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mental or control functions, and the following were specifically abolished upon occupation:

a. Regional Economic Chambers (Gauwirtschaftskammern). b. Economic Groups (Reichsgruppen, Wirtschaftsgruppen, Fachgruppen and

Fachuntergruppen). c. Armament Inspectors (Ruestungsinspektoren). d. Armament Chiefs (Ruestungsobmaenner and Bezirksobmaenner). e. Other regional agencies and representatives of the Ministry of

Armaments and War Production. 1. Industrial Rings (Industrieringe). g. Main Committees (Hauptausschuesse) or Special Committees. h. Reichsvereinigungen, cartels and syndicates.

Chambre of commerce and Trade Association

Each Minister President is authorized to permit the establishment of Trade Associations, organized on a horizontal basis, of independent firms in the same fields of industry or trade, with voluntary membership and with jurisdiction confined to a single Land. The Associations can exercise advisory functions only and have no authority over distribution, sales, marketing, prices, allocation of orders, materials or fuels, licensing of business or production quotas. The Minister Presidents, in addition, are authorized to permit the Trade Associations to negotiate with the corresponding labor unions. The Minister President of each Land, through the Minister of Economics, has to date authorized a considerable number of such Trade Associations.

The Minister President of each Land is also authorized to permit organizations of local Chambers of Industry and Commerce and associations of the Chambers at Land level. The functions of the Chambers are limited in the same manner as the Trade Associations. The Chambers of Commerce and Trade Associations operate in large part in the same manner as they did prior to the Nazi Regime except that compulsory dues cannot be levied from nonmembers.

Associations of Chambers on a Land level have not yet been organized and the total number of Chambers in each Land varies from six to ten. Handicraft Chambers have been organized on a basis similar to the Chambers of Commerce and Trade Associations. **The Minister Presidents, in conjunction with Military Government, however, are now studying the possible re-organization of the Handicraft Chambers, both because of their importance to the large handicraft trade in the U. S. Zone and to see that there is no conflict between them and the labor unions. The German authorities are proposing that the Handicraft Chambers should be given responsibility for allocating materials to individual handicraft enterprises.

Food and Agriculture

The Food and Agriculture Administrations, under the Minister of Economics in Wuerttemberg-Baden and under the Ministers of Food and Agriculture in Bavaria and Greater Hesse, are organized along approximately the same lines in each Land. Because of the possibility that immediate complete reorganization inight have interfered with the maintenance of essential controls, reorganization in food and agriculture has proceeded somewhat more slowly than in the economics.

The Minister Presidents were, therefore, authorized in August, 1945, temporarily to continue the Land Marketing Associations and the Peasant Associations with compulsory membership as instruments for carrying out certain controls. The Minister Presidents, however, in conjunction with Military Government, beginning early in 1946, undertook to study reorganization of the Food and Agriculture Administrations. As a basic principle, Military Government instructed the German authorities that in this reorganization, associations of private individuals could not be given the authority to execute government regulatory powers, and that such functions would have to be accomplished along the lines laid down in the field of economics. As a result of the study, an amendment to Military Government Regulations has beer. issued, and the German authorities are effecting reorganization in accordance with this new amendment. Under a recent amendment in Regulations, Marketing Associations and Peasant Associations will be dissolved and the regulatory functions and powers previously exercised by these associations will be transferred to the Food and Agriculture Administrations.

The Minister Presidents are authorized to permit the formation of Farmers Associations with jurisdiction confined to a single Land and with voluntary membership. The associations will exercise advisory functions only and are specifically forbidden not to carry out government regulatory functions. Each Ministry will contain a Food Division which will be charged for the food administration program including controls imposed upon the production, delivery, marketing, processing, storage, and distribution of food to the ultimate consumer and the allocation of agricultural and processing supplies to producers and processers.

Cooperatives

The Minister Presidents are required to permit the formation of cooperatives provided they are organized and function in accordance with democratic principles. The voluntary federation of cooperatives up to Land levels is permitted, and in addition, cooperatives from more than one Land are authorized to group together in joint enterprises such as wholesale purchasing cooperatives and auditing associations and for the purposes of acquiring pro

duction facilities and other capital assets.

Statisticat Services

A Land Statistic Office with branches has been established by the Minister President in each Land as a separate agency, although functioning under the general over-all supervision of the Minister of Economics. The Statistical Offices operate as service agencies for economics and food and agriculture and maintain all other Land statistics. The Laenderrat

The Minister Presidents were authorized in November 1945 to organize the Laenderrat as the means for obtaining necessary coordination within the U. S. Zone. They were, however, specifically not authorized to form a zonal government because of the U. S. policy that nothing should be done that might interfere with the establishment of central agencies for Germany as a whole.

The Laenderrat consists of the Council of the Minister Presidents which meets once a month, a Directorate composed of two delegates from each Land and the Secretary General, a permanent Secretariat, and numerous committees. The Directorate has been authorized by the Minister Presidents to take action on all but over-all basic policy matters which are reserved for decision by the Council of Minister Presidents. Decision by the Directorate must be unanimous except in routine matters with respect to which a Land may waive its veto right.

