treaty of 1936 did primarily in the way of concessions by one Government to the other, and considerations by the other Government, something that will give us the substance of that treaty? General MEHAFFEY. Yes, sir. (The matter referred to is as follows:) SUMMARY OF ESSENTIAL FEATURES OF AGREEMENTS OF MARCH 2, 1936 1 I. General treaty. Article I establishes a basis of friendship and cooperation between Panama and the United States. Article II. The compliance of Panama with the provisions of article II of the convention of November 18, 1903, in turning over to the United States additional lands and waters beyond those specifically mentioned therein is recognized. The requirement of further lands and waters is considered improbable by both Governments, but they nevertheless recognize their joint obligation to insure the continuous operation of the Canal and undertake to reach an agreement should additional lands and waters be in fact necessary for this purpose. Article III contains various provisions restricting the commercial activities of the United States in the Canal Zone in order that Panama may take advantage of the commercial opportunities inherent in its geographical situation. In this article are listed the classes of persons who may reside in the Canal Zone and the persons who are entitled to make purchases in the Canal Zone commissaries. PANAMA TREATY-GENERAL Article IV provides for the free entry of merchandise entering Panama destined for agencies of the United States Government, and provides that no taxes shall be imposed upon persons in the service of the United States entering Panama or upon residents of Panama entering the Canal Zone. Article V provides that port facilities other than those owned by the Panama Railroad Co. in the ports of Panama and Colon may be operated only by Panama; exempts from Panamanian taxation vessels using the Canal which do not touch at ports under Panamanian jurisdiction; and provides for the establishment of Panamanian customhouses within the Canal Zone. The United States undertakes to adopt such administrative regulations as may be necessary to assist Panama in controlling immigration into that country. Article VI revises article VII of the convention of November 18, 1903, in that the United States renounces the right to acquire, by the exercise of the right of eminent domain, lands or properties in or near the cities of Panama and Čolon, although retaining the right to purchase necessary lands or properties. The third paragraph of the said article VII, granting the United States the right to intervene in the cities of Panama and Colon and the territory adjacent thereto for the purpose of maintaining order, is abrogated. Article VII provides that beginning with the 1934 annuity payment the annual amounts of these payments shall be four hundred thirty thousand balboas (B/430,000.00) or the equivalent thereof. In a supplementary exchange of notes the balboa is defined as having a gold content equal to that of the present United States dollar. Article VIII provides for a corridor under Panamanian jurisdiction to connect the city of Colon with other territory of Panama. Article IX establishes a similar corridor under American jurisdiction to connect the Madden Dam area with the Canal Zone proper. Article X provides that in case of emergency both Governments will take such measures of prevention and defense as they may consider necessary for the protection of their common interests. Article XI reserves to each country all rights enjoyed by virtue of treaties now in force between the two countries, and preserves all obligations therein established, with the exception of those rights and obligations specifically revised by the present treaty. The juridical status of the Canal Zone, as defined in article III of the 1903 convention, thereby remains unaltered. Article XII provides that the treaty shall take effect immediately on the exchange of ratifications in Washington. 1 The full text of the 1936 treaty and accessory notes are contained in Senate Executive Report No. 5, 76th Cong., 1st sess., submitted by the Committee on Foreign Relations, U. S. Senate.. II. The 16 exchanges of notes which accompany the general treaty deal with the following subjects: 1. Applicability of the treaty to all lands and waters of Panama used, occupied, or controlled by the United States. 2. For the purpose of making purchases at the Canal Zone commissaries the term "officers, employees, workmen, or laborers in the service or employ of the United States" is interpreted as referring only to such officers and employees as are connected with the Panama Canal, or exercising official duties in Panama. 3. As exceptions to the general rule regarding residence in the Canal Zone, certain truck gardeners and hucksters are permitted to continue residing therein. 4. Exemption of the Canal Zone hotels from the general restrictions on residence in the zone pending the establishment of a satisfactory hotel business in Panama. 5. As an exception to the general rule regarding purchases at the Canal Zone commissaries, residents of the Canal Zone are permitted to purchase essential provisions for their servants. 6. The United States undertakes to withdraw from the "hold for orders" business as soon as satisfactory bonded warehouse facilities become available at reasonable rates in Panamanian jurisdiction. 