regulation of armaments and the establishment of United Nations enforcement machinery. A program for the regulation of armaments must be negotiated between sovereign states. The only existing alternative to such a negotiated agreement or agreements is imposition of armament regulations through duress and force It is axiomatic that there can be no effective control in the fields of armaments without universal acceptance. There is no indication at the present that the Soviet Union, or others, would be ready or willing to accept such controls Consideration of the world factors affecting the achivement of such agreemen or agreements points to the necessity not only of persistent efforts to improve world conditions and to raise the present degree of international confidence but also, of patience with the amount of progress which can meanwhile be made by direct approach to the problem. The United Nations is necessary fundamentally because peoples and nations differ on matters important to peace and security. There is no short cut in dealing with such matters. Durable settlements are agreed settlements. For such settlements, time and effort alike are indispensable. Hon. JOSEPH W. MARTIN, Jr., Speaker of the House of Representatives. DEPARTMENT OF STATE, MY DEAR MR. SPEAKER: There is transmitted herewith a copy of the Conven tion on Privileges and Immunities of the United Nations which was approved by the General Assembly by a resolution adopted on February 13, 1946, pro posing the convention for accession by each member of the United Nations This agreement is designed to implement articles 104 and 105 of the Charter o the United Nations, which read as follows: ARTICLE 104 "The organization shall enjoy in the territory of each of its members sucl legal capacity as may be necessary for the exercise of its functions and th fulfillment of its purposes." ARTICLE 105 "1. The organization shall enjoy in the territory of each of its members suc privileges and immunities as are necessary for the fulfillment of its purposes "2. Representatives of the members of the United Nations and officials o the organization shall similarly enjoy such privileges and immunities as ar necessary for the independent exercise of their functions in connection with th organization. "3. The General Assembly may make recommendations with a view to deter mining the details of the application of paragraphs 1 and 2 of this article or ma propose conventions to the members of the United Nations for this purpose." The convention is submitted to you with the request that the Congress giv consideration to the passage of a joint resolution authorizing the President t accede to it on behalf of the United States. A draft of a proposed join resolution is enclosed. The convention gives certain privileges and immunities to the United Nations as an organization, and to its employees and representatives of member state who are designated in their respective capacities to the United Nations. Man of the privileges and immunities for which provision is made in the convention have already been conferred upon the United Nations by virtue of the provi sions of the International Organizations Immunities Act, approved December 29 1945 (Public Law 291, 79th Cong., 1st sess.). In some respects, however, th Convention on the Privileges and Immunities of the United Nations goes beyon the terms of the International Organizations Immunities Act. Thus, there i provision in section 19 for giving the Secretary General and all Assistant Sec retaries General of the United Nations, their spouses and minor children, th privileges and immunities, exemptions and facilities accorded to diplomati envoys in accordance with international law. There is provision in secton 2 for extending certain limited privileges and immunities to experts on mission for the United Nations. In other respects the convention is less liberal than th provisions of the International Organizations Immunities Act. For example section 11 (b) and (g) limit the free-entry privilege to "personal baggage," a term which is narrower in scope than the term "baggage and effects," as used in section 3 of the act. The effect, therefore, of approval of the enclosed draft resolution will be to supplement or replace certain provisions of the International Organizations Immunities Act, and the draft joint resolution provides that in the case of absolute conflict the provisions of the convention shall prevail. Since our acceptance of this convention will give effect to articles 104 and 105 of the Charter of the United Nations, the Department of State believes that the convention should be submitted to Congress for its approval by joint resolution. At the meeting of the General Assembly of the United Nations in February 1946. the United States delegation voted for the General Assembly resolution opening the Convention on Privileges and Immunities for accession by each member of the United Nations. At that time Senator Vandenberg reserved the position of the United States with respect to provisions in the convention regarding tax immunities and regarding national-service exemptions in these words: "I rise only to make the position of the delegation of the United States perfectly plain in regard to the reports of the fifth and sixth committees. We have reserved our position in respect of tax immunities in regard to the reports of both committees. The Constitution of the United States gives the American. Congress sole power to exempt American citizens from taxation. The distinguished delegate of the United Kingdom made a very interesting and