after any war in
which a present enemy or ally of enemy nation has been or is pow e.'
gaged, of anything produced, mined, or manufactured in the United
States, may be abrogated by such citizen or corporation by sri
thirty days' notice in writing upon the alien property custodian of his
or its election to abrogate such contract. :
(c) The running of any statute of limitations shall be suspein44
with reference to the, rights or remedies on any contract or obl"g1to
entered into prior to the beginning of the war between parties neitiwr
of whom is an enemy or ally of enemy, and containingany promise o
pay or liability for payment which is evidenced by drafts or ,:
commercial paper drawn against or secured by funds or other property
situated in an enemy or ally of enemy country, and no suit sba i.
maintained on any such contract or obligation in any court withjIo
United States until after the end of the war, or until the said funadAq
property shall be released for the payment or satisfaction of swsIl
contract or obligation: Provided, however, That nothing herein con
trained shall be construed to prevent the suspension of the running
of the statute of limitations in all other cases where such suspense
would occur under existing law. ,i
SEC. 9. That any person, not an enemy, or ally of enemy, cla4 -'
ing any interest, right, or title in any money or other property which
may have been conveyed, transferred, assigned, delivered, or paid
to the alien property custodian hereunder, and held by him or by the





1oth e United State, or to wiom; any debt may be owing
:|M qr ally oX uwY whose property or any part thereof
W'p conveyed, trasferred, assigned, delivered, or paid
/f.operty custodian herlqunder, and held by him or by the
:i. the: United States, ma file with the said custodian a
L claim under oa't and in such form and containing such
e as the said custodian shall require; and the President, if
* jflpadeotheredory the claimant, may, with the assent of
"Q'i d p operty aneof all1 persons claiming any right, title,
theteIiqrder the payment, conveyance, transfer, assign-
'vTery to sai claimant, of the money or other property, so
aben property -e custodian or by the Treasurer of the
.b ogoft inte"et therein to which the President shall
d claimant is entitled: Pravided, That no yuch order by
lt Shall bar any person from the propecutio iof any suit
^ W ,p "reguty against the claimat to 'establish any .right, title
M% l he may havqin suchmoney or other property. If
.s qhahl not so order within sixty days after the filing of
S appcation, or if the climant shlpl. ,ave filed- the notice as
..m.n.,heAall have w e no application to the President,
y | ma, at any time before the expiration of six months
of the .war, institute a:a ut in equity in the district
i ,tnpdStates for the districtin which such claimant
........farporationwhpe it .has its principal place of busi-
Liii the alien property custodian or the Treasurer pf
,as the case may be, ha1ll be made a party efend-
Ja* K lis the interest, ra it,1 title, or debt so claimed, a4
^ ae s instituted then the money or other property of the
l jyoWwo.enemy, against whom such interest, right, or title
sr dhtlI claimed, shall be retained in the custody of the
eltdjan, or in the Traury Ofi the United States, as
1Mit Act, and. until any f.al judgment or decree which
4.d in favor of the claimant shall be fully satisfied by
p^vreyaic., transfer, assignment, or deliver jby rthe
i !by the alien property custqdian or Treasurer of the
n @order of the court or tltinal judgment or decree
ia ted, against the claimant, or suit otherwise terminated.
.re4i roided,themoney or other property conAyed,
,la ; delivered,... or.p. .t alien.proprty, cu
N ot able to lien, attacimeut, garnishment, trustee
ERAItru -
o eczfciWon, or subject to agy orer r decree of any court,
.,. :phall not appy,, however, to moaey pai&4 to the alien
...t .er sectionoten heritofj.
nothmn containers this Actshallb held to make
u6eb hfollow'ingAqts:::
.. lM? rY, o rsly wemyy sy leand pe1s-cfl in the
^ p b jpphiistio. for letters patents for w restration of
Wkj-n nZ, lfeorq pwiit, andt may pay any feesMtherefor
,#cJ~I.witmrndas requred by: the% provisions of existing law
attorneys: or* a tgens tar filing and pposecuting such
AT suc.h a.e.emvo ally of,:.. enemy, whot is unable
r-0 ;4int nt si t .hereafter, on account of conditions
.VS ,W IX..





14
arising out of war, to file any such application, or to pay any official
fee, or to take any action required by law within the peri'l pfi-
scribed by law, may be granted an extension of nine montl Leycad
the expiration of said period, provided the nation of which the a 0id
applicant is a citizen, subject, or corporation shall extend hbstma-
tially similar privileges to citizens and corporations of the rUtited
States.
(b) Any citizen of the United States, or any corporation oraizMd
within the United States, may, when duly authorized by the Pieiid0nt,
pay to an enemy or ally of enemy any tax, annuity, or fee'rhieh
may be required by the laws of such enemy or ally of enemy nation in
relation to patents and trade-marks, prints, labels, and copyriglts
and any such citizen or corporation may file and prosecute an appli-
cation for letters patent or for registration of trade-mark, print, libel,
or copyright in the country of an enemy, or of an ally of eneamy
after first submitting such application to the President and receiving
license so to file and prosecute, and to pay the fees required b't' law
and customary agents' fees, the maximum amount of which in ech
case shall be subject to the control of the President.
(c) Any citizen of the United States or any corporation organIzed
within the United States desiring to manufacture, or cause to be ma6inu-
factured, a machine, manufacture, composition of matter, or design,
or to carry on, or to use any trade-mark, print, label or cause to bek.r-
ried on, a process under any patent or copyrighted matter owned :or
controlled by an enemy or ally of enemy at any time during the exist-
ence of a state of war may apply to the President for a license; and the
President is hereby authorized to grant such a license, nonexclnsive or
exclusive as he shall deem best, provided he shall be of the opinion that
such grant is for the public welfare, and that the applicant is able'iwnd
intends in good faith to manufacture, or cause to be manufactured,
the machine, manufacture, composition of matter, or design, or to carry
on, or cause to be carried on, the process or to use the trade-mark, print
label or copyrighted matter. The President may prescribe the contd-
tions of this license, including the fixing of prices of articles an4'pridw'
ucts necessary to the health of the military and naval forces of the
United States or the successful prosecution of the war, and the p1tli
and regulations under which such license may be granted and the f0e
which shall be charged therefore, not exceeding $100, and not exceeding
one per centum of the fund deposited as hereinafter provided. Such
license shall be a complete defense to any suit at law or in equity in-
stituted by the enemy or ally of enemy owners of the letters pattf
trade-mark, print, label or copyright or otherwise, against the licensee
for infringement or for damages, royalty, or other money awarud'bi
account of anything done by the licensee under such license, except
as provided in subsection (f) thereof.
(d) The licensee shall file with the President a full statement ofthe
extent of the use and enjoyment of the license, and of the pries: re-
ceived in such form and at such stated periods (at least annually) us
the President may prescribe; and the licensee shall pay at such time as
may be required to the alien property custodian not to exceed five per
centum of the gross sums received by the licensee from the sale of Mid
inventions or use of the trade-mirk, print, label or copyright matter,
or, if the President shall so order, five per centum of the value of the






lepth inventions, trade-marks, prints, labels or copyrighted
,MNike licensee as established by tihe President; and sums so paid
f p otode by said alien property custodian forthwith in the
bI'tAe United States s a trust fund for the said licensee and
l barof the said patent, trade-mark, print, label or copyright
Sas hereinafter provided, to be paid from the Treasury
i $o the court, as provided in subdivision (f) of this section,
t~~t'direction of the alien property custodian.
1 rrendered or terminated as provided in this Act, any
*ihthereunder shall continue during the term fixed in the
Biathe absence of any such limitation during the term of the
e tailde-mark, print, label, or copyright registration under which
6 ...Upon violation by the licensee of any of the provisions of
J&Mg. cancel any license granted by him.
S*c Owner of any patent, trade-mark, print, label, or copyright
tu *bk4. M a license is granted hereunder may, after the end of the
aItw..aMi the expiration of one year thereafter, file a bill in equity
les m the district court of the United States for the
Jwhih the said licensee resides, or, if a corporation, in which
a 'mincipal place of business (to which suit the Treasurer of
d*tiWr States shall be made a party), for recovery from the said
m twW1 nil. use. and enjoyment of the said patented invention,
i sdMark print, label, or copyrighted matter: Provided, however,
uew suit is brought, as above, notice shall be filed with the
Wycusetodian within thirty days after date of entry of
fhreUt firer, That the licensee may make any and Hl de-
tifr h would be available were no license granted. The court on
V i I*W had may adjudge and decree to the said owner pay-
ubb amasonble royalty. The amount of said judgment and decree,
wSO al, shall be paid on order of the court to the owner of the
.11..he fund deposited by the licensee, so far as such deposit
owiWNiWaid judgment and decree; and the said payment shall be
4*hotfs .tial satisfaction of said dgmnt and decree as the facts
flpwa; :ahiif, after payment f all such'judgments and decrees,
lhirswaei~~n any balance of said deposit, such bamlance shall be
licensee on order of the alien property custodian. If no
t witi enps year after the end of the war, or no notice
Sv required, then the licensee shall not be liable to make
r deposits, and all funds deposited by him shall be repaid to
:.l of the alien property custodian. Upon entry of suit and
utl.p ifl above required, or upon repayment of funds as above
1the liability of the licensee to make further reports to the
fifti& broughtt as above provided, the court may, at any time,
4IUS th iape, and 1a,i suc .vut, imm ia min caa to
pM~tAe Uwrbuensee frem Mgement thereaftero, or the .sourti in
...M. N.M.,Oprier to suit, shall have madeinvestment of capital
.e i ....B oB.r'f:the license, may continue the license for such
--i.. xiq uck terms and with such royalties as it shall find to
B I^^ eOyraUy of s.. ny, may institute and prosecute suits
in equity against any person other than a licensee under this Act to






enjoin infringement of letters patent, trade-mark,, print, labell, and
copyrights in the United States owned 'or controlled by said enepy
or ally of enemy, in the same manner and to the extent that,.. .wou.l
be entitled so to do if the United States was not at war: PION
That no final judgment or decree shall be entered in favoro... Ih
enemy or ally of enemy by any court except after thirty days'!,t. e
to the alien property custodian. Such notice shall be in writig qd
shall be served in the same manner as civil process of Federall f qpw ,
(h) All powers of attorney heretofore or hereafter grantdl by: l n
enemy or ally of enemy to any person within the United Sto.tes .n so
far as they may be requisite to the performance of acts authorized in
subsections (a) and (g) of this section, shall be valid. I .,, ?
(i) Whenever the publication of an invention by the graatmgAo .
patent may, in the opinion of the President, be detrimental., t he
public safety or defense, or may assist the enemy or endawge. .tbah
successful prosecution of the war, he may order that the intentionn
be kept secret and withhold the grant of a patent until the end of the
war: Provided, That the invention disclosed in the application for
said patent may be held abandoned upon it being established beforetor
by the Commissioner of Patents that, in violation of said order ,said
invention has been published or that an application for a patent tbee-r
for has been filed in any other country, by the inventor or his asagub
or legal representatives, without the consent or approval ofthbscowl s
missioner or under a license of the President.. .. ...
When an applicant whose patent is withheld as herein provided-and
who faithfully obeys the order of the President above refmrreI.'o
shall tender his invention to the Government of the United Sttes fwr
its use, he shall, if he ultimately ftceives a patent, have thl' right-vto
sue for compensation in the Court of Claims, such right to comp.na.,
tion to begin from the date of the use of the inventions by kts
Government. .;*'
SEC. 11. Whenever during the present war the President shall find
that the public safety so: requires and shall make proclamation therfr
of it shall be unlawful to import into the United States 1from any
country named in such proclamation any article or' articles meutiheod
in such proclamation except at such time or times, and uhdr such
regulations or: orders, and subject to such limitations and exeeptionasa
the President shall prescribe, until otherwise ordered by the Pe"Idl.t
or by Congress: Provided, however, That no preference shall be 6iveI
to the ports of one State over those of another. '. I -: i
SEC. 12. That all moneys (including checks and drafts. payable on
demand) paid to or received by the alien property custodian, rsuti
to this Act shall be deposited forthwith in the Treasury of the U-TitUi
States, and may be invested and reinvested by the Scretary '.bfli ti
Treasury in United States bonds or United States certifiatte ot In-
debtedness; under such rules and regulations as the President s OI
prescribe for such deposit, investment, and sale of securities; dtnd a9
soon after the end of the war as the President shall deem pactdkabilbi
such securities shall be sold and the proceeds deposited in theTntea-ury
'All other property of an enemy, or ally of enemy, coiteyed, ras-
ferred, assigned, delivered, or paid to the alien property custodlal
hereunder shall be safely held and administered by him except as here-







tided; an4 thbe 'Presiadft is authorized t designate as
, 6r depositarie0; of property of an enemy or ally of
(bank, or bapks, or trust company, 6r trust companies, or
M depositary or ddositaries, located and doing business
W States. Th e alien property custodian may deposit with
*10d depositary or depositaries, or with the Seqretary of
ry any stocks, bonds notes, time drafts, time bills of ex-
ther securities, or xpoperty (eixbept money or checks or
bte on diidemand which are required to be deposited with the
ifthe Treasury) and such depositary or depositaries shall
d and empwered-to collect My dividends or inteetr or
6t may become due and any maturing' obligations ield for
S'of such dustodiai. Any moneys collected on said account
# and deposited forth by said depositary or by the
&4r custodian into tiM Treasury of the United States as
A hal require all such designated depositaries to exe-
l_ b s sufficient in his judgmtent to protect property on
ibilds to be conditioned as he may drect.
rpfpeity custodian shUll be vested with all of the powers
a-ItAw trustee in respect of all property, other than money,
I Abiome ito his possession in pursuance of the provisions
4 id, acting under the supervinon and direction of the
nd uiier such rules and regulations as the President shall
ay i:nage such proqPerty andd any act or things in
iE or make any disposition thereof or of any part thereof,
2hewi, and exercise any rights whih may be or become
thsretb or to the ownership threof, it and wheonees-
et 'wae and protect schproperty and to the ed4tiat
Sof fie United States in such pr1oprty and rights or -6f such
ufttlVt;mately become entitled thereto, or to the proceeds
Sbeprestervel and safeguarded.'It shall be the duty of
tticfihmorporated with the United States md Vy
ated association, or company3 or istee,'or trustees within
States Zsuing shares 6r certxficatewmptesenting beneficial
franslr such shares or certificate upo)i its, hu, or their
t aime of the alien prerty e t. an un dem d,
WIb thfe 'resentationof Xlbencial interests. The lie prny cusadian shalI
li otkm the Thnasru tW e Tnit Stoiates, as herem-
tb, e proceeds of any such property or right e sold
.),. :* : -: .:. ..: -.. . :
. .o '. .
or property require or ar tOari by the provisions
to bpetlad, conveyed, transferred1 asi or d nredto


cusa haIif acdcstpidan shall so directby
Iacony tqffsrc$aji& or &Sffiv
el v. '. mr:.
od ma r l' '*'*: '' " : 'I ' *. "
I the war. any claim of any enemy or of 0: ay of
e i: or t phber, 'That an Otider
ite'shaU direeter,'Th t an order


off t


top :.. be






of the President as set forth in section nine hereof, or of the court,
as set forth in sections nine and ten hereof, the alien propery .usP
todian or the Treasurer of the United States, as the case may fr.
shall forthwith convey, transfer, assign, and pay to the person to
whom the President shall so order, or in whose behalf -the 9ourt shall
enter final judgment or decree, any property of an enemy or ally of
enemy held by said custodian or by said Treasurer, so far as may be
necessary to comply with said order of the President or said ,,a.
judgment or decree of the court: And provided further, That te
Treasurer of the United States, on order of the alien property cua-
todian, shall, as provided in section ten hereof, repay to the licensee
any funds deposited by said licensee.. ,
SEC. 13. That, during the present war, in addition to the aq
required by sections forty-one hundred and ninety-seven forty-a
hundred and ninety-eight, and forty-two hundred of the. BeviL
Statutes, as amended by the Act of June fifteenth, nineteen l d.d
and seventeen, to be set out in the master's and shipper's manifests
before clearance will be issued to vessels bound to foreign pqrs, the
master or person in charge of any vessel, before departure 0 suih
vessel from port, shall deliver to the collector of customs of the dis-
trict wherein such vessel is located a statement duly verified by oath
that the cargo is not shipped or to be delivered in violation of this
Act, and the owners, shippers, or consignors of the cargo of .such
vessels shall in like manner deliver to the collector, like statement
under oath as to the cargo or the parts thereof laden or shipp-e ,yy
them, respectively, which statement shall contain also the. names
and addresses of the actual consignees of the cargo, or if th aip-
ment is made to a bank or other broker, factor, or agent, the names
and addresses of the persons who are the actual consignees. n whose
account the shipment is made. The master or person in cobtrol,0f
the vessel shall, on reaching port of destination of any of the cargo,
deliver a copy of the manifest and of the said master's owner's,
shipper's, or consignor's statement to the American consular ofiicer
of the district in which the cargo is unladen.
SEC. 14. That, during the present war, whenever there is reasonable
cause to believe that the manifest or the additional statements uni'er
oath required by the preceding section are false or that any vesse,
domestic or foreign, is about to carry out of the United States Wny
property to or for the account or benefit of an enemy, or ally -of
enemy, or any property or person whose export, taking out, or trans-
port will be in violation of law, the collector of customs for tjhe
district in which such vessel is located is hereby authorized and em-
powered, subject to review by the President to refuse clearance o .iany
such vessel, domestic or foreign, for which clearance is requed bhy
law, and by formal notice served upon the owners, master, or person
or persons in command or charge of any domestic vessel for .4ii
clearance is not required by law, to forbid the departure of suc 'ses-
sel from the port, and it shall thereupon be unlawful for such voisel
to depart.
The collector of customs shall, during the present war, in each case
report to the President the amount of gold or silver coin or bullion or
other moneys of the United States contained in any cargo intended






fl epot.. Such report shall include the names and addresses of the
&iibrs and consignees, together with any facts known to the col-
I"btoS'tW reference to such shipment and particularly those which
Simicat that such gold 0r silver coin or bullion or moneys of
W UildW-d"States may be intended for delivery or may be delivered,
W" btejytr indirectly, to an enemy or an ally of enemy.
I&' That the sum of $450,000 is hereby appropriated, out of
in the Treasury of the United States not otherwise appro-
be used in the discretion of the President for the purpose
Iibut the provisions of this Act during the fiscal year ending
*h, nineteen hundred and eighteen, and for the payment
69.6f all persons employed under this Act, together with the
Ax penses for transportation, subsistence, rental of quarters
M rOct of Columbia, books of reference, periodicals, stationery,
t and exchanges thereof, miscellaneous supplies, printing
oteat the Government Printing Office, and all other necessary
OWi.4s0nincluded in the foregoing.
! kijf. Thiat whoever shall willfully violate any of the provisions
EU!s roof any license, rule, or regulation issued thereunder, and
Wt ii l willfully violate, neglect, or refuse to comply with any
t iV tift President issued in compliance with the provisions of this
4th t *kpkbn conviction, be fined not more than $10,000, or, if a
a, imprisQned for not more than ten ears, or both;
lae& blfer, director, or agent of any corporation who knowingly
tsin such violation shall be punished by a like fine, impris-
or:-oth, and any property, funds, securities, papers, or other
cuments, or any vessel, together with her tackle, apparel,
f*& Itfand equipment, concerned in such violation shall be for-
Vh 'Uited States.
..That the district courts of the United States are hereby
J] Ffisiction to make and enter all such rules as to notice and
ts# .nad all such orders and decrees, and to issue such process
..i necessary and proper in the premises to enforce the pro-
isn~hf this Act, with a right of appeal from the final order or decree
ch'"' ft.. as provided in sections one hundred and twenty-eight
* .f'%uindrjd and thirty-eight of the Act of March third, nineteen
t and eleven, entitled "An Act to codify, revise, and amend
'.i, Ltln to the judiciary."
SWW .i That the several courts of first instance in the Philippine
ihild the district court of the Canal Zone shall have jurisdic-
o0oqe nses under this Act committed within their respective
: 'ind8 concurrent jurisdiction with the district courts of the
W.*tes of fenses under this Act committed upon the high
Sconstiracies to commit .such offenses ab defined by sec-
14Seven of the Act entitled "An Act to codify revise, and
.enal laws". of the, United States," approved March fourth,
.. iipena~l laws' a.,.pprove...
hun dred and nine,: and the provisions of such section for
of this Act are hereby extended to the Philippin Islands
Ih(t30aal Zonie*.
mhat ten. da6 after the approval of this Aci nd until the
.tti~ewkr, it sahlYbe unlawful for any person, firm; corporation,
'Si association, to print, publish, or circulate, or cause to be printed,
Published, or circulated in any foreign language, any news item, edi-






trial or other printed matter, respecting the Governmei, iof thU
United States, or of any nation engaged in the present w., V p.li-
cies, interp ational relations, the state or conduct of the war, o. mr
matter relating thereto: Provided& Tft this section sh.l no. apay
to any print, newspaper, or publication where the publisher or
tributor thereof, on or before offering the same for mailing, r .y
manner distributing it to the public, has filed with the postmaster
at the place of publication, in the form of an affidavit, a true .a.co
plete translation of the entire article containing such matter pilpoe
to be published in such print, newspaper, or publication, adi s
caused to be printed, in plain type in the English language, at the
head of each such item, editorial, or other matter, on iacbopyq
such print, newspaper, or publication, the words "True tJrapsRtaop
filed with the postmaster at on (naming the pot i
where the translation was filed, and the date of filing theriod).. as
required by the Act of (here giving the date of this Act),
Any print, newspaper,' or publication in any foreign aguag
which does not conform to the provisions of this section is heby
declared to be. nonmailable, and it shall be unlawful for any person,
firm. corporation, or association, to transport, carry, or others
publish or distribute the same, or to transport, carry or'otherwise
publish or distribute any matter which is made nonailable by the
provisions of the Act relating to espionage, approved June fifteenth,
nineteen hundred and seventeen: Provided further, That upon eV-
dence satisfactory to him that any print, newspaper, or public-atin,
printed in a foreign language may be printed, published, and dis-
tributed free from the foregoing restrictions and conditions without
detriment to the United States in the conduct of the present wr,
the President may cause to be issued to the printers or publishers of
such print, newspaper, or publication, a permit to print, publish, and
circulate the issue or issues of their print, newspaper, or puhiati,
free from such restrictions and requirements, such permits to be, n-
ject to revocation at his discretion. And the Postmaster General
shall cause copies of all such permits and revocations of permits to
be furnished to the postmaster of the post office serving the place
from which the print, newspaper, or publication, granted the pmit
is to emanate. All matter printed published and distributed der
permits shall bear at the head thereof in plain type in the English
language, the words, "Published and distributed under permit au-
thorized by the Act of (here giving date of this Act), on file.
the post office of (giving name of office)."
Any person who shall make an affidavit containing any false t*e-
ment'in connection with the translation provided for in this sDtzi
shall be guilty of the crime of perjury and subject to the punishment .. ..
provided therefore by section one hundred and twenty-five of the Act of
March fourth, nineteen hundred and nine, entitled "An Act to edify,
revise, and amend the penal laws of the United States," and say
person, firm, corporation, or association, violating any other requirn'e-
ment of this section shall, on conviction there, be punished by a fine of
not more than $500, or by imprisonment of not more than one year,
or, in the discretion of the court, may be both fined and imprisoned.










* i 2.' Conference Report1
M.i. Enemy .,. 1 N &
..W M.. N the.Enemy, Homse, port No. 155, 6th Conpess, lst Seslsion
ANW*W e Report To Aecompany TR. 4960 September 21, 1917
iVf^ ^ i-
x4 Zi 4 e of conference on the 4isagreein votes of the two
V.*. opthe amendments of the Senate to the bill (H.R. 4960) to
q B.iw ,t., and punish trading with the enemy, and for other
I fl WflAlhving met, after full and free conference have agreed to
an i^, and do recommend to their respective Houses as follows:
I4lAjthw Semate recede from its amendments numbered 68,128, and
' MAte 4 B. Houm recede from its dis ent to the amendments
Wd1M-eut twnmbered 1, 2, 3, 4, 5, 6, 7, 9, 18, 15, 16,17, 20, 21, 22,
~23, S4%, 28, 30, 31, 32, 33, 34, 87, 38, 39, 40, 41, 42, 43, 44, 45, 46,
B7 O sW 51, 53,5:: 55,:66, 67, 58, 59, 60, 61, 62, 63, 64, 66, 69, 71,
787WA16, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 90, 91, 92, 93,
J1B .071, 98199,100, 101, 103, 104, 106,107, 108,110,111,112, 113,
M tPd4lU9, 121,122, 124, 125, and 126, and agree to the same.
t AfnLft&mt numbered 8:
'v flnt IHouse recede from its disagreement to the amendment of
fob.PAsunbered 8, and agree to the same with an amendment as
lew10 iv5Jth4 last line of the Senate amendment strike out", and
pk tebsankers"; and the Senate agree to the same.
.A.4 IBt'*1t iumbered 10:
S"W bmttAe House recede from its disagreement to the amendment of
i "Both10 nd mbered 10, and agree to the same with an amendment
naotd :In, lieu of the matter proposed by the Senate amendment
ime the following:
Rit & aThat it hall be unlawful-
b 04kFw amy person m the United States, ecept With the lice-s Of
ax*Hhewtbst, grasOed to stch person, or to the enemy, or alty of
em' as provided in this Act, to trade, or attempt to trade, either
'ww .: ieuctly, with, to, or from, or for, or on account of, or
- ehaS f of, or for the benefit of, any other person, with knowledge
wia i&e eause to. belive that &uck other person is an enemy or

r is ondt g or taking artin u ade
Por on count of, ,n bef of, or for Noe ben0ded
or ally of enemy.
r jpweron et oept weith the acense of the President, to
'.r tfw tranSport nto or from the United State, or
aster, or: other penom ii-efrge of a vessel of Ameri-
S dmawsport or aflempt to transport from any ulace to
ay subject or ciihen of an enemy or a*y of enemy


P .*
07,1 Ideailcul 'to B ondW ,Xer 'NO. 266,'ez(eett that the "State-
M 1tabmr.dbitPart of the HOElS" SflMl.tteL"
a.21
i






nation, with knowledge or reasonable cause to believe that the .person
transported or attempted to be transported is such subject or ciien.
(c) For any person (other than a person in the service of the UIited
States Government or of the Government of any nation, eMcept that
of an enemy or ally of enemy nation, and other than sWuc persona or
classes of persons as may be exempted hereunder by the Presidentm. or
by such person as he may direct), to send, or take out of, or bring. to,
or attempt to send, or take out of, or bring into the Unie. Stf
letter or other writing or tangible form of convmutfi onW i e
the regular course of the mail; and it shall be unlawful for any PeVrm
to send, take, or transmit, or attempt to send, take, or tnmsi e of
the United States, any lttdr or other writing, book, wap, phvna r
other paper, picture, or any telegram, cablegram, or wilrelmesa. g,
or other form of communication intended for or to be del'medi,
rectly or indirectly, to an enemy or ally of enemy: Provided ew,
That any person may send, take, or transmit out of the UnitedStes
anything herein forbidden if he shall first submit the same to the Pflw-
ident, or to such officer as to President may direct, and shall abtaai he
license or consent of the President, under such rules and #vqlatlWss,
and with such exemptions, as shall be prescribed by the Presidsa:.-
(d) Whenever, during the present war, the President shada deo"
that the public safety demands it, he may cause to be cenaoredob.d
such rules and regulations as he may from time to time .tab. i ,0
communications by mail, cable, radio, or other means of trt4IE&AM
passing between the United States and any foreign country :-.amy
from time to time specify, or which may be carried by any vessel or
other means of transportation touching at any port, place, o.W6rtr-
tory of the United States and bound to or from any foreign c.ouafr.
Any person who willfully evadetor attempts to evade the ub:bmissin
of any such communication to such censorship or wilfully -tw or
attempts to use any code or other device for the purpose 7opf .nal-
ing from such censorship the intended meaning of such
tion shall be punished as provided in section sixteen of thisA .t.
And the Senate agree to the same. :
Amendment numbered 11: ..
That the House recede from its disagreement to the amendment of
the Senate numbered 11, and agree to the same with an amendment
as follows:. .
On page 4, in line 2 of the Senate amendment, strike out tliw.owd
.
"other."-" "
On page 4, in line 9 of the Senate amendment, after the word "%ther-
wise," insert a comma., .'
On page 4, in the line 10 of the Senate amendment, after them*d
"time," insert a comma. -.
On page 4, in line 13 of the Senate amendment, after the: wrd
"company," insert a comma; and in. the name line after the mwod
enemy" where it occurs the second time insert a comma. .
On page 4, in line 15 of the Senate amendment, after 1h words
"United States," strike out the comma and insert a semieolol. ,.
On page 5, in line 4 of the Senate amendment, strike out the .words
or treaty,"; in line 7 strike out the words "or treaty"; and in ,e 9
strike out the words "or treaty", in line 11, after the. wotrd"- ,"
insert a comma; in line 12, after the word "President," insert a
comma; and in line 13, after the word "enemy," strike out the comma.