7. The use and services of hospitals, dispensaries, restaurants, lunchrooms, messes, clubhouses, and moving-picture houses in the zone are limited to Canal Zone residents and their guests, and officers and employees of the United States of America. 8. Agreement to confer regularly with a view to preventing smuggling. 9. Private enterprises temporarliy engaged in construction work having a direct relation to the operation, maintenance, sanitation, or protection of the Canal are permitted to operate in the zone for that purpose. 10. Regulation of sales to ships by the Canal Zone commissaries. 11. Reservation of the rights of the Panama Railroad Co. to operate, port facilities in Panama and Colon. 12. Reservation of certain rights of officers and employees of the United States in regard to the immigration laws of Panama. 13. Cooperation for the sanitation of the cities of Panama and Colon. 14. Agreement to hold conversations to discuss problems which have arisen in connection with the distribution of water in the cities of Panama and Colon. 15. Equality of opportunity and treatment of Panamanian and American employees in the Canal Zone. 16. Monetary agreement redefining the gold content of the Balboa in terms of the present United States dollar. I GENERAL TREATY The United States of America and the Republic of Panama, animated by the desire to strengthen further the bonds of friendship and cooperation between the two countries and to regulate on a stable and mutually satisfactory basis certain questions which have arisen as a result of the construction of the interoceanic canal across the Isthmus of Panama, have decided to conclude a treaty, and have designated for this purpose as their Plenipotentiaries— The President of the United States of America; Mr. Cordell Hull, Secretary of State of the United States of America, and Mr. Sumner Welles, Assistant Secretary of State of the United States of America; and The President of the Republic of Panama; The Honorable Doctor Ricardo J. Alfaro, Envoy Extraordinary and Minister Plenipotentiary of Panama to the United States of America, and The Honorable Doctor Narciso Garay, Envoy Extraordinary and Minister Plenipotentiary of Panama on special mission; Who, having communicated their respective full powers to each other, which have been found to be in good and due form, have agreed upon the following: ARTICLE I Article I of the Convention of November 18, 1903, is hereby superseded. There shall be a perfect, firm, and inviolable peace and sincere friendship between the United States of America and the Republic of Panama and between their citizens. In view of the official and formal opening of the Panama Canal on July 12, 1920, the United States of America and the Republic of Panama declare that the provisions of the Convention of November 18, 1903, contemplate the use, occupation and control by the United States of America of the Canal Zone and of the additional lands and waters under the jurisdiction of the United States of America for the purposes of the efficient maintenance, operation, sanitation, and protection of the Canal and of its auxiliary works. The United States of America will continue the maintenance of the Panama Canal for the encouragement and use of interoceanic commerce, and the two Governments declare their willingness to cooperate, as far as it is feasible for them to do so, for the purpose of insuring the full and perpetual enjoyment of the benefits of all kinds which the Canal should afford the two nations that made possible its construction as well as all nations interested in world trade. ARTICLE II The United States of America declares that the Republic of Panama has loyally and satisfactorily complied with the obligations which it entered into under Article II of the Convention of November 18, 1903, by which it granted in perpetuity to the United States the use, occupation, and control of the zone of land and land under water as described in the said Article, of the islands within the limits of said zone, of the group of small islands in the Bay of Panama, named Perico, Naos, Culebra, and Flamenco, and of any other lands and waters outside of said zone necessary and convenient for the construction, maintenance, operation, sanitation, and protection of the Panama Canal or of any auxiliary canals or other works, and in recognition thereof the United States of America hereby renounces the grant made to it in perpetuity by the Republic of Panama of the use, occupation, and control of lands and waters, in addition to those now under the jurisdiction of the United States of America outside of the zone as described in Article II of the aforesaid Convention, which may be necessary and convenient for the construction, maintenance, operation, sanitation, and protection of the Panama Canal or of any auxiliary canals or other works necessary and convenient for the construction, maintenance, operation, sanitation, and protection of the said enterprise. While both Governments agree that the requirement of further lands and waters for the enlargement of the existing facilities of the Canal appears to be improbable, they nevertheless recognize, subject to the provisions of Articles I and X of this Treaty, their joint obligation to insure the effective and continuous operation of the Canal