moving appeal in respect of rival allegiances, and suggested that a man cannot serve two masters. Quite in the spirit in which the able delegate of the United Kingdom spoke, the delegation of the United States does not propose to serve two masters. Its master is the Constitution of the United States. This does not, however, mean that the attitude of the Government of the United States is not totally at one with a cooperative attitude, and wholly hospitable in regard to all cooperation which we, as the host country, shall undertake to give to this great institution when it goes upon its way. Indeed, even so far as privileges and immunities are concerned, I am very happy to say that the last session of the American Congress has already passed a statute which includes, I should say, about 95 percent of the things which the report and the general convention from the sixth committee anticipate. "The delegation of the United States also reserves its position in respect of national-service exemptions under the general convention reported by the sixth committee. This again is due to the fact that the Constitution of the United States permits no authority other than the American Congress to deal with this matter, and we are not in a position to prejudge that ultimate consideration. "With these exceptions, we have been very happy to accept the balance of the report of the fifth Committee, and we are very glad to vote, with these reservations, for the general corvention. "So far as the special convention is concerned, we shall abstain from voting, because the special convention is one to which the Government of the United States will be a party, and we consider it would be inappropriate for us to prejudge the case here. "In this entire attitude, I want to repeat that the purpose and the intention, and heartfelt desire, not only of the delegation of the United States, but of the American people, I am sure I speak with complete justification, is to extend every consideration, and to give every possible cooperation, to the United Nations Organzation as it proceeds upon the greatest and most hopeful adventure in the history of human kind." With respect to the question of income-tax immunity for officials of the United Nations, I wish to point out that section 116 (h) (1) of the Internal Revenue Code, as amended, exempts alien employees of public international organizations rom the payment of a Federal tax on income received from such international organizations. United States nationals employed by international organizations, however, are ubject to the Federal tax on income received from the United Nations. Section 8 (b) of the enclosed convention would extend this tax exemption now granted lien officials of international organizations to American nationals who are officials If the United Nations. It would also grant immunity from State income taxes on uch income both for aliens and United States citizens. The General Assembly of the United Nations has considered whether or not fficials of international organizations, regardless of their nationality and place f residence, should be exempt from national taxation. The Assembly concluded t its first session in London that "there is no alternative to the proposition that exemption from national taxation for salaries and allowances paid by the Organization is indispensable to the achievement of equity among its members and equality among its personnel." This proposition was accepted unanimously, the United States delegation abstaining. The convention which is submitted herewith was also approved unanimously by the General Assembly, although the United States delegation reserved its position with respect to the question of tax immunity as noted above. In view of the general policy of the United States, to give its full support to the United Nations, it is the opinion of the Department of State that this Government should comply with recommendations of the General Assembly wherever it can do so without prejudice to overriding considerations affecting the vital interests of the United States. For this reason, the Department hopes that the Congress will not insist on a reservation that tax immunity should be inapplicable to United States nationals. With respect to section 18 (c) of the Convention, which would give officials of the United Nations immunity from national-service obligations, I believe it would be well for this Government to reserve its position. Under the terms of the Selective Training and Service Act of 1940, aliens attached to foreign missions in the United States were exempted from registration under certain circumstances. Since the Selective Training and Service Act has now expired, the question at this time of immunity from national service for officials of the international organizations is not of immediate concern. I think it would be well for this Government, however, to reserve its position as to United States nationals and aliens who have declared their intention of becoming citizens, so that if in the future it becomes necessary to provide again for national service we will be free to determine at that time the extent to which national-service immunities should be extended to Americans who are employed by the United Nations. A provision to that effect is incorporated in the attached draft resolution. The special convention which Senator Vandenberg mentioned in the next to last paragraph of the afore-quoted statement is a reference to a proposed agreement between the United Nations and the United States concerning the administration and control of the area in the