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agreement of the parties, and the specific and affirmative recognition in article I by the parties of the absence of any obligation on the part of either party to change the annuity.

"Senator FULBRIGHT. Yes.

"Mr. HOLLAND. I think the sanctity of those rights is thereby strengthened. "Senator WILEY. As I understand from you, Secretary Holland, there is nothing in this present treaty that would in the slightest degree depreciate all the attributes of sovereignty that we possess.

"Mr. HOLLAND. That is true; and so true is it, that in the course of the negotiations the Panamanians advanced several small requests which, 1 by 1, had considerable appeal, but all of which we refused, because we did not want to leave 1 grain of evidence that could a hundred years hence be interpreted as implying any admission by the United States that we possess and exercise anything less than 100 percent of the rights of sovereignty in this area.

"For example, they asked that ships transiting the canal, as a token of deference to Panama, fly the Panamanian flag as well as the United States flag.

"Now, it seemed, perhaps, a little unfriendly to say, 'No,' but we said, 'No.' because while the gentlemen representing Panama would never have any misunderstanding as to why that might be done, generations coming after us might have some misunderstanding as to why that was done, and we felt we could not agree to do anything, nor would the Senate approve it if we were to agree to it, which could be construed a hundred years hence as receding one millimeter from the position that we possess and exercise all of the rights that we would have if we were the sovereign in that area.'

99 10

On Feb. 7, 1974, Secretary of State Kissinger and the Panamanian Minister of Foreign Affairs (TACK) announced a series of principles to guide the negotiation of a new Panama Canal Treaty. These principles are

1. The treaty of 1903 and its amendments will be abrogated by the conclusion of an entirely new interoceanic canal treaty.

2. The concept of perpetuity will be eliminated. The new treaty concerning the lock canal shall have a fixed termination date.

3. Termination of United States jurisdiction over Panamanian territory shall take place promptly in accordance with terms specified in the treaty.

4. The Panamanian territory in which the canal is situated shall be returned to the jurisdiction of the Republic of Panama. The Republic of Panama, in its capacity as territorial sovereign, shall grant to the United States of America, for the duration of the new interoceanic canal treaty and in accordance with what that treaty states, the right to use the lands, waters and airspace which may be necessary for the operation, maintenance, protection and defense of the canal and the transit of ships.

5. The Republic of Panama shall have a just and equitable share of the benefits derived from the operation of the canal in its territory. It is recognized that the geographic position of its territory constitutes the principal resource of the Republic of Panama.

6. The Republic of Panama shall participate in the administration of the canal, in accordance with a procedure to be agreed upon in the treaty. The treaty shall also provide that Panama will assume total responsibility for the operation of the canal upon the termination of the treaty. The Republic of Panama shall grant to the United States of America the rights necessary to regulate the transit of ships through the canal and operate, maintain, protect and defend the canal, and to undertake any other specific activity related to those ends, as may be agreed upon in the treaty.

7. The Republic of Panama shall participate with the United States of America in the protection and defense of the canal in accordance with what is agreed upon in the new treaty.

8. The United States of America and the Republic of Panama, recognizing the important services rendered by the interoceanic Panama Canal to international maritime traffic, and bearing in mind the possibility that the present canal could become inadequate for said traffic, shall agree bilaterally on provisions for new projects which will enlarge canal capacity. Such provisions will be incorporated in the new treaty in accord with the concepts established in principle 2.11

9 Id. at 45.

10 Id. at 164.

11

11 70 Dept. State Bulletin 181, 184 (1974).

At the time that the joint statement was signed, Secretary Kissinger emphasized that the purpose of the treaty would be to "RESTORE Panama's sovereignty." 12 Obviously, if one is to restore sovereignty, it cannot be said to already exist.

Hon. M. GENE SNYDER,
House of Representatives

AUGUST 18, 1976.

DEAR MR. SNYDER: During the Negotiators' testimony before the Panama Canal Subcommittee on April 8, you contested the view that the Canal Zone is territory of the Republic of Panama. On that occasion you took exception to a point raised in my December letter which you regard as of key significance in determining the status of the Canal Zone. That point is that Article III, Section (6) of the 1936 Treaty with Panama recognizes the Canal Zone as "Territory of the Republic of Panama under the jurisdiction of the United States of America".