The Directorate was established by the Minister Presidents in June, 1946, so as to provide a means for rapid decisions and to relieve the Minister Pre sidents of all routine matters.

The Main Economics Committee consists of the three Ministers of Economics. The committee usually meets every two weeks and is attended by the Ministers and the top members of their staffs. The committee covers approximately the same fields as the Ministers do within their own Laender, except that a separate Main Committee has been formed for public utilities. The Main Economics Committee has a permanent staff, an over-all committee for planning and allocations, and 18 (eighteen) other sub-committees covering the various fields for which the Main Committee is responsible. The Main Economics Committee, the working staff and sub-committees prepare over-all economic proposals on all other matters which require coordination and uniform action in the three Laender for submission to the Laenderrat. In June the Minister Presidents authorized the designation of a commissioner for prices within the framework of the Main Economics Committee.

The Main Food and Agriculture Committee has a working staff and subcommittees and functions in approximately the same manner as the Main Economics Committee. Because of the serious food situation, however, the Minister Presidents in April were authorized to appoint a Commissioner for Food and Agriculture in the U. S. Zone, and the Minister Presidents have transferred certain of their powers in the field of food and agriculture to the Commissioner subject to their supervision. The Commissioner is responsible to the Secretary General of the Laenderrat and acts as Chairman of the Main Committee for Food and Agriculture. As for as the Commissioner agrees with the Main Commitee, he is authorized to issue instructions directly to the Minister for Food and Agriculture for the Land. If no agreement is reached by the Commissioner and the Main Committee, proposals must be submitted to the Directorate for decision.

Interzonal Coordination

The Laenderrat has been authorized by Military Government to effect direct contact with the German officials in the other zones. There are regular meetings between the German officials in the British and U. S. Zones, and permanent liaison has been established between the Laenderrat and the central offices in the British Zone for economics and for food and agriculture.

An initial meeting was also held with the German officials for economics in the Soviet Zone on 13 and 14 June and a program for the exchange of goods was developed. Meetings have not yet been held with the German officials in the French Zone because German officials in that Zone are not yet authorized to meet with officials from other zones. The meetings are held for the purpose of coordinating common economic problems and for developing common economic plans, especially for inter-zonal trade.

Germans Officials

German officials in the field of economics have made every effort to carry out the policies and standards established by Military Government. However, they have encountered considerable difficulty in establishing effective administration because of the lack of suitable personnel, particularly for lower positions. The top officials in the field of economics are:

MINISTERS OF ECONOMICS:
Bavaria: Dr. Ludwig Erhard
Greater Hesse: Dr. Rudolf Mueller
Wuerttemberg-Baden: Dr. Heinrich Koehler

MINISTERS OF FOOD AND AGRICULTUR: Bavaria: Dr. Josef Baumgartner Greater Hesse: Mr. Hermann Hoering Wuerttemberg-Baden: Mr. Heinrich Stooss Dr. Hermann Dietrich, Commissioner for Food and Agriculture for the

U. S. Zone

[graphic][subsumed]

The

he Economics Division, OMGUS, has made every effort to secure agreement for the

the establishment of Central German Administrative Departments for Industry, Agriculture, and Foreign Trade, as instruments of the Allied Control Authority for the treatment of Germany as a single econo mic unit and for the formulation and implementation of common policies with regard to mining and industrial production and allocations; agriculture, forestry, and fishing; and import and export programs for Germany as a whole, as provided under the Berin Protocol. In addition, it has been considered that central administrative machinery is urgently required for the formulation and implementation of common policies with respect to prices and rationing.

The Central German Administrative Departments as proposed by OMGUS would function as direct agents of the Allied Control Authority and would report directly to the corresponding committees of the Allied Control Authority. The Departments would be neither political bodies nor agents of the Laender or Provincial governments, and would not be responsible to individual zone commanders.

The decisions of the Departments would not be subject to interference or interpretation by the zonal authorities, because if zonal authorities could interfere with or interpret such decisions, the principles of Control Council direction, of economic unity and of common policies for all Zones would be negated. The Departments would function directly through the corresponding agencies of the Laender and Provinces, and all German zonal administrations which have been established by the occupying powers would be eliminated. The Departments would be required to coordinate all proposed programs with the corresponding agencies in the Laender or Provinces before they are put into effect or submitted to the Allied Control Authority for approval.

The program for the establishment of Central German Administrative Departments was developed on the basis that such central departments would be organized shortly after the signing of the Berlin Protocol. With the pas sage of time, however, it is increasingly apparent that this program is now inadequate, although it would represent a significant stride forward from the present situation. It is considered that the time has now come when some type of provisional central government should be established which would function under the supervision of the Allied Control Authority. The Central Departments would then function under and as part of the Central Government.

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