and the preservation of its neutrality, and consequently, if, in the event of some now unforeseen contingency, the utilization of lands or waters additioanl to those already employed should be in fact necessary for the maintenance, sanitation, or efficient operation of the Canal, or for its effective protection, the Governments of the United States of America and the Republic of Panama will agree upon such measures as it may be necessary to take in order to insure the maintenance, sanitation, efficient operation and effective protection of the Canal, in which the two countries are jointly and vitally interested. ARTICLE III In order to enable the Republic of Panama to take advantage of the commercial opportunities inherent in its geographical situation, the United States of America agrees as follows: (1) The sale to individuals of goods imported into the Canal Zone or purchased, produced, or manufactured therein by the Government of the United States of America shall be limited by it to the persons included in classes (a) and (b) of Section 2 of this Article; and with regard to the persons included in classes (c), (d), and (e) of the said Section and members of their families, the sales above mentioned shall be made only when such persons actually reside in the Canal Zone. (2) No person who is not comprised within the following classes shall be entitled to reside within the Canal Zone: (a) Officers, employees, workmen, or laborers in the service or employ of the United States of America, the Panama Canal, or the Panama Railroad Company, and members of their families actually residing with them; (b) Members of the armed forces of the United States of America and members of their families actually residing with them; (c) Contractors operating in the Canal Zone and their employees, workmen, and laborers during the performance of contracts; (d) Officers, employees, or workmen of companies entitled under Section 5 of this Article to conduct operations in the Canal Zone; (e) Persons engaged in religious, welfare, charitable, educational, recreational, and scientific work exclusively in the Canal Zone; (f) Domestic servants of all the before-mentioned persons and members of the families of the persons in classes (c), (d), and (e) actually residing with them. (3) No dwellings belonging to the Government of the United States of America or to the Panama Railroad Company and situated within the Canal Zone shall be rented, leased, or sublet except to persons within classes (a) to (e), inclusive, of Section 2 hereinabove. (4) The Government of the United States of America will continue to cooperate in all proper ways with the Government of the Republic of Panama to prevent violations of the immigration and customs laws of the Republic of Panama, including the smuggling into territory under the jurisdiction of the Republic of goods imported into the Canal Zone or purchased, produced, or manufactured therein by the Government of the United States of America. (5) With the exception of concerns having a direct relation to the operation, maintenance, sanitation, or protection of the Canal, such as those engaged in the operation of cables, shipping, or dealing in oil or fuel, the Government of the United States of America will not permit the establishment in the Canal Zone of private business enterprises other than those existing therein at the time of the signature of this Treaty. (6) 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 Colón, 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 af 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 Panamá or Colón, 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. (7) The Government of the United States of America will extend to private merchants residing in the Republic of Panama full opportunity for making sales to vessels arriving at terminal ports of the Canal or transiting the Canal, subject always to appropriate administrative regulations of the Canal Zone. ARTICLE IV The Government of the Republic of Panama shall not impose import duties or taxes of any kind on goods destined for or consigned to the agencies of the Government of the United States of America in the Republic of Panama when the goods are intended for the official use of such agencies, or upon goods destined for or consigned to persons included in classes (a) and (b) in Section 2 of Article III of this Treaty, who reside or sojourn in territory under the jurisdiction of the Republic of Panama during the performance of their service with the United States of America, the Panama Canal, or the Panama Railroad Company, when the goods are intended for their own use and benefit. The United States of America shall not impose import duties or taxes of any kind on goods, wares, and merchandise passing from territory under the jurisdiction of the Republic of Panama into the Canal Zone. No charges of any kind shall be imposed by the authorities of the United States of America upon persons residing in territory under the jurisdiction of the Republic of Panama passing from the said territory into the Canal Zone, and no charges of any kind shall be imposed by the authorities of the Republic of Panama upon persons in the service of the United States of America or residing in the Canal Zone passing from the Canal Zone into territory under the jurisdiction of the Republic