It was your view that the quote referred not to the Canal Zone as such but rather to specific areas owned in 1936 by the Panama Railroad Company which were located outside the Zone in the cities of Panama and Colon. In response the Negotiators stated that this phrase of the 1936 Treaty could not refer to these particular properties outside the Zone, because they never had been under the jurisdiction of the United States. Rather, as Article V of the 1955 Treaty states in referring to these areas in the cities of Panama and Colon, they were "held by the United States of America or its agencies (i.e. the Panama Railroad Company) . . . in Territory under the jurisdiction of the Republic of Panama".

You subsequently issued a statement with your April 18 press release on the testimony which said, in part: "neither Ambassador Bunker nor his aides were able to substantiate in the slightest degree the claim they have been making around the country in public speeches that a phrase in Article III of the 1936 Treaty of Friendship with Panama refers to the Canal Zone as 'territory of the Republic of Panama under the jurisdiction of the U.S.'"

You went on to demand that this view be publicly substantiated or retracted and concluded that "to lie to the American people is nothing less than malfeasance in office".

The Department completely agrees that this matter should be put to rest, and welcomes this opportunity to clarify the legal status of the Canal Zone. Attached is the official record on this particular aspect of the 1936 negotiation-the Joint Minutes of the 107th Negotiating Session which commenced at 11:00 a.m. in Washington, D.C. on February 1, 1936, pages 20-26.

As you will note, the Joint Minutes demonstrate that this phrase of the 1936 Treaty, which received the advice and consent of the Senate and was ratified by the President, was intended to reflect the status of the Canal Zone as territory of the Republic of Panama under the jurisdiction of the United States.

In this same regard, you have also taken the view that the phraseology of Article III Section (6) could not diminish or otherwise affect the rights of the United States under the 1903 Treaty, in view of Article XI of the 1936 Treaty, which provides that the rights and obligations of the parties under other treaties then in force between them are not affected by the 1936 Treaty unless specifically altered or modified by provisions of the 1936 Treaty.

We share that view entirely. As was stated in the testimony of the Negotiators, we have never maintained that this phraseology in any way altered our rights under the 1903 Treaty. It only reflected in clear terms the legal status of the Canal Zone as it had been since the 1903 Treaty entered into forceterritory of Panama under United States jurisdiction.

I trust that this letter clarifies the points you have raised.
Sincerely,

Attachment.

12 Id. at 182 (emphasis added).

S. MOREY BELL, Minister, Deputy U.S. Negotiator.

JOINT MINUTES OF THE 107TH MEETING OF THE PANAMANIAN COMMISSIONERS WITH THE DEPARTMENT OF STATE RELATING TO THE NEGOTIATION OF AGREEMENTS BETWEEN THE TWO COUNTRIES

Present: Dr. Alfaro, Dr. Garay, Mr. Welles, Mr. Baker, Mr. Duggan, Mr. Castle and Mr. Daniels.

Mr. WELLES. I understand that the sixth section of the third article of the general treaty was tentatively agreed upon in the following form. (Mr. Daniels distributes drafts.)

"The Republic of Panama will permit vessels entering at or clearing from the ports of Panama and Colon, in case of emergency and also under suitable regulations and upon the payment of proper charges, to use and enjoy the dockage and other facilities of said ports for the purpose of receiving or disembarking passengers to or from the territory under the jurisdiction of the United States of America, and of loading and unloading cargoes either in transit or destined for the service of the Canal or of works pertaining to the Canal."

May I ask if that text is satisfactory to the Commissioners?

Dr. ALFARO. That text is satisfactory as the one we had agreed upon with Mr. Duggan.

Mr. WELLES. That is then agreed.

Dr. ALFARO. We made the remark that the expression herein contained "territory under the jurisdiction of the United States" is not objectionable in substance to us, but we had used the expression "Canal Zone" because we are speaking of the ports of Panama and Colon and any person going to those ports or leaving those ports will necessarily come from the Canal Zone or go into the Canal Zone. Now from the Canal Zone he might go to other territory under jurisdiction of the United States, but of course that is not the usual result.

Mr. WELLES. With that clarification, is that satisfactory then? With the clarification you have just given.

Dr. ALFARO. The clarification is to explain why we have proposed the expression "Canal Zone" as more precise.

