(2) if a receiver or trustee for the person on behalf of whom the award was made has been duly appointed by a court in the United States and has not been discharged prior to the date of payment, payment shall be made' to the receiver or trustee or in accordance with the order of the court; and

(3) in the case of an assignment of an award, or an assignment (prior to the making of the award) of the claim in respect of which the award was made, by a receiver or trustee for any such person, duly appointed by a court in the United States, such payment shall be made to the assignee. (g) Nothing in this section shall be construed as the assumption of a liability by the United States for the payment of the awards of the Commission. SEC. 9. Section 12 of the Trading With the Enemy Act, as amended, is further amended by adding at the end thereof the following new paragraph:

"Notwithstanding the foregoing provisions of this section, all property and interests in property, which is owned by the Imperial Japanese Government, or its nationals, and which has been or may hereafter be conveyed, transferred, assigned, or delivered to the Alien Property Custodian, and by that official delivered, pursuant to Executive Order Numbered 9788 of October 15, 1946, to the Department of Justice for administration by the Attorney General of the United States, or to any other department or agency of the Government under the provisions of this Act, including the armed forces of the United States or any military or civil government established by it, shall be sold and the proceeds of such sales, and all other moneys owned by such government or its nationals, which have been or hereafter may be paid to or received by the Alien Property Custodian and delivered as aforesaid to the Department of Justice or other department or agency of the Government, including the armed forces and such military or civil government, shall be vested in and become the absolute property of the United States and shall be deposited in the general fund of the Treasury."

SEC. 10. (a) There is hereby created in the Treasury a Japan special deposit account, into which shall be deposited all funds hereinafter specified, and from which shall be disbursed all payments authorized by this Act.

(b) The Secretary of the Treasury is authorized and directed to deposit in such special deposit account (and such funds and property shall henceforth be available for the satisfaction of awards of the Commission) —

(1) all sums invested or transferred by the Alien Property Custodian, or his successors, under the provisions of section 12 of the Trading With the Enemy Act, as amended by section 9 of this Act, or by section 25 of that Act, as amended;

(2) all funds and other property which shall have come into the possession or under the control of the United States, or of any department, commission, or agency thereof, including the armed forces of the United States, belonging to the Imperial Japanese Government, or its nationals, since December 6, 1941; and

(3) all money (including the proceeds of any property, rights, or benefits which may be sold or otherwise disposed of, upon such terms as he may prescribe) received, whether before or after the enactment of this Act, by the United States in respect of property of the Imperial Japanese Government or of its nationals.

(c) The Secretary of the Treasury is authorized and directed, out of the funds in such special deposit account, to make payment of the awards and decisions of the Commission, together with interest thereon, as provided in subsections (b) and (c) of section 8.

(d) Payment of the awards of the Commission shall have a priority right over any other claims to the funds in the Japan special deposit account.

SEC. 11. (a) The Commission is authorized and directed, out of the funds appropriated for that purpose, to make the payments of expenses of administration authorized by section 2 of this Act.

(b) The Commission, in its annual report to the Congress, shall include a detailed statement of all expenditures made in carrying out the provisions of this Act.

SEC. 12. (a) Notwithstanding the provisions of section 236 of the Revised Statutes, as amended, the decisions of the Secretary of the Treasury in respect of the funds to be paid into the Japan special deposit account and of the payments therefrom shall be final and conclusive, and shall not be subject ot review by any other officer of the United States.

(b) The Secretary of the Treasury, in his annual report to the Congress, shall include a detailed statement of all expenditures made in carrying out the provisions of this Act.

SEC. 13. (a) The Commission, either acting as a body or through a single Commissioner, is authorized (upon request as hereinafter provided) to fix reasonable fees (whether or not fixed under any contract or agreement) for services in connection with the proceedings before the Commission in which an award was made, and with the preparations therefor, and the application for payment, and the payment of any amount under this Act. Each such official is authorized and requested to send by registered mail to each claimant receiving an award, in proceedings before him or the Commission, as the case may be, notice of the provisions of this section. No fee shall be fixed under this subsection unless written request therefor is filed with such official before the expiration of ninety days after the date of mailing such notice.

