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Berne, 24 October 1945

Sir:

With reference to the Payments Agreement of today's date, I have the honour to request you to signify your agreement with regard to the following:

1. The Swiss Government will facilitate the exports of goods of Swiss origin to the Netherlands. The Government of the Netherlands, for its part, will take into due consideration the desires of the Swiss Government with regard to the distribution of orders.

It is understood that orders may be placed both by agents of the Netherlands Government and by representatives of Netherlands industry. The co-ordination of the various orders placed by Netherlands buyers will be ensured by the Netherlands Government.

2. A joint commission composed of representatives of the two Governments shall be established, with headquarters at Berne. Its function will be to examine the orders proposed by the Netherlands (both through official and through private agencies) under the present arrangement. The two Governments will co-operate to instruct the said commission in accordance with the following principles:

(a) Orders shall be distributed among the various sectors of Swiss economy on the basis of normal pre-war business currents; due consideration, however, shall be given to the exceptional needs of the Netherlands for purposes of reconstruction.

(b) Account shall be taken of the Swiss Government's desire to avoid an accumulation of orders over the same period, in the sense that of the total credits made available by today's Payments Agreement and Annexes 2 and 3, the amount used before 30 June 1946 shall not exceed 90 millions of Swiss francs.

3. The Government of the Netherlands is aware that it is in the interests of Switzerland to be repaid at present by supplies of goods and services rather than by purely monetary payments. It will therefore do everything possible to effect deliveries of goods required for the Swiss economy, such as coal, and to offer the Swiss Government the services of the Netherlands Merchant Marine as soon as conditions permit, taking into account world conditions, relevant international agreements and its own national needs.

From now on, the Netherlands Government declares itself ready to resume the export of coal to Switzerland as soon as transport facilities between the Netherlands and Switzerland are re-established and as soon as the Netherlands possesses a net surplus of coal. These deliveries are to attain the level of pre-war deliveries to Switzerland as soon as possible and to be effected at the price in force at the time of export.

No 25