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it trage 674,ofil097entirety, made it impPage74 ££1097resh arrangements should be agreed between the three Western Occupying Powers and embödiɛä in a general settlement with the Federal German Government.

7.

After a long discussion it was agreed that, provided the German Government gave the necessary assurances on security and evidence of their good intentions by agreeing to join the International Ruhr Authority, and declared their intention of co-operating closely with the Military Security Board, the High Commissioners should have authority to remove from the list of plants at present scheduled to be dismantled the following:

8.

(i) The synthetic oil plants.

(ii)

(iii)

The synthetic rubber plants, less certain special

laboratory equipment.

All plants in Berlin at present scheduled to be

dismantled.

(iv) The following steel plants:

August Thyssen, Hamborn

Huttenwerke Siegerland, Charlottenhutte Ruhrstahl, Hattingen

Bochumer Verein, Gusstahlwerke, Bochum

August Thyssen Hutte, Niederreinische Hutte Klockner Werke, Dusseldorf

Deutsche Edelstahlwerke, Krefeld

This list includes all the major steel plants except the Herman Goering works at Salzgitter and Krupps, Essen. Although both Mr. Acheson and I would have been agreeable to the inclusion of the plant at Salzgitter among those in respect of which the High Commissioners have authority to cease dis- mantling, M. Schuman said that his political life, which was already in danger, would be lost if dismantling ceased at this plant. In view of the great efforts which M. Schuman and the French Government had made to meet us on this dismantling problem and of the overriding importance of not prejudicing M. Schuman's position, Mr. Acheson and I agreed not to press the matter further. It must also be remembered that this plant was built during the war and operated by forced labour, some of it from France.

9.

M. Schuman also put forward certain other conditions, the most important of which were:-

(a) That in order to ensure that the retained list of plants should not cause German steel production to exceed the agreed ceiling (i.e. 11.1 million tons per annum in the three Western Zones) these plants should be placed under a special control and a special Statute; and

(1) That the German Government should be required to compensate the Governments represented on the Inter-Allied Reparations Agency for the loss of reparations by the supply of plant of an equivalent value.

10.

On a) the practical objections were pointed out and it was made clear that there would be very little chance of such a system being able to work in practice. M. Schuman eventually6 746498 accept a formula which laid fqw that the High Commissioners would automatically put these seven retained plants out of production if German total steel production exceeded the existing ceiling of 11.1 million tons per annum.

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