United State selected for the permanent headquarters of the United Nations. That agreement is now in the process of being negotiated between representatives of the United Nations and representatives of this Government. When agreement has been reached the text will be submitted to the Congress for its approval. This draft agreement, in its present form, provides, among other things, for extending diplomatic privileges and immunities to principal resident representatives of member states and such resident members of their staffs as may be agreed upon between the Secretary-General, the United States, and the government of the member concerned. The enclosed Convention extends full diplomatic privileges and immunities only to the Secretary-General of the United Nations and the Assistant Secretaries-General (sec. 19). Lesser officers of the United Nations (sec. 18), experts on missions for the United Nations (sec. 22), and representatives of members other than those covered in the above-mentioned site Convention (sec. 11), are not to receive full diplomatic privileges and immunities. The immunities which these officers, experts, and representatives are to receive are extended to them while they are performing their official functions. Section 11 lists in paragraphs (a) through (f) certain specific privileges and immunities which representatives of member states are to enjoy. Paragraph (g) states that they are to have "such other privileges, immunities, and facilities not inconsistent with the foregoing as diplomatic envoys enjoy, except that they shall have no right to claim exemption from customs duties on goods imported (otherwise than as part of their personal baggage) or from excise duties or sales taxes." It is the view of the Department of State that this paragraph provides only for privileges with respect to matters other than those specified in the foregoing paragraphs (a) through (f), and does not provide for additional privileges in respect of such matters. Thus, immunity from legal process is confined to the limited immunity granted by paragraph (a) and could not be extended under paragraph (g) to provide the complete immunity which is enjoyed by diplomatic envoys. Article VII of the Convention authorizes the United Nations to issue laissezpasser to its officials. Section 24 of article VII provides : "These laissez-passer shall be recognized and accepted as valid travel documents by the authorities of members, taking into account the provisions of section 25," This language does not authorize or require, and is not interpreted by the Department of State as authorizing or requiring the United Nations or any member state to issue or accept a document which is a substitute for a passport or other documentation of nationality; it provides only for a certificate attesting to the United Nations affiliation of the bearer in respect to travel and will be accepted by the United States as such a document. Thus article VII, if approved, will not amend or modify existing provisions of law with respect to the requirement or issuance of passports or of other documentation evidencing nationality of citizens or aliens. The fact that the United Nations has selected the United States for its permanent headquarters may cause certain specialized agencies to make their permanent headquarters in the United States. When the decision of those agencies as to their permanent headquarters is known, it may be necessary for the Department of State to ask the Congress to give its approval to a further agreement defining the privileges and immunities of those organizations insofar as it may be advisable to grant them privileges and immunities beyond those provided in the International Organizations Immunities Act. The Department hopes that extensive amendment of Public Law 291 can be deferred until such time as the need for privileges and immunities on the part of international organizations throughout the world shall have become clarified. In this connection, you may be interested to know that the Secretary General of the United Nations has been instructed to make a study of the privileges and immunities of specialized agencies and to open negotiations with them in order to systematize their privileges and immunities. Since the United Nations has decided to make its permanent headquarters in the United States and is now considering plans for the construction of its buildings, the Department of State believes that approval of the enclosed convention is a matter of some urgency. The Department has been informed by the Bureau of the Budget that there is no objection to the submission of this report. A similar letter is being sent to the Speaker of the House of Representatives. Sincerely yours, The Honorable CHARLES A. EATON, G. C. MARSHALL. DEPARTMENT OF STATE, Chairman, House Committee on Foreign Affairs, House of Representatives. DEAR MR. EATON: In connection with the consideration by your committee of Senate Joint Resolution 136, authorizing the President to accept on behalf of the Government of the United States the Convention on Privileges and Immunities of the United Nations * ** * I would like to express once again the hope that the committee will give the most careful consideration to the desirability of approving the pending resolution without the reservation now attached thereto by the Senate with respect to income-tax immunity. You will recall that section 18 (b) of he Convention provides that officials of the United Nations shall be exempt from taxation on the salaries and emoluments paid to them by the United Nations, and that the Senate, in approving the joint resolution, amended it to withhold the application of this section from United States nationals. I fully appreciate the reluctance of the Senate to relieve any group enjoying the benefits of United States citizenship from the obligation to contribute to the financial support of their Government. At the same time * * * there are in my opinion certain compelling reasons for not including in the Senate joint resolution a reservation of the type in question. 