File 200/1928 Pt 4 'Persia: Anglo-Persian Relations. General Settlement and Treaty Negotiations' [‎25r] (54/1256)

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[This Document is the Property of His BritanniQ‘Majesty’s Government, i
PERSIA.
CONFIDENTIAL.
[V 4369/19/34
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,tS 20
September 2 , 1929.
Section 1.
No. 1.
Sir R. Clive to Mr. A. Henderson.—(Received September 2.)
(No. 439. Confidential.)
Sir, ^ ^ Gulhek, August 21, 1929.
IN my despatch No. 426 of the 10 th August I had the honour to enclose the
outline of the proposed general treaty as communicated by me to the Minister of
Court.
2. I now beg leave to enclose copy of a letter dated the 20th August which
I have received from His Highness, and in which he gives his views on the general
question of the treaty and each article in particular.
3. You will observe that in the fourth paragraph of the letter His Highness
draws attention to four points which, in his opinion, require to be settled, either
as a part of the treaty or separately. The first of these relates to the question of
income-tax payable by the Anglo-Persian Oil Company to His Majesty’s Govern
ment and the Persian claim to part of that tax as set forth in the Minister of
Court’s letter of the 6 th April last, which was enclosed in my despatch No. 193
of the 6 th April. At an interview which I had with His Highness yesterday
afternoon J. told him that I had so far received no reply to this despatch, but the
question vrns doubtless under consideration by the Treasury. He said that if His
Majesty's Government were unwilling to refund to Persia a part of this tax the
Persian Government would probably themselves impose an income-tax on the
company’s operations in Persia which, combined with the English income-tax
payable, would be a very heavy burden to the company. I made no comment on this
beyond saying that I would inform you of what His Highness had said.
4. With regard to the question of telegraphs, I told him that the matter was
a complicated one and that I was not in a position as yet to make any definite
proposals to His Highness, and I trusted that he would agree to leave this matter
for the time being in abeyance. This he agreed to do.
5. I enquired what he meant by his reference to the question of the Shatt-el-
Arab in connexion with our present treaty negotiations. He replied that although
this had nothing to do with the actual treaty, yet he was mindful of the assurance
which I had given on behalf of His Majesty’s Government that a reasonable arrange
ment, agreeable to the Persian Government, would, if possible, be made in regard
to this question and that he hoped thah the negotiation of this arrangement, even
if it did not take place in Tehran but Bagdad, might proceed, pari passu, with our
negotiations. I said that it appeared to me that it was for the Persian representative
in Bagdad to raise the question with the Iraq Government as it had been definitely
agreed that the negotiations would take place in Bagdad. He said he would
telegraph to the Persian Minister to do so.
6 .. It is interesting, and I consider satisfactory, that His Highness should
state that the successful result of the negotiations between himself and the Anglo-
Persian Oil Company must depend on the goodwill and support of His Majesty’s
Government. I have always considered, as" I told Sir John Cadman last spring,
that it was advisable, both from our point of view and from his, that the Persian
Government should realise that His Majesty’s Government had a definite interest
in his negotiations, and that a satisfactory settlement was more probable if it
coincided with the conclusion of our general treaty in order that both might be
submitted simultaneously for the ratification of the Majlis. Taimourtache clearly
realises that His Majesty’s Government, as the biggest shareholder in the company
and with her large political interests in Persia, must be favourable to any agreement
that is to be made between the Persian Government and the Anglo-Persian Oil
Company. His Highness showed me a letter which he had that morning received
from Mr. Greenhouse stating that one of the directors of the company would arrive
in Tehran in September to continue negotiations, as Sir John Cadman was
unavoidably prevented from coming out on that date although he was prepared to
come out again later if necessary.
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