form acceptable to the Secretary of the Treasury of the United States under the general regulations of the Treasury Department governing transactions in United States obligations. 5. Exemption from Taxation. The principal and interest of all bonds issued or to be issued hereunder shall be paid without deduction for, and shall be exempt from, any and all taxes or other public dues, present or future, imposed by or under authority of France or any political or local taxing authority within France, whenever, so long as, and to the extent that beneficial ownership is in (a) the Government of the United States, (b) a person, firm, or association neither domiciled nor ordinarily resident in France, or (c) a corporation not organized under the laws of France. 6. Payments before Maturity. France, at its option, on June 15 or December 15 of any year, upon not less than ninety days' advance notice to the United States, may make advance payments in amounts of $1,000 or multiples thereof, on account of the principal of any bonds issued or to be issued hereunder and held by the United States. Any such advance payments shall be applied to the principal of such bonds as may be indicated by France at the time of the payment. 7. Exchange for Marketable Obligations. France will issue to the United States at any time, or from time to time, at the request of the Secretary of the Treasury of the United States, in exchange for any or all of the bonds issued hereunder and held by the United States, definitive engraved bonds in form suitable for sale to the public, in such amounts and denominations as the Secretary of the Treasury of the United States may request, in bearer form, with provision for registration as to principal and/or in fully registered form, and otherwise on the same terms and conditions, as to dates of issue and maturity, rate or rates of interest, if any, exemption from taxation, payment in obligations of the United States issued after April 6, 1917, and the like, as the bonds surrendered on such exchange. France will deliver definitive engraved bonds to the United States in accordance herewith within six months of receiving notice of any such request from the Secretary of the Treasury of the United States, and pending the delivery of the definitive engraved bonds will deliver, at the request of the Secretary of the Treasury of the United States, temporary bonds or interim receipts in form satisfactory to the Secretary of the Treasury of the United States within thirty days of the receipt of such request, all without expense to the United States. The United States, before offering any such bonds or interim receipts for sale in France, will first offer them to France for purchase at par and accrued interest, if any, and France shall likewise have the option, in lieu of issuing any such bonds or interim receipts, to make advance redemption, at par and accrued interest, if any, of a corresponding principal amount of bonds issued hereunder and held by the United States. France agrees that the definitive engraved bonds called for by this paragraph shall contain all such provisions, and that it will cause to be promulgated all such rules, regulations, and orders as shall be deemed necessary or desirable by the Secretary of the Treasury of the United States in order to facilitate the sale of the bonds in the United States, in France or elsewhere, and that if requested by the Secretary of the Treasury of the United States, it will use its good offices to secure the listing of the bonds on such stock exchanges as the Secretary of the Treasury of the United States may specify. 8. Cancellation and Surrender of Obligations. Upon the execution of this Agreement, the delivery to the United States of the principal amount of bonds of France to be issued hereunder, together with satisfactory evidence of authority for the execution of this Agreement by the representative of France and for the execution of the bonds to be issued hereunder, the United States will cancel and surrender to France at the Treasury of the United States in Washington, the obligations of France held by the United States. 9. Notices. Any notice, request, or consent under the hand of the Secretary of the Treasury of the United States, shall be deemed and taken as the notice, request, or consent of the United States, and shall be sufficient if delivered at the Embassy of France at Washington or at the office of the Ministry of Finance at Paris; and any notice, request, or election from or by France shall be sufficient if delivered to the American Embassy at Paris or to the Secretary of the Treasury at the Treasury of the United States in Washington. The United States in its discretion may waive any notice required hereunder, but any such waiver shall be in writing and shall not extend to or affect any subsequent notice or impair any right of the United States to require notice hereunder. 10. Compliance with Legal Requirements. France represents and agrees that the execution and delivery of this Agreement have in all respects been duly authorized and that all acts, conditions, and legal formalities which should have been completed prior to the making of this Agreement have been completed as required by the laws of France and in conformity therewith. 11. Counterparts. This Agreement shall be executed in two counterparts, each of which shall have the force and effect of an original. IN WITNESS WHEREOF France has caused this Agreement to be executed on its behalf by Hon. Henry Bérenger, its Ambassador Extraordinary and Plenipotentiary at Washington, thereunto duly authorized, subject, however, to ratification in France, and the United States has likewise caused this Agreement to be executed on its behalf by the Secretary of the Treasury as Chairman of the World War Foreign Debt Commission, with the approval of the President, subject, however, to the approval of Congress, pursuant to the Act of Congress approved February 9, 1922,3 as amended by the Act of Congress approved February 28, 1923, and as further amended by the Act of Con 3 42 Stat. 363. 42 Stat. 1325. gress approved January 21, 1925,5 all on the day and the year first above written. The Republic of France, hereinafter called France, for value received, promises to pay to the Government of the United States of America, hereinafter called the United States, or order, on June 15, 19, the sum of Dollars ($ ), and to pay interest upon said principal sum after June 15, 1930, at the rate of 1% per annum from June 15, 1930, to June 15, 1940, at the rate of 2% per annum from June 15, 1940, to June 15, 1950, at the rate of 22% per annum from June 15, 1950, to June 15, 1958, at the rate of 3% per annum from June 15, 1958, to June 15, 1965, and at the rate of 32% per annum after June 15, 1965, all payable semiannually on the 15th day of December and June in each year. This bond is payable as to both principal and interest in gold coin of the United States of America of the present standard of value, or, at the option of France, upon not less than thirty days' advance notice to the United States, in any obligations of the United States issued after April 6, 1917, to be taken at par and accrued interest to the date of payment hereunder. This bond is payable as to both principal and interest without deduction for, and is exempt from, any and all taxes and other public dues, present or future, imposed by or under authority of France or any political or local taxing authority within France, whenever, so long as, and to the extent that, beneficial ownership is in (a) the Government of the United States, (b) a person, firm, or association neither domiciled nor ordinarily resident in France, or (c) a corporation not organized under the laws of France. This bond is payable as to both principal and interest at the Treasury of the United States in Washington, D.C., or at the option of the Secretary of the Treasury of the United States at the Federal Reserve Bank of New York. This bond is issued pursuant to the