Telegram from Ambassador Henry Grady to Secretary of State Dean Acheson, Number 352

NLT(PSF-5UB5)352 INCOMING TELEGRAM Department of State copy 1002 162 TELEGRAPH BRANCH 7/25/51, 7:30 a.m. D-X TOP SECRET CORRECTED PAGE 1 A Action Control: 12499 NEA Rec'd: July 24, 1951 FROM: Tehran 1:29 p.m. Info SS TO: Secretary of State DECLASSIFIED G E.O. 13526 EUR NO: 352, July 24, 3 p.m. Authority LP. HST 2013-010 , #7 E NARA PMH DCR Date 1/15/2016 PRIORITY. SENT DEPT 352, LONDON 71 (EYES ONLY AMB). FROM HARRIMAN FOR THE PRESIDENT AND SECRETARY. NO DISTRI- BUTION EXCEPT AS DIRECTED BY SECRETARY'S OFFICE. I gave the British Ambassador this morning formula for meet- ing as proposed by Iranian Government and translation of Iranian Cabinet minute ; also my language of (A), (B), and (c) included in MYTEL 340, which Iranian Government has authorized me to pass on to British Government. In addition, I went over with him the substance of all of matters included in my telegram referred to above and supplementary telegram referring to Court decision. He said that he thought his government might well wish to have included "and to discuss matters of mutual interest to two governments" I told him I felt sure Iranian Government would agree. He thought his government would question the language "on behalf of the AIOC' He pointed out "the lesser (AIOC) was included in the greater (British Government)" I explained the significance I thought the Iranians attached to this was on account of their prior position that dispute was with oil company and not (rpt not) British Government. He said this was no (rpt no) time to take legalistic position. I also told him that I felt sure Iranian Government would interpret my use of the word "law" in (c) as abbreviation for language of third point of Cabinet minute: "The proposal which was approved by Special Oil Committee of Ma jlis and was confirmed by law of March 20", the text of which was quoted. He appeared to agree when I said that present atmosphere was more favorable to satisfactory settlement than was likely to exist again. He responded to my explanation of Iranian worry about alleged AIOC political activities by saying that this could be worked out be tween governments. I emphasized importance to Iranians that AIOC cld not (rpt not) appear SMD:VH TOP SECRET REPRODUCTION OF THIS MESSAGE IS PROHIBITED