"A "in line 5 of the Senate amendment, after the word "com-
m r's#4 a comma; in line 6, after the word "granted" insert a
qINlIfine 183, after the word "Act," insert a comma; in line 14,
~ .. !' President," insert a comma; and in line 22 strike out
r~~ w insert the word sixteen.
.. T in line 9 of the Senate amendment, strike out "fifteen"
the word sixteen; in line 10, after the word "or," insert to
l B 18, after the word "company," insert a comma; and in line
the word "pay," strike out the comma.
,j i n.m line 5 of the Senate amendment, after the word "ues-
prt the words, hereinafter provided for,
Sate ae to the same.
ih numbered 12:
]RHouse recede from its disagreement to the amendment of
S..At numbered 12, and agree to the same with an amendment
*I ,, line 3 of the bill, after the word "That" insert:, during
. ewar.; and the Senate agree to the same.
t numbered 14:
t.^ House recede from its disagreement to the amendment of
Splb red 14, and agree to the same with an amendment
fA.the proposed amendment, after the word "Whenever,"
S t' e present war,; and the Senate agree to the same.
lumbered 18:
tMe House recede from its disagreement to the amendment of
h..ltumb.ered 18, and agree to the same with an amendment as
*irl fBT "' .l. "* '
irHfl Sne 21, of the proposed amendment as engrossed, strike
Hn and insert postponemen4
A... after line 28, of the proposed amendment strike out the
i*i ti* amendment and insert the following:
e President may investigate, regulate, or prohibit, a der
^rhu oeb as he mae prescribe by means of licenses
taPf tnnactiont in foegyn er autge, ewVrtW or'w
..*.. c /tgold o silver coin or bullion or currency, transfer of
form (ether than credits relating solely to transactions
Swhi g within the United States), and transit fers of
i of indebtedness or of the ownership of property between the
...... nMd an foreign country, whet her enMgr, al of enem
oreptgli ee residents of one or more fosigdn countries,
te tla;nd w the United Stee; anmd eM mae V r 4 aqc
e ef i T any such transactin to furnish er oath, COm-
relative thereto, i ncltig t'he production of any
e':Iwo. unt, contracts, letteft Or other ypen, in comuection there-
k tfl cist~ody or control of suck persoin either before or after
siuaw tgos the namO.-
tWIDA 19:
bi froWntt disagrebment to the amendMent'of
nubee 19, r 8fgem
mberid 19, and agree to the same with fn amendment
On line 25 of the bill, after the word "President" strike
It the commal; and the Senate agree to the same.
S-O2---T6---3




.24


Amendment numbered 27:
That the House recede from its disagreement to the ati"endmeit of
the Senate numbered 27, and agree to the same with an: twendnenti
as follows: .
On page 9, line 13 of the bill, after the word 'PreoAent"'st
out the comma; and the Senate will agree tq the same. '' r
Amendment numbered 29: "
That the House recede from its disagreement to the am4ne4ni pof
the Senate numbered 29, and agree to the same with an amendment
as follows: .
In lieu of the matter proposed by the Senate amendment' isrt. h4
following: known td be, or whom the representative of9.av4co'dror
tion, association, company, or trustee has reaso wable cause, ifqbelze to
be; and the Senate agree to the same. 9 : .
Amendment numbered 35: ....
That the House recede from its disagreement to the ametumef #of
the Senate numbered 35, and agree to the same with an-ame4.in nt
as follows: ..
On page 13, in line 11, of the amendment, .after the wor*6i AM '
insert a comma; and the Senate agree to the same. : .
Amendment numbered 36: ....
That the House recede from its disagreement to the amlin eent bf
the Senate numbered 36, and agree to the same with an amend 1he.t as
follows: ..,
On page 11, in line 19, of the bill, after the word "Presidet" 'txki'e
out the comma; and the Senate agreed to the same. ... i; :i"
Amendment numbered 52: ...,..:.
That the House recede from its disagreement to the amended of
the Senate numbered 52, and agree to the same with an amenm'eht
as follows:
In line 10, page 19, of the amendment, strike out the Wpids '"the
laws of the State" and insert law,; and. the Senate agree -to.. tj.,ame,
Amendment numbered 65:
That the House recede from its disagreement to the ame.mdrent
of the Senate numbered 65, and agree to the same with an amend-
ment as follows: .
On page 19, inline 10 of the bill, after the word "may.' insert
when duly authorized by the President,; and the Senate agree to
the same. ,- .
Amendment numbered 67: .. ,
That the House recede from its disagreement'to the amendment of
the Senate numbered 67, and agree to the same with an amendment -as
follows: ,
On page 19, in line 21 of the bill strike out "who desires" and iu.8
desiring; and the Senatae, agree to the same. ,,,
Amendment numbered 70T:" "
That the House recede from its disagreement to the amendment
of the Senate numbered 70, and agree to the. same with an amend-
ment as follows: .
On page 20, line 4 of the bill, after the word "as" strike out "it"
and insert the word he .. f: .. .....





I .the same page, in line 5 of the bill, after the word "provided"
out "it" and insert the word he
And. the Senate agree to the same.
rw=dnmwt ntnumbered 73:
tid~ft:h House recede from its. disagreement to the amendment
Of the Senate numbered 73, and agree to the same with an amend-
i-pW follows:
In lieu of the matter proposed by the Senate amendment insert the
following: including the fixing of prices of articles and prodUcta
.tec $0 t1. he health of the Military and Naval forces of the United
4A e r tke successful/ prosecution of the war,; and the Senate agree.
to the same.
*.YSuudment numbered 89:.
.jat the House recede from its disagreement to the amendment of
th Senate numbered 89, and agree to the same with an amendment as
follows:
'0;ij4 ^ $line 23 of the bill, after the word "expiration" strike out
Aone.
In the same line, after the word "thereafter" insert a comma.
jg dth zte'agree to the same. ,
MA44 entt numbered 102;
Tat the House recede from its disagreement to the amendment
of the Senate numbered 102, and agree to the same with an amend-
S.hwtfiows: :
.024, in line 16 of the bill, after the word "President" strike
0he comma; and the Senate agree to the same.
4mapwa numbered 105:
Ta te aouse recede from its disagreement to the amendment
%$w$.apate numbered 105, and agree to. the same with an amend-
L : 26, in line 3 of the bill, strike out the word "such"; and'
i Tagree to the same.
'A4m4meut numbered 109:
Wh~tfeHouse recede from its disagreement to the amendment of
tp ,$natenumbered 109, and agree to the same with an amendment
,4T line 6 page 29 of the amendment, strike out the words "in like
UPRW!ahout gh he were the absolute owner thereof," and insert
tAio14wigig: if a-nd when necessary to prevent waste and protect
I rt4an d; and the Senate agree to the same.
nn numbered 115
t3Mo4use recede from its disagreement to the amendment of
pm$bered 115, and agree to the same with an amendment as
[. ... B in lines 19 and 20 of the bill, strike out the words "(or
lotr .officer as the President shall direct)'?; and the Senate agree
nendmp .numbered 116: .
,i:(i | D .b a m e n d m ent
i.:. ,ie41ouse recede from its disagreement to the amendment of
te:unhered .416., and agree to the. same with:an amendment
.... ..........






On pages 26, in line 23, of the bill insert the following:, during Nhe
,present war,; and the Senate agree to the same.
Amendment numbered 118:
That the House recede from its disagreement to the amendment of
the Senate numbered 118, and agree to the same with an amendment
*as follows:
On page 27, line 23, of the bill insert the following: during the
present war,; and the Senate agree to the same.
Amendment numbered 120:
That the House recede from its disagreement to the amendment of
the Senate numbered 120, and agree to the same with an amendment
as follows:
In the first line of the amendment proposed by the Senate after
the word "shall" insert: during the present war,; and the Senate
agree to the same.
Amendment numbered 123:
That the House recede from its disagreement to the amendment of
the Senate numbered 123, and agree to the same with an amendment as
follows:
On page 28, line 23, of the bill after the word "Stationery" insert
the following: typewriters and exchanges thereof,; and the Senate
agree to the same.
Amendment numbered 127:
That the House recede from its disagreement to the amendment of
the Senate numbered 127, and agree to the same with an amendment
as follows:
In lieu of the matter proposed by the Senate amendment insert the
following:
SEc. 19. That ten days after the approval of this act and wti2 the
end of the war, it shall be unlawful for any person, firm, corporation,
or association, to print, publish, or circulate, or cause to be printed,
published, or circulated in any foreign language, any news aite,
editorial, or other printed matter, respecting the Government of the
United States, or of any nation engaged in the present war, its
policies, international relations, the state or conduct of the woar,.. or
any matter relating thereto: Provided, That this section shall not
apply to any print, newspaper, or publication where the publisher or
distributor thereof, on or before offering the sa mne for mailing, or in
any manner distributing it to the pubt lie, has filed with the post-
master at the place of publication, in the form of an affidavit, a true
and complete translation of the entire article containing ueA master
proposed to be published in such print, newspaper, or publication,
and has caused to be printed, in plain type in the English language,
at the head of each such item, editorial, or other matter, on each copy
of such print, newspaper, or publication, the words "True ransla-
tion filed with the postmaster at on (naming the post-
office where the translation was filed, and the date of filing thereof),
as required by the Act of (here giving the date of this Act).
Any print, newspaper, or publication in any foreign language
which does not conform to the provisions of this section is hereby
declared to be nonmailable, and it shall be unlawful for any person,
firm, corporation, or association, to transport, carry, or otherwise pub-






W urW.) Wte the same, or to transport, carry, or otherwise pub-
E oA o &s ute any mater which is made nonmailable by the pro-
M e the Act relating to espionage, approved June 15, 1917:
9Wwwf4d ftrther, That upon evidence satisfactory to him that any
..... ..tper, or publoan, printed in a foreign language may
qjihed, aniuted free from the foregoing re-
nd conditions without detriment to the United States in
146- a&d of the present war, the President may cause to be issued
e prsmktm or publishers of such prikt, newspaper, or publication,
a. .$ prWt, publish, and okul te the issue or issues of their
pv&^jesewespaper, or publication, free from such restrictions and re-
glflta. tA pennits to be subject to revocation at kis discretion.
.Potmaster General shall cause copies of all such permits
_ai _it .---of permits to be furnished to the postmaster of the
serving the Place from whiokh the print, newspaper, or pub-
onw se d the permit is to emanate. All matter printed, pub-
Ik1 ld4 ietuted under permit shall bear at the head thereof
nWantypi in the English language, the wonis, "Published and dis-
permit authorized by the Act of (here giving
Sof is Act),on fie at the post office of givingg me of
~er~mrtlf an who shall make an afdavit containing any false state-
r irqevaection with the. translation provided for in this Act shall
-9he rime 9 perjury and subject to the punishment pro-
fo4r by Section 126 of the Act of March 4,1909, entitled
to fofy, revise, and amend the penal laws of the United
...:a"- 4a ,w fimu corporation, or association, violating
a requirement of thk Act shall, on conviction thereof, be
Twt baine of not more than five hundred dollars ($600), or
kof n/ot more than one year, or, in the discretion of
l ..... be be both fined and imprisoned.
nate agree to the same.
oti W.C. AnAxsoN,
rrr' A.'** *. A. J. MONTAGUE,
ArrHuu G. DEWALT,
.... JOHN J. ESCH,
'.if = ... ..."* *E.L. HAMILTOzN,
=itrrVi 'L :_'-, i Managers on the Part of the House.
DuNCAN U. FLETCHFR,
JA& K. VAnAxDAM ,
E %!': !. Jos. E. R&Nm xL ,
14t' nT'::'-+.. J' E JOB. E Bwmra,
4^ KiNTun NaLsoN,
BuMT X. FErNALD,
.ir.. . M.e.... on the Part of the Senate.


. V....J'iFd n T.o r MAG nO.. THE PART OF THE HOUSE .
.........s .on the part9f the House at the conference on the
vqti ote two Housd on the amendments of the Sen-
|rnu ..zt ( 4960) to dbfine, regulate, and punish trading
h f, Einynd r. Other purposes, submit the following state-







ment in relation to the action agreed upon by the conference com,
mittee as to the amendments of the Senate:
Amendment No. 1: This amendment strikes out (1) all of the
House provision relating to enemy insurance companies, and (B) alo
the definition of enemy or ally of enemy found in the proviso of the
amendment; but the former portion of the amendment finds a.sub-
stitute in Senate amendment No. 11, hereafter to be noticed. "'*
Amendments Nos. 2, 3, 5, and 6 more clearly define the meaning of
thle word "citizen" used in the bill.
Amendment No. 4 strikes out the same definition referred to in
amendment No. 1.
Amendment No. 7 defines more clearly what is meant by the wods
"end of the war."
Amendment No. 8: The definition of the words "bank or banks"
is accepted by the House conferees, with an amendment excluding
therefrom "private bankers."
Amendment No. 9 enlarges the definition of "trading" to include
"loans or extension of credits."
Amendment No. 10: The House recedes from its disagreement and
agrees to the same with an amendment, which- ' .
(a) Includes, comprehensively, such persons as are prohibited
from trading as defined in the act, with knowledge or reasonable
cause to believe that the person with whom the trade is carried on
is an energy or ally of enemy, except with license. It should bW
especially noted that the President is generally substituted by the
Senate amendments to perform directly or indirectly the functions
assigned to the Secretary of Commerce, the Secretary of the Treas-
ury. the Federal Trade Commission, and other officers. I .
(b) This is substantially an enlargement of the House provision
forbidding any person to transport or attempt to transport into or
from the United States, or for any owner, master, or other person
in charge of a vessel of American registry to transport or attempt to
transport from any place to any other place any subject or citizen of
an enemy or ally of enemy with knowledge or reasonable cause to
believe that such person transported or attempted to be transported
is such subject or citizen.
(c) This paragraph contains two substantive provisions: (1) It
is unlawful to send or attempt to send, take out, or bring into the
United States any letter, writing, or other tangible form of commu-
nication, except in the regular course of the mail; or to send, take,
or transmit, or attempt to send, take, or transmit out of the United
States any letter or other writing, book, map, plan, or other paper,
picture, or telegram, cablegram, or wireless message, or any other
form of communication intended to be delivered directly or indi-
rectly to the enemy or ally of enemy: Provided, however, That the act
or acts forbidden may be performed if first submitted to the Presi-
dent, or to such officers as he may direct, and license or consent there-
fore obtained.
(d) This paragraph gives the President authority during the
war, when the public safety demands it, to censor, under appro-
priate rules and regulations, communications by mail, cable, radio,
or other means of transmission between the United States and any





1M.. .outry which he may from time to time specify, or which
4 E rl ed by vessel or other means of transportation, and pre-
W p..1nd penalties for violations thereof. It should be
otbi,1owtver, that the censorship does not extend in this para-
Army.n way to newspapers or other publications.
M .EW eAts Nos. 11, 12, 14, 15, and 17 are formal in character
4.,rify the text.
A n %ents Nos. 13 and 16 substitute the President for the Secre-
f, ornmerce.
^p ant No. 18: (a) Elaborates the provisions of the House bill
^ 3 %hibitions against trade save and except in pursuance
o07id gives the President full authority over the same.
(i^ ] amfendm t contains a new subject matter, giving the
jiltho rity to investigate, regulate, or prohibit under appro-
.iia .....d regulations, transactions in foreign exchange, export,
11of coin, or bullion, or currency, and generally the sub-
jeit of indebtedness or ownership of property between the
^M#W^s. and any foreign country whether enemy or neutral, or
BVe nkrednt of one or more foreign countries and any person in
Thittd ats; and the President may require any information in
Srelatio hereto, including the production of books, accounts, letters,
ld r .i P,: a : .. ' " :' '.
___ffi nts Nos. 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, and 31
unimportant save for the substitution of the President for the
" 'of? Commerce, and with the exception of No. 24, which for-
Bce of voluntary official service.
"'j-iets Nes. 32 and 33: Fix February 3, 1917, as the date
xM"w'Kdislosures ~and reports of enemy stock, shares and prop-
erty shall be made.
": t3ihi6t No. 34 empowers the President to extend the time in
whihL ksuci reports shall be made, as well as the inquisitorial jurisdic-
& rt1r eipr6ite t bustodian and the President.
'iiiBe- t No. 5 nl&rges the scope of the invalidity of convey-
ances trnsfers, assignments, etc., contemplated by subMection b,
MX 'ii fiM1flo0o1is bill.
~~ifiiwntX6. 37 'eKpands and carries into detail the provisions
ael i" "' ection 7 of the House bill. 6 ,
A imenents Nos. 36, 38, 39, 40,'41, 42, 43, 44 4, 46, 47, 48 49, 50,'
ailto o 8W tmateriallv change thb House bill save to bring the
ns int conio 'rity with the teit of the bill.
E bo ti fl, 2 is rededed Irom and concurred in with an amend-
't %ldlbories- 6tion 8' of the H1ouse bill, and perhaps con-
M tSlta^tlih. prpose designed by the orgin al text. .
xfi Nos. ~54, 5556,b 57; 58,59, and 60 revise theinterpleader
i h dt -psted patie 's provided in sectiat: 9 of the House bill.
W* t 1&61 is wh Xly s'rickenout;.*
"aiM tpr.t Nds. 61 `8, 6,65, 66 ', 6, ,70, 7,nd '72 are mainly
II tiy'S iformity and&larity- '""'
N)o. 68 is whoY receded from by the Senate,.
Amend itiN 1 o. 7 incurredd in by the House'bonferees with an
amendment confining the fixing of prices to articles and products neces-
ary to the health of the Army and Navy or the successful prosecution
of war.






Amendment No. 74 provides that licenses shall be defense to. suits
in relation to the subject matter of such licenses.
Amendments Nos. 76 to 98, inclusive, are necessitated by reason of
the changes heretofore referred to, and to preserve unity and clarity in
the text.
Amendment No. 99 authorizes the President to keep sbfret and
withhold publication of inventions or patents until the end f the
war if the publication of such inventions may assist the enemy or
endanger the successful prosecution of the war.
Amendment No. 100 authorizes the President to place an embargo
upon all imports into the United States, in pursuance of proclama-
tion and under such regulations as he may prescribe, giving no pref-
erence, however, to the ports of one State over those of another.
Amendments Nos. 101 to 108, inclusive, relate to the substitution
of the President for the heads of the departments, and punctuation
and slight verbal changes necessary for the continuity of the text.
Amendment No. 109 deals with the powers to be exercised by the
alien property custodian, and the duty of corporations, associations,
companies, and trustees within the United States to transfer shares
and certificates upon their books to the alien property custodian
upon his demand, and under certain conditions.
Amendments Nos. 110 to 119, inclusive, are formal in character
and intended to perfect the text. The same may be said of any other
amendments, not specifically noted in this statement.
Amendment No. 120 requires the collector of customs to report
to the President the amount of gold or silver coin or bullion or other
moneys contained in any cargo for export, the purpose being to safe-
guard the delivery of such property directly or indirectly to an
enemy or ally of enemy.
Amendments Nos. 121 and 122 increase the sum of appropriation
from $250,000 to $450,000.
Amendment No. 124 strikes out section 15 of the House bill relating
to penal provisions, inserting in lieu thereof section 16 covering the
same subject more in detail.
Amendments Nos. 125 and 126 relate to renumbering sections.
Amendment No. 127: This amendment is in relation to printing,
publishing, or circulating in any foreign language matter respecting
the Governlent of the United States, etc.
Its provisions are operative 10 days after the approval of this act,
and until the end of the war, during which time it shall be unlawful
for any person, firm, corporation, or association to print, publish,
or circulate, or cause to be printed, published, or circulated, in any
foreign language, news items, editorials, or other printed matter
respecting the Government of the United States, or of any nation
engaged in the present war, or their policies, international relations,
state, or conduct of the war, or any matter relating thereto. This
section shall not apply where the publisher or distributer on or before
mailing or distributing the article, has filed with the postmaster
at the place of publication a true and complete, translation of the
entire article, as provided more in detail in the amendment.





31

Any print, newspaper, or publication which does not conform to
te aqurement as to translation, etc., makes the matter nonmailable,
and it becomes unlawful not only to mail but to transport, carry, or
othwise publish or distribute such matter.
:.*But the President is authorized to issue permits for such publica-
n;t which, however, are subject to revocation.
firI etll i s sNos. 128 and 129 are receded from by the Senate

.*' W. C. ADAMsON,
A T Afn'Sam S


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tus'I~l^.t if:.. *d.







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I -B Hn I'i. ^ *'


A. G. DEALT,
JOHN J. ESCH,
EDwARD L. MaMLTON,
Managers on the Part of the Hose.


I.


i4.






i* : I,1' .. ...t..



3. Senate Debate (Excerpts) ,
[55 Cong. Rec. 6949-6950, 6957-6958, 7015-7018, September 11-iZ A917. .
.* *

TRADING WITH THE ENEMY

Mr. FLETCHER. Mr. President, I move that the Senate proceed to
the consideration of the bill (H.R. 4960) to define, regulate, and pun-
ish trading with the enemy, and for other purposes.
The motion was agreed to; and the Senate, as in Committee of the
Whole, proceeded to consider the bill, which had been reported from
the Committee on Commerce with amendments.
Mr. FLETCHER. I ask unanimous consent that the formal reading of
the bill be dispensed with, that the bill be read for amendments, and
that the committee amendments be first considered.
The PRsmDING OFFICER. Is there objection to the request of the
Senator from Florida? The Chair hears none, and it will be so ordered.
The Secretary proceeded to read the bill.
The first amendment of the Committee on Commerce was, in section
2, page 2, line 7, after the word "territory," to strike out:
Provided, That nothing in this act shall impair or affect the President's proc-
lamation of April 6, 1917, or any amendment, modification, or revocation thereof,
in relation to the branches of enemy or ally of enemy insurance companies in
the United States, when such branches are under the management of citizens
of the United States, and such branches, and the managers and trustees thereof,
shall be subject to license by the Secretary of Commerce regulating the business
thereof and the control and disposition of the funds thereof, subject to rules
and regulations prescribed by the Secretary of Commerce, with the approval
of the President: Provided further, That the definition of "enemy" in this
subdivision shall not include any person outside the United States residing
outside of the territory of any nation, or ally of any nation, with which the
United States is at war, in so far as such person does business with neutrals,
allies of the United States, or with the Government or people of the United
States, and such business is not connected directly or indirectly with any busi-
ness done by sdch person within the territory of any nation or ally of any nation
with which the United States is at war.
So as to make the clause read:
SEC. 2. That the word "enemy," as used herein, shall be deemed to mean, for
the purposes of such trading and of this act-
(a) Any individual, partnership, or other body of individuals, of any nation-
ality, resident within the territory (including that occupied by the military
and naval forces of any nation with which the United States is at war, or resident
outside the United States and doing business within such territory, and any
corporation incorporated within such territory of any nation with which the
United States is at war or incorporated within any country other than the
United States and doing business within such territory.
The amendment was agreed to.
The next amendment was, on page 3, line 8, after the words "may
be", to strike out "citizens" and insert "natives, citizens"; and in
(32)






line 9, after the word "war," to insert "other than citizens of the
United States," so as to make the clause read:
.:s,01 Such other individuals, or body or class of individuals, as may be natives,
msWe.r subjects of any nation with, which the United States is at war,
other than citizens of the United States, wherever resident or wherever doing
t isemWB a the President, if he shall find the safety of the United States or
tBnum fsful prosecution of the war shall so require, may, by proclamation,
IPe Wldewlthin the term "enemy."
TNe amendment was agreed to.
,V.Jet next amendment was, on page 3, line 25, after the word "terri-
f sp'to strike out:
oLPw fcTat the definition of "ally of enemy" In this subdivision shall not
fsu& any person outside the United States residing outside of the territory
U ntpn or ally of any nkatilon with which the United States is at war, in
i msuch person does business with neutrals, allies of the United
I wh the Government or people of the United States, and such business
eam eted directly or indirectly with any business done by such person
W f rrltory of any nation or ally of any nation with which the United
big.ainm KX. war.
Boa sa to make the clause read:
0 ( .) Any individual, partnership, or other body of individuals, of any nation-
rodent within the territory (including that occupied by the military
-wttl Tforces) of any nation which is an ally of a nation with which the
f tV .s to at war, or resident outside the United States and doing busi-
.UJIn such territory, and any corporation Incorporated within such terri-
*t 4fe.ch ally nation, or incorporated within any country other than the
U t~~ t a and doing business within such territory.
*t/; W anrnedment was agreed to.
7q% next amendment was, on page 4, line 16, after the words "may
Icrd out "citizens," and insert "natives, citizens"; and in line
..Vim word "war," to insert "other than citizens of the United
ats seWas to make the clause read:
other,individuals, or body or class of individuals, as may be natives,
ftbjects of any nation which is an ally of a nation with which the
....te is at war, other than citizens of the United States, wherever resident
d6oIk business, as the President, if he shall find the safety of the
taters or the successful prosecution of the war shall so require, may, by
o, include within the term "ally of enemy."
.- ]i amendment as agreed to.
'T next amendment was, on page 5, line 10, after the word "date,"
'" 'of: proclamation," so as to make the clause read:
:r'rW1' :"end of the war," as used herein, shall be deemed to mean the date
~~tlan of exchange of ratifications of the treaty of peace, unless the
1R:4shall, by procdamation, declare a prior date, in which case the date
AjP aiaed shall be deemed to be the "end of the war" within the meaning

!!te amendment was agreed to.
. A#e amendment was, on page 5, after line 14, to insert:
.2* 4*4 "bank or banks" as used herein, shall be deemed to mean and include
...4.. .. 2f.W State banks, trust companies. or other banks or banking assoca-
'4p bfMsness under the laws of the 'Uited States, or of any State of the
;w fiSth afd private banker s. of
C r~e itl.A meut was agreed t.,".
I 161 ext amendment was, on page 6, line 3, after the word "sell,"
Sto insert "loan or extend credit," so as to make the clause read:
" (d) buy" or sell, loan or extend credit, trade in, deal with, exchange, transmit,
transfer, assign, or otherwise dispose of, or receive any form of property.





