'F 80 File 82/34 I APOC Concession' [‎234v] (413/436)

2
Answer No. 1.—You may be aware that we were the first to entertain the
idea of referring this case to the Council of the League of Nations, the reason
being the unfriendly attitude of the British Government in this oil question, and
the threats and the pressure which that Government brought to bear upon us.
As a matter of fact, there was no ground for such an attitude to be taken by
the British Government, because the Persian Government, simultaneously with
the annulment of the D'Arcy Concession, intimated to the Anglo-Persian Oil
Company its willingness to negotiate a new and fairer agreement based upon
the respect of the rights of both parties. But. it is not clear to me for what
ulterior motive the British Government found it necessary to interfere in an
affair which involved only the Persian Government and the company.
At first, the British Government declared that they would refer the case
in question to the Permanent Court of International Justice at The Hague, but
the Persian Government having questioned the competency of the above court,
in this special case, and having hinted that they might be led to refer this matter
to the Council of the League, the British Government hastened to take the first
step; invoking article 15 of the Covenant, they brought the controversy into the
category of disputes that might lead to a rupture.
Now the Persian Government have always believed in the League of Nations
and made it their policy to settle differences by peaceful means. They were
among the first to adhere to the League and have constantly sought to co-operate
with that institution. They are signatories of the Briand-Kellogg Pact and of
numerous arbitration conventions with other countries. It was therefore natural
for them, relying as they did upon the justice of their case, to think of appealing
to the Council and of welcoming the step taken by the British Government to
bring the matter before that august assembly.
We are, however, at a loss to know why the British Government have thought
fit to interfere in an affair which concerns solely the Persian Government and a
private company.
Furthermore, we cannot conceive of any reason why the British Government
should have considered this as a dispute which might lead to a rupture of
diplomatic relations, and, basing themselves on this ground, have invoked the
provisions of article 15 of the Covenant. Indeed, the Persian Government have
not only manifested their desire to negotiate a new agreement with the company,
but have assured the British Government that, pending an amicable settlement
with the company, they would refrain from interfering with the latter's operations
and activities in Persia.
As a matter of fact, since the cancellation of the D'Arcy Concession, the
Persian Government have taken no steps whatsoever against the company and
not one incident prejudicial to the interests of the company has taken place in
Persia.
This being the position, I do not believe that the Council of the League
will have much difficulty in settling the question submitted to its appreciation.
It will become evident that no ground existed for any threat or pressure to be
brought to bear upon Persia by the British Government in the discussion between
the Persian Government and the company. Moreover, the nature of the dispute
has been such as to dispel all thought of any diplomatic rupture happening
between the two Governments. It would have been much more expedient if the
British Government had not stepped in; and would have allowed the negotiations
to go on between the Persian Government and the company unhampered. In all
probability the two parties might have reached an agreement and arrived at an
understanding which would guarantee the mutual interests of both parties.
Now, coming to a different phase of the question, you will agree with me
that public opinion everywhere and even in England recognises the natural
reluctance of the Persian nation to be bound by a concession granted more than
thirty years ago under extremely one-sided and unfavourable conditions.
Moreover, the present Government in Persia considers the said concession to be
in contradiction with its best interests. Why then, should not the Persian Govern
ment proceed to revise the said concession; and why should she overlook and
disregard the just claims and the best interests of the nation simply because an
ignorant Government in the past has signed an unsatisfactory contract?
With the points in our favour I see no reason and no probability that the
Council of the League should require of Persia an attitude incompatible with
her rights and interests. It is with this spirit of confidence in the justice of our
develo