Mr. WELLES. I understand.

Dr. ALFARO. Of course, if you insist on that . . .

Mr. WELLES. It would be preferable from my standpoint. Your clarification makes our understanding perfectly clear.

Dr. GARAY. I understand, Mr. Welles, that the reason for this change was that by the words "Canal Zone" you fear that additional lands may be left outside, but at the same time we have the same feeling you have. It might refer also to the United States.

Mr. Welles. It would hardly seem to me that it would be possible for that interpretation to be given. Would it seem to you, Mr. Baker?

Mr. BAKER. I don't think so.

Mr. WELLES. The whole context, I would say, would make that outside of the bonds of possibility.

Dr. ALFARO. Of course, that expression has never been used. We have had to refer to territory within the jurisdiction of Panama because the territory of Panama, of course, comprises territory under the jurisdiction of the United States, by reason of the Canal treaty. In the case of the United States there is the Canal Zone and additional lands, but in this specific matter if we speak of receiving or disembarking passengers to or from the ports of Panama and Colon, necessarily they have to come from the Canal Zone or go into the Canal Zone since the Canal Zone surrounds the two ports.

Mr. DUGGAN. Does the Canal Zone entirely surround the port of Panama? Might there not be some other access?

Dr. ALFARO. Yes, but in that case the provision does not apply. If you bring passengers from other ports into the ports of Panama, for instance, suppose you disembark a passenger from Punta Mala or from the Punta Mala station to go to Panama through the Canal Zone. If he goes through the Canal Zone, then that is the correct expression. The reason is that people who will read this treaty when they see in the first paragraph of Article VI that we speak of the ports of the Canal Zone and the territory under the jurisdiction of Panama, will wonder why should we speak here of territory under the juris

diction of the United States of America as something different from the Canal Zone, if they have to go to the Canal Zone.

Mr. WELLES. The question is really one of fact. Do they inevitably have to go to the Canal Zone? Take your Punta Mala example, for instance.

Dr. ALFARO. Yes.

Mr. WELLES. Would such individual have inevitably to go to the Canal Zone? Dr. ALFARO. In all probability he would.

Mr. WELLES. In all likelihood.

Dr ALFARO. He is in the service of the Canal.

Mr. WELLES. In all likelihood, yes, but it is not inevitable, is it? The matter is frankly one of no particular interest to me. I simply wanted to be quite sure that the question you have already mentioned would not be raised in the future, that is, the distinction between the Canal Zone as originally and the lands and waters that have since come under the jurisdiction of the United States.

Dr. ALFARO. It is because of the provisions. The Republic of Panama will permit vessels entering at or clearing from the ports of Panama and Colon in case of emergency and upon the payment of proper charges to use and enjoy the facilities of said ports for the purpose of receiving or disembarking passengers from the territory under the jurisdiction of the United States, that is, the Canal Zone.

Mr. WELLES. Yes.

Dr. ALFARO. When speaking of disembarking passengers from the Zone you do not have in mind anything outside of the Zone.

Mr. WELLES. Supposing under the conditions foreseen you were disembarking a passenger for Punta Mala and that passenger wishes to go there by launch. That would not make it necessary for him to go.

Dr. ALFARO. We are speaking of an emergency which will make it necessary to use the Panama docks.

Mr. WELLES. Suppose such an emergency exists and suppose such an individual wishes to go straight to Punta Mala and not to the Canal Zone.

Dr. ALFARO. In case of emergency?

Mr. WELLES. Yes, it would not then be strictly correct to say Canal Zone. I can't see that this prejudices in any sense the interest of the Government of Panama and I should like to retain the phrase simply for the purpose of attaining strict accuracy.

Dr. ALFARO. The only thing we have in mind is that this reciprocal use of the port contemplates the traffic between the ports of the Canal Zone and the ports of Panama and that is why we begin by saying, "In view of the proximity of the port of Balboa to the city of Panama and of the port of Cristobal to the city of Colon".

Mr. WELLES. I am sure that the records will now show exactly what we have in mind so that if any question is raised in Panama the clarification will be on the record. May we then take up for the Commissioners' approval the text...

Dr. ALFARO. By the way, it is also understood that we have eliminated section 6, paragraph 2.

Mr. WELLES. May I take that up in a moment." I have it here.