34

The amendment was agreed to.
The next amendment was, on page 6, after line 7, to strike out:
SEC. 3. That it shall be unlawful for any person in the United States, except
with the license of the Secretary of Commerce, as hereinafter provided in aetiam
5--
(a) To trade, or attempt to trade, with an enemy, or for, or on account of, or
on behalf of, or for the benefit of an enemy, either directly or indireetly,.with
knowledge or reasonable cause to believe that the person with or for, mr .1
account of, or on behalf of, or for the benefit of whom such trade is conducted, or
attempted to be conducted, is an enemy.
(b) To trade, or attempt to trade, with an ally of enemy, or for, or on amount
of, or on behalf, or for the benefit of, an ally of enemy, either directly or indirectly,
with knowledge or reasonable cause to believe that the person with or for, or
on account of, or on behalf of, or for the benefit of whom such trade is con-
ducted, or attempted to be conducted, is an ally of enemy.
(c) To transport, or attempt to transport, an enemy, with knowledge or reasn-
able cause to believe that the person transported, or attempted to be transport,
is an enemy.
(d) To transport, or attempt to -transport, an ally of enemy, with kihowled or
reasonable cause to believe that the person transported, or attemnipted to be
transported, is an ally of enemy.
And insert:
SEc. 3. That it shall be unlawful- ::
(a) For any person in the United States, except with the license cf the
President, granted to such person, or to the enemy, or ally of enemy, as provided
in this act, to trade, or attempt to trade, either directly or indirectly, wif, t
or from, or for, or on account of, or on behalf of, or for the benefit of, any Other
person with knowledge or reasonable cause to believe that such other person is an
enemy or ally of enemy, or is conducting or taking part in such trade, directly
or indirectly, for, or an account of, or on behalf of, or for the benefit of, an enemy
or ally of enemy. -
(b) For any person, except with the license of the President, or eof such per.
son as he may direct, to transport or attempt to transport into or frqm the
United States any subject or citizen of an enemy or ally of enemy natUbm, with
knowledge or reasonable cause to believe that the person transported or at-
tempted to be transported is such subject or citizen.
(c) For any person (other than a person in the service of the United Stas
Government or of the Government of any nation, except that of an enemy Or afy
of enemy nation, and other than such persons or classes of persons as m'y be
exempted hereunder by the President or by such person as he may direct),
to send. or take out of, or bring into, or to attempt to send, or take out of, or
bring into, the United States, any letter or other writing or tangible form of
communication, except in the regular course of the mail; and it shall be Tun-
lawful for any person to send, take, or transmit, or attempt to send, take, or
transmit, out of the United States, any letter or other writing, book, map, plan,
or other paper, picture, or any telegram, cablegram, or wireless message, or
other form of communication intended for or to be delivered, directly. or in-
directly, to an enemy or ally of enemy: Provided, however, That any peromp
may send. take, or transmit out of the United States anything hereinbefrela,.
bidden if he shall first submit the same to the President, or to such ofleer as
the President may direct, and shall obtain the license or consent of the Prenidewt
or of such other officer, under such rules and regulations, and with such exmp
tions, as shall be prescribed by the President.
The PmRESmIG OFICER (Mr. Kirby in the chair). The question is'on
the amendment of the committee striking out section 3 of the bill and
inserting section 3, as proposed by the committee as just read. Is there
objection? The Chair hears none, and the amendment is agreed to.
Mr. RmE. Mr. President, before section 3 as reported by the com-
mittee is agreed to I desire to say that it seems to me that the language







I l, s O15to 17, on page 7, may be too broad and sweeping. I call the
~~I~tOlaf the Senator in charge of the bill to this language:
A...4 other person with knowledge or reasonable cause to believe that such
dMJWybmersoI5 anI enemy or ally of enemy-
1itrm reasonable cause" is one that is pretty comprehensive;
and, as this is to be a penal statute, I inquire whether or not we can
tot nmplby some phrase a little more conservative than that
rtIXn.us of great excitement, as we all know, it may be that a jury
woul~4.ifa aomethig as reasonable cause and send somebody to the
pU tsry when a man had no evil purpose or intent. I suggest that
5gfeti0on be passed over and that a little further consideration be
0-ji I have no objection.
She Pa m niG OnICER.o It will be passed over.
Trjf. lbsM I wish to say, so that I will not be misunderstood, that
j legep g, Xurther than I am willing to go-
fiigtiamiiu OrrCER. The Chair announced that the section was
agreed to without objection. If the Senator will move to reconsider
it, that motion will be entertained.
Mr. R4NSzLL. I move that it be reconsidered.
qi i9Wq i O iCR. It is moved that the proposed amendment be
w iFg re4d, and, without objection, it is reconsidered.
1hnrj. J 1i =. I desire to say just this much, so that I will not be mis-
it tellbod: No one could go further than I am willing to go to make
Stfij)tijble for information to be sent to the enemy, and no one will
~~kr than I am willing to go to punish every act that is calculated
ter &i aid or comfort to the enemy. It is, perhaps, for that reason
more than any other that I desire that we shall be careful not to draw
wo ufttes so loosely that they may work hardships and thus result
i afilutre to enforce them.
*Oi T nR-s LmNG OrnmR. Without objection, the amendment is passed
annMThe next amendment of the committee will be stated.
"h VF. *
Vr e amendment was, in section 5, line 18, before the word
"That," toinsert "(a)"; in line 18, after the word "and," to strike out
'Mh6 Seeitary of Commerce may, under the direction of"; in line 19,
bosf the word "grant," to insert "may"; and in line 20, after the word
"' eral," to strike out "to any person or class of persons, to perform
V t Adatade unlawful in section 3 of this act without such license, if
W iftifbe of opinion that such grant shall be compatible with the
safety of the United States and with the successful prosecution of the
war, and he may, with the approval of the President, make such rles
and regulations not inconsistent with law as may be necessary and
prper to carry out the provisions of this act,"and insert:
tat otherwise, and for such period of time'and containing 'iuch j-
iais imad conditions na he shall prescribe, to any person or class of perseus
to do business as provided in subsection (a) of section 4 hereof, and to percm
v..rt m.m4oe unlau*ful without such license In section 3 hereof, and to file and
p tbtt applications under subsection (b) of section 10 hereof; and he may
*ft or 'enew sucek licses from time to time, if he shall be of opinion that
wth grant or revocation or renewal shall be compatible with the safety of the
United States and with the successful prosecution of the war; and he may make
.eh rules and regulations, not inconsistent with law, as may be necessary and
a]i h ; ."..:..o *,:--... *







proper to carry out the provisions of this act; and such other officer, or officers, a
the President shall direct, shall have similar powers to grant licenses under sub-
sections (b) and (c) of section 3 hereof and to make rules and regulations there-
under, with the approval of the President. .
If the President shall have reasonable cause to believe that any act is aonut
to be performed in violation of section 3 hereof, he shall have authority to order
the suspension of the performance of such act for a period not exceeding 90
days, pending investigation of the facts by him.
(b) No investigation or examination of any bank shall be made, except through
the Secretary of the Treasury or the Federal Reserve Board.
(c) That the President may investigate, under such rules and regulations
as he may prescribe, any transaction in foreign exchange, export of gom or
silver coin or bullion, and transfer of credit in any form (other than eoedits
relating solely to transactions to be executed wholly within the United States)
by any bank; and he may require any person engaged in such transaction to
furnish complete information relative thereto, including the production. of .any
books of account, contracts, letters, or other papers in connection therewith in
the custody or control of such person, either before or after such transaction is
completed. Whenever it shall appear to the President that the export of tany
gold or silver coin or bullion or of any moneys of the United States may result
in violation of the provisions of this act, he may cause notice to be served on the
parties in interest to withhold such export for a period not exceeding 90 days
pending investigation of the facts by him.
So as to make the section read:
SEC. 5. (a) That the President, if he shall find it compatible with the .safety
of the United States and with the successful prosecution of the war, may, by
proclamation, suspend the provisions of this act so far as they apply to an alty
of enemy, and he may revoke or renew such suspension from time to time; and
the President may grant licenses, special or general, temporary or otherwise,
and for such period of time and containing such provisions and conditions as he
shall prescribe, to any person or class of persons to do business as provided In
subsection (a) of section 4 hereof, and to perform any act made unlawful with-
out such license in section 3 hereof, and to file and prosecute applications under
subsection (b) of section 10 hereof, etc.
Mr. RANSDELL. On page 14, line 15, I move to strike out, after the
word "at" and the semicolon down to and inclusive of the word "Presi-
dent," on line 19, in the following words: "and such other officer, or
officers, as the President shall direct, shall have similar powers to grant
licenses under subsections (b) and (c) of section 3 hereof and to make
rules and regulations thereunder, with the approval of the President,"
and to insert in lieu thereof, beginning after the word "act," in line
15, and after the semicolon, the following: "and the President may
exercise any power or authority conferred by this act through such
officer, or officers, as he shall direct." .
The PRESIDING OFFICER (Mr. King in the chair). The question is
on agreeing to the amendment of the Senator from Louisana to the
amendment of the committee.
The amendment to the amendment was agreed to.
The amendment as amended was agreed to.
.S.:,
The VICE PRESIDENT. The amendment passed over will be stated.
The SECRETARY. Amendment inserting section 3, page 6, passed over
at the request of the Senator from Missouri [Mr. Reed.]
Mr. REED. Mr. President, let me state that matter for the benefit of
the Senators who are present. The first part of the section proposed to
be inserted reads:
SEC. 3. That it shall be unlawful-.-.
(a) For any person in the United States, except with the license of the Presl-
dent, granted to such person, or to the enemy, or ally of enemy, as provided in






tt kiwo trade, or attempt to trade, either directly or indirectly, with, to, or
qam "r for, or on account of, or on behalf, or for the beheft of, any other
p mptr knowledge or reasonable cause to believe that such other person Is an
ILV of enemy, or It conducting or taking part In such trade, directly
wl -f.r, or on account of, or on behalf of, or for the benefit of, an enemy

i tifgft e. that I call attention to is found in line 16, "or reason-
S I'g* believeve" I confess that I am somewhat puzzled to know
ftEhoW ithe thought in the framer's mind could be expressed with
g safety, but to say that a man can be held because he has merely
k hW cause to believe may be quite a dangerous thing. The ques-
tK*bt is a reasonable cause would be left to a jury.
@ ^ MNE. On what page is that I
^^PlB I am reading from page 7, and I call the Senator's atten-
hAbi& 16. In a time of great excitement a jury might think some-
0thi .t have been reasonable cause which would never have occurred
t h 'dotnt as any cause at all. What might put a man of shrewd
I npent and experience upon notice might to an inexperienced
I $ jo d tiee ata.
.fl iqiry I make is whether the word "knowledge" is not suffi-
K t it usi a#aa matter of law if a man knows enough to practically
&1 am t to proof it is equivalent to knowledge itself of the ultimate
di WVdot kno*t how I can make this plainer than I have in this some-
t~I fqr statement. A munitions expert might be fully advised
'ifl Wtion to munitions of some dangerous condition because he
lir"ed some one fact.
Aman. unacquainted with that business might not get any notice
*6hz fIAt. The term "reasonable cause" or the term "reasonable
n.feae^O to be determined by what the ordinary prudent man would
* known or understood under the same circumstances. It may be
.di..e possible, but I think we can get along without it.
i. I suggest to the Senator in this connection that I
VObse'rvations are entirely sound. The purpose, I thiik, w-as
SUn=where one might have information, might be absolutely
Sathe person with whom he is dealing is an enemy or the
fkrPinemny, but still be might not know it as a fact He could only
tt" fmation to that effect. It might be the whole of his informa-
Itieis an enemy or ally of an enemy, and yet he might iot have
sibiA 1 n1'l;dge. Would the Senator think this language would fit
ftM ams to take the place both of knowledge or reasonable cause to
Piev"e I Just so as to any other person who is an enemy or ally of an
. It leaves it open to proof as to whether he is bor is not, without
roof ofactual knowledge.
SLet me examine the context and see how that would fit in.
r. xPoMmirq. May I suggest to the Senators who are discussing
ueion would it not improve the language somewhat if they
I ma*t 'read "with the knowledge or mean 6f knowledge that
he"ery btsis ani enemy or ally of an enemy" '"
VI am afraid not. The Senator suggests '"means of knowl-
lt 'd6 that mea? 6'se ob1ng to try a citizen for this
Sis taYged *ith pmssig he means of'knowledge. What
the means of knowledge? It is anything that'he could employ to







ascertain, to find out. It seems to me that that suggestion would be
dangerous. ........., ;
Mr. PomnER Of course, it all resolves itself nto a question of'1ht
if he had the means or reasonable means of knowledge whie'wgd
enable him to inform himself. Every fair-minded citizen ought tobe
on his guard lest he be doing something which might inure to the t44m-
fit of the enemy. I think under normal conditions the critiiam of e.
Senator from Missouri is sound. Possibly the language here is not.s
explicit as it should be. ..
Mr. RzED. Let me suggest this to the Senator from Ohio a.4 te
Senators from Florida and Lousiana. It seems to me that if th set
was made to read in this way it would probably cure the defeqt-: .6r
any person in the United States except," and so forth, "wilf.llW 'to
trade with any other person who is an enemy or ally of enemy of :he
United States." -
Mr. RANSDELL. "Willfully" would come, after the word '"to'I
line 13.
Mr. RnE. "Willfully to trade or attempt to trade, either d Wfe$
or indirectly, with, to, or from, or for, or on account of, or on bqhil tf
of, or for the benefit of, any other person who is an enemy or flly,of
enemy."
Mr. RANSDELL. I suggest to the Senator that it come in in line 15,
after the words "for the benefit of," and then skip down to "for the
benefit of an enemy." You do not want to say "any other person who
is an enemy," because the whole idea is conveyed in the language "for
the benefit of an enemy or an ally of enemy." ...P
Mr. REED. That is entirely correct.
Mr. RANSDELL. I am inclined to accept the suggestion to insert the
word "willfully" and eliminate the other words. I believe it will go as
far as we probably should go.
Mr. RnE. "Willfully" means intentionally, of course, and it also--
Mr. POXERENE. The word "knowingly," is used with "willfully.'P
Mr. REED. I like the word "willfully," because it has a legal mean-
ing. It implies a moral turpitude. It implies that the individual doing
it does it with intent and purpose and knowledge. I hope that amex7.
ment will be accepted. I will say to Senators nobody can go furtbe;
than I am wiring to go to make this law drastic, but at the same time
I should like to make it so that innocent people will not be punishe
Mr. RANSDELL. I understand the Senator to use the word "willfu'i
in the sense of intentional. .* ;.
Mr. REED. Yes.
Mr. RANSDELL. To do it intentionally.
Mr. REED. Yes.
Mr. RANSDELL. I see no objection to the insertion of the wOrd
"willfully." .
Mr. Rn. I think "willfully" is a much better word in law. ;
Mr. POmERENE. LU.t the amendment be stated at the desk. .
Mr. RANSDELL. Then, it will read, beginning with line 13, "to will-
fully trade or attempt to trade, either directly or indirectly, with, to,
or from, or for, or on account of, or on behalf of, or for the benefit of";
and skip now to line 17, "for the benefit of an enemy or ally of enemy,
or is conducting," and so forth. ,!





(fMi Ran. That is all right, except that the word "willfully" should
pabed th. word "to," so as to read, "willfully to trade, or attempt to
tu~;Tthen the word "willfully" will qualify the whole clause.
:-A 4 RA-NSDLL. There is no objection to that.
MEaiNYzOX PESIDENT. The amendment will be stated.
AI4SAJS*E TARY. On page 7 in the committee amendment, line 13,
trss* Mrwords "to trade," insert the word "willfully"; and on lines
)t ziad'17 strike out the words "any other person with knowledge
orffslmu ble cause to believe that such other person is," so that when
a.ttfdha it will read:
*"6SAIon n the United States, except with the license of the President
g tldoetuBCh. person, or to the' enemy, or ally of enemy, as provided in this act.
w[iiflp ~Utmade, or attempt to trade, either directly or indirectly, with, to, or
Sfrom. [or on account of, or on behalf of, or for the benefit of an enemy or

Mr. President, while I, to a certain extent, dislike
tto' which the Senator from Missouri has alluded, to wit,
hI cause to believe," still I hestitate to accept the substitute
y o he proposes for it. If you strike out of this provision the words
wedge "or reasonable cause to believe" and make the offense
w ur g with an enemy or an ally of an enemy, it is going to be
'I to convict anybody in the way this clandestine trade is con-
|| rough intermediaries and neutrals who are suspected at
t e ly means that a man actually knows the person is an
qpq -i whom be is trading and deliberately and willfully makes
upjpmiusi to trade with him, to commit an offense.
.nture to say, without accurate knowledge of the statistics on the
subje that a, great deal of trade that is very dangerous to this coun-
ttj jIvery hepful to the enemy is conducted by people who just do
N )auls t h p o l
n t, th e pains to make all necessary inquiries-inquiries which
p 'Iou make-who do not examine into the history and status of
the person who comes into their office and wants to buy goods and have
.tb ""w dlvered at certain times and places. Much of the trouble with
the purchaser or the man who is working for the enemy is caused be-
cal he has plenty of cash on hand and pays high prices at once and
is %*inmg to make a liberal contract, and the necessary pains are not
by the would-be seller to make any inquiries which would put
J 4C, position of being a willful offender against the law if he
$[ t tiiknowledge that e might get.
Fi;M as I have said, I do not exactly like the words "reasonable
tb' believe," still this is a criminal statute with heavy fines and
ies andunless you could prove to a jury of 12 men that the party
d *it" the offense did really have a reasonable cause to believe
't ik there is much danger in anybody getting wrongly con-
Ad ctis country, even if there is some war excitement going on. It
ftifcult to find 12 men who will send a man to jail and say he
'Wad reasonable cause to believe that he was trading with" the
unless he did. After all, as a practical administrative matter, is
iWlb6 difficult for a jury to decide what was the reasonable cause
n it is for them to decide what is reasonable doubt or what
tItn conduct, what is reasonable care, or any of those
1 questions ?


68-002-76----4







As I said, I think there is considerable force in the suggesting rustle
by the Senator from Missouri. Still we are trying to win a war andto
prevent a despicable and contemptible betrayal of our country by peo-
pie who are willing to take chances to do it, provided they can, sneak
through on technicalities and not get caught, and do it for money t ad
pretty drastic provisions of law are necessary to stop it. I ventureito
say that many a man who does not care anything about his reputation
even if he has any other than a bad one if he could go on making great
war profits by doing the country an injury and was advised by an as-
tute lawyer in advance that they never could prove that he willfully
did it unless he admitted it himself, if he took certain precautions,
would continue that trade, who would not take the chance if these.
words are left in the bill, as they are now. Therefore I am'rather in-
clined not to support the amendment of the Senator from Missouri.
Mr. RANSDELL. I do not think there is any practical force in what the
Senator says. The people we are trying to reach by the bill are' ti;se
who intentionally carry on trade with the enemy. As I underistandtihe
word "willfully," it is in that sense as applied to a man who knowingly
and intentionally carries on trade with the enemy, hoping to .deuie
great profit from that trade or hoping to benefit the enemy by that
trade. The innocent person who trades without any intention of yiolat-
ing the law. without any intention of making any special amount of
money or without any intention of befiefiting the enemy, is really tot
the person we are after; it is the guilty man, the man who despite Rhe
fact that hle lives in this country and owes his loyalty and alltgiance to
this country deliberately and intentionally carries on trade with' an
enemy or with the ally of an enemy hoping to derive benefit from it,
hoping to give the enemy some benefit of it. He is the man we are after,
and we will reach, I think, ninety-nine cases certainly out of every
lumdred if it is worded this way. There is a possibility that we may
seriously injure some innocent people if the other language is put in.
I believe I prefer the language suggested by the Senator from Mis-
souri myself.
The VICE PPRESIDEN.T. The question is on agreeing to the amendment
of the Senator from Missouri.
The amendment was agreed to.
S
Mr. RANSDELL. Mr. President, I do not know that section 3 has ever
been agreed to. We passed it over yesterday and we have just inserted
one amendment. I have one or two other amendments to section 3. Oi'
page 7, line 22, I offer the amendment which I send to the Secretariy's
desk.
The VICE PRESIDENT. The vote by which the amendment was agreed
to is, without objection, reconsidered. The Secretary will state the
amendment which is now offered by the Senator from Louisiana.,:.
The SECRETAnr. On page 7, line 22, in the committee .amendment it
is proposed to strike out the words "or of such person as ie may
direct."
The VICE PRESIDENT. The amendment to the committee amendment
is agreed to, without objection.
Mr. RAN5SDELL. I submit the amendment to the same section which I
send to the desk.




41
.. "ViC PRSwhDxNTl The amendment to the amendment proposed by
fitoto fromn Louisiana will be;stated.
SfMa MSBCzrARn. On page 7, line 28M after the rname "United States,"
jitrfrproposed to insert "or any other owner, master, or other person in
lfeGqp .f a vessel of American registry to transport or attempt to
twmanpore from any place to any other place."
iM f.*Vc PurmNTr. Without objection, the amendment to the
amendment is agreed to. -.., .
SMt ]ausmznL. On page 8 1 submit the amendment to the amendment
which I send to the desk.
M ec"w PiwsmrEx. The amendment to the amendment proposed
liiM lator from Louisiana will be stated.
-AfjIAowrARY. In section 3, page 8, line 24, it is proposed to strike
Oatth words "or of such other officer."
Xni PmsEn:T The amendment to the amendment is agreed
tei-Vthoat objection.
sinlaiawu. On the same page, I move the amendment which I
,,?*,*, IW W :>- .,*/
"The VIE PREsmDErNT. Have all the amendments which are to be
q .tp ion. been submitted I
WZ3PESDENT. The amendment which is now presented by the
Senator from Louisiana, then, is to section 4 ?
... ...I .... I beg pardon. I think I have offered all the amend-
x "tlcs. w 'Ydesire to offer to section 3."
1.,w 5nC PREm zNrr. Then, in the absence of objection, section 3
as Haended is agreed to.
o'.; *h q. ,*
Mrn. kP sNDELu. I now move to reconsider the vote by which section 5
wia .imd to; and I offer the amendment:toithat section which
I' 11O the desk.
th I a."ic PmmSmNTm Are there any further amendments to sec-
Sflairantx Im know of na others.
,i'^'frnPknsmxmT. Then as amended the amendment is agreed to.
: Mr. NAzm m. Mr. President, I want to call the attention of the
Sentor from Louisi an to the fact that while lhb has changed the
iimk a line 16 of page7 of the bill, to strike oilt.the words "1*ith
ttwlee or reasonable cause to believe" and has inserted the word
u in a prior part, of the section, the same language appears
1|00.^ f par agraph-paragraph (b)--and his has allowed it to
$ Ji. l I: assume, has been carefully drawn by the Do epart-
V.-f ie and the effect of those words has been very carefully
.....-Cbrtainly the same nga to describe the willful intent
I. be used in all of the different paragraphs, .and I assume the
St n.i 4 4f Justice has adopted,, a, uniform plan throughout the
.... il-t I do not, therefore, think it is wise:to change it in one
SAM4dnpt 'in others. I think wb were changing it in
Bt d id : : W r 0 4f'l g. f i. t f. l
NSDMLL. This does not relAte to trading; this relates to trans-
"ilgi^.' f"-q- ,**:t "'" "* j ',,,: "": :9"t.s". .. 'o""* ;"',? i "" *" ..*
M.i aa .
38 w ifraw thh







Mr. BRANDEGEE. I know that each section relates to its own ubjet,
of course. It seems to me, however, that there is no ground for making
such a distinction as appears to have been made by saymging inoed se
that it shall be a crime for a man willfully to trade with an enPmy.,
but that it will not be necessary to prove a willful attempt to transport
an actual enemy, but only that the person accused shall haveieason-'
able cause to believe him to be an enemy. However, I do noet carito
make any motion on the subject. *. :' ,.
Mr. RANSDFlL. I should not object to such an amendment if 'the
Senator wishes to have it inserted. '
Mr. BRANDEGEE. I would not for the life of me think of suggeting
it. I should like to have reconsidered the action by which thoSeAiate
adopted the amendment of the Senator from Missouri, buttdo not
suppose I could succeed if I made the effort. : "
The VicE PsREsmEwr. The amendment proposed by the 'enAtor
from Louisiana will be stated. .
The SECRETARY. In the committee amendment in section 5, wiciis
found at the top of page 15, Mr. Ransdell proposes to strike-out ftb-
section (b), being lines 1, 2, and 3 on that page.
The VIcE PRESIDENTr. The vote whereby the amendment was agreed
to is, without objection, reconsidered, and the amendment propdsedby
the Senator from Louisiana to the amendment is agreed to.
The amendment as amended was agreed to. ; -
Mr. RANSDELL. That will necessitate making the next subsection (b)
instead of (c).
The Vica PmRESIDENTr. The amendment suggested by the Senktor
from Louisiana will be stated. : .F c'
The SECRETARY. It is proposed to change the designation of the
subsection beginning in line 4 to read (b). .
The VICE PRESIDENT. Without objection, the amendment to the
amendment is agreed to and the amendment as amended is agreed to.
Mr. RANSDELL. That concludes the committee amendments, Mr.
President.
Mr. FLrrcmnn. One moment before we pass from that. I thinkli?
line. 14, page 15, after the word "completed," the remainder of: the
section should be stricken out. : '
Mr. RANSDELL. There is no objection to that. -
Mr. FLETCHmR. I move that that be done, because it is covered else-
where. ,
The VIcE PRESIDENT. The vote whereby the amendment was; aped!
to is, without objection, again reconsidered. This is, the last time. that
can be done under the rule, as it has been twice reconsidered.. Now
the Senator from Florida moves the amendment which will b6e sated.
The SECRETARY. On page 15, beginning with line 14; it is 'prmpsed
to strike out as follows: ., '
Whenever it shall appear to the President that thd export of any gold o* sffvvr
coin or bullion or of any moneys of the United States may result in viol4atiow
of the provisions of this act, he may cause notice to be served on the parties,
in interest to withhold such export for a period not exceeding 90. days ,pending
investigation of the facts by him.
The VIcE PRESIDENT. The amendment to Ahe amendment is, wth-
out objection, agreed to; and the amendment as amended is agreed
to, without objection.