(b) After a fee has been fixed under subsection (a), any person accepting any consideration (whether or not under a contract or agreement entered into prior to the enactment of this Act) the aggregate value of which (when added to any consideration previously received) is in excess of the amount so fixed, for services in connection with the proceedings before the Commission, or any preparations therefor, or with the application for payment, or the payment, of any amount under this Act shall, upon conviction thereof, be punished by a fine of not more than four times the aggregate value of the consideration accepted by such person therefor.

SEC 14. There is hereby authorized to be appropriated, out of funds in the Treasury not otherwise appropriated, the sum of $400,000 for the expenses of the Commission, in carrying out its duties as aforesaid, during the fiscal year ending June 30, 1948, including personal services in the District of Columbia, or elsewhere, without regard to the provisions of any statute relating to employment, in the District of Columbia, or elsewhere, furniture, office supplies, and equipment, including lawbooks and books of reference, stenographic, photostatic, and translating services, without regard to section 3709 of the Revised Statutes; traveling expenses; printing and binding; and other expenses necessary to carrying out the functions of the Commission.

Mr. HINSHAW. It will be recalled that a few weeks ago the committee held hearings on a bill for the purpose of considering civilian personnel who had been interned by the Japanese Government. I believe the number of that bill was H. R. 1823.

The first witness this morning will be Mr. Van Zandt. He is not here yet, so we will hear Mr. Fernandez.

Mr. Fernandez, it is quite obvious that there are a number of witnesses to be heard, or at least who desire to place their statements in the record.

I trust that all witnesses will confine their remarks to new matter to be presented to the committee and any additional remarks they care to make and that they will avoid making repetitious statements. Mr. Fernandez, we will be glad to hear you, but before we hear you I would like to enter into the record reports which the commit-tee has received from the Department of State and the Department of Justice and the United States Civil Service Commission.

I shall not read those reports at the present time but if time permits may read them at the conclusion of the hearings. (The reports above referred to are as follows:)

Hon. CHARLES A. WOLVERTON,

WAR DEPARTMENT, Washington, 21 April 1947..

Chairman, Committee on Interstate and Foreign Commerce,
House of Representatives.

DEAR MR. WOLVERTON: Reference is made to your request for a report from the War Department on H. R. 1000 entitled, "A bill creating a commission to examine and render final decisions on all claims by American nationals who were members of the armed forces of the United States and who were prisoners of war of Germany, Italy, or Japan, for payment of its awards, and for other purposes."

The proposed legislation would establish a commission to hear and decide. claims against Germany, Italy, and Japan predicated upon the maltreatment in violation of the Geneva Convention of members of the armed forces of the United States who were held as prisoners of war by the governments of those countries at any time subsequent to December 6, 1941. The claims of individuals who suffered injuries as a result of such maltreatment or the claims of their survivors if death resulted from maltreatment would be satisfied out of German, Italian or Japanese assets which have come or may hereafter come under the custody or control of the United States.

While the War Department is in sympathy with the over-all purpose of the proposed bill, it feels that certain aspects of the measure may seriously interfere with the successful accomplishment of its occupation mission in Germany and Japan.

So far as the bill concerns claims arising out of the war with Japan and Japanese assets, you are respectfully referred to the report submitted by the War Department to you on H. R. 2823.

To the extent that the bill would deal with claims arising against Italy and with Italian assets, your attention is respectfully invited to the treaty of peace wih Italy which is now before the Senate for ratification. Parts VI and VII of this treaty entitled "Claims Arising Out of the War" and "Property, Rights, and Interests," respectively, articles 74 to 81 inclusive, limit the extent to which Italian assets may be applied to the satisfaction of claims of citizens of the United States. Furthermore, article 73 of the treaty, which deals with the withdrawal of Allied forces requires that all Italian property in the hands of those forces in Italy must be returned to the Italian Government within 90 days of the date of ratification unless compensation is paid therefor.