1. At two consecutive regular sessions, the General Assembly of the United Nations (the United States abstaining) has unanimously requested all members to provide such tax exemption in order to ensure equality of tax treatment among the staff in a manner which is equitable among members. Since it is the policy of the United States to give its full support to the United Nations, it is believed that this Government should comply with such requests of the General Assembly whenever it can do so without prejudice to the vital interests of the United States. 2. Only two other states-New Zealand and Canada-have made such a reservation. Eighteen members, including the United Kingdom and France, have acceded to the Convention without reservation. Nationals of only two members, 75921-48-33 United States and Canada, are presently subject to taxes on their income from the United Nations. 3. In order to afford equality of treatment to all members of the secretariat staff, the General Assembly has in the past authorized the Secretary-General to reimburse employees for taxes which they have paid to their national governments on income received from the United Nations. The cost of such tax reimbursements to the United Nations is approximately $500,000 annually, of which about $450,000 represents payments to United States nationals. This charge, of course, is drawn from the general budget and is apportioned among all member states. Despite the dissatisfaction of many members at having to contribute to taxes paid by United States nationals to the United States Government, the Assembly has agreed to continue the tax-reimbursement system for one more year with a clear warning that it may be terminated after 1948. 4. When the situation is reviewed by the General Assembly next fall, there is likely to be a demand that members who do not grant exemption to their nationals make supplemental contributions to the United Nations budget in order to meet the tax-reimbursement payments. If this were done, the result would be to increase our share of the total United Nations budget and to set the stage for the doctrine that members might be permitted to vary their contributions on the basis of the particular activities they might choose to support. 5. If, alternatively, the tax reimbursement plan is abandoned, United States nationals employed by the secretariat would be earning a net salary substantially lower than their foreign colleagues. As a result, it would be difficult to recruit well-qualified American citizens. 6. The Department is convinced that the best ultimate solution to this difficult problem lies in the adoption of a staff contributions plan under which United Nations employees would make contributions from their salaries to the United Nations, based roughly on the income-tax structure in the member nation where the employee is situated (in most cases the United States). The effectiveness of such a scheme would depend on the willingness of member nations which may not wish to grant tax exemption at least to amend provisions of their tax laws designed to avoid double taxation so as to allow a credit for contributions made under the scheme. Approval by the Congress of the pending resolution without a reservation with respect to income taxes would create the best possible atmosphere in which to work out a satisfactory staff contributions plan avoiding the creation of a taxprivileged group. It would also reaffirm the willingness of the United States to cooperate fully in carrying out the declared policy of the General Assembly. It is therefore the hope of the Department of State that the Congress will approve the pending resolution without reservation with respect to income tax. Officials of this Department will be glad to furnish further information on the subject at the convenience of the committee. Faithfully yours, GEORGE C. MARSHALL, Letter from the legal adviser of the Department of State to the Honorable Lawrence H. Smith, chairman, Subcommittee No. on International Organizations and International Law of the Committee on Foreign Affairs. APRIL 29, 1948. MY DEAR MR. SMITH: In your letter to me dated April 16, 1948, you referred to the relationship between the proviso contained in section 9 of the International Organizations Immunities Act (Public Law 291, 79th Cong., approved December 29, 1945) and the provisions of Senate Joint Resolution 136 (80th Cong., 1st sess). Your letter inquired: "to what extent would section 9 of the act be applicable to the privileges and immunities accorded to the various categories of persons covered by the Convention?" (the Convention on the Privileges and Immunities of the United Nations). In the Charter of the United Nations, the United States along with the other members undertook to grant certain privileges and immunities to the United Naitions organization, to its officials, and to the representatives of members. Artcle 105 of the Charter provides, in part: "1. The Organization shall enjoy in the territory of each of its members such privileges and immunities as are necessary for the fulfillment of its purposes. |