on the basis of mutual benefit and conciliation. Extremely difficult issues remain for examination and negotiation. They involve such matters as participation by interested states and broadcasters and practical assistance to that end. Direct broadcast satellite technology can make a great contribution to the values proclaimed by the Conference on Security and Cooperation in Europe. In the Final Act of the Helsinki Conference, participating states stated that they consider "the development of contacts to be an important element in the strengthening of relations and trust among peoples" and that they "make it their aim to facilitate the freer and wider dissemination of information of all kinds, to encourage cooperation in the field of information and the exchange of information with other countries..." The participants further pledged "to develop the mutual exchange of information with a view to a better knowledge of respective cultural achievements" and "to seek new fields and forms of cultural cooperation." It is in this light that the United States will participate in the difficult but absorbing work of the Legal Subcommittee in 1977 . . .. Press Release USUN-191 (76), rev. 1, Dec. 22, 1976, pp. 125–128. § 1 Chapter 9 STATE RESPONSIBILITY FOR INTERNATIONAL CLAIMS Conditions and Procedural Aspects of Claims of U.S. Nationals Against the On October 18, 1976, the President approved Public Law 94-542 (90 Stat. 2509; 22 U.S.C. 1644 et seq.), "To amend the International Claims Settlement Act of 1949 to provide for the determination of the validity and amounts of claims of nationals of the United States against the German Democratic Republic." The legislation had been introduced at the request of the Department of State. Ambassador Robert J. McCloskey, Assistant Secretary of State for Congressional Relations, in a letter dated June 22, 1976, to the President of the Senate and the Speaker of the House of Representatives, described the draft legislation as follows: The draft bill proposes to add a new title to the International Claims Settlement Act of 1949, as amended (22 U.S.C. sec. 1621 et seq.), for the purpose of determining certain claims of nationals of the United States against the German Democratic Republic which arose out of the nationalization, expropriation, or other taking of, or special measures directed against property owned by nationals of the United States. The proposed claims program under the bill would be similar in many respects to the Czechoslovakian claims program under Title IV of the International Claims Settlement Act, and in certain respects to the Cuban and Chinese claims programs under Title V of the Act. The bill authorizes the Foreign Claims Settlement Commission to receive and determine the validity and amounts of claims by nationals of the United States against the German Democratic Republic for losses arising as a result of the nationalization, expropriation, or other taking of property owned at the time by nationals of the United States. A 12-month filing period is provided and the Commission is required to complete its affairs with respect to these claims within 3 years after the deadline filing date. A claims fund is established in the U.S. Treasury Department for the payment of claims authorized under this title. The fund will be composed of such funds as may be paid to the United States by the German Democratic Republic pursuant to the terms of any agreement settling such claims. Claims under the bill will not be favorably considered unless the property on which such claims are based was owned, wholly or partially, by a national or nationals of the United States on the date of loss and continuously until the date of filing. A national of the United States, as defined under the bill, may be a natural person who is a citizen of the United States or a corporation or other legal entity organized under the laws of the United States, in which at least 50 percent of the outstanding shares of stock is owned by natural persons who are United States citizens. An award payment procedure is prescribed which is similar to other titles of the International Claims Settlement Act. Awards less than $1,000 would be paid in full. All awards exceeding $1,000 would be paid an initial amount of $1,000 and the unpaid balance would be prorated in the same proportion as all other awards exceeding $1,000. After payment in full of all principal amounts of awards, pro rata payments may be made on account of any interest that may be allowed on such awards. An appropriation is authorized for such sums as may be necessary to enable the Commission and the Treasury Department to pay their administrative expenses in carrying out their functions under the new Title VI. These are the basic provisions of the Act to which have been added certain necessary incidental provisions, including claims of stockholders, attorney fee limitations, and other procedural matters. Subsection 4(h) provides, among other things, that the action of the Commission in allowing or denying any claim shall be final and conclusive on all questions of law and fact and not subject to review by any official, department, agency, or establishment of the United States, or by any court. In late 1974, the Foreign Claims Settlement Commission, at the request of the Department of State, conducted a registration of claims against the German Democratic Republic. Over 8,000 notices and claim registration forms were forwarded to persons at their last known addresses who had previously contacted the Department of State and the Foreign Claims Settlement Commission concerning possible losses in East Germany. Approximately 2,100 of these registration forms were completed and returned to the Commission prior to the deadline filing date of July 1, 1975. Since approximately 4,000 of the forms were returned for insufficient addresses, the number of potential claimants under the bill is an unknown quantity. However, based on experience in similar circumstances, it is estimated that as many as four or five thousand claims could be filed under the new program. The bill authorizes the Secretary of the Treasury to deduct from any amounts covered into the Claims Fund an amount equal to 5 per centum as reimbursement to the U.S. Government for expenses incurred by the Commission and by the Treasury Department in the administration of this title. Accordingly, it is possible that all or most of the administrative expenses incurred by the Commission and the Treasury would be reimbursed to the United States. The proposed bill stems from the time that diplomatic relations were established between the Governments of the United States and the German Democratic Republic in July 1974. It was agreed during those negotiations that, following the establishment of relations and the opening of embassies, the two Governments would enter into negotiations for the settlement of U.S. claims and other financial and property questions which, thus far, remain unresolved. The Department of State believes that claims of nationals of the United States against the German Democratic Republic should be