Dr. GARAY. Pardon me for coming again to this point but will it be objectionable to you if we say in the text of the reply "in territory of the Republic of Panama under the jurisdiction of the United States of America"?

Mr. WELLES. That would be entirely satisfactory to me.

Dr. GARAY. I think it should be changed that way.

Mr. DUGGAN. May I ask what that modification is?

Dr. GARAY. To insert "territory of the Republic unde rthe jurisdiction of the United States", so that there is no possibility of anybody saying that the phraseology refers to the whole territory of the United States.

Mr. WELLES. Dr. Garay's suggestion is to insert after the phrase "disembarking passengers to or from the territory" the words “of the Republic", so that it would read. "receiving or disembarking passengers to or from the territory of the Republic of Panama under the jurisdiction of the United States of America". The modifiation is then agreed upon?

Dr. ALFARO. Yes.

U.S. HOUSE OF REPRESENTATIVES,

COMMITTEE ON MERCHANT MARINE AND FISHERIES,
Washington, D.C., December 15, 1976.

HON. S. MOREY BELL

Minister, Deputy U.S. Negotiator,
Department of State,

Washington, D.C.

DEAR MR. MINISTER: I have examined carefully the portion of the minutes of the negotiations that you recently sent me which culminated in the 1936 Treaty with Panama, the portion which deals with the disputed section 6 of Article III of that Treaty. In fact, I have also examined the minutes obtained elsewhere for earlier discussions of section 6 which previously had been considered as section 5.

It is my contention that any country lawyer could see that the minutes do not support the position Ambassador Bunker and yourself have repeatedly taken in statements to the Congress and the American people, that by the section in question the United States recognized the Canal Zone as "territory of the Republic of Panama under the jurisdiction of the United States." On the contrary, those minutes demonstrate precisely the opposite to be true!

You repeated your position again in your letter to me of August 18th:

"As you will note, the Joint Minutes demonstrate that this phrase of the 1936 Treaty, which received the advice and consent of the Senate and was ratified by the President, was intended to reflect the status of the Canal Zone as territory of the Republic of Panama under the jurisdiction of the United States."

That is absolutely untrue. The language in section 6 of Article III has precisely the opposite intention to that which you falsely attribute to the 1936 negotiators!

Further, not a word concerning that so-called "intention" which you claim appeared in any report on the 1936 Treaty from the State Department to the President or to the Congress, nor in any communication from the President to the Senate, nor in the Senate debate on that Treaty !

Quite frankly, I am forced to repeat my charge of April 13, 1976, which you quoted in your letter, "To lie to the American people is nothing less than malfeasance in office!"

I continue to maintain my original position that paragraph 2 of section 6 of Article III refers to sites or areas in the Republic of Panama outside the limits of the Canal Zone.

The minutes clearly record the insistence by the United States negotiator, the Honorable Sumner Welles, that a traveler could get to those sites or areas without even entering the Canal Zone. This is certainly proof of the correctness of my position and of the falsity of your own and Mr. Bunker's.

Therefore, I must repeat my demand that the Department of State stop making the false claim that in the 1936 Treaty with Panama, the United States recognizes the status of the Canal Zone to be only "territory of the Republic of Panama under the jurisdiction of the United States."

I am writing both President Gerald Ford and President-elect Jimmy Carter making the same demand, basing it on the evidence that follows.

At the outset let me state the complete text of section 6 of Article III, with the phrase in dispute underlined:

"In view of the proximity of the port of Balboa to the city of Panama and of the port of Cristobal to the city of Colon, the United States of America will continue to permit, under suitable regulations and upon the payment of proper charges, vessels entering at or clearing from the ports of the Canal Zone to use and enjoy the dockage and other facilities of the said ports for the purpose of loading and unloading cargoes and receiving or disembarking passengers to or from the territory under the jurisdiction of the Republic of Panama.

"The Republic of Panama will permit vessels entering at or clearing from the ports of Panama or Colon, in case of emergency and also under suitable regulations and upon the payment of proper charges, to use and enjoy the dockage and other facilities of said ports for the purpose of receiving or disembarking passengers to or from the territory of the Republic of Panama under the jurisdiction of the United States of America and of loading and unloading cargoes either in transit or destined for the service of the Canal or of works pertaining to the Canal."

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