* *







biz-ltwt P h {:
itt t-, 4'ijrr j *i Vi : It e
H. *.fe ,* , : .
m i ... f r .. ..
lM M + i : k / 7 + ......-^. .
*-.l i -,;L /..
lM. 4. House Debate (Excerpts)
|iUedPUr p Z. 4844453,aS 487% July 9, 1917;
S55 Cons. Re 4907492 uat .1%"1917]"
rr n .noi .I '.5. i' . + -, : .;
-w e+t L, ::
mu .*i :. "<" "+
inr:.ra TRADING WrTH THE NUT (JULYi 9.]"
ik Or"oTACTE. Mr. Speaker, I move that the Hiouse tesolve itself
I.f.leiittee of tie Whole House on the state of the Union for
$ertion of the bill (H.R. 4960) to define, regulate, and pun-
Wioth the enemy, and for other purposes; and pending the
Speaker. I would suggest td my colleague from Wisconsin
) if could notagreeupon time for general debate.
Mr. Speaker, I havehad seve il requests, and I thinkwe
On6 oar side 4f6ibly two hours..
M-.oT Mr. Speaker, I will say to my colleague from Wis-
ritlemen of the House generally, that, so far as I am
spd :I+ believe so far as every member of the committee is
*| i it purpose is to have liberal debate under the five-minute
W*;'will the gntlemazi allow me to make a suggestion
amCertainly,..' *
*'s*it.! I do not think it desirable to commence the reading of
L'giodor the five-minute rule today. Why not say that general
hndiide todajr, the time to be equally:divided between
.IIun. I undkntood from the gentleman from Wisconsin
......that twohours on a side would he ample.
Mr. Speaker, since making that statement I have had
hifbitl requests whibh wold make at least two and a half
W.NI.. W:oul d akb- this after l, .ad. . .
ur. Theim, Mr, Speaker, submit a t. inanimous-bnsent
Wadertl debate Or this bill in the Committee ot the Whole
qi~itBsta td: U the iion shall class uponMafjoummsnt this
Ththetbim e .ul divided.
a| + To be equally divded between my college from
."I MVJ JMndinyseL ,.
4$ New Jersey. Will thegIOteman a& to that 'eqest
ut.todebat i abme to this + # +
Tw do not ttink that is neceary. That will trolled
l i a who yield time. So*mebd igkt aat to say something
,.I wt1-h to Sthat bt it sms t be an in-
dBidw.^teB tirogreitb-e bushes oft this Hose.
Mkw 1wgaldsafroa'jh&U V gIme'si ontaguej ads
l^ oe eomsenttthat S jn~dAd N! cloaM *ittithe
(43)






adjournment of the House tonight, one-half to be controlled by him-
self and one-half by the gentleman from Wisconsin [Mr. Esch]. Is
there objection ? [After a pause.] The Chair hears none.
The question is on going into the Committee of the Whole House
on the state of the Union.
The motion was agreed to.
Accordingly, the House resolved itself into the Committee of the
Whole House on the state of the Union for the consideration of the
bill H.R. 4960, with Mr. Byrns of Tennessee in the Chair.
The CHAIRMAN. The House is in Committee of the Whole House on
the state of the Union for the consideration of the bill H.R. 4960,
which the Clerk will report.
The Clerk read as follows:
A bill (H.R. 4960) to define, regulate, and punish trading with the enemy,
and for other purposes.
Mr. MONTAGUE. Mr. Chairman, I ask unanimous consent that the
committee substitute for H.R. 4960 may be considered in lieu of the
original bill, with all of the privileges attaching to the original :bill.
My purpose in making this request is that there were a good many
amendments considered in connection with the bill, which the com-
mittee adopted, and in order to make the whole bill more convenient
for consideration by the House a committee substitute was reported
in lieu of the original bill which was agreed upon, as the substitute
itself was unanimously agreed upon. And every member, Mr. Chair-
man, has had a copy.
The CHAIRMAN. The gentleman from Virginia asks unanimous con-
sent that the committee substitute be considered in lieu of the House
bill on the same subject, with all the privileges attaching to the House
bill. Is there objection?
Mr. MANN. Mr. Chairman, reserving the right to object this is a
very unusual request. If the committee had a substitute why did they
not report it to the House? Here is the original bill reported to the
House, and no committee substitute and no amendment reported to the
House.
Mr. ADAMSON. I will state to the gentleman that long subsequent to
reporting the bill the gentleman having in charge the bill had a meet-
ing of the committee called and submitted a good many committee
amendments, and all were merely consolidated in the version of the bill.
Mr. MANN. The gentleman ought to obtain permission to withdraw
the report and file a new report with the substitute report submitted
to the House.
Mr. ADAMSON. We had it printed and furnished every Member with
a copy several days ago, and there are many other copies here.
Mr. MANN. The gentleman says he furnished every Member of Con-
gress with a copy. I was out of the city, but I have been back nearly
a week and I have not heard of nor seen any committee substitute.
Mr. ADAMSON. We tried to do so. :
Mr. MANN. The gentleman's effort was not very valiant.
Mr. MONTAGUE. I will say to the gentlemen from Illinois that when
this substitute was offered we expected the consideration of the bill
was in the House, and there was no timeto formulate another report.
Mr. MANN. There has been plenty of time since.




145
IEr. Mo Anuo. That is true.
I MinzjfrjihKr. I shall object to the request at this time, and suggest
[d1o n atleman that when the committee rises and we go into the
46" Wtf he ask unanimous consent to have a reprint of the bill
Swil the committee substitute printed in italics in place of the bill, and
&a|en probably there will be no objection to considering the substitute.
rl~i baib is a very important measure. We have the right to have the
1i4t .hat is to be considered before the Members of the House, and
||l+,, up in the committee room.
S i P sNB ge ron with general debate, and on adjournment tonight we
Ia*| wmannous consent to have a reprint of the bill, and when we re-
' p Artt wsreprint it as pertaining to this subject.
AIk7e CWmEIUXAN. Objection is heard. The Clerk will read the bill.
i.aMZAuiMSoN. Mr. Chairman, I ask unanimous consent to dispense
Iit h* fie&t.reading of the bill.
U[-[ QOrAmAN. The gentleman from Georgia asks unanimous con-
l.nis t41dihpense with the first reading of the bill. Is there objection
U fter a pause.] The Chair hears none. The gentleman from Virginia
l| ;, UM-tague] is recognized.
i:. ..;iEMan oui&GE. Mr. Chairman, international law, as adjudicated by
i[Pour+ pi-us courts and our Supreme Court, holds that one of the
l e consequences of war is the interdiction of commercial re-
7i= W.ween the citizens or subjects of the belligerent nations. In-
|ti i atienkl law has been often held by our Supreme Court to be aq
qpuart of the law of our country, so it is necessary for the committee
't,"th b cantry to realize that from the outbreak of this war all com-
...1W intercoursee, with negligible exceptions, between American
Pt..i i.. d German subjects has been abruptly suspended or revoked.
MI 'c immuance or revival of this commerce on the part of our citizens
l i had by the express permission of our Government. This
7 tE ted Anglo-Amencan doctrine.
*,, 4ThP. Sir William Scott, in the leading English case of the
4 .p .A Hffoop, after stating the case as one involving the shipment
rtfn rom Holland to Great Britain, declared:
J+ e~~i~ultn there exists such a general rule in the maritime jurisprudence
V't~iC o mntry, by which all trading with the public enemy, unless with th"
p iF o of the sovereign, is interdicted. It is not a principle peculiar to the
Aim. law of the country; It is laid down by Bynkershoek as a universal prin-
JO law--Ex natura bell commerela inter hbostes eessare non eat dubltandum.
sai specials sit commerciorum prohibitio, ipso tamen Jure bell corn-
lqw.____ vetita, ipsae indictiones bellorum satis declarant, etc. He proceeds
[41|t the interests of trade and the necessity of obtaining certain com-
I have sometimes so far overpowered this role that different species of
II llve been permitted--prout e re sua, subditorumque suorum emse censent
MlLBut It Is in all cases the act and permission of the sovereign. Wherever
UJi Deaitted It Is a smupenuion of the state of war quoad hoc. It Is, as he ex-
'It, pro parte sic bellum, pro part pax inter subditos utriuslque principles.
t mia.from these passages to have been the law of Holland. Yalta (1. m.
,at. ) states it to have been the law of France whether the trade was
.. ted] to be carried on in national or in neutral vessels; it will appear from
lii hi 1T shall occasion to menton-fe 'Fortsne-to have been the law of
lil.i and It may, I think, without rashness, be affirmed to have been a general
m a law in nietost of the countries of Durope.
i#*t thainman, this opinion is stall the law of England, as may be
ieen by an examination of her text writers and" her latest decisions. I




46

would refer here to the report submitted in elation to the pending
bill to the cases of Hugh Stevenson & Sons:,(Ltd.) agaminskken-
Gesellschaft and the Distington Hematite I-ron Companyr (Ltd.)
against Possehl, both decided by the high court of justice of the i-As
bench division in 1916, as confirming what I have stated to be thei law
of Great Britain. s i ,n,:
SMr. Chairman, I would now ask brief consideration of the Anterfr
view. The leading case is The Rapid, decided by the Supreme uwart
in 1814, involving the bringing into the United States, froina small
island situated near the boundary line between our country ahd Stbva
Scotia, goods purchased in England and carried to this island before
the outbreak of the War of 1812, wherethe court held the transaction
a trading with the enemy, and a consequntnt forfeiture followed. -.
In the case of Insurance Company against Davis, decided intB77T,
the Supreme Court discussed quite fully this doctrine in relationftd an
insurance contract between parties resident, respectively, of opposing
belligerents, but the policyholder and the.agent of the compa&kqYp-
pointed before the outbreak of the war, were residents qfi the sane
State, and th6 court said: I 1 S
That war suspends all commercial intercourse between the iti*ns 6of :io
belligerent countries or States, except so far as may be allowed by 'ta'isadeign
authority, has been so often asserted and explained in this court Withip thehlast
15 years that any further discussion of that proposition would be aolt, Je.
As a consequence of this fundamental'proposition it must follow tai1f0b qtve
business can be maintained, either personally or by correspondence, tr ti tLb"h
an agent, by the citizens of one belligerent with the citizens of :tb other: The
only exception to the rule recognized in the books, if we lay out o view tonftacts
for ransom and other matters of absolute necessity, is that of .AlloWi %t-,e
payment of debts to an agent of an allen enemy, were .such agent reWi1"A I
the same State with the debtor. But this indulgence is subject to restrictln.
In the first place, it must not be done with the tien of'transmitting ftibethds
to the principal during the continuance of the war, though if stumoraumltltd
without the debtor's connivance he will not be responsiblelfor it. WIL ahiWtphA,4,
in Conn v. Penn (Pet. C. Ct., 496) ; Buchanan v. Curry (19 Johns. LNj.).I*1).
In the next place, in order to secure the subsistence of the agency nurffi, the
war it must have the assent of the parties thereto--the principal arid the Uent.
A's war suspends all intercourse between them, preventing any indtructlmu,
supervision, or knowledge of what takes place on the one part, and:-any ,ept
or application for advice on the other, this relation necessarily ceases on the
breaking out of hostilities, even for the limited purpose before metiendd, :utless
Continued by 'the mutual consent of the parties.a It is not compuTeot&y,7 ,no c&n
it be made so on either side to subserve the ends of "third parties. IfIthe *.gent
continues to act as such, and Vis so acting is subsequently ratffied by 't 'itln-
cipal, or if the principal's assent is evinced by any other clrenmstanAe,";in
third parties may safely pay money for the use Of the principal into the aflgags
hands; but not otherwise. It is not enough that there'was an ageneyipflr tothe
war. It would be contrary to reason that a man, without his oonU-f--;'$tltd
continue to be bound by the acts of one whose relations to him have minteMone
such a fundamental alteration as that produced by a war between the:: to -in--
tries to which they respectively belong-with whom he lcan have no cornbpkid-
ence, to whom he can communicate nb instructions, and over wflRou he can
exercise no control. It would be equally unreasonable that the agent ftfhu tbe
compelled to continue in the service ,of one whom the law of nations dMftes
to be his public enemy. : .: 4 i-
Mr. Chairman, it would weary t0b4 committee to discua in detail
the cases of our Supreme Court upon this. great question. I desire,
however, for the sake of brevity, to read the syllabiof a few o'thse
cases taken from the Digest of the, Supreme -Court, published by'the
Lawyers' Cooperative Publishing Co.:






,7lU erenits and all their citizens and smbjecta are enemies to each
I im e and comunicatidn between them Is unlawful. (Jecker v.
4te tence of war doses the courts of each belligerent to the citizens
.-dot 4.es not prevent the 4tizens of Qne belligerent from: taking
f r th protection oCtheir own property, in its own courts, againAt
flHff ^ the er whenever the latter can be reached by process. (Master-
fiilfllt an of the right' of the citizens of one belligerent to sue the
i otht -Oher a4nd prohibition to exercise such right, exist during war
SQf nan4s; but the 'restorG"ton pof peace removes tle disability and
row.9f cft courts. (Capertoi v. howyer, 14 Wail., 216.)
..... & nhetral cMuntry established in business in the enemy's country
1ie :as emne Sdheir property aSs enemy's property. (The
y.Vatted States (The flying.Bet),:60 Walt, S
X"irMa the most abbreviated discussion of this subject would
bu4-MLaqf t.Q without reference to Judge Gray's great opinion in
... -gw1giiat Keiley, decided in the Supreme Judicial Court of
S.. i.. 1868, and where his extraordinary genius for assem-
.i..g.4 eedents was, perhaps, never equaled by him in his subsequent
yeMe S preme Bench ot the Nation. After an exhaustive
aMand analysis, he says:
ii tt the law of nations, as judicially declared, prohibits all inter-
SildWis of the two belligerents which Is incoesitent with the
I ....l tweena their countries; and that this includes any act of voluntary
Hi t the enS ow receiving his protection, as well any act or contract
'lil' lt'to increase his resources:; and every kind of trading or commercial
i .Or": "ltercourse, whether by transmission of m6ney or goods or orders
lb ry of either, between the two countries, directly or indirectly, or
i|iftervention of third persons or partnerships, or by contracts in
~*M ,..,I to or involving such transmission, or by insurances upon trade
Chairman, I may affirm that the suspension, the inter-
1nd sometimes the revocation of all commTercial intercourse
t|e citizens or subjects of belligerent nations, upon the out-
war, is the accepted. Anglo-American law. All such trading
'| I introurse, wuless specially licensed, becomes ipjto fa.to
|ltioutbreakof waro This rule, I may add, is undoubtedly
Nsem o thex rule, namely, that all such trading is permissible
bited, is contended for by some publicists, butit does tot
'1* sustained by adm stradve ron0 neesents or juridictal
however desirable such international practice may .bed.
1 approximation to such a rule may be fund in the poew
e 8.jti6 J 3 of the "regulations respqetiog the laws. of land
-t.dunder the letter (h) at the second Hague peace con-
Uom-te adwhichrunneasfuol* 1
1fSi rhbiMds "to declare extinguished, suspende&4 or neafordible In a court
lights and rights of; action a! the national of ate adverse parties."
~~l rt btio f this rubk y' Great Britan and the-Unined
|ffto to th right o the betlirreit
II.1sent te^" ..fltseforoes ithie ene t. county

.....1 !Wh ubh I6ty For eriple Germny has no authority
ri C1irQ h parS of tie citizens of BeE
| )f :"rTN :fta.. ... in g mil"taryd up c o oher






territory. This seems to be the interpretation of the rule by Datil, !te
of the American delegates to the second Hague conference, as fp.i: d
in the third edition of his very excellent work, The Elements ,of Inter-
national Law, page 576. I may add that Germany was the author of
section (h), but that her practice is in brutal conflict with an ite"re-
tation of the rule even so narrow as that made by Davis; indeed'.
many seems rather to have forgotten the rule in all of its aspects,. or
designedly to have considered it another "scrap of paper."
Mr. Chairman, I venture now to hope I am justified in concldiUng
that this committee, in view of the state of the law of nations asreOg-
nized by the United States, realizes that our commercial intercou.e
with Germany has been brought to an impasse, and that none of this
trade, no matter how necessary and beneficial to our citizens, caA be
resumed or carried on in the absence of appropriate legislation by Con-
gress. This bill, therefore, is submitted as according the most adequate1
the most equitable, and the most practicable method for the conductk-o
all desirable trade. f-, .
Mr. GRAHAM of Illinois. Mr. Chairman, will the gentleman yieldV.
Mr. MONTAGUE. I will.
Mr. GRAHAM of Illinois. Before the gentleman leaves that subbject I
would like to have him expand his statement a little as regar4s:con-
tractual rights between people or citizens of belligerent countries. As
to those countries, are these contractual rights ipso facto null and vidid,
or do they continue after the resumption of peace? .. ,
Mr. MONTAGUE. As a rule, all contracts concluded during. wai-are
void. No action upon such contracts will be entertained during or after
the war, as I understand the law. But contracts made before the w0r:
are usually suspended as to their execution, and the right of ':actfot br
suit revives after the war to the former enemy. '
Mr. MADDEN. Mr. Chairman, will it interrupt the gentleman if.Ishk
him a question ? .
Mr. MONTAGUE. No. s;. ..
Mr. MADDEN. I am interested to find out just exactly what effect'this
law will have, and I think the people of the United Stateg who aren't
lawyers are anxious to know what effect this law, when passed, will
have upon alien enemies living in this country and doing busin Jin
this country: i
Mr. MONTAGUE. This bill does not recognize "alien enemies liv ...-ir
this country" as enemies. Germans living in Amnerica are not enfniM;
they are entitled to all the rights of American citizens unless their 4t*n-
duct becomes so hostile or offensive that they must be inachedfby "Er-'
ecutive proclamation, as provided for in the bill. The clilof eflition
of an enemy is one resident within Germany or 'within the :tjiwmtnry
occupied by her military forces.
Mr. Chairman, perhaps in no former war was trade ever so poteNtial
a weapon in the hands of a belligerent as in the present conflict,.This
is not a war of soldiers so much as a war of- economic forces. Trader-
tended or trade suspended-commerce wisely withheld or coinm mge
employed to exert the greatest economic pressure-is of transaeflqt
moment now. But, happily for us, this bill sek. to accomplish tlese
great ends by creating no new rules of international la;,V. ,It, recogr-
nizes that these rules work an abatement of trade lby reason of war,
but it undertakes to surmount this barrier by allowing trade under







I













it

AI













PAa.






!teenemy


49
BB'tf la'w. That is to say; the bill recognized and affirms the
in of international law, and then It once relaxes the scope
'I such interdiction bytlowing almost all forms of trade
(tutbority of licenses issuld by ti Secretary of Commerce
direction of the President Ti other words, the bill would
ll trading with a German subject by an American citizen
imtted by the license 4 the Government. The extent and con-
Slionses are almost unlimited, depending upon prudent
b ministrative discretion. Therefore it nay be affirmed that
Slbe allowed that does not, conflict with the national safety
rc -sukl prosecution of the' war.
lill the gentleman yield for a question
wA* ilL -L WI
..'-Without this legislaIoen *hat is the legal status of an
dent here Has he any standing in court at all? ,
iwTAGu. A German resident in the 'United States is not an
r the terms of the bill, unless he should be so declared sub-
..M Fro nation of the Presidintin which case he .ould
iffit in court. i'i (i
g. He could hot sue on contract?
iNTaGUR. Not unless the contract-er one of'the exceptions
Mh by general international la#. a :
s& And therefore this legislation is impl to enable,,himto
nir0ise he could not do. i l
WMoAU. The gentleman in his interrtgaory has stated the
his question. Under existing iteriational law there is no
wKeh enemies can stand to protect or inforee their con-
couttts do iot open their doors to enemies -
_the citizen -of an enemn country resident blre "has no
IAr the patent law, 'has he-rights ath lit had already e-
re the war? Such rights, either urdiaer tEl patent law orthe
law, do not longer exist, dotheyl '.
Nr. Will the gentleman answer a question right their* in
l* s **; ' *:n i .. ..: *"
ictmB. Yes. ,
7 -. Suppose 'that some German patentee has entered ipto
-^nnan Amercan citizen. to manufacture his 'prodnct in
Eo'sale to the American people.'What be mes of thL con-
:the.declaratipn of war? '
kGI. t is suspended under Axisting law-that is,'the gp-
Is bn gies recipronal.tights as respects otnts '
D|EN'. Wouldtthere be yeansbywleh Am citi-
Sany such contract 'oud poe4e the buliess under& the
uring the pendency of the war He may hbiv invested a lot


dTAd

ided


mU. He may conduct the business under the liceise pro-
ill. Under this billthe.citizen can obtain a license todo
vided in the oiiginaJ patent.
SWould there be any means by which the mohey could
i -* .


tnritrz. This bil W undertaken alsotod4 that if the income of
is in form of money ordeimafd notes:






Mr. MADDEN. Yes; so that he could continue to do his business with-
out losing his investment. wo.ul
Mr. MONTAGUE. The enemy patentee would not continue to d ls-
iness, but the American licensee under the patent would do t0' s-
iness, being ultimately liable for certain profits or royalties weered
in the bill. ., ,r ?,
Mr. HULBERT. Do I correctly understand that the purpose of till
is to provide rules and regulations for the carrying on of bus iuess
which now we are permitting to be carried on as a mere matter 40 0f-
france? I -
Mr. MONTAGUE. Of course trade now carried on is carriedA on In-ola-
tion of general international law and at a very great risk to., wse 9pn-
ducting it. They may be violating international law, and th9s vidla-
tions may be recognized by the American courts without cogrpy ala
legislation. .'.
Mr. FEss. Will the gentleman permit an interruption ;i, b
Mr. MONTAGE. Yes.
Mr. FEss. The general opinion regarding the enemy-tradipj a')p
been that it has an element of punishment in it, but instead'oftJ t4,i 5
is a friendly attitude toward the enemy citizen-- .V9
Mr. JoHiNON of Kentc .ky. Enemy resident. ., .
Mr. FEss. Enemy resident. It is in his behalf rather tha. giwst
him ? ; ...
Mr. MONTAGUE. The first intention of the bill is to give the n
resident in the United States almost every right that a cities ha.' ihe
German resident can be disturbed, not by the first operation. of: the
act, but by the subsequent proclamation of the President, isieA.E in
pursuance of authority given in the act, manifestly to be dine.ily
when it is apparent that the German or ally of Germany residing in
America is giving aid or comfort to the enemy or doing some j.f of
somewhat similar character.. $ .
Mr. STAFFORD. Will the gentleman yield? :
Mr. MONTAGE. I will. :
Mr. STAFFORD. Do I understand that this bill confersuppntbehPresi-
dent any authority to grant to an alien subject doing businep-inA this
country the right to sue in the courts to enforce his contract? t f
Mr. MONTAGUE. If he is a resident of this country, he'has that right
under this bill without the proclamation of the President, ,;.
Mr. STAFFORD. If so, where is that authority ? ,,
Mr. MONTAGUE. In the very terms of the bill defining an enemy,
whereby German residents in the United States have all rkit A in this
respect of native-born citizens, unless these rights be recalled by the
proclamation of the President for hostile conduct on the part of the
Germans resident in the United States..
Mr. LF.NROOT. Will the gentleman yield?
Mr. MONTAGE. I will. .
Mr. LENROOT. With reference to the statement the genitlen ui has
just made, that the purpose of this bill is not to -infringe "jny
way upon international law, I wish to ask the gentleman wjith rfer-
ence to section 2- ...
The word "enemy" shall be deemed to mean any resident outside of th wilted
States and doing business within such belligerent territory.