It is believed that the provisions of sections 9 and 10 of the proposed bill should be circumscribed to clearly exclude from their operation the following assets:

1. Patents, applications for patents, unpatented inventions, technical information, trade-marks, copyrights, contract rights relating to any of the foregoing, royalties accrued or collected for the use of inventions in war production which royalties were charged directly or indirectly to the United States Government, and any claim against the United States under the Royalty Adjustment Act (Act of October 31, 1942).

2. Any property which may have come into the possession or under the control of the armed forces of the United States as war booty or which was taken by the armed forces for the purposes of research or experiment in connection with the development of material required for national defense.

3. Property coming into the custody or under the control of the armed forces of the United States or any miiltary government established by them for the purpose of restitution or reparations.

4. Property coming under the control of the armed forces of the United States or any military government established by them for the purpose of being sold or otherwise disposed of in the channels of international trade for the support or rehabilitation of the occupied areas.

5. Property, such as works of art, which came into the custody or under the control of the armed forces of the United States, individual members thereof, or any military government established by the armed forces of the United States, and which should be returned to the occupied areas.

The War Department does not desire to offer technical comment upon the language employed in section 9 of the proposed bill as it believes that only after a detailed study of the Trading with the Enemy Act and the many executive orders, regulations, and rulings issued pursuant thereto could the effect of this language be accurately appreciated. The last sentence of subsection (b) of section 9 is believed, however, to be clearly objectionable as it would require the United States to take a position with respect to treaties that may be made in the future with or concerning Germany and Japan which may not be acceptable to the other interested powers.

It is also desired to invite your attention to the fact that almost all German property and assets which come under the custody or control of the military government in Germany must be dealt with and disposed of in accordance with enactments of the Allied Control Council, of which this Government is a member, or under agreements made between the representatives of this Government and one or more of the other occupying powers.

It is noted also that subsection (d) of section 10 would give priority to tort claims over those based on contract. Possibly this may become a matter of

importance as the amount of German assets available for the payment of claims against Germany or its nationals may well prove insufficient to satisfy all claimants in full. It is suggested in this connection that it may be appropriate to amend the proposed bill to provide that no claims will be paid until all claims have been adjudicated, and that the German assets available for the purpose of paying such claims be marshalled in such a way as to equitably satisfy all concerned.

H. R. 1000 makes no appropriation for the maintenance of the Commission created thereby.

Because of the limitation of time for the submission of this report, it has not been presented to the Bureau of the Budget prior to transmittal to your committee.

DEAR Mr. WOLVERTON: Reference is made to your letter of April 1, 1947, requesting a report from the War Department on H. R. 2823, Eightieth Congress, a bill "To provide for a commission to adjudicate claims of American nationals who were prisoners of war of Japan, for payment of its awards, and for other purposes."

It appears to be the purpose of the proposed legislation to establish a domestic commission to hear and decide claims against Japan predicated upon maltreatment of prisoners of war, both military and civilian, held by the Japanese authorities subsequent to December 6, 1941. The bill provides that all assets of the Japanese Government, or its nationals, coming into the possession of any agency of this Government, shall be liquidated and the proceeds utilized in effecting payment of awards which may be rendered by the proposed commission with respect to claims of the character referred to above. Without undertaking at this time to comment in detail regarding all of the provisions of the bill, the following general observations are submitted:

As you know, certain other measures have been introduced in the present Congress, and also in the preceding Congress, contemplating the liquidation of the assets in the United States of certain enemy countries and the utilization of the proceeds in the settlement of claims of citizens of the United States against those countries for losses or damages sustained during the present war. The War Department is in agreement with the basic policy involved which contemplates, insofar as Germany and Japan are concerned, that legislation for the ultimate disposition of funds realized through such liquidation should make no provision for any return or compensation, direct or indirect, by the United States to the former owners, and also with the policy of utilizing such funds in the settlement of claims against those countries.

The War Department has a definite interest in measures designed to afford appropriate compensation with respect to the categories of claims falling within the scope of H. R. 2823. However, the bill encompasses only part of the problem, since in addition to claims with respect to the maltreatment of prisoners of war, there exist a large number of other claims against Japan, such, for example, as those based upon personal injury and death claims of others, including those resulting from the sinking of vessels on the high seas. Citizens of the United States have also sustained extensive property losses during the war. To limit the jurisdiction of the proposed commission as contemplated by the bill would seemingly entail excessive expenditure of funds, since, presumably, it would be necessary to create one or more additional commissions to adjudicate other categories of claims not contemplated by the bill.

With reference to provisions in the bill for payment in full of all awards rendered by the commission with respect to the particular category of claims involved, it appears probable that the total amount of all classes of claims against Japan, which may ultimately be found to be meritorious, may far exceed any amounts which may be realized from the sale of Japanese assets in this country. It might be necessary, therefore, to scale down within the limits of available funds, the amounts determined to be due individual claimants, unless, of course, it is intended to give preferential treatment to certain groups of claimants.

Still another objection of the War Department arises from the fact that from the property proposed to be liquidated by sections 9 and 10 of the bill no exceptions have been made as to the following assets: "patents, applications for patents, unpatented inventions, technical information, trade-marks, copyrights, contract rights relating to any of the foregoing, royalties accrued or collected for the use of inventions in war production which royalties were charged directly or indirectly to the United States Government, and any claim against the United States under the Rolayty Adjustment Act (Act of October 31, 1942)”.

The War Department is opposed to the sale or disposal of patents or other industrial property to the general public in such a way that purchasers of these rights could exact a toll from the War Department and other Government agencies for the use of these rights. However, the War Department would have no objection to the disposition of the property mentioned if adequate provision were made (1) to exclude the giving of any cause of action against the United States growing out of such property; (2) to reserve a nonexclusive, irrevocable, royalty-free right and license to the United States under any such property; and (3) to safeguard military security by excluding any property or technical information important to the public safety or national defense.

It is believed that the Congress might give consideration to the enactment of legislation along the following lines:

1. Require that all Japanese assets within the continental limits of the United States and its territories except patents, applications for patents, unpatented inventions, technical information, trade-marks, copyrights, contract rights relating to any of the foregoing, and any claim against the United States under the Royalty Adjustment Act (act of October 31, 1942), be liquidated and the proceeds turned into the Treasury after completion of the program of administration and allowance of claims against such property as is now required by established policies and existing law.

2. An expressed declaration of legislative policy that plans for the ultimate disposition of such proceeds shall make no provision for any return or compensation, direct or indirect, by the United States to the former enemy owners.

3. That a war claims tribunal be established vested with jurisdiction to adjudicate the following classes of claims on behalf of citizens of the United States arising during the war:

a. All personal injury and death claims against Japan including claims arising out of maltreatment of prisoners of war and civilian internees; and,

b. All claims against Japan involving losses or destruction of, or damage to, property, and with respect to which compensation is not otherwise provided under treaty stipulations or war damage compensation legislation in any country. It is suggested that in the light of the tribunal's annual reports to the Congress, and also the information which may then be available with respect to realizable enemy assets and reparations receipts, the Congress would be able to provide for the payment of awards, in whole or in part, and on the basis of such priorities as it may deem just and equitable.

In order to effect further consolidation of effeort, the jurisdiction of the tribunal might be broadened to include all other enemy countries in addition to Japan. It is understood that at the present time the State Department is giving consideration to some method of reimbursing individuals who rendered services or advanced money to prisoners of war and civilian internees. These or similar claims might be included in the scope of the tribunal's jurisdiction.

In the opinion of the War Department the property or interests in property owned by the Imperial Japanese Government or its nationals which have been or may hereafter be conveyed, transferred, assigned or delivered to the armed forces of the United States or any military or civilian government established by them should not be sold and the proceeds thereof deposited in the Treasury of the United States as provided in section 12 of the Trading with the Enemy Act. A considerable portion of any property which has or may hereafter come into the possession of the armed forces of the United States or any governmental authority established by them will no doubt ultimately be found to belong to persons who are citizens or subjects of nations which were not enemies of the United States during the war, although the property at the present time may appear to belong to the Imperial Japanese Government or its nationals. To require the United States Army of Occupation in Japan to turn over any money or property which has or may hereafter come into its possession for the liquidation of claims of American nationals against Japan probably would lead to serious difficulties in carrying out allied occupation policies and might create