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OCR Page 1 of 2NLT/NAVAL AIDE) 437
OFFICE OF
THE SECRETARY OF STATE
WASHINGTON
E.O. Guidelines, March 6, 1982
12065,
State Dept. DEF NLT, Date 9-11 -
December 4, 1952
By
TOP SECRET SECURITY INFORMATION
SUMMARY OF TELEGRAMS
IRAN
In a personal message to Prime Minister Mosadeq,
our Ambassador to Iran, who is now in the US, has
suggested a possible solution to the question of compensation for
the nationalized British oil interests. The suggested formula takes
into consideration a statement made by Mosadeq in his note of
September 24, 1952 to Prime Minister Churchill that compensation
be based on "any law carried out by any country for nationalizing
its industries in similar instances' which may be agreed to by the
Anglo-Iranian Oil Company. With this in mind US officials have
been studying the possibility of creating a Board of Arbitration
agreed to by both disputants, possibly appointed by the International
Court of Justice, to consider the amount of compensation to be paid
the British interests. Such a Board would not question the validity
of the Iranian nationalization law and would in setting the amount
of compensation consider the standards used by the British Govern-
ment in determining the amount of compensation to be paid to any
of the enterprises which it nationalized during the past ten years
which in its opinion may be appropriate. In this connection,
Ambassador Hendersor points out that it is apparently the view of
the British Government, which is widely shared by the whole inter- -
national business world, that any formula for determining the value
of nationalized property should not specifically deny the Board of
Arbitration the privilege of considering the earning value of
property.
Ambassador Henderson's message informs
Mosadeq that we have not consulted the British on the proposal and
inquires whether he would be willing to agree to allowing a Board
of Arbitration determine the amount of compensation due the AIOC.
Our Charge in delivering the message is to make its personal and
unofficial character absolutely clear and to state that it would be per- -
sonally embarrassing to Henderson if the substance of the message
were made public.
TOP SECRET SEGURITY INFORMATION