.XMOAT"tn. Where is the gentleman reading ?
.'TMwt. At the bottom of page 1 of the committee substitute.
t o s dthe gentleman whether that does not violate international
IL' tVat, irrespective of whether the business of the resident
he f e United States is within billigerent territory or not, if
N y business within belligerent territory it makes him an
, not only for such business Tut for all business done by that
ad is not that in violation of existing international law .
M.elArt.1 The purpose of the bill is to make neutral citizens or
i doing business within the enemy's country enemies. This is
Vw law. The English trading-with-the-enemy act so determines
als, andZ I think our Supreme Court declares business so
54 in the country of the enemy by neutrals makes them enemies.
ft1 is not in contravention of international law for the Con-
todelare such business residents to be enemies.
Sttdbo, I call the gentleman's attention to the consequence of
W7!4*leme it renders void any contract or payment made to any
fT xuesttate, a citizen of Denmark, we will say, has an agent
SUiffixt in Germany, a very small percentage of his business
Sl*mess which he has the right to do under international law;
F h:shad business dealings with American citizens, not with
Sto the business which he has done with Germany but entirely
S toi't TUndet the bill as it stands it renders void every contract,
iire of the kind of business in which the'Denmark subject is
ned, ad treats him as an enemy, not only so far as business done
ermany but all business done.
. MOTA Gu. I can only repeat that a neutral carrying on business
is an enemy under this bill and because he does business,
a of the business as to that, with citizens of friendly
'it not alter his enemy character. It would be impossible to
..(.Estnguish his enemy business from his neutral business.
,edt his solvency, could not be separated and apportioned. He
6. business residence in Germany, and of necessity he must,
| b" es stand as other residents of Germany.
e. But section 7 has no dxceptions, but renders every con
MouE. That seems true, but there is no practicable way of
aid: separating his business as to enemy edits and
.It is one business, regardless of the character or resi-
Sevurchasers or contractors.
ripant turning now to my line of argue tI have here-
U tat the definiti6h of enemy 4f 'ix the bill is sig-
it is determi.native. This is the6 AngIm-An a definition
St ahs the residence of the person inenevet territory the test
M character, in contrist with tat of l which makes
onality the test. A Gman subject esid in America,
lMean enisy n peder this 'bll is only an
A the prOclamation of the Pi6sident so declares him upon
-oSf public safety.
..'Will the gentlemn ve hig .csitructne of the phrase
sde of the United Sdates 4oing )usiness within such
^ a^ -,- -rt. * ,






Mr. MONTAGUE. I have heretofore discussed this definition and Aest
of enemy character, and endeavored to show that it was in aomse.
novel or an extension of the rule recognized by Englnani'and t i..e
United States. I will now answer that it would be most udoban'te
to exclude enemies falling under.this definition, for it is his lasiaf
enemies who lby indirect methods and circuitous routes carry Q tqade
of America to strengthen the credit of Germany.. .. ..,
Air. LENROOT. The gentleman's construction is that it means all bui- i
ness done by that resident, if he does any business wit 44emy i y
res. PIR 4.44
territory .. ,
Mr. MONTAGUE. Yes;, his business is not susceptible of division. listo i
lines or degrees of hostile activity or friendly activity. No such appbr- '
tionment is practicable, and adefihition of enemy inf, such a',ivpd I
character would destroy, the entire definition. He cpa not b, liW{
enemy and half neutral at the same'time. .;
Mr. LEIKBOOT. HIow 9es the. gentleman think the ..U..nitecd Sfqteg
would have considered Germany's action if, prior to the beginning of
the war, she had treated every citizen who did business wit. IEng.Ld.
as an enemy, and forfeited all property held in Germa.nyh lyu:
citizen? . -
Mr. MONTAGUE. Germany would have had a right to so hold1 if lie
did business within England. ;, .
Mr. LENROOT. Absolutely not, under international lawonly .tiat
part of the business done with. England would she hae, aght, to
forfeit. Mr.himh nln wu4 she have-,a 'nght - toI'
forfeit. :. '\ -, .
Mr. Hi. Mr. Chairman,will the gentleman yield : .V.
Mr. MONTAGUE,. Yes. .- -.
Mr. HnL. There is one question that troubles mnie a little mi rP-4to
this bill and that ip this: What becomes of the dividends 60railroad.
companies' due to foreign stockholders? For many years th gn arkaail-
roads of the country Have been placing loans abroad an mnaAny. pf
them are held therenow represented by bonds and stocks. OUndeistad
me, I am in sympathy .with the general provisions of the'bill, fibut I
would like to know what becomes'of future dividends anpI future
interest upon stocks and honds, amounting to millions and ,M lio f
dollars due to foreigners.' .. ..
Mr. MONTAGUE, I am answering the gentleman generally. ;t6aili
provides machinery by which there shall be a complex disclosur aiid
discovery of all .foreign stockholders and their interests, and provides
that that interest shall be impounded and cared for by .our Gpyvem-
ment during the war. .
Mr. HILL. How cared for? Is it compulsory that thse divideds and
that interest shall be paid to the Secretary of the Treasury, or ca it
be held back by the companies owing the debt!
Mr. MONTAGUE, It will be compulsory in this sense, that the Sienm-
tary of Commerce shall make rules and regulations with respectt to
the payment.' The report is 61bmpulsory, the collection of the money
reported may or may not be compulsory. I imagine a great deal of it
will never be attempted to be collected. ..
Mr. HiLL. Then there is no definite provision in the bill !
Mr. MONTAGUE. There is a definite provision in tiat the bill gives
ample authority to deal with that subject. Administrative discretion,
under appropriate regulations is provided for.





Atno specifiQ provision is made by the bill itself, except
Hm bzillionsf dollars are to be put into the hands of the Secretary
... ,if the Secretary of Commerce shall so prescribe.
S.aav. One of the objects of this bill is to put those particu-
Nrita the hands oL this Governmexit if it is deemed wise or
Stp .do. If it is, money or demand notes, it goes into the
l ...can then be invested in Government bonds and certifi-
egretiry Pf the Treasury.
Il1 Is there any provision made, for a subsequent payment to
h|oof that property ?
jMB ir A. After the wart
:." 6Wat bs the provision then made? As I read the bill the
Cspqiptnt ca;.sue and recover for royalties and for use, but
is no provision in the bill whatever for the return of dividends
M NO anp stocks and .bonds, an investment which we ourselves
*4 foma investors ix. foreign countries.
alaJM? The question of patents is a reciprocal one.
............. rtainly. ." "
'^lThait right j given provided the enemy nation.ac-
p||asimria right tohe citizens of America There is a provision
-a& that all money and property may be impounded by the Govern-
np y it pan be reminvested by the Secretay of the Treas-
wj; :Alte end of the war Congress may deal with all property so
MOIdtmed. No hard-and-fast ru can be made now, because t&e ques-
f i offsets, will ariseq and, we should fortify our
S al~negotiationus of peace.
d.Iefa S t.' .erst.and it, it is practical confiscation now,
Stohe courtesy and kindness of Congress after the war is
:A P*al money is concerned, bpt giving a legal right to
e m as0e: 1ipatents ?
u. Not confisotipn at alL The Government will'act,
j ,i:a= legal te.mR, as tsilee. It will take this property and
inheibest security in the world. It wil! take property which
no:t belong to debtors in this country, and who may notibe solvent
t e of the war, ad hold it for final disposition after the war. In
the Government undertakes to do by these enemy creditors
.Ate resident debtors, or such enemy creditors could do for
That might be. I do not want to take the gentleman's time,
Sa, .understanding of this situation, because it is true that
rthe. future, as in the past, probably be applicants for the
F or&' funds in the development of the industries and
4raMroad situation of this country, and no one needs it more than
aI dkLo now. What position are we gding to be in if we con-
and bonds owndal abroad a4d:put the dividends and
m them into the Treasury of the United States for the Sec-
:Treasury oft the United States to hold, to invest, to sell,
A'o provision whatever at the time we do it,4 that here shall
t prescribed legal way for the.owner to come bhck and make
^p s p e m t d B a e ...... .* . *.*. .:.*
Q^^TAq^LI :thinkCtho gentleman's M pon that the bill an-
coxfiscation is a violent one. .*,,. ...
Mr..ThLL. No disposition is made of it.






Mr. MONTAGUE. The disposition is to hold it in safety, aLd use64 to
our advantage during the war. .' :
Mr. HILL. Why not let the companies hold and refu:se6 tPra.ie
dividends and interest to the foreign stockholders instead WAtfkg
it out of investment. Let them refuse and hold it and re"ptto tit
Government they have got it, and let the Government authoiiithe 6m
to hold it back, absolutely hold it back and not pay it over uuil '
Mr. MONTAGUE. Because in war enemy property can be bet liel *: d
cared for by the Government itself. It is primarily the funtioi of
government to deal with enemy property. r
Mr. HILL. I heartily agree with the gentleman on that' proposition.
Mr. MONTAGUE. That is what the bill endeavors to aomplish
Mr. HILL. Why not make some declaration of what will be done with
it after the war is over ? : : '
Mr. MONTAGUE. Because you can not make a proper disposition Hi
advance of the end of the war. We preserve this property inW 'ii -
tegrity until the war is over, and then we will deal with it in tihez.al
negotiations. "
Mr. HILL. These dividends and interest must be paid to a W:nited
States custodian ? '
Mr. MONTAGUE. Yes. ',
Mr. HILL. And held by the Secretary of the Treasury until aftei th
war is over. ''
Mr. MONTAGUE. The dividends go into the Treasury. .t
Mr. HILL. There is no provision whatever for the presehtatiob f
claims on the part of owners, except that they must trust entirely to
the action of Congress after the war is over. Do I understagad'he
gentleman correctly? : T e" ,
Mr. MONTAGUE. In so far as the Government has taken possesiioiiof
the money or other property. '
Mr. HARDY. If the gentleman will permit, it seems to me thg purfjose
of this bill is to leave the international rights of citizens of different
nationalities for adjustment between the nations now at war ifter the
war is ended. "
Mr. MONTAGUE. The gentleman correctly states it. :'' '
Mr. STAFFORD. Will the gentleman yield fot just a question. "Will
the gentleman inform the committee, either now or before he condsiM "s
his remarks, whether billigerent Governments have pursued- Suii
lar policy since the beginning of the great war? '
Mr. MONTAGUE. Great Britain and France have, so far as N Ta inf-
formed. They may not invest or reinvest the money so taken over ;that
is an American contribution to belligerent finance. ."
Mr. STAFFORD. To the extent as embodied in this bill ? : '1
Mr. MONTAGUE. I think Great Britain goes further than we do. I a i
not prepared to say how far the French Government has gone 'as
respects the custodian. '
Mr. EscH. If the gentleman will permit,' I understand the GOe'inins
also have a custodian. '
Mr. MONTAGUE. In response to the question of the gentleman from
Wisconsin my. answer was meant to convey the idea'that the.wA w of
the other belligerent nations as respects enemy property are pehaps
more drastic than this bill. ,






)Mr. ] sG.. If the gentleman will permit, in reference to an inquiry
|$!Vb. th gentleman from Connecticut [Mr. Hill], these stocks and
|M|s 04a 0 to be turned over to the custodian, but they must be left
tflcdjeetories selected by the Secretary of Commerce on recom-
b dtion by Secretary of the Treasury.
f'r*WMtWTAGumo. Yes.
suKit. And after the depositories pay over to the custodian they
iklin the Treasury the dividends on the stocks and interest on the
.2DMAliLT. And further, in reference to that, these depositories
BJttu h bonds for safekeeping.
wO'OAGUE. I will say that was in my mind when I replied to
a *blseman from Connecticut that the Government was a uasi
wjn. Now, the increment, the interest, goes to the custodian, and the
terns it over to the Secretary of the Treasury, who may in-
.kGt ivernment bonds or certificates.
l-rIpLT. I am not criticizing, that, but I wonder if some better
4.sHldnhot be had ? For instance, take the case of the Pennsylvania
4,: Nobody questions the financial solvency of that railroad.
ji not be better to pass a law authorizing and requiring the
e ylvania Railroad to withhold the dividends from the foreign
sd*ilifrs until the close of the war to be then paid, rather than re-
Of-qhyi. to pay it over to a custodian and that custodian invest it in
mtA\ dfh d as he sees fit-
'^M "MONAGTJ. The character of investment is prescribed by the
h1'BA f-iti. Within the last 30 or 60 days the 3 per cent Panama bonds
ire 'gone. to th. eighties. Is there any justice in taking the money of
bt igner, investing it without this knowledge or consent, if it can
e 'Wely retained in the property in which he made the investment?
r msi harm would there be in allowing the Pennsylvania Railroad,
tv*tmpI, to withhold the dividends and also keep here the interest
- lt tc held by foreigners?
O S Dair-. The answer to that, let me say to the gentleman from
Doecticnut [Mr. Hill] is this: The purpose here is to take the incre-
HdtrisinJg fromni these bonds, place it in the hands of this Govern-
in1'shd let this Government use that for its purposes during the
Ijfc~-jmfoef thle war.
ka An. I 'Would not have the slightest objection to that if there
t rb provision in the bill that the full amount should be returned
Kh l'Mwar was over.
CO'WALT. When the war is over, these parties are relegated to
uhts under the act of Congress. This property is not confiscated
Hi".. Hn. To all intents and purposes it is,because it says it shall be
Setto the action of Congress, then-
,gtswar.'Tery true.
lht'z And who knows what the Government or Congress will
Tx ,AiT. 'But the gentleman seems to forget that these bonds
lves are not in the hands of the Government.
'MkiHp. That Is the way I understood it when reading the bill.
[ v i r r i "* .. 1 : " "


U-002--76----5







Mr. DEWALT. They are in depositories to be selected by the Secretary
of the Treasury-trust companies or other security companies. Those
security companies must enter bonds with the United States Govern-
ment for the safe-keeping thereof.
Mr. HILL. What I think ought to be done should be to require those
people to withhold the dividends during the continuance of the war.
Mr. MONTAGUE. As long as we do that the German owner of the
dividends has a substantial basis of credit.
Mr. HILL. Not under the law. It is confiscation as the bill puts it.
Mr. MONTAGUE. Why should a private or corporate debtor be per-
mitted to hold property belonging to the enemy? The money belongs
to the enemy. No individual should control it unless allowed by his
Government.
Mr. HI-L. Why does the bill provide that in the case of a patentee
that provision shall be made for procuring his rights afterward, but
not in the case of actual cash ?
Mr. MONTAGUE. There is no analogy between patents and the divi-
dends due enemies by citizens of America. We give patent rights to
Germany upon condition that she give similar rights to the United
States.
Mr. HiL. I want this country to so fairly and justly protect the
foreigner that in the years to come when we go, as individuals and
corporations in your State and my State and other States of the Union
will go, to Europe to solicit funds, as they have done in the past, we
will not be met with the reply that we have confiscated property.
Mr. MONTAGUE. If the act does not permit the debtors of these divi-
dends to retain them there is no injury to their rights, for their right
is to pay it over to the owner, and when that owner is an enemy the
Government steps in to forbid such payment.
Mr. HILL. Of course, there is not, but it is an injustice for the Secre-
tary of the Treasury to have authority to invest in any form that he
sees fits in Government funds, and then not return that money when
the war is over until Congress shall provide how it shall be done or
whether it shall be done at all or not.
Mr. MONTAGUE. Of course, the gentleman may take a case that-he
feels would be better conducted by doing as he suggests, but all of these
debtors are not Pennsylvania Railroads. No one can foretell the status
of business in the era now facing us, and therefore I submit that if
the United States should become the custodian of this property it
would protect rather than jeopardize the interests of enemy creditors.
Mr. HILL. Why not permit it to be placed in the bill, and not say
as this bill does that we will invest it for our own benefit, and perhaps
by and by, five years from now, after the war is over, Congress may
take some action for their relief ?
Mr. MONTAGUE. My individual views are that by impounding this
property it is made to serve the interests of America in this great strug-
gle, and, at the same time, its final and honest payment to the creditor
is made more secure.
Mr. MOORE of Pennsylvania. Will the gentleman yield? As to this
Pennsylvanian Railroad illustration, I understand the gentleman from
Connecticut [Mr. Hill] fears that the foreign investment in an Ameri-
can railroad may be disturbed and that its usefulness will be destroyed;




iiihiii!57

ilAw kll be a vacuum when the alien investment is taken away
l rb: -ave to be filled up? If I understand the gentleman from
hsi|B i a [Mr. Dewaltj and the gentleman from Virginia
N[r. Montague] the investment itself is not disturbed at all
IM 1M tNrrAouE. Not at all.
9 Mr. Moon of Pennsylvania. The increment is taken over by the
Si! k -ctejty custodian and is held in the Treasury, but the invest-
it m toes on and serves its purpose. Am I right about that ?
15flkiWALT. Yes. And permit me farther. This is also true, that
i; itAt t may be in time of war loss to the Pennsylvania Railroad
4iiiiit6r hat may apply to the home holder of the same stock. So
thaat it would not work any injustice to anybody at all
H;E.^- I~e'Mi on of Pennsylvania. The disposition of the investment
i:Itatthe increment is left for Congress to determine after the war t
StT WALT. Exactly
i Mr. Moon of Pennsylvania. And the investment fund itself remains
il ta xs of the operating companies
Ta mtlhvau Yes.
SMr. MoonE of Pennsylvania. And is kept working in the United
'iVafvWnAuE. Yes; and money so held by the Government is for
the benefit of the creditor and the Nation alike.
I)"Mn 1 6 ^If'The bill does not so provide. I think it should do so
A p ai l May I ask the gentlemen why provision is not made for the
i proving of the title, as in the case of a patent suit, in
IiBir f. interest and dividends on bonds As it is now it is tem-
,poary confiscation, trusting in the goodness of Congress after the
Iwar is over to provide some remedy. I can not understand why prefer-
hWO1dbhuMIA in one case and not in the other.
L" ^ Mo Airnm I answered the gentleman a few minutes since. The
difference between the gentleman and myself is that he believes in
private "confiscation" and I believe in Government "confiscation," to
us Mthe term employed by him, which is wholly inapplicable.
Mr. at& I do not believe in railroad confiscation. I believe in hon-
AL.t OneS. I do not believe in repudiation of StAte debts or any
4ind of debts. I believe the Federal Government has the power
.1fpr...w Pennsylvania Railroad or to any other railroad, "You
. ...one penny of interest on any bond to a foreign
l ., AT. What would you do with it
['1Ttk. 6I would let them hold it where the investor originally
it.Your bill says, "We will temporarily confiscate it and leave
gdess of Congress by and by to provide some law by which
66 afforded;"
I:j.. E Laf The gentleman's use of the word "confiscation" is
"'W_.. is ns ly a question as to which is to be bailee
h prinvt debtor or the United States. That is the
S .Thebill provides that the Government may be the
,2ot te private debtor of the enemy.
r.. ..... T Oh, i one case the stockholder has a right to sue the
||oraio after the war, and he can not sue the Government.
IlJ lbtsra There will no trouble about suing the Government.
0v ,:: :2 .






Mr. HTinL. There is trouble. The law does not permit him to sue the
Government. I say, "Treat them fairly and treat them strictly, buL.4o
not confiscate property." We may have occasion to go to them .g4in
for loans by and by.
Mr. MONTAGUE. The enemy creditor might not recover fropm the
debtor in the absence of this law after the war is over ?
Mr. HILL. Why not leave the investment there, but not let the pro-
ceeds go to him? :: .
Mr. MONTAGUE. It is wiser and more expedient that earnings:beloang-
ing to the enemy creditor may be turned over to the Governeat as
bailee than that it should remain in the hands of the debtor. That is
evidently the principle underlying the bill.
Mr. HILL. Suppose that money had been invested in Panama 3
percent bonds two or three months ago, and the Secretary ,of the
Treasury at the end of the war should sell those. Who is going to stand
good and make the loss ?
Mr. MONTAGUE. I do not think there will be any loss. But in any
case where loss should occur, it would occur as well as if the interest
were retained in the hands of the debtor himself.
Mr. HILL. Oh, you do not think there will be. There has been. on
every bond issued by every belligerent nation in the world, depending
on the length of the war.
Mr. ALANw. Mr. Chairman, will the gentleman from Virginia yield
for a question?
MAir. MONTAGUE. I yield to the gentleman with pleasure.
MAir. MAIANNx. I thought the gentleman had been diverted from any
argument.
Mr. MONTAGUE. I thank the gentleman for his rescue.
Mr. AIAN-N. Is there any authority in this bill for an alien enemy to
bring a suit pending the war against the United States, except in
patent matters?
Mr. MONTAGUE. Not during the war.
MAr. IANNx. How about a bankruptcy case?
Mr. AMONTAGUE. The same prohibition applies, I would say.
Mr. MA.NN. Here is a bankruptcy case. A man has to file claim
or lose it. What are you to do? Shut him out entirely?
Mr. MONTAGUE. How could he bring a suit without this billW J will
ask the gentleman? "
Mr. %ANN,. I think under international law he could. That claim asIm
been made, but that has nothing to do with the question. ,
Mr. AlONTAGUE. But if he has no such right in the absence of legisla-
tion, how is he injured ,
Mr. AIANN. We are passing a bill now to fix the rights. It oses
perfectly manifest that if there is a case in bankruptcy and the alienM
enemy has a claim, there ought to be some way of proving thie im.
It might not be desirable to pay the money to an alien enemy during
the war, but does not the gentleman think that the claim ought to be:
allowed to be proven? There are many cases similar to that
Mr. AMONTAGUE. I do not think suit, as suggested by the geatleman
from Illinois, could be maintained under this bill or under interna-
tional law.
Mr. MAIANN. This bill, as I understand it, covers the law on this sub-
ject. I am informed by reputable attorneys that there have been cases:
7.




59
S:..i ::-flg^d that in a bankruptcy proceeding an alien enemy
uM prove his claim, although the money might not be paid to him
iidi the war. But this bill, determining the rights of the alien enemy,
--bM that right to be preserved.
A .i* nn. May I ask what part of it would forbid that I
SMr. MANN. The bill fixes the whole status.
SMr. Duozn. I think not. A claim or suit would not be a question
I adin with the enemy, would it?
& -n. It ~plainly forbids the bringing of a suit except in patent
:kji:'#ft NAT. Mr. Chairman. if the gentleman from Virginia will
le-NMM reply to the gentleman from Illinois [Mr. Mann], if he
.1, A. to section 9, on page 13, he will find that that section inti-
a .t--does not clearly express, the rights of those who have
.eup 4 ..a very free to grant what the gentleman says that there
,. klW6snd( inherent right of suit in the bankruptcy court.
-P.'= "S*aw. I think there would be, except by this bill.
| i JMtP W'w. Except by this bill; and I judge from what the gentle-
: .*Rference to it that a provision of that sort might be the
iw ; but if the gentleman will read section 9, it declares
j tab who has-
yi ht. or title in any money or other property which may have
Stransferred, assigned, delivered, or paid to the allen property
liJtikc tcl-im, and may also pursue his remedy in the district
*Tobntart out with the absolute idea that all the property assets
f lhi^etbxrupt are conveyed ab initio to the custodian. Another
| l must be remembered is this, that in this bill the enemy is
I b as an enemy by nativity or by citizenship. He is described
'by. the mere fact of location. In other words, it does not
m who is resident in this country. It does affect those who
hostile territory.
i' LMWM ni. It might affect a citizen of the United States in Germany.
r. DWAJJ. Yes.
4MVSMi *. Although he has an agent here with a power of attorney,
.'.bill the agent here with that power of attorney can not do
*, bnxd might entirely lose his claim, though evidently that is
eof the bill.
,*I The latter statement that the gentleman makes is a
ink. I'do not think so.
t H !D iKBasically it might be correct, but it must be couched
tPX exdption. If there is an established agency in this country
t eegn'zed both by the agent and the party who employs him
I tSerproyer be living m! a foreign country, then the agent can
va y nt for the principal, and that is legally valid under the
s'as an acquitance.
QXA;sw Is t"iat provided for in this bill?
.Thw s. Tes; that is provided for in'this bill with this provi-
)s," npverithat if the Government of the United States has
#e~ ~cjfI"' believe that the agent located here will transmit
'im~~eimn iW foreign country the property which he c&lleets, then
ie can be prohibited from so doing.






Mr. MANN. Are the provisions to which the gentleman refers in the
original bill or in the substitute? 1
Mr. DEWALT. In the original bill and the substitute. .
Mr. MANN. I must say I do not find them in the original bil. I have
not examined the substitute. I should be glad to have any gentleman
point out where they are in the original bill. ,
Mr. MONTAGUE. I think they are in the substitute.
Mr. STAFFORD. Where ? .
Mr. MANN. I shall be glad to know where that is in the substitute.
Mr. MONTAGUE. Mr. Chairman, I now desire to proceed in my own
time. When interrupted, some minutes since, I was addressing mysWimlf
to the definition of enemy, the enemy to whom trade and intercourse
and communication are forbidden in this bill. I now desire to direct
attention to the kind of trade and intercourse interdicted. The.inter-
diction is very ample, very comprehensive; it embraces all foqus of
trade and commercial intercourse and communication; it forbids the
transportation of an enemy or the ally of an enemy; it fqrbidp the
transmission out of the United States of all letters, documents, writ-
ings, pictures, diagrams, maps, or other forms of commucatiapn in-
tended to be delivered to any enemy or his ally-prohibitions in the
main and in principle long recognized by international law. .
Mr. Chairman, it should be observed that these interdictions.are at
once comprehensive and definite. We know what is forbidden, We'lp
not have to grope and search for meaning or subjects or .argnfor
authority. But if the interdiction is of ample extent, so are the excep-
tions to the interdiction, for the doing of all the things prohibited is
allowed in the next line of the bill. In one line, so to speak, we are told
what we must not do, and in the next we are told that all these things
can be done if properly sanctioned by the President under thefomn of
licenses issued by the Secretary of Commerce under appropriate ,rules
and regulations. So the character and scope of the licenses constitute
the real measure of the modifications, the real extent of the relaxation,
of the interdictions imposed by the bill. The prohibition and the excep-
tion go hand in hand. .
Mr. Chairman, commerce in its ultimate analysis is property, and it
is this property and the credits based thereupon that we wish to wi'th-
hold from the enemy. To reach this end the bill provides for tbi dis-
covery and disclosure of enemy property and a report thereof. So,
under appropriate regulations, with the approval of the President, all
corporations, associations, companies, or trustees within the United
States must make a report enumerating every officer, director, or stock-
holder who is an enemy or ally of an enemy, together with the amount
of stock or shares owned by such enemy officer, director, or stock7
holder. I will not, however, elaborate these provisions, as the inter-
rogatories and colloquies heretofore occurring in my time have covered
the subject.
But, Mr. Chairman, this property must be conserved. The report of
its existence and character having been first made, the next step will be
the taking over of the property by the Government, should it be
proper and expedient to do so. It should be observed that the discovery
and report of such property is compulsory, but its acquisition by the
Government is discretionary. When acquired, however, it is manifest





some agency of Government must become the custodian of this
Irw. ,lahfs end the bill provides the agency to be known as "the
fl ttodian," who is empowered to receive all money and
fin liUnited States due and belonging to an enemy or to an
Senm, and who is to hold and account for the Same under
.ibed regulations. This custodian is appointed by the Secretary
,tith approval of the President. He receives a salary not
W $ per annum, must give approved bonds for the dis-
z:. his ,duties, and the clerks, investigators, accountants, and
.*yeee necessary for the conduct of the office are to be selected
'tw list of eligibles prescribed by civil-service regulations and
tIR ." :L .....
r. Chairman, in this connection a very novel and interesting
are mf this bill should at least be brought to the attention of
o ittee. This is the provision authorizing the alien-property
i&W4t deposit all moneys, including checks and demand drafts,
k Treasury of the United States, and that this money ma be
i1rkiiemvested in United States bonds or certificates of in-
ln... aithe interest and increment theareon may be used in the
l oilers of mortgages and liens, if not enemies or allies of the
y, havestimir rights protected as far as possible. For mortgagees
lieWrs may enforce their liens under such regulations and after
4if0~10i the Secretary of Commerce may prescribe, provided
rj that the regulations shall require no other notice than that
.& b)y1the terms of the contract or the law in force at the time
kmng the contract of mortgage or lien. And, generally speaking,
Into prior to the war between citizens or corpora-
I::the United States with an enemy or ally of an enemy may be
ted upon notice in accordance with the terms of such contracts
A6 ... d, upIon the alien-property custodian, and the notice so
40s' effctive as if served upon the enemy or ally of the enemy.
Wf o oT. Will the gentleman yield ?
.1will.
l O. 3pon this subject of lienors the bill provides that
p~MunOt an enemy having a lien may have a remedy. The word
Is *fivind in the bill, but what I want to ask the gentleman is
..e.on: In the case of securities subject to taxation by the State
nudpality and upon which they have in lien for tax, under the
mis of this bill the State or municipality will lose all such taxes,
.i... uffaw Why does the gentleman think so
Mi nrr. Because section 14 provides that there shall be no lien
TV. .41 this property except as specificaly provided in the bill.
r u section 9, page 14. The word "person" as defined in the bill
&kl mlSeie State governments or municipalities.
Wfr0 Th. gentleman may be correct, and the definition of
* W' not embrae States or political subdivisma I incline to
eMis correct, and perhaps an amendment should be offered to
W.tde diculty.
too, Mr. Chairman, are the rights and interest of mper s not
FeW a.l.s of the enemy, in and to property eouteyed, trats-





62

ferred or assigned or paid to the alien property custodian fully'
protected. The claimants of such property may litigate their rigltts
under the rather wide latitude conferred by the bill, the pwesed i
provided for being somewhat analogous to the interpleader commonly
known to lawyers.
I woud now advert for a moment to the subject of patents, trade-I
marks, and copyrights. All of these subjects are dealt with in sections
10. This section has been drawn with great care, has had the consider-?
ation of the Commissioner of Patents, and the Committee on Interstate1
and Foreign Commerce, and I am justified in affirming that the rights;
of American citizens are fully protected. Fundamentally, patent:
rights are intended to be reciprocal.
Mr. LA GUAIumA. Will the gentleman yield ?
Mr. MONTAGE. Yes. :
Mr. LA GuAmmiA. Will the gentleman point out where that is pro-i
vided for ?
Mr. MONTAGUE. Section 10, dealing with this precise question, says:?
Provided, The nation of which the said applicant is a citizen, subject, or eor-1
poration shaU extend substantially similar privilege to citizen and corpttatliOm..s
of the United States.
Mr. LONGWORTH. Will the gentleman yield on that point?
Mr. MONTAGUE. Certainly.
Mr. LONGWOrrH. I did not understand from the hurried reading of a
the bill exactly what the regulations are in regard to patents. Suppose
a patent is taken over under a license, is there any provision as to'
what price may be asked for the goods ?
Mr. MONTAGUE. It gives the licensee a right to take the patent not'
to exceed a prescribed charge.
Mr. LONGWORTH. And he can sell at his own price. "
Mr. MONTAGUE. The Federal Trade Commission may prescribe the!
conditions under which the license is granted, the fee to be charged*
therefor-which, however, is not to exceed $100-and a further charge
not exceeding 1 per cent upon 5 per cent of the gross sunms derived:
by the licensee from the sale of the invention, or 1 per cent upon 5 per
cent of the value of the use of such invention as decided by the Federal
Trade Commission. Subsections (c) and (b) o.f section 10 deal fullty
with the fee and charges to be paid by the licensees.
Mr. LA GUArIA. Will the gentleman yield again ?
Mr. MONTAGUE. Yes.
Mr. LA GuAmrIA. Has the gentleman any information as to what thad
rights are of American citizens in regard to patents in Germany at this
time?
Mr. MONTAGUE. I think Germany accords reciprocal rights. Russiai
is the only exception.
Now, Mr. Chairman, with respect to the clearances of vessels, I need
only say it is obvious that the Government should have regnlatoryl
powers as to the clearance of all. vessels, and the bill gives ample powerW
in this particular. I
Mr. FEss. Will the gentleman yield ? I
Mr. MoNTAGUE. Yes.
Mr. Fuss. Before the gentleman takes his seat I want to say that myi
recollection as to the international requirements touching the annul-
A





bf tracts does not touch the issuance of bonds by the Govern-
th -th. State. The question was suggested awhile ago by the
rom Wisconsin.
T AefiL The validity of the bonds is not in question; the
wl- how to collect the interest on them. The right is either sus-
*1brgated by war; the remedy for collection must be af-
"iition.
krat L. In other words, the Government would not discount its
ow blgton a
SMr. MoNTAGue. Payment is suspended, and when the war is over
tfrqustion of an accounting and settlement arises, the question of
.0sets and indemnities, and therefore this whole matter, it seems to
msir wisely left to Congress when the conflict is over.
Mr4 EaAs a Member well informed in international law as is the
* Mr MeONauE. I thank the gentleman for his compliment, but I
natfraid ha does violence to the fact.
Wr M Ear No; I do not. Is it not true that that is one exception in
ihtamatioml law-the matter of annulling contracts ?
.. Mr. MoNtaGou. I would not like to answer the gentleman off hand.
Mr,. LA (uamA. Mr. Chairman, will the gentleman yield?
LMLItOA Yes.
h 'Mrh, TaAtO u. The reciprocal provision applies to applications for
pate mntsm es
Mr. IA GtALxA. What I had in mind was paragraph (c) of section
t .npzorides that citizens of this country may manufacture any
pt tihp tected by patent belonging to an alien enemy. That is not
M.. Aouu. That right is acquired by license.
Itr.t viWrA ma. Has Germany m any way suspended patents apply-
ltomican citizens ?
MiIrAiam The war suspends them.
ALA Guna. Why should not this be limited to similar action
y % te part of the German Government !
I ZOrrAQULB If we did, we might find our hands tied.
I.i. ftGiAOnIna. Is the gentleman aware of the fact that a good
paytentsare owned in Germany by American citizens?
l~o aoTAkux That is true; more than are owned by German citi-
xlhtb.i* country.
*i EWU "ia. I would want to limit that to similar action taken
il GiCnan Government.
.M... WONTA UT. I doubt whether it is practical to effect such an
wNGWOrH. Mr. Chairman, will the gentleman yield !
MoNTAGU. Yes.
Uf.wI^GwOrrH. What effect would this bill have upon the collection
po ta:X from foreigners ?
4' pfOf*Aq"i'. The gentleman means enemy foreigners !
IsOivWorTH. Yes.
:wr MOrAltJE. I do not know how it is possible to collect it. If
Sreigner hd property here, it could be subjected to payment of





64


the tax, but I do not see how the tax could be collected in the abseee
of such property in this country. Perhaps there might be at the end
of the war collections made in the form of offsets.
Mr. Chairman, I have not discussed this bill with the detail and
continuity I anticipated, and the many interruptions have perhaps
rendered my explanations unsatisfactory to the committee. The bill,
Mr. Chairman, is complex, technical, and dry, but is neverthelhi a
great war measure, and I hope it may reach a final passage at the
earliest practicable moment. I thank the committee for its &ttntion.
[Applause.]
Mr. ESCH. Mr. Chairman, I yield now to the gentleman from Wis-
consin [Mr. Lenroot].
Mr. LENROOT. Mr. Chairman, I asked the gentleman from Virginia
[Mr. Montague] some questions during the early portion of his speech,
as to whether or not this bill in any of its particulars violated existing
international law. He replied that it did not, that it was not the inten-
tion of the committee in reporting the bill to do anything other than
to mitigate the harsh conditions of existing international law, and I
am entirely in sympathy with the committee in that, but in section 2,
defining the word "enemy," we find this language:
The word "enemy" as used herein shall be deemed to mean: Any lnAividual,
partnership, or other body of individuals, of any nationality, resident within the
territory (including that occupied by the military and naval .forces) of'any
nation with which the United States is at war-
And this is the language to which I particularly wish tb" direct
attention-
or resident outside the United States and doing business within sueh territory.
Section 7 of the bill makes void all contracts of every character and
payments made after the beginning of the war to any such enemy.
I contend that that is clearly in violation of international law,, nd
such a violation that, if it had been made by Germany when we were
neutral, would have called for notes and condemnation second oaly
to the condemnation with which the submarine warfare was met by
us. It will be observed that this is not limited to business done with the
enemy by residents outside of the United States. If it were so limited,
it would be proper and in accordance with existing international
law, but as the language reads, if anyone outside of the United States
in a neutral country has an agent in Germany for the purpose of
carrying on a business which he has a perfect right to carry on under
international law, the existence of that agency in Germany makes
that man an enemy not only so far as the business with German is
concerned, but so far as all business is concerned, and renders void all
contracts that he has made in this country.
Mr. MONTAGUE. Mr. Chairman, will the gentleman yield !
Mr. LENROOT. Yes.
Mr. MONTAGUE. Does the gentleman think his argument is wholly
sound in consideration of the pxoviso found in line 21, on page 9
Mr. LENROOT. The proviso has nothing whatever to do with it,
because if the payment is made to a person in Holland, we will say,
and it is known at the time the payment was made that that Holland
party had an agent in Germany, but that the subject of transaction had
nothing to do with Germany, might have concerned England, never-






Mnd tr t he payment weld be absolutely void under
Sp ov SH does not ia any degree limit it or rectify it. What
t1tgIuM4.-w on the subject I was smuazed at the statement of
9dIK _gntema fnoun Virginia [Mr. Montague], an emi-
hiut .iaa la wyer, which he made in response to a question
ain ptlAhtI-him I asked him what we would have thought of
mmus adIen if, whem we were neutral, Germany had undertaken,
intt of some American citizen carrying on some perfectly ligiti-
vwit* England, to render void all contracts made in
msu^hod undertake to confiscate all of the property of the
pin t.cities in Germaay, because he had done a perfectly legiti-
stwMo,: in England. The gentleman made the surprising state-
4k st;Lhe believed Gemmay would have had the right to so
Ini the property of Americans in Germany, I am very sure upon
pOWdBke gntemaa will see that could net possibly be done
kiheW groes.t and most palpable violation of international law.
rh the ItS matimoal law upon this subject I read first from
109ft9 pae 7;:., 1 : .-.'
lPwiwbb ikt6,g it wtfs6 commerce in the enemy's country, although
& i I It W, aiewfttal coemtry, is treated as an enemy-
MA stop.t `
*W.O ,. sfnemy so ;far tof. as that part of his business is concerned,
A" 0pi ,f quo ad hoc. ..
to th te t, nmd it extent only. And in Hall's Inter-
Taw, rear ing from page 494, we find this:
j on thought not residflt Is a country may be so associated with it
S~kit 4 beind a paxtebr In, & house of trade there, as to be', affected
Seamy character, in respect at least of the property which be possesses In
t ieitory I tif he is a iercbant-
h tlwrQuds i" heisa merchant"-
:, fM ., ctf*Nlit oone isa neutral and the other belligerent, he is re-
Rk atuttral k br eIlIgSent, according to the country in which a partieu-
0i4goeta Pf Ita pWmerep has originated. Things are different when a
labt ,L In anuptral country and carrying on an ordinary neutral trade
tl resldin.t agent fi the belligerent State, the- agent being looked
k. oqly a itnstment for ltacedlAttting the conduct of a trade which hn other
W t l i- bble & Otib that of other neutral merchants.
W he unquestioned international law upon this subject, and
Sas at present framed and reported by the committee,
as a np enemyr and render void all contracts made by
tihgm ine iralountry if he did any business within the
of n enemy, and before the committee has any right to ask
Oit. it that p ision, clearly violating international law
it. H1o6s 1 6 titled to some better exposition tan the
V.itgini4mIr. Montague] has undertaken to give that
hYe xist mternPtiOt law. Now, Mr. Chairman, it is
T teft StatS,,i a it has entered upon this war for
aoaa iU h i careful that in the prosecution of this
jit a wot.itself vi.late plain and unquestioned principles of
'ia:We innobe too careful in observing international
thatwe Mshall8 din the prosecution of this war, nd
i'rAt lihatcsimittm :had'in mind throughout the prepara-






tion of this bill that it has no intention of violating those principle
of international law, but rather to mitigate them, but the fa'ctrtimaia
that if this bill does remain, as reported by the committee in this
provision, it does violate international law, and violates it in suek-&
way that if it had been practiced by Germany when we were neutral
we would most vigorously have protested. Indeed, we' all remineuni
that while we were neutral England had what was called a blacklis
and we protested then. ,
England made no attempt to forfeit contracts made by American
citizens because of their doing business with Germany. What they
attempted to do in that blacklist was to operate upon their own
citizens only to prevent them from trading with certain firms. It was
merely domestic and municipal legislation. It did not in the least
attempt to affect the rights, duties, and obligations of any citizen of
any foreign country. It may be-I would not care to discuss that
now-that we would have the right to pass any legislation we choose;
so far as obligations of our own citizens are concerned, and penalins
them in any way we choose, but when we undertaketo deal with rights
and properties of citizens of neutral nations and, say they shall be
forfeited and confiscated, we can only do it by violating one of the
plainest and most unquestionable principles of international law,.and
I sincerely hope before we reach the consideration of this bill under
the five-minute rule the committee will see to it that this provision, so
far as citizens outside the United States are concerned, will be
amended so that in treating them as enemies they shall be treated as
enemies only to the extent of business done by them in the enemy's
territory. I yield back the balance of my time.
Mr. EscH. Mr. Chairman, Iyield 10 minutes to the gentleman from
Pennsylvania [Mr. Watson]. t i-
Mr. WATSON of Pennsylvania. Mr. Chairman, I shall speak dre
particularly upon section 10, relative to patents. I am not going to
make a very broad address but narrow my remarks probably, to one
or two patents. Much has been said here to the effect that probably
Germany will suffer because of the rules or laws laid down by this billM
but I feel sure that since the Federal Trade Commission has b3litrol
of it, no injustice will be meted out to any alien patentee.
In the early part of the session I introduced a bill for the suspen-
sion of a patent that was issued to a citizen and resident of Germany.
The administration afterwards drafted the intent of my bill in section
10 as pail of the measure now under consideration. This is the first bil)
in the history of our legislation to suspend a patent owned by aR
enemy. The Department of Justice, in its judgment, did not-advisq
this step without compensation to the patentee. The Magna Carta,
which guaranteed the rights and privileges to the English barons,
contained the principle that "merchant strangers arem uppn the break-
ing out of war, to be attached and kept without'harm to'body and
goods until it should be known how English merchants are treated. by
the sovereign of their State, and if the latter are safe there then the
former are to be safe here."
In the case of Brown against the United States, Chief Justice Mar-
shall said, "It is urged, in executing the laws of war, the Executive
may seize and the courts condemn all property, which according to






iDadenm laws of nations is subject to confiscation, although it might
|#.M: act of legislation to'justify. the condemnation of that prop-
I which according to modern usage ought not to be confiscated."
SWlhtib ile 6f civilized nations is to favor moderation and humanity
1ng with the property of an enemy in time of war.
hisi section has been drawn with the view of carrying out those
" btmdpr rules and regulations prescribed in section 12. On
samt of the conditions issuing out of the war trade relations for a
between ithe people of Germany and ourselves will be abandoned.
L are many German drugs covered with American patents that
Secxtnsinvely used in this country but manufactured in Germany,
Sint. beomnoe indispensable to the medical world. It is for the
Miie 'dfard that these drugs be manufactured in America in order
obtain them. An infection prevails in the Army and Navy-not
Misarily originating from camp life-but an infection most im-
iMt'tp, be eradicated in order that greater efficiency may be ob-
Ie from our officers, soldiers and sailors. The German remedy to
ftdlkaIde -is 80 times more effective than any other known drug.
miCial history reveals that our Army is more infected than any
an the wprid, being 16.77 percent among the younger men and
pehentage among the older. It is impracticable to extend to
%Truit a complete physical examination; the infection becomes
wn aften his enlistment, and then he is a patient under the care
tie Government. IL hamva been informed by the medical department
Pq G.. ... l of Nationali Defense that 100,000 ampuls are needed
uifad that it is impossible to obtain them even at the market
lis $.50 Sper ampul, which represents one dose. Before the war
ibtea $2.50 an ampuL The office of the Surgeon General re-
ft that during the year 1914 the Army purchased 9,380 ampuls,
Sahi|idtb4 flsu1 year of 1917 to June 1 the Army purchased 2,074
MS at a cost of $9,344, nearly $4.50 an ampul.
ah ortieky great importance of this I ask that the letter from
Si~reQBrsbe read.
Op s tread as:follows:2
i.i. ,"'...: WA DEPARTMNNT,
fcyft-^W. *W! Wt. ..u.. ". W t April 5,1917.

I. In reply to your favor of the Mt, Inclosing copies of
1qSMl, 9M7, and S .1, I D :a nte honor to Intus you that salvarsa
uuhult tMow PoSdw an IndispeubIa remedr in the treatment of
4ndne d Iy -am= manufacture Undr -t. prqM n of Awri-
.416 .. e "fb arwerk Hlct o
i (Wq i'ed k have *caused great n Inthgr obtatnng
li^^.iiite qun^iaotaialefoim fte Farbvvrk4&A HoeChst CA, Who
the ageay tMa county, under the: anagement of W.
i 0WS.ie. m S sodaefle -.. Medical Department has been obliged to
r *O e foaUhuppUq recently obtainedaa compared with
PSeglmatoeogcul tIntit I ThladelIa can make thisA same material
i dt tatee aetObenmfMl Anlmtnobazol It an entily satsfhetory snub-
fr .:,,viM, aNAD;b Seamberg, tbe diretor of the. astitte., Informs
Al P a bee or iquu. were the potent laws not In question.
inabroza ssenbh
$ Wmuat C. Gacasx, Sygo Gsr
10 "b "pp be.
.;fCT t .+, t ftfi H. ". '" ^7 .:: "* "':.*** *"/ "" .. :*" : <- .,*
Btt--^u^; :!:,.;: ::T".. : I I IMW., OBS SVfonl nrable 7Mta






Mr. LA GUARDIA. Will the gentleman yield right there F i-1, .
Mr. WATSON of Pennsylvania. I yield to the gentleman fhom New
York. .
Mr. LA GUARmIA. Is the gentleman aware of the results of thimuPhi-
delphia preparation ? .... i
Mr. WATSON of Pennsylvania. To a degree. :
Mr. LA GUARDIA. Has it been as successful as the original Ir
Mr. WATSON of Pennsylvania. I think so.
Mr. LA GUAmDwm. Is it not true that the doctors would not amm itobwe
cause they could not obtain the same results? ' :
Mr. WATSON of Pennsylvania. On the contrary.
Mr. LA GUARDiA. Is it not true that a preparation has been msadse in
Canada and that the doctors of this country have used i din the lns-
pitals and that they say that it is not satisfactory?
Mr. WATSON of Pennsylvania. I do not know it.
Mir. LA GUawDIA. The hospitals in New York have made a practical
investigation of it- ::
Mr. WATsoW of Pennsylvania. I am not fighting for Candsj4 but
for America.
Mr. LA GuARA. Is it not true that the salvarsan people iI Now
York are in a position to make it and put it on the market ,' : .
Mr. WATSON of Pennsylvania. They are not. I have a lettr firi
them stating that they are not able to put it on the market. ,
Mr. LA GuADxa. I have a letter saying that they can.
Mr. WATSON of Pennsylvania. They asked the Phi"adelphia people
to manufacture it for them, and they have been promising thae.ior
ernment to supply its needs, but they are unable to do so6 ..;.
Mr. LA GuARwi. The trouble is that they can not make the pvepara-
tion in this country. ,
Mr. WATSON of Pennsylvania. I can not yield further, as1 b. hveu
a few minutes left. .
If this bill is enacted the drug can be manufactured for $I per aspul
and within a year at a much lower cost. The medicalprofea ain ih
need of 3,000 ampules per diem to treat the. cases under theiraire.:The
statistics from a Government report issued by the authority of the
Surgeon General show that 20 per cent of the adult mala poputioC
of the United States, that 22.10 per cent of the inmataaqf thjpj8
homes, and that 2L&5 per cent of the Axray prisoners aae itfect,and
further, "that the iudectioa is a. greater menae, to the p.,lic iwth
than any other infectious disease, not even ex-ept tuerol-w sis,
It is of great consequence to preserve the health of the mvn t0N
Army and Navy in orer to. procure the best of. service, and i j _.
ae essential to guaw the sanity of the ipubli fOro whos i ir sou.dl.
mutt be conscripted m.. the future. Grave resposibilittesl ka e b
forced upon our Government by the great nations' of tIke cout"' t,
and no man can foretell how they may affect ou Coinstitution or ,hsi'ae
our present. policies.. We are tl.mreore, campelle, to use. evey oscir-
able means to terminate the war. The youth 'bf America are fkA de-
veloping-into the highest type of soMiers for 'i them we find iiili-,
genes and patriotism combined. Thk'bldI n cmm imp. 'A
in their hearts, "Dulce eA decorum est propatria aeri2" .
It is greater to be an American than ever it was to be a Roman.
Rome rose to the zenith of her power by the might of the sword,




r o

tirmwty tie love of liberty. [Applause.] Liberty, love, and home
B e-.1tb sweetest words in the English language, and by those
S-0 wa will preserve the perpetuity of our Republic. [Applause.]
SPMr. MoonR of Pennsylvania. Will the gentleman yield
lb -1WAwmo of PensyirTania. I yield to the gentleman from
oB f Pennsylvania. I dislike to disturb the effect of that
tkBtrupwroratiow, but as the gentleman is a prominent member of
SCommxittee on Patents I desire to interrogate him before he yields
f c. I have a recolkection that the gentleman introduced a bill
4ujering the matter of the manufacture in the United States of sal-
narian, a German patented product about which many physicians have
In eanwrializing Congress. Do the provisions of this bill embody
pohl covered in the bill introduced in the House by the gentle-
-tt WATNew of Pennsylvania. My bill was simply to suspend the
l h, 'without any provisiona This bill is broader and takes care of
German patentees.
Ir. Me6OO of Pennsylvania. The point was to obtain for the United
thii German product, which we have been unable to get by
Sof the German patent. The gentleman's bill proposed to cover
'W'i. W'ATSON of Pennsylvania. My bill covers the point-in order to
iappend the patent during the time of the war.
r. MpooE of Pennsylvania. And what the gentleman had in his bill
ibi4erported in the present trading-with-the-enemy bill?
S.%ir. WATson of Pennsylvania. Yes. In order that the product may
vkeWl ned in tfis country, as the letter from the Surgeon General
it itis greatly needed.
AirM MooRn of Pennsylvania. In effect, then, we are making a short
Ito t&e purposes intended by the gentleman when he introduced his
l ii: 30.1 Wof Pennsylvania. Yes.
Mr A Will the gentleman yield for a question f
WAVom of Pennsylvania. I yield to the gentleman from Illinois.
iN-N. I.have.not given as much attention to this bill as perhaps
~Id 'a[we given it il had been herd AN1 df the time, but I would
tt the gentleman a question. Under the terms of this bill a
pin ned patent may' be worked in the United- States; as I under.
M oh ObtanMing a license and upon the payment of 5 :per cent of
..retipls as royalties ?
AWOSW r 6r Perpsylvania.'Yes. tf the sales are $10,000, then
ran patentee wolTd get $500. If he is not satisfied with the
Ithpq- &eas the right tof she for the sum *hieh he thinks he ought
EX^i.tAN^Atr he PaX' he uw eertieveeit
.W otTSaV dfO. Imsyrania, Aft"t the war is ended, within the
tMX ..cTfh canoei cmmence suit after te war is ended, how
the licensee know on what basis he can carrv on the business t.
Wa WaTson of Pesaylva ia.- The. person who obtiins the license
), kftmiiV., nt enly pLay $100 fox the license hut must also pay






Mr. MaNN. He does not know how much more he will ha*o& pay!
Mr. WATSON of Pennsylvania. Under this bill the patentee may sue
for a much greater sum than the 5 per cent if he feels that this amount
is insufficient, .
Mr. MANN. How is that going to get people to work the patently
Mr. WATSON of Pennsylvania. I do not know, except.iti cases sacha
as I have just alluded to, wheTsre it is very important. The people will
be willing to take a risk. In the case of ordinary patents I fancy they
would not...,
Mr. MOORE of Pennsylvania. Mr. Chairman, will the gentleman yield
to me for a further question?
Mr. WATSON of Pennsylvania. Yes; with pleasure. -
Mr. MooRE of Pennsylvania. Is there anything in the patent law
which requires a foreign patentee to manufacture in the United States
Mr. WATSON of Pennsylvania. Not so far as I know.
MAir. MoonE of Pennsylvania. Is it not a fact that England requires
of one towhom a patent is issued that manufacture shall ensue within
the jurisdiction of England?
Mr. WATSON of Pennsylvania. Yes; for instance, in the case of a war
with Germany, or any war, if a foreigner obtains a patent in England,
and the foreigner refuses to manufacture that patent, a subject of
Great Britain has the right to manufacture it within a certain time.
Mr. MOORE of Pennsylvania. In other words, while Great Britain
grants a patent, it controls it in any event ?
Mr. WATSON of Pennsylvania. Yes.- .
Mr. MooRE of Pennsylvania. And that is what we haye failed to do
in the United States?
Mr. WATSON of Pennsylvania. Yes; our laws should be amended in
order that we may exercise our control over patents issued to
foreigners. .
Mr. MONTAGUE. Mr. Chairman, I yield 20 minutes to the gentleman
from Pennsylvania [Mr. Dewalt].
The CHAIRMAN (Mr. McKeown). The gentleman from Pennsylvania
is recognized for 20 minutes. :
Mr. DEWAtT. Mr. Chairman and gentleman. of the committee, neces-
sarily in the consideration of this bill we have to do considerably with
the question of international law. In fact, as far as we have almpdy
gone there has been considerable discussion in regard to that sub.lct.
Primarily it should be understood by the members of this com tte
that during a state of war the sovereign belligerent power has plenary
powers. It has the absolute right of confiscation, if you please. It has
the undoubted right of use. In other words, the sovereign belligert
power, as against the citizens of the other belligerent, has unlimited
powers unless one thing is provided, and that one thing is if there be
an existing treaty which operates against that international law. : ,
Now, I know of no clearer explanation of the definite powers Ien
to belligerents under international law than is expressed in the; case
of the Insurance Co. against Davis. In the starting and beginning of
this argument it might be well to refresh our minds upon that subject.
Now, what is it? I read:
That war suspends all commercial intercourse between the citizens of two
belligerent countries or States except so far as may be allowed by the sovereign
authority, has been so often asserted and explained in this court within the last
15 years, that any further discussion of that proposition would be out of place.






0l l0l: it this fundamental position it must: follow that no active
y bq. FDaftpJZLed, either personally or by correspondence, or through
Ut4(e .citiens oa one beUtgerent with the citizens of the other. The
l toi the rule recognized in the books, if we lay out of view contracts
i:;j*l endther matters of absolute necessity, is that of allowing the pay-
.le.t. tosan agent of an alien enemy, where such agent resides in the
l.hi.htie debtor. But this indulgence is subject to restrictions. In the
i rust not be done with the view of transmitting the funds to the
l tag the continuance of the war; though, if so transmitted' without
Uj ecthovance, he Will not be responsible for it. Washington, J., in
; a enmsylvauia: (Pet C.Q Ot., 496); Buchanan v. Curry (19 Johns
%)#.^A LIn the next place, in border to the subsistence of the agency during
Aiatiltmqgt have the asset of the parties thereto7-the principal and the
t d w4t Suspends all intereourde between them, preventing any instructions,
hI~t Uknowledge of what t4kes place, on the one part, and any report
jitgEar.~ftor advice on Abe othet, this relation necessarily ceases on the
itbi of hostilities, even for' the: limited purpose before mentioned, unless
;hq.e, mutual assent of the parties. It is not compulsory; nor can it. be
n 60ite4r side, to subserve the ends of third parties. If the agent con-
tiit, a8 suich, and his so acting 'Is subsequently ratified by the principal,
pii al's asset is evinced' b V any other circumstances, then third
ey pay money for the .use of the principal into the agent's hands,
t Pews. It is not enough that there was an agency prior to the war.
ntrary to. reason that a man, without his consent, should continue
b Ithe acts of one, whose ielationS to him have undergone such a
altekatian as that prodeed by a war between the two countries to
i.thetespectively belong; with whomi he can have no correspondence, to
TO .a. cofemmufiate no instructions, and over whom he can exercise no
I, would, be equally unreasonable. that the agent should be compelled
ire In the 4servie of one whom the law of nations declare to be his public
*T cite this case of Davis and the insurance company simply
"purpose of surely establishing, by this edict of the Supreme
I* what ,the relaop n-of the parties who -are belligerent to each
er lerly are during 'the continuance of the war; in other .words,
f nwM wat-I stated in the beginning, that the soyvereigna power
oi bslutte right of conpscatwn if, it seeks and determines to
celLt
?whIb. purposes of this bill, may it please the committee, are not
sp| ici enforcement. of the provisions of international law, but
ma rly i.Jn, amelioration thereot They are a relaxing of the
q nd Mfect of international law.
S t surprised at my' fend frqmn -Wisconsin [Mr. Lenroot]
k e taed as an absolute fact, as a. primary fact in roterational
l the belligerent. power and sovereign power' of the Govern-
W"*o right either to suspend or to take over the contracts of
1a beligerent power, or of a citizen of a neutral country
4ll Ingi the' belligerent country. .
|r< Mr. Chairman, will the gentleman.yield there?

Te gentleman hoii d not attribute fliat statement
pr 4Lt. That is what I understood the gentleman to say.
.tf l ,, ade norsucb Atatemntit. WhNt I said was that
ijerenlt h4d -u right .to equester the property of a neutral with
4tq E p sie un' t xat neutrall oiitside 6f the belgerent
1Ltrah .1.'3A(jiII1!6F11.r'.
?r. DEW.ALT. That i.s a, diffg... t i t sd understandd
p ; P .. ... ".'I "P r" ** 'r i .
I gentlem a. .; ,.. .:: ", ** .. ... ""r :'..," '. : "- : '. ,. .. .-


68-002-7---6






Now, the fact of the matter is this, that as to the power of thebeflig-
erent Government, and in our case as to the power of the United
States, as fixed by international law, we have the determinate rigt of
confiscation if we desire to use it in regard to every dollar's tort of
property of any alien enemy wherever he has residence. But, this bill
does not go as far as that, and it is well for some of those who are
vitally interested in the welfare of those who are not naturalized citi-
zens of the United States, and who are really aliens to this territory,
to consider primarily this important fact, that the enemy as deseriled
in this bill is not described in terms of nativity, if you please, or in
terms of citizenship, but he is described in terms of locality.
What do I mean by that? The enemy is a party who lives in enemy
territory, or who lives in territory of the allies of the enemy, and i
makes no difference whether that party be a citizen of the United
States or whether he be a citizen of the alien country. In other words,
to repeat what I have tried to make clear, the enemy description is a
local description. It is not one of nativity, or of naturalbzation, or
of citizenship. Therefore this bill primarily sets forth to do this, that
it does not in any way affect anyone who is a resident of Germany,
if you please, now living in the United States, nor does it affect in any
way a party who is, if you please, a resident of Austria and. who is
now temporarily here, or who has been here for continued time. The
same thing anplies to citizens of Turkey and of Bulgaria, except iM so
far as the bill provides that if the emergency demands and the neces-
sities of the case arise the President may by proclamation make those
parties who are residents of this country and who are citizens of Ger-
many, or Turkey, or Bulgaria, or Austuia, subject to the provisions of
this act.
Mr. MOORE of Pennsylvania. Will the gentleman yield at that point!
Mr. DEWALT. Certainly.
Mr. MooRE of Pennsylvania. The gentleman recalls the discussion
about holders of Pennsylvania Railroad stock?
Mr. DEWALT. I do.
Mr. MooP.E of Pennsylvania. Let us take another illustration which
will get nearer to the plain people, that of holders of building associa-
tion stock, with whom I assume the gentleman is familiar. Taking
the gentleman's description of alien residents, does this bill mean t!lat
a German alien resident in the United States would be liable to harWe
his stock in a building association seized ?
Mr. DEWALT. No; it does not in any way affect the rights of any
citizen of any enemy country who is a resident of this country, unless
the President, by proclamation, determines that that party sha .e
thus affected. ;
Mr. MooRE of Pennsylvania: To put it plainly, so that a laympanU$ke
myself may understand it, a resident of my city who is an alien--
Mr. DEWALT. Who is a German by birth and who never has been
naturalized--
Mr. MOORE of Pennsylvania. Yes-owns stock in a building associa-
tion.
Mr. DEWALT. His rights will not be affected by this hill one iota.
Mr. MOORE of Pennsylvania. But if a German alien resident in. Germ-
any, or in any other unneutral country-
Mr. DEWALT. Or in any country, the ally of Germany-






SI d PeamylvaMij. Yes-owns stock in a building associa-
.roadthat would ibetaku into custody. .*
U M. Atnd d hiu- the haihds of the alien-property custo-
1d2td dis ti on theof, would await the diterminatipn of an
lne.-Ttflric !^. ... *
OI Tof Pennsylvania. So that an alien resident of the United
W lriot be affected in his property rights by this bill I
D W.s M& otdd be absohtely unaffected, unless he misbe-
theuPeaeitheFt of the United States by special proc-
bim subject to the provisis of this act.
O.l.ennsya E. Bigl.That makes it clea.
M ..s it tjqwar special proclamation I
I IWDNWrA usd lthe wor' 'special" I meant special in
iO .hit subjieet, and notin regard. to th. individual.
rMu. It .ia sA ..& matter-ol tasbetaa g. m t is a matter of
of of the President as to whether it is esirable to ect off
i. J WrALT. I should judge that is the primary idea; ye.
WMool of Pennsylvamnia. Will the gentlemean yield o one more
iL 'i "," -' ;
DEWAZr. Certainly. We are all here for information, andi if I
.i[. Iill give iit. :f n"t,j will raerte gemtlmIan to some one else.
fr. oon of Pennsylvania The gentleman isa member of the.Oom-
seti Interstate and Foreign Commerce, and I am now addressing
mwte spokesman of that committee. Does this bill have the ap-
al of the President of the United Statesu
t.NZWALk. This bill, as I understand from the information I have
b only from tke mediman of th committee but from the
Pbenhi of the committeis te draftof the Department.o Justice
y tLf. Patat. Office patially, and) tin Department cf Cnm-
|aawel, aRdbas th arovwal, if youaso choose to call it, ofthe

*flesylwaa isfk^By whom was it endorsed before the
taa I ta t~~ae and Fm CemmeM"O"u I
flwnn. Mv; Warrm Hae in one of ther amistant at-
y8 general. Mr. Red&M Am appe .,:
4oi0 at !Ainsyrivani.. Mr. WarrnN, of. the De.artment of
'IISRtPikV& r
lBa"in. ies .' . . ., :. -, ,
e8:W k .v,: 'M ; 'efe4 o- t- Of


-yM.a.tPeai.s.txhaaAd LpxduzgI
Sl.lf o .'/t.. I.:. i , "it!?(. . \ , .
gf
p^SwuinYes Secmwrqtyar nsiafRistoa: f^iai
IM. DWAxT. Yes; he .4K appear i fm e ose ft this bill, as IweMR as
"lot e "~~ .. .. "** ": "; *"*"; "u /:- .#?*{ n *E".i' ~: :* *r *-.* i -
Kir. MOOR of ennsyIvania Then, it mayais ted iufiilatnily
ib..B NWAfI Tuat isd O dxnbutekOsh i ze qcb -to -th.e
ada Mwh ac1iri^si *r ant aIdt-







istration matter. I would call it a matter of general public intdfst
which the administration desires for the public welfare. .
Mr. MooRE of Pennsylvania. There is just this about that, if'the gfen-
tleman pleases: Many Members of Congress on both sides of the po-
litical aisle are expected to stand by the President of these bills.
Mr. DEWALT. Yes. ;
Mr. MOORE of Pennsylvania. I assume it would help the passage of
this bill very much if it were known that the President approved it.
Mr. DEWALT. No better proof of that could be obtained than the fact
that his Secretary of Commerce, his Secretary of State, and a repre*;
sentative of his Attorney General all appeared in person and advo-
cated the provisions of the bill. Of course, the bill as reported *as
changed somewhat from the bill as originally presented. 7 24
Mr. MOORE of Pennsylvania. Does this bill follow the English feort?
Mr. DEWALT. It is not as drastic as the English form. It follows4he
English form, but it is not as severe. .:
Mr. MOORE of Pennsylvania. It may be called an American bill, then2
It originated in this country? /
Mr. DEWALT. It did. ,. :,
Mr. MOORE of Pennsylvania. And it originated in the departments
of this administration? ..,
Mr. DEWALT. So far as I know, that is the fact; yes. .
Mr. STEELE. Will the gentleman yield ? .. -
Mr. DEWALT. Yes. *:
Mr. STEELE. Have your committee considered this bill in connection
with any treaty obligation ? -
Mr. DEWALT. We have. .
Mr. STEmE. Is there anything in the provisions of this bill that
would violate the treaty with Prussia of 1828 ? .
Mr. DEWALT. Nothing. I am glad the gentleman referred to it, al-
though it is rather out of the line of my sequence of argument; but the
provision which the gentleman refers to is this:
If war should arise between the two contracting parties the merehanti of
either country then residing in the other shall be allowed to remain bibe months
to collect their debts and settle their affairs, and may depart freely, carrflg
off all their effects without molestation or hindrance. ..
Now, if the gentleman will, observe, that article 23 of this treaty has
reference to whom? "The merchants of either country then residing
in the other." Bearing in mind that specific definitive mark as hit the
contracting parties, namely, that they shall be merchants then residing
in one or the other of the countries, and knowing also that this bill
does not in any way affect the alien whether he be merchant or othier-
wise who is residing in this country, and that the descriptive at the
enemy is a local description, and that the enemy must be resident in
the territory which is hostile or a territory of the allies hostile to this
country, then you will clearly see that this provision does not in finy
way affect merchants resident in this country.
Mr. STEELE. Will the gentleman permit another question?:
Mr. DEWALT. Certainly. "
Mr. STEELE. In the discussion of this morning reference was made
to some provision in this bill being confiscatory. The Hague Conven-
tion of 1907, to which the United States and Germany were both sigr






iyp .. i provided against the confiscation of private property
bvent -of war between any parties to the convention.
r. SIn Are any of the provisions of this bill in violation of that
KIL.DiwAt. Absolutely none, and I think it was in conformity with
dk.m!tbat the proclamation f the President as early as last June
Kr n gthe4doctrine that private property should not be
h E and that the provisions of this bill were made as they are.
i:O gentleman has studied the bill, as I have no doubt he has, for
mowIMhiassiduity as a student and his carefulness as a lawyer, he
MmeeA-amly that instead ofits being confiscatory in its nature it is
Aim nature of a requisition of property and a conservation of the
p in the hands of the trustee, who is to hold it in escrow until
tft.vi&n of the war, when this property is to be returned to
I,14 Qwmeru thereof subject to the equities existing between the
. CH'AtnMAN. The time of the gentleman from Pennsylvania has
kr.D wAr. Mr. Chairman, I shall have to have some more time.
Mr. MONTAzGU. How much more time. does the gentleman want
.Daw. uAL How much, time can the gentleman give me-15 min-
"A.. AGxZ. I yield to the gentleman from Pennsylvania 15 min-
of Illinois. Will the gentleman yield?
.,.As soon as I get through with the inquisitor on my
S ield to the gentleman on my left.
:.3u z. Under the provisions of this bill, no property is for-
ito the public.
.t *IVAL. No property ip forfeited.
S ni The holding of the property by the public agent is only
b"tt of the owner of the, property?
t kLT, Precisely so. Now, I will yield to the gentleman from
4lAxAr' of I:inois. The gentleman read an extract from what
Ienion
ALT. Article 23 of the Prussian treaty of 1799. The gentle-
.find It on page 644 Senate Document, volume 37.
x|.4 of TIl. mo4 I am somewhat famiar with that. Does
tofi coItend t am thmebit tirebit
tiin tend tht t eaty or any other treaty with Prus-
,D.tv|.n. I do not. r think they are all abrogated by the conduct
nay. ,f4 portion is very lear nd emphatic onthat.
:"'<:"N "..ew bOi Does the gentleman say that hostilities
ntia4roga tereaties between tle belligerents
BflwAn. It' dono 4ecessarIy. fthe conduct of any belliger-
Mist BaitD .fpta with'h.Womwe are iot at war; asagainst
|n~i4 ha i. treaty with1 one of thie blliWgerents, is so ut-
u'.s i t "^pdUe tdea t0the ttre.aty abrogated, we shld abrogate
','"" p [;.... i "" i" f' : "" .'. .:, '
| S K ^ ^ .. i ...* : ; .. , -..;. ..:. .:. ..,-, ^ > ... ; .,**], .> .- i'*
"1 i. ,- .* % .* *..i : .^ ^ .^ n r .^ v .. i <1, '; "* ;' ,. i ,* .:
..o pb ,"t
..' r ,: ." ;
-,. . .4






Mr CHn AnLma of New York. We have declared that they 'arebm
gated and repudiate them. : :. I
Mr. Rosx. Will the gentleman yield!2
Mr. DEWALT. I beg the gentleman's pardon, but I have only 10a i-
utes remaining and I have not time to yield. This power of the' 'w-
ereign is so great that it oftentimes presents itself in the oddest of
stances. Let me refer the committee to a very noted case, that of Mhou
tley against the Nashville Railroad Co, and see how far the poe.wii
of Congress can go in reference to matters of this sort. It is found ti
page 480, volume 219, United States Reports, and I desire to sA
only the doctrine so as to enforce what I have already said in'r regard ti
the powers of the Government.. :.
This is from the opinion of Justice Harlan: n : '
In the Addyston Pipe ease, this court said that, under its power to regitl'.
commerce, Congress "may enact such legislation as shall declare void and prebif:
the performance of any contract between individuals or corporations whim
the natural and direct effect of such a contract will be, whet carried M6, tgi
directly, and not as a mere incident to other and innocent purposes, regulate t
any substantial extent interstate commerce." i
Applying that in the same opinion, he said: ,
As in a state of civil society, property of a ciLtem or subject is ow asBip, Sub-:
ject to the lawful demands of the sovereign, so contracts must be understood :w
made in reference to the possible exercise of the rightful authority of, he oV -.
ern ent, and no obligation of a contract can extend to the defeat of legitiate
Government authority. (:
This case was rather peculiar,' and I desire to cite it for this pr-
ticular purpose. Mottley was a passenger on the Louisville & KNahvik
Railway. He met with an accident. In consideration for his seWLk-
ment of the case, they gave him an annual pass. After he had iejdjed
the privileges of this annual pass for a number of years OngieiS
passed an act by which it declared that no railway company co.ld,
under any circumstances, accept anything except money or the eqs6i
alent thereof for transportation. In other words, they forbade the
giving of passes. Mottley had settled his case, and in consideati
or part consideration he had received a pass. He asked for his iS'
and they refused to grant him an extension of the same. He
brought mandamus proceedings in the Kentucky courts to enfoRe
his rights. The Kentucky courts affirmed his rights and said that t:
railroad company must regrant the pass. The case was carried to t'he
Supreme Court of the United States and, in this decision I haw:
just read, Mr. Justice Harlan states this rule and lays it down flatl
that although the man was paid a consideration, namely, the settle-
ment of his case with the railroad company, although he had enjoy ii
the rights of that pass for a number of years, yet when Congress pasm
an act declaring that he did not have the right to the pass, that th
railroad company had no right to issue a pass, that was the end of te
matter. And now I am coming to the point that the gentleman who laa
this bill in charge delegated me to speak upon, namely, What is ih
right of a patentee under the Government of the United States B:
cause if he has a vested right for 17 years to the exclusive enjoy' nt
of that privilege, then he has a property right, and under the decision
in this Louisville & Nashville case that property right is always sub-






Nfte.wamt? It is. subject to the sovereign power of the United States
wihnait whith at any time, according to its necessities, may de-
b am~r"tt at that rigt ives to himz either exclusive or in part
6Sfrbt's,.am be dedared oid.
S&t be"g the law it follows as a matter of legal sequence that, as
hfltsnt isused by foreign countries enjoyed in this country or as to
mBW issued to residents of foreign countries by the United States,
~i i, power has the right to do what? It has the right to
Wfiwtta, if 3m please, that patent, it has the right to make soBe use
f eatant under this decision, and the right to declare that the
mig patenitee who obtained his patent in the United States can no
~~As tie same in any regard and obtain no profits or emoluments
raui; but this bill does not go so far as that. This bill says this:
Sawhe t th patentee in a foreigner he shall have his rights sus-
d id during the war unless he receives a license from the Govern-
imn&ts ga on with his patents. The bill goes further than that. The
El'&s_. fmr as to say that if the patentee be a foreigner and has
bW&4at paten-t in the United States, that then any citizen of the
lted Sus may apply to the United States Government and obtain
6a t Federal Trade. Commission a license to operate under that
itmalitizieonsiderasionof s6 operating the sublicensee, I shall call
tidA iet.itbpatesitee, must do what V He must pay 5 per cent of
b fttyt per cent of the gross receipts if that is demanded. If,
wever..that it not demanded, or if it is thought that that is not com-
IMk i:with the value of the patent, then he has to pay 5 per cent
Ili.ft lase of that patent as determined by the Federal Trade
nMtanuiji his 5 percent is to be paidto the Treasury of the United
bp mdO t is to remain there during thie continuance of hostilities;
IfydI She .eclatatibn! of peace then what happens! Then the
ltkialcpateatee hag the! right to demand of the subpatentee that he be
brit d; and he gets his reimbursement from this 5 per cent, or if
Waa the 5 per cent thus deposited, he gets his reimbursement from
iPO t Oef the gross value of the use of the patent. This I make
$BitT a ok in order to inform my friend, Mr. La Guardia, in
:JWthat he may kniw perhaps more definitely the rights of the
fte. and the licensee.
LA. .(UA A. I thank the gentleman, but I do not agree with his
: imtw'r/. It may be that the gentleman does not agree with it,
'all it is conservation of the property. He has received a li-
frbm the United States, and that property should be used by
A tiI power if it becomes necessary during a state of war.
'I C T1. I do not agree with the analogy drawn by the
fraiom the Mottley case.
.D .alr. easoming by analogy is always dangerous, particu-
1 .when the other fellow does it.
kpfKnoWN. Is it not a fact that Russia has already confiscated
patentt rights?
: ..DhwA. Rssia is the oily belligerent country that has done
i rest of the countries have still observed the amenities of the
en, and have not forfeited the patents. This is not anew theory
:patent rights, and it is not a new theory as to confiscation, as some







have it, of property. We call it a requisition of property, a comern-
tion of property. During the Civil War this same thing was done. in
regard to property, and by reading the report of Gov. Monte, 0D
rather the testimony in regard to this matter when pending before'tho
committee, the gentlemen of this committee will find a long list of cUaes,
all of which reaffirm and clearly establish the right of the Government
even if confiscation is necessary or the granting of licenses for the per-
mission of doing business. Now, I have as clearly as I possibly could
explain what I believe to be the vital and pivotal points in regard
to this matter of licensing uider the rights of the original patentee.
However, there is one thing that should be remembered as well; After
the subpatentee, as I call him, gets a privilege from the Government,
the Government does not give him by this act an unrestricted privilege,
but still holds a check upon the valuable right which it has given to the
original patentee, and gives to this subpatent or license a right under
the original patent, for how long! "We will give it to you for such time
as we deem proper, and, more, we will give it to you for such time as
you obey the regulations which we enforce from time to time.";.and to
make it liberal, so that no man will lose by going into the venture, they
say this: "If in the meantime you invest large sums of money for the
establishment of plants or other means of production, then you shall
be granted a license to operate under this patent during the lifetime of
the patent, or so long as we find that it is necessary to remunerate you
and to recompense you the outlay you have made."
Now, the value of this matter is very clear. There are millions and
millions of dollars' worth of remuneration annually coming from tlihe
use of these patents that are held by foreign patentees. Resuming the
argument, then, gentlemen, this is a privilege given by a' sovereign
power, given for a period of 17 years, and if that sovereign power has
the right to revoke and annul that privilege at any time, it may do that
according to the necessities of the Government in a state of war; then it
follows, as a matter of clear reasoning, that if it has the power to annul
it has also the power to restrict, and if it has the power to restrict, then
it has the power to grant a sublicense, and if it has the power to grant
a sublicense-it has the right to define the terms upon which those sub-
licenses shall be granted; and then the United States Government steps
in and says, "We grant this license, this subpatent, to a citizen of the
United States." And then he must do what? He must pay a license fee
of $100 as provided by the act, and must also pay the sum of 5 per cent,
as above stated, of the gross receipts for the use of the patent, or ,5
per cent of the value of the use of the patent as determined by the Fed-
eral Trade Commission. At the end of the war the alien who has a
patent right originally from the Government is recouped, and how does
he get it? He gets it from the United States Government, which is
holding in escrow this 5 percent from the gross receipts, or 5 percent
of the value of the patent.
The CHAIRMAN. The time of the gentleman has again expired.
ifr I.*
[Mr. SNOOK].... The title of'the bill now under consideration is "To
define, regulate, and punish trading with the enemy, and for other
purposes." This advises us that it is a war measure.






^^ta^of the act shows that it deals with questions and situations
qogweit of the war in which we are now engaged; in fact, the hear-
p showyclearly that it was s study of questions connected with and
uy iog of the war as presented to the Secretray of State, the Sec-
,iy of tie Treasury, the Secretary o'f Commerce, and the Attorney
nepT)al n the daily conduct of their official duties which suggested the
Ippiation of this measure and a determination by these officials to
pgQO matter before Congress.
Ijieing of the bill as originally presented to the Committee on
pState and Foreign Commerce. Secretary Redfield says a committee
S o ,representing four departments-the State Department,
,ant of Justice, the Treasury Department, and the Depart-
"jo Coinmerce-to consider what we should do in this particular
ter. That committee gave this subject very, very thoughful study.
P qommttes was composed of Assistant Attorney General Charles
lthe"Cdmptrol of the CQrrency, Mr. Woolsey, the Solicitor
I l 9[eo. the Dspastment of State, and Dr. Pratt, the Chief of the
Foreign and Domestic Commerce of the. Department of
i mewe. T went over the matter for weeks with very great care.
ittdtb dir ft of a Nill to the Secretary of State, the At-
I nal, the Secretary of the Treasury, and myself. We made a
labe. a. comments upon it, and it was returned to them. It was then
IN'ataa.led with great care, and this is the result of their unanimous
S'hieh was, in substance, conveyed to you.
he la ag of Secretary Redfleld in this respect will answer the
Ml1ttb.t sone extent, that was asked by the gentleman from Penn-
H ..-[Mr. Moore] as to whether this bill has the endorsement of
Rubzittee or not.
Sr. XMOtR of Pennsylvania. Will the gentleman yield !
Kr..Swoox. Yes.
NEr 9)tOa of Peunsylvania The gentleman is .also a prominent
.ha of the Committee on Interstate and Foreign Commerce, and I
||.d."es iave a expression from'him as to whether he regards
| .dzi tration measure, one that the Presiden4 deems neces-
o~r the'proper'prosecutionof the.war!
rSook. I can not answer the gentleman in any other way than
fl 'ser 9jte my colleagui from Pennsylvania [Mr. Dewalt] and
ghi1#ujat I 1 ave just r.ad from the Secretary of Commerce,
*-eoax Of Pepasylvani. Secretary Redfield, having originated
ementtonferred *.ith his colleagues in the Cabinet, and some
&.4peared bdbre the;, ai.tI"ttee. But what. I am interested in
.g and what some ofrmy colleagues are intere ted k lonowing, is
wixiePresidant is interesting this
S t0oK..Doubtless he is. '
tl M gO* f J'~nsylvama. So, it may be regarded as an adminis-
l ili L' v -' ...5M~i j' -y *1, '1'' .. ... .' ..... .. .
kSNOOK. 1081 D1 say n-a tw .. gentlemantcan put it that
'ilf Jie likes :. "*"* *' **: . '
P Mooof PPflJ aa. If t iq gentleman pleases, it is a serious
^iori.T e peple a Zskd tobipport the Presidentin the prosecu-
hSurouW.. i n.d:d thtge.-,- n .ni..s : osi ..tn ...
,'BS? SNOE .'1 udsad gneanspsto: ".





80

Mr. MooSE of Pennsylvania. And it may be that a great d l of
the legislation that we are passing is not what the Presidetaub ats
and feels is necessary for the prosecution of the war. "
Mr. SNooK. I have no doubt he feels that this is necemary.:
Mr. Moon of Pennsylvania. I wanted to get the gentleans Aew.
That is his opinion.
Mr. SNoox. The courts of all the civilized countries hold it to be
the law that war suspends all commercial intercourse between the
citizens of two belligerent countries or States, except so far asny
be allowed by sovereign authority.
In time of war, therefore, some such law as the one under coansid-
eration becomes a necessity. The rule of law to which I have referred
is announced by the Supreme Court of the United States in the case
of United States v. Lane (8 Wall., p. 195) in the following lsiutts:
At the time this contract purports to have been made this country w"
engaged in war with a formidable enemy, and by a universally reogi
principle of public law commercial intercomrse between States at war Mih
each other is interdicted. It needs no special declaration on the pagt* the
sovereign to accomplish this result, for it follows from the very aitumre awm
that trading between belligerents should cease. If commercial lebreoov.bewr
allowable it would sometimes be used as a color for intercourse of aL. enfh*
different character, and in such case the mischievous consequences tWt *d1
ensue can be readily foreseen. But the rigidity of this rule can be r.Pt by
the sovereign, and the laws of war so far suspended as to permit trade wfk
the enemy. Each State settles for itself its own policy and detprmines whether
its true interests are better promoted by granting or withholding licees, .to
trade with the enemy. ,"
There seems to be but one exception to this rule; this exception iA
explained by the Supreme Court in the case of Insurance Co..against
Davis, in Ninety-fifth United States, page 425, where that court
announces the rule laid down in the Lane case and then explains the
exception in the following language: ....
The only exception to the rule recognized in the books, if we lay out of iew
contracts for ransom and other matters of absolute necessity, is that etCallow-
ing the payment of debts to an agent of an alien enemy where sueh agent
resides in the same State with the debtor. But this indulgence is subject to
restrictions. In the first place, It must not be done with the view of tranmif-ttg
the funds to the principal during the continuance of the wtr, though, if so train-
mitted without the debtor's connivance, he will not be responsible for it (WVsbh-
ington, J., in Conn. v. Penn. Pet. C. Ct, 496: Buchanan v. Cury,. 19 Johns,
(N.Y.), 141.) In the next place, in order to the subsistence of the agency twing
the war, it must have the assent of the parties thereto-the principal jid
the agent. As war suspends all intercourse between them, preventing say MouWme-
tione, supervision, or knowledge of what takes place on the one part at anyr
report or application for advice on the other, this relation necessuarly ease
on the breaking out of hostilities, even for the limited purpose before mentioned,
unless continued by the mutual assent of the parties. It is not compul ry r
can it be made so on either side to subserve the ends of third partft. f the
agent continues to act as such, and his so acting is sm-sequetly ratifedl b-the
principal, or if the principal's assent is evinced by any other ctvr sastwes, then
third parties may safely pay money for the use of the principal into the auea
hands, but not otherwise. It is not enough that there was an agency pritr to
the war. It would be contrary to reason that a man, without his comsaN, @omld
continue to be bound by the acts of one whose relations to him have undergpe
such a fundamental alteration as .that oduesd by a war between the two
countries to which they respectively belong, with. whom he can have no orre-
spondence, to whom he can communiceate no Instructions, and over whom he
can exercise no control It would be equally unreasonable that the agent sholM
be compelled to continue in the service of one whom the law of nation declares
to be his public enemy.






p.lIyuing. the provisions of the bill I might say that this
.L r co zed', and situations growing out of facts such as
... s exception are provided for in the proviso found
of page O9 Md top of page 10 of the bill.
u as under the law as stated Um the cases from which I have
"ticly no commercial intercourse can be carried on be-
64zen retnonr
... citizens of bellgerent countries or States except so far as
w dby the sovereign aWthority, it follows that it becomes neces-
Jtm.v some exercise of that authority. This is attempted to be
~J| bI' as it attempts to -define what things a law-abiding
NI0 -, do and what h4A my Wnt -do in regard to his commercial
pesr, with ana enemy, and what disposition he may make of the
enemy that may come .into his hands or under his
g hisovereigp authority to make clear just what a citizen
doiwhat lie may not do, and what he should do the bill defines
S4m ..an4 lays down certain rules which I shall undertake
.44 possible. ".
ae wori emy and' ally 6 enemyy; these being
'7 of esD [i whom trade is forldden except
3Aj" a'rny i. any person resident of the nation
e 4rwat: ar or,.esient outside of the United States and
L-thi such naozw gith which we are at war.
ion~ithe one' which fhe gentleman from Wisconsin
criticized, and I, am inclined to0 think that in connection
k4st : stbdivisio(b), terQ. is something to his criticism.
Nit pand Irank. Beeausi the bill c9mes from the committee
.1 mI ; member I d4 not feel that I am certain that it is not
ii. amendment in t..ei.ps. And I wish to say, in con-
With this subdivision {b),'.f section ', there i something to
p.itci~i which the gentleman m:ide in this regard, and I think
W.nb:B died by an amendment which will be offered probably
a the i11 comes to passage..
..' Qr.a.iqn formed within a nation with which we are at war
V w4bin. in any country other than the United States and doing
athia such nation. :
,..vernment of any nation with which we are at war or any
h 9bnsions, agents, or agencies.
;pVqto be' A,. tha* this i a? essetij*l pro s.ion., because the
4'*iLI which, we .re at wa dr ay 6$ it. agencies or
.MWould eqrtainly come within the term enemyy a described
wqr oater measure along this line.
Sotfer persons as may be natives or are subjects of any nation
lc we ae a &r w bar. Meever resident or doing business as the
-may by C rolamatio n.plude w.ithia the term "enemy."
.2 as es the ta of enemy." This definition
''~~ y. o. ...ne"my'""..
.0 saubt..e the teams u ned m dining the term "enemy" with
nges ai Ake the terms applicable.to an ";aly" of enemy.
w.r. ., ..q. A of
i. 2 aslo dFM.. t..e word trade, as coveinng every sort of
trnibOUacti tha t may e carried .o 'between persons or
his denion is minute i it.a details and, is found in para-
M^ ), (j4,(c);, ( d),,d and4(p:tpaes4 and 5.
Iton forbids trading 'with an enemy or an allyV of an enemy,
makes such trade unlawful except under a license issued by the






Secretary of Commerce. By this section the forbidden intercoutlu o01
commerce also extends to the transportation of an enemy or ally of ar
enemy, and also to the transmission, or attempted transmission; oul
of the United States of any, letter, document, writing, message, pi-ture
diagram, map, device or other form of communication.addr'e tc
an enemy or the ally of an enemy. The necessity of this p.rti ulai
prohibition is too obvious to require explanation. -
As my colleague from Pennsylvania [Mr. Dewalt] just said, thi,
is no new provision as to issuing a license under which trade' ma3
be had. In the case to which the committee's attention has been called
the Lane case, decided by the Supreme Court of the. United States
you will find there is a review of all the acts of this kind that werE
in effect during the Civil War and an exposition of the law regarding
them. And so it is an application of an old principle that was in effect
during the Civil War-this providing for a license for trading witl
the enemy.
Mr. McKEowN.. Is there any provision in this bill that will dbirvei
a case like this: Suppose horses in Oklahoma have been sold to 2tus-
trian agents or German agents, to be delivered in New York, and o
contract made and an agreement made before the declaration .of *'ar
and the horses are delivered in New York after the declaration c'1
war, but have not been delivered to the enemy, in that case what pro-
vision is there, if any, to take care of the owners or the men whboatWfv
sold this property ? .
Mr. SNOOK. I am afraid there is no provision in the bill to take
care of such a thing as that, and I do not know that there ought tc
be a provision of that kind, because I really think we ought not tc
send horses or property of that kind to the enemy to help them in thi,
war in which we are engaged against them. I do not see how yot
can make a provision of that kind. It is one of the risks of. war thai
they will have to assume. ':
Mr. McKEowx. Then, those people in Oklahoma in that case wil'
have no redress in the courts utinder this bill?
Mr. SNOOK. I think not. Under section 5 of the bill the Presideni
may suspend the act so far as it applies to an ally of the enemy. Thi,
is a provision that the department thought to be wise, becaulfse. a
sometime it might be necessary in the course of trading for the Preai-
dent to suspend it.
This provision further provides that licenses may be granted under
the direction of the President to any person if he be of opinion thai
such license is advisable. This is the provision of the bill that allows
the President to grant licenses to alien citizens who may be residents
of the United States, so that that matter may be taken care of ifhbE
thinks that some person is transgressing the law or is pursuing somnc
kind of trade to the detriment of this country.
As to the provisions of section 6, I only want to say this: It seen
to be the opinion of some Members of the House thaf this bill provides
for the confiscation of the property that is to be turned into the hands
of this custodian. On the other hand. It is the opinion of the committee
and of the people who framed thisbill that that will not be the result
if this bill is enacted into law. Indeed, it is the opinion of the com-
mittee and of the people who framed the law that it will take care






0jit property, so that it will be in readiness to be disposed of at
4Afdh war according to an act of Congress.
ft 'irimn. Mr. Chairman, will be gentleman yield?
8 OK.m Yes.
TT!FOD. What provision is there in the bill that at the close
wa-the property of those enemy foreigners who have seen fit
other property to be invested in this country is to be returned
r oOK. The provision in the bill is that that is to be disposed of
46retion of Congress.
Sr+AMoRD. Well, if Congress does not act, then their property
t I el from them and confiscated by the Government.
Sicox. Does the gentleman think that Congress will assume
oSitin Has the gentleman so little confidence in the Congress
td States as to think it will not act fairly and justly with
rment
r. STmiR. Oh, it is not a question of acting fairly, but a question
bg s not acting expeditiously-a question of how long the
n of these foreigners will be withheld.
N S66K. The thing is not one-sided, the gentleman should know.
sit will be so mkny things to adjust when this war is over. The
41 will hat: property of our citizens. There will be claims for in-
Mity and the German 'Government will undoubtedly have prop-
r beluging to our citizens. And it seemed wise to the committee,
ougit may not seem wise'to the'gentleman, that this property
left in the position it is in, so that when all these questions
ip they can be adjusted equitably.
S OID. The gentleman is confusing in the statement he has
the rights of the belligerent government with the rights of in-
ual subjects. It is not sought by this bill to appropriate the
erty of foreigners who are domiciled in this country. That re-
ain the hands ofthose aliens who are domiciled here, but you are
fitng to take the property of foreigners resident abroad who
Seen fit ti leave their property for investment perhaps with a
|ration or some individual, or turn it over to the Government
unt any right whatever, so far as the provisions of the bill are
.ed, to require the Government to turn it over to them after the
the war.
SSNOOK. This property is taken and t1aced in the hands of the
an under the powers of Congress.' Congress passes the law
Whikh it is done, anid I do not see why Congress could not be
to pass a law governing the matter when the war is over; why
mlcd not be trusted to adjust this matter and see to it that the
.Vy is returned to the owner. I am sure there is no disposition on
.of the Congress to confiscate aiy property.
.STAnP Does the gentleman know of any treaty at the close
t'ar where the conditions hate been to take the property of sub-
resident abroad and adjust those .,claims. They are always ex-
It is only the poverty of the government itself that is taken
Mderation...
; Swxo o. I would remind the gentleman of this fact, that when
.iar isover Germany may'lhave enacted a law similar to this, under






which the property of our citizens will be held in Germany. Does the
gentleman think that, without regard to the way they have treated our
citizens, we should turn this property over to them?
Mr. STAFFORD. While the Government has the right to take the
property of an alien living in its jurisdiction, no government has in
recent times gone to that extent, and all authorities on international
law recognize the fact that individual property should not be taken
during a state of belligerency.
Mr. SNOOK. I understand that; but this proposition is not only-
as the gentleman will see if he examines it closely-for the benefit of
our Government, but is also for the benefit of the foreigners who own
this property, because in all cases the property will not be, as the
gentleman from Connecticut [Mr. Hill] pointed out, held by corporal
tons which are as solvent as the Pennsylvania Railroad. This prop-
erty, if it must be kept in the hands of the debtors, may be lost; but if
it is put into the hands of the United States it will be saved.
Mr. STAFFORD. If the gentleman will permit right there, I have in
mind a case where an alien enemy, formerly a governess in the home
of a constituent of mine, left property in this country in.his hands t6
take care of. She exercised her judgment as to who should be hr
debtor. Now, you enact this bill and take away her right of recovery-'
of suing her agent or trustee for her property.
Mr. SNOOK. Well, that is the gentleman's view of the matter.
Mr. STAFFORD. That is the bill itself.
Mr. SNooK. I think the property would be just as much safeguarded
and all rights as well protected if it is left to Congress to dispose of
after the war as it would be to give the party a right to bring a, suit
in the Court of Claims. .
Mr. GORDON. Will the gentleman yield ?
Mr. SNOOK. Yes.
Mr. GoRDOiN. If the custodian of the money of this governnessth4
the gentleman speaks about were to send it to her, and when it gl
across the sea it were to get into the hands of one of the Government
at war with Germany, they would take it and keep it!?
Mr. SNOOK. Yes. I
Mr. GORDON. And use it against Germany !
Mr. SNOoK. Certainly. Alien enemies have no legal rights that-4
belligerent is bound to respect, as a matter of law.
Mr. STAFFORD. But this Government does recognize them. ,
Mr. GORDOm We are recognizing them in this country by providA;
in this act for a trustee to hold the property until the close 0'of t
war.
Mr. SNOOK. I see that my time is running.
By section 4 an enemy and an ally of an enemy is forbidden to
sume and use any other name than that by which it was known it-
the beginning of the war, except under license issued by the Secretaq
of Commerce.
Under section 5 the President may suspend the act so far as it
plies to an ally of an enemy and licenses may be granted under thel
reaction of the President to any person if he shall be of opinion
such grant shall be compatible with the successful prosecution of t4
war.






ti"W provides for tlie appointment of a Government agent to
M Ntf alien-property custodian, and all money and property
States due or onging to an enemy or an ally of enemy
Bhad to this cust; ian tobe held by him and accounted for
ratscxsss of the .at. .
i^ .d.: employees asa ny be necessary to carry out the
Appointed trough thlie Civil Service Commission, and
F t C ioier e is emp'wOer.d to accept voluntary services.
tmin it has been stated that,it will require an additional
ep e1oyes to sdiiainistqr the law.
l, 3on page 30, Secetftry Redfield assures us that this
t s entirely unfounded, and that it will not require one-tenth
ni: er; on pages 17 to 19 of the hearings the Secretary
"eMS the nature, of the work that this bureau will have
~~Frbes
tsiatesthe number of clerks that will be required to per-
Sdu.ties t 45; he then .makes the statement, to be found on
0y : M is 6f the opizion"that he will be able to secure volun-
qt a large art of Iths work without compensation.
...La) .'ovidIes for the disclosure of all property of an enemy
..19 emy u situate within the United States and of all
ean or an'lly of enemy through reports which must
-the custodian. a any cv
decl) dlares that.nty conveyance or transfer of the prop-
Saenemy or ally of enemy after the beginning of the war
tog that it was such property shall be void. This section
asthe exceptig to whichI have heretofore referred to con-
p 1Wi. i if the Secretary shall so require any
r..oier iroperty of an enemy or ally .of enem or which is
P or .los to an enpmy or aiy of enemy shall be conveyed,
ii ,&hmredor paid t' the custodian, and that any person not an
t ally of enemy who owes to such persons any money may, at
t, paiLy the same to he cuodian, and that such delivery of such
or property to the custodian shall be a full discharge of the ob-
to the extent of such. payment or delivery, and the custodian
d to isSue receipt for'the same, which shal be evidence of
*.Try or jaynmentL
prMdAes a method of dispose. of property belonging to
,or aiIly of an enemy where it is encumbered by mortgage

lany person notan enemy or an
Zm, clOaim a inee i n xmmuey or property which has
St ed of th sod orto who&a a debt may be owing
Ps~Yi;y or eau o (y hnvi cKaindicated
B l n x r '' ':. :"i& *i', '1 ^ *i'' '":*' "*, '" : t. "^ : *il'.1:; ** ." :
iW 411 piovidibi thatt 4ll Aoneys Snceludui# chekfs and drafts
MBdemfnd, -rmd*W by thderustodian shall be deposited in the
?ii~rthfT~ni~d Sate land veN46d M. United OSttes bonds;
D ao p for fce606g -And safeguafing .of an
i ethe'stoien. It contaiim the
IttH, Aka' I Wti of ofthoe property
nder the control ths cawliO n g to an enemy or to






an ally of enemy shall be disposed of at the conclusion of the. war at
the discretion of Congress. ,
1. Sections 12 and 13, pages 20 and 21, relate to the regulation of
clearance of vessels bound for foreign ports, in order that there may
be full control of both vessels and cargoes, domestic as well as foreign.
2. An appropriation of a sum not to exceed $250,000 is contained in
the act to be used in the discretion of the Secretary of Commerce for
the administration of the provisions of the act during the fiscal year
ending June 30, 1918, and for the payment of salaries of all persons
employed under the act, together with the necessary expenses for tras-
portation, subsistence, rentals in the District of Columbia, books, peri-
odicals, stationery, miscellaneous supplies, printing, and other neea-
sary expenses.
Section 15, page 22, provides punishment and penalty for the viola-
tion of the act. And section 16, pages 22 and 23, confers jurisdietlia
upon the district courts of the United States to issue such process as
may be necessary to enforce the provisions of the act, with the right of
appeal as provided in sections 128 and 238 of the act of March 8, 1911,i
entitled "An act to codify, revise, and amend the laws relating ttof h
judiciary." Jurisdiction of offenses against the act committed i the
Philippine Islands and the Canal Zone is given to the several 'cuitsa of
the first instance in the Philippine Islands and the district court of the
Canal Zone, and concurrent jurisdiction for like offenses is conferdy
upon the district courts of the United States for offenses ag.ainstthe
act committed upon the high seas.
The analysis I have made of the act under consideration will show
that its purpose is to define what trade may be carried on and what
trade is forbidden. The object of its framers was to provide aiithatmi
to protect our country against any aid being given to the enemy by our
citizens or any other persons, and yet to cause as little interruption as
possible of our commerce. To accomplish this the trade forbidden to ap
enemy or an ally of an enemy in the first instance is not fixed by the
nationality of the person with whom the trade is to be carried, on but
by the domicile or the residence of that person.
The intention is to make it impossible to aid our enemy by forbid-
ding that money or property of any kind held in this country jhourld
reach the hands of the enemy.
Secretary Lansing, who was one of the persons responsible f0r thi
bill, in the hearings before the committee put the matter in this way:
You will observe, in the definition of the word "enemy," that an eneuw Isa
person, corporate or otherwise, who resides in the territory of an enemy or aM
ally of an enemy, or in territory occupied by their armed forces, Or in nOaJ
countries and doing business in such territory, on an official or agent of the WOE-
ernment of the enemy or his ally. By proclamation the President may extend t
definition to include natives, citizens, or subjects of the enemy or hiS aly vlw.h-
ever resident, i.e., in neutral countries or even in the United States. :
The officers of the Government inform us that there may be, me
kinds of business transactions between citizens of this country =Wd
enemies, allies or enemies, or subjects of such countries which, may A*
carried on with safety to the United States. The bill, therefore, pro-
vides for the granting of licenses for the carrying on of such busine*
if such grant shall be compatible with the safety of the United Sta
and with the successful prosecution of the war. g




87


tlr1a apiplned duiogqrthe Qivil War quite successfully.,
'4bh fl'y.wjbp tdu i"m t.,a "'aS with great benefit.
Aa it wa applied
in the vaaouis a
taw a4 p orthiuthe
t. noted in this COnSOnthRO tR&ae witih kliens whtqs rnide'
pQ~ ~~lsul~k~b 'lw'e^fbrbiddea "only ibyvipaoclamatien of .the
*A^&t~~6h a "vy.^ hoiab f Ind- thdt the- safety of the .United,,
1S).iu .inrto I pwrmitb aS little interfereoae, w".' -Ourj
] o 5e6. L !a 1 Pa] zqm.?'h

are passing so many laws for the regulatiop biof r jrdeo
hylu-u M Ah)y ant torkeepriin mind tbat wa JkGw
,,udit in the woldndy..,thlt:
|w f mflieonesato airtaini that dre
iN o ae ifi6Ki os iy..-.bflma oe.wth .
..lft *lpr rl ty O b ecidinglactor in bhis great
Bl lW1 .JIlt ,edodin id, i reign conmerves be j ti:
E aS Ita4f it withais anpanig our efficdietay our
S^ctfort to our enem t hLi .V .. *. i i.:
I .I1*11S4*II Otkdmnfzv be $w povide such regultaftis
kwi^ lfitoht tig authy neachixg-the: snemy thatT
'Ioftal in eauIyiplz'sBthe: war. Ao6their object oft'
hEXvSKtl tboqighithnlien-exemy custodial.
*m rights and property of enemies and allies of eaesea
t-ithWt SEkI persons sit the ounm sdi *aluable
Siib vTh.,utett,&s t ,that A",..e awpuirtistor conr
IT~ilaktbi*bfttiwbqimn of thewat which have not 74
wake ftikw "t t a ri'Adi 6w., odIaurd now due tes vh
pirp:As&Iimatje ijj4 iAlmkgiusrisifafrnse om q '"and that r
* tnbaafa^^^i^B6t~hewkri a Nhtet *ndiilionei ilueQtiz~em'
iB~~qitE^ unlglil Atpwjim6a vashmn~s ajonomai ad rca',
Q1 Amveriean securities. : .....
HlH^tiifa^ds ws~ww*~tdral xg~onr]o this.'pbcopcty,
g*"WhiamilA A4duleoJpfaJaea of tuohWiterest
j Io.e ., A

|l|yB ;i," : ^.:;-? ri .*!TIJt r:*...^ ii
eA&ht ]kWst'rlo ai4i.s sate the praezrt of
bosusOabe &i apptebidw aWcbumtry w Mtich
rthce.fmetshoiyo thaafcalam like tbhpe vid-,

4112:.4 1,) arcI.editu iu.,w jw, '4v:
I.C.'rue^ l AA9niudi ri. AZWO-Ay a- 1W Mdiij, ibfch>ut
rwf~eRuMrcs&k &sn labi Lb9t itwmnittnm,
hl$iw~ay; 1t tBU..)39j JftlOBKi TOnl^Sffl$1Jjfl itt^lt't II r t :n

YMLW* SL itt h ra
|af ^ Nlaff'era el *o ir^^d
t place j own t9 uas-tbat i iT
Mumbf Af 4rtctamvwt lta tM ts 147e 1V


-AD302-76---7






is over. Then this bill does not give to that custodian the final dirposiottIn ap iattt
property, but it expressly declares that after the war shall have ceased MtI pIop-j
erty thus secured shall be at the disposition, of Congress and that it, ub 4 or,
Congress to say how it shall bo handled. It is evident to roUt, sir, Ir m **zJ
what a remarkable power the possession of that enemy property thh*!/:'"hi
guarded would be to you if you were negotiating terms of peace. I hardly xeetb:
more than to suggest the weight that this would give your wotda, nd als,pa
being an act of good faith even toward an enemy. .. ,
Then too, you can readily see in what an embarrassing pobitkn Q-U
own people are placed on account of the rule of law to -whiehi 41d
your attention. Many of our people hold property which belongp 4
an enemy; many others have entered into contracts befo.vthe wig
with persons who are now our enemies; still others have may yriI*
belong to such persons. :. 2:
Almost daily these persons are asking the Department of J u .to
advice; they wish to know what to do. The adoption ofthism s
will relieve the embarrassing position in which they aeplace;. 1
property held by our citizens belonging to an enemy or ito ti l
of an enemy may be turned over to the custodian and, all m-ein iy
which an enemy or an ally of an enemy has any interest n ,lit
to the custodian and the holder relieved of further liabilitya44devr-
one will be assured that this money and property willbe safety .bld
and equitably and justly disposed of. '
The necessity for this law, then, grows out of,the, o that.all
money and property of the enemy held by the people of this country
can not, under the present state of the law, be turned over to the for"g.,
enemy in any way and can not be-used by the enemy as a basis of crdit,
nor for his benefit. : :: i
Therefore unless the law is changed all this moneyandpiopbety
must remain in the hands of.the present holders; and no otr can ie
ceive any benefit therefrom except such people as hold it for the ownrIs.,
The ,theory of the bill is that it shall not be allowed to remain i. tht
hands of the debtor or the -holder, but that. it shall be turned oV&ip,
the custodian, to be held by him during the war and to be invested 1
Government securities, thereby helping to finance our GovYernment
to build up its credit., *.
Thus this feature of the bill provides a means for assistig the
Government, but at the same time is just and fair to th.e eaemny. ; .
For if the war is to last very long and a measure of thiarkiadi$|nz
passed, the enemy will be bound to take the tisk of the solvency-,qS he
debtor in America. In times of peace, in the ordinary course f bsi
ness, the risk of insolvency is quite great. This risk may be.iWre
times of war. This bill does away with that risk. It absolutelyr (rw d
a means by which all this property and money will be taken cao 4an3
invested in the highest securities, so that when the war is ended
owner may make and prosecute a claim for his property,.' '. ,., i ,
At the same time,the.bill safeguards and .protects the rigAht of ia
Government, for the whole question, as to the .inal' disposition'4l
this property and money, together with the income thereof, is left t:o
the discretion of Congress and is to be settled by appropriate legislation
when the war is over. .''..'.' '..
Heretofore I have not referred to section 10 of tdi act for ti re09
that'thei provisions of this section refer to a subject different fom tha
which we hive been discussing; This section is divided into eight pars