adjudicated as soon as possible by the Foreign Claims Settlement Commission. Enactment of the bill and adjudication of the claims before an agreement is negotiated and concluded with the German Democratic Republic for payment of claims is contemplated for more than one reason. The Department of State may be in a better position to negotiate an adequate settlement if the scope of the claims has been authoritatively determined before negotiations are undertaken. Adjudication at this time would take advantage of the experienced staff currently in the employ of the Commission. The claims are old, many more than 30 years old, and the sooner evidence in support of them is assessed, the better. The enactment of this bill will allow the Foreign Claims Settlement Commission substantially to conclude the adjudication of claims by American citizens for losses resulting from the myriad of nationalization programs carried out by certain Eastern European governments after World War II. A section-by-section analysis of the bill, prepared by the Department of State, follows: Section 600. PURPOSE OF TITLE Section 600 states that the purpose of the draft bill, which adds a new Title VI to the International Claims Settlement Act of 1949, as amended, is to provide for the determination of the validity and amounts of claims against the German Democratic Republic which have arisen out of the nationalization, expropriation, or other taking of, or special measures directed against property interests of nationals of the United States. This section also provides that the enactment of the proposed new Title VI shall not be construed as authorizing an appropriation or as any intention to authorize an appropriation of Federal funds to pay any claims of United States nationals against the German Democratic Republic. Section 601. DEFINITIONS (1) National of the United States-This is defined as a natural person who is a citizen of the United States, or a corporation or other legal entity which is organized under the laws of the United States, or of any State, the District of Columbia, or the Commonwealth of Puerto Rico, if natural persons who are citizens of the United States own, directly or indirectly, 50 percent or more of the outstanding capital stock or other beneficial interest of such corporation or entity. The term does not include aliens. (2) Commission-This means the Foreign Claims Settlement Commission of the United States, a quasi-judicial agency of the United States Government which has handled other claims programs under the International Claims Settlement Act. (3) Property-Section 601(3) gives a broad definition of the range of property interests covered by the proposed claims program. Section 601 is analogous to section 401 of Title IV (Czech claims) and Title V (Cuba and China claims). (4) The term "German Democratic Republic" includes the government of any political subdivision, agency, or instrumentality thereof or under its control. (5) The term "Claims Fund" means a special fund created in the Treasury Department from which awards, as authorized and certified by the Commission under this title, will be paid. The Claims Fund will consist of whatever money is realized under a formal agreement entered into between the Governments of the United States and the German Democratic Republic settling such claims. Section 602. REceipt and DETERMINATION OF CLAIMS Section 602 states that claims must be submitted within the period specified by the Commission which shall not be later than 12 months after publication of notice in the Federal Register. In determining the validity and amount of claims, the Commission is directed to apply “applicable substantive law, including international law." This requirement is similar to those contained in other titles of the International Claims Settlement Act of 1949, as amended. Section 603. OWNERSHIP OF CLAIMS This section, which follows the pattern of previous U.S. claims programs, provides that a claim for property losses shall not be considered unless the property involved was directly or indirectly owned by a U.S. national on the date of the loss and continuously thereafter by one or more U.S. nationals until the date it is filed. In case a claim is owned jointly by a U.S. national and an alien, only the validity and amount of the U.S. national's interest in the property will be determined by the Foreign Claims Settlement Commission. Section 604. CORPORATE CLAIMS Section 604(a) provides that a claim under section 602, relating to receipt of claims, which is based upon the ownership interest in any corporation, association, or other entity which is a national of the United States (as defined in sec. 601) shall not be considered. In other words, stockholders or owners of a corporation may not file a valid claim based upon their individual interests. The claim must be filed by the corporation in its own behalf and treated as a corporate claim. Section 604(b) states that a claim based upon a direct ownership interest in a corporation, association, or other entity which was not a national of the United States on the date of the loss, shall be considered and without regard to the percentage of ownership vested in the claimant. The effect of this provision is to permit a U.S. national to file a claim for his interest (no matter how small) in a foreign corporation which was taken by the German Democratic Republic. Section 604(c) provides that a claim based upon an indirect ownership interest in a corporation, association, or other entity shall be considered only if at least 25 percent of the entire ownership interest thereof, at the time of the loss, was vested in nationals of the United States. Section 604(d) states that the amount of both direct and indirect losses shall be calculated on the basis of the total loss suffered by the corporation, association, or other entity, and shall bear the same proportions to such loss as the ownership interest of the claimant at the time of loss bears to the entire ownership interest in the corporation, association, or other entity. Section 605. OFFSETS Section 605 is designed to prevent double benefits for the same loss or losses. In some cases claimants may have received compensation from the Federal Republic of Germany under the Equalization of Burdens laws or from the Foreign Claims Settlement Commission under Title II of the War Claims Act of 1948, as amended, especially in regard to the "special measures" provisions of section 202(a) which defines World War II losses as having occurred "as a direct consequence of . . . special measures directed against property because of the enemy or alleged enemy character of the owner, if such property was owned by a national of the United States at the time of loss." Under that program claims were found compensable under the "special measures" provision if they involved property of Americans that had been confiscated during World War II and which was located in an area under Communist control at the end of hostilities and was not restored to its owner. This applied to property located in East Germany. Claimants were awarded compensa |