of Panama, all other persons passing from the Canal Zone into territory under the jurisdiction of the Republic of Panama being subject to the full effects of the immigration laws of the Republic. In view of the fact that the Canal Zone divides the territory under the jurisdiction of the Republic of Panama, the United States of America agrees that, subject to such police regulations as circumstances may require, Panamanian citizens who may occasionally be deported from the Canal Zone shall be assured transit through the aid Zone, in order to pass from one part to another of the territory under the jurisdiction of the Republic of Panama. ARTICLE V Article IX of the Convention of November 18, 1903, is hereby superseded. to be introduced for use or consumption in territory under the jurisdiction of the Republic of Panama, and upon vessels touching at Panamanian ports and upon the officers, crew, or passengers of such vessels, the taxes or charges provided by the laws of the Republic of Panama; it being understood that the Republic of Panama will continue directly and exclusively to exercise its jurisdiction over the ports of Panama and Colon and to operate exclusively with Panamanian personnel such facilities as are or may be established therein by the Republic or by its authority. However, the Republic of Panama shall not impose or collect and charges or taxes upon any vessel using or passing through the Canal which does not touch at a port under Panamanian jurisdiction or upon the officers, crew, or passengers of such vessels, unless they enter the Republic; it being also understood that taxes and charges imposed by the Republic of Panama upon vessels using or passing through the Canal which touch at ports under Panamanian jurisdiction, or upon their cargo, officers, crew, or passengers, shall not be higher than those imposed upon vessels which touch only at ports under Panamanian jurisdiction and do not transit the Canal, or upon their cargo, officers, crew, or passengers. The Republic of Panama also has the right to determine what persons or classes of persons arriving at ports of the Canal Zone shall be admitted to the Republie of Panama and to determine likewise what persons or classes of persons arriving at such ports shall be excluded from admission to the Republic of Panama. The United States of America will furnish to the Republic of Panama free of charge the necessary sites for the establishment of customhouses in the ports of the Canal Zone for the collection of duties on importations destined to the Republic and for the examination of merchandise, baggage, and passengers consigned to or bound for the Republic of Panama, and for the prevention of contraband trade, it being understood that the collection of duties and the examination of merchandise and passengers by the agents of the Government of the Republic of Panama, in accordance with this provision, shall take place only in the customhouses to be established by the Government of the Republic of Panama as herein provided, and that the Republic of Panama will exercise exclusive jurisdiction within the sites on which the customhouses are located so far as concerns the enforcement of immigration or customs laws of the Republic of Panama, and over all property therein contained and the personnel therein employed. To further the effective enforcement of the rights hereinbefore recognized, the Government of the United States of America agrees that, for the purpose of obtaining information useful in determining whether persons arriving at ports of the Canal Zone and destined to points within the jurisdiction of the Republic of Panama should be admitted or excluded from admission into the Republic, the immigration officers of the Republic of Panama shall have the right of free access to vessels upon their arrival at the Balboa or Cristobal piers or wharves with passengers destined for the Republic; and that the appropriate authorities of the Panama Canal will adopt such administrative regulations regarding persons entering ports of the Canal Zone and destined to points within the jurisdiction of the Republic of Panama as will facilitate the exercise by the authorities of Panama of their jurisdiction in the manner provided in Paragraph 4 of this Article for the purposes stated in Paragraph 3 thereof. ARTICLE VI The first sentence of Article VII of the Convention of November 18, 1903, is hereby amended so as to omit the following phrase: "or by the exercise of the right of eminent domain." The third paragraph of article VII of the Convention of November 18, 1903, is hereby abrogated. ARTICLE VII Beginning with the annuity payable in 1934 the payments under Article XIV of the Convention of November 18, 1903, between the United States of America and the Republic of Panama, shall be four hundred and thirty thousand Balboas (B/430,000.00) as defined by the agreement embodied in an exchange of notes of this date. The United States of America may discharge its obligation with respect to any such payment, upon payment in any coin or currency, provided the amount so paid is the equivalent of four hundred and thirty thousand Balboas (B/430,000.00) as so defined. ARTICLE VIII In order that the city of Colón may enjoy direct means of land communication under Panamanian jurisdiction with other territory under jurisdiction of the |