FOREIGN RELATIONS, 1942, VOLUME VI



ment with these companies whereunder the companies would comply
with the obligations imposed upon them through the concessions which
they had obtained in Venezuela, whereby the grossly unjust con-
cessions and privileges obtained through corruption and fraud by the
companies would be abrogated and negotiated on a new, legal and
fair basis, and whereby the companies would be willing to enter into
new agreements, in certain instances, with the Venezuelan Government
as a result of which anachronistic privileges (such as exemption from
customs duties for their commissaries) obtained in the earliest days
of the concessions, some 30 or more years ago, would be abandoned.
  Dr. Pacanins said that all of the efforts of the two Venezuelan
governments above referred to had been fruitless. He stated that as
a last resort just a year ago he had been sent to New York by the
Government of Venezuela to attempt to reach a satisfactory under-
standing with the companies at their home offices. He stated that he
had requested the companies to present him with a project covering
what they believed to be fair and reasonable in view of changed con-
ditions and in the light of the facts above set forth. He stated that
when this project had been received it had offered nothing except
the prospect of interminable negotiations which the Government of
Venezuela was unwilling to contemplate.
  The Attorney General stated that before the conclusion of this year
of 1942 the Government of Venezuela was afforded the opportunity,
by the terms of the concession granted the Shell Company, which
had been in existence for just 20 years, to terminate the concession or
negotiate a new concession. Dr. Pacanins stated that, by the terms
of the concession, if the Government of Venezuela did not avail
itself of this opportunity this autumn, the existing terms of the
concession would continue in effect for another 30 years. He stated
that it was therefore imperative for his Government to take this
opportunity, and it desired, consequently, at the same time, to eliminate
all of its differences with the other two American companies, although
only a few of the subsidiary concessions of the American companies
expired during the next twelve months.
  The Attorney General stated that he was instructed officially to
state to this Government that the Government of Venezuela had not
the remotest intention of expropriating foreign-owned oil properties
in Venezuela. He stated further that the Government of Venezuela
desired that the exploitation of Venezuelan oil resources be continued
by foreign companies and specifically the companies already doing
business in Venezuela. Finally, he stated that the Government of
Venezuela would not undertake a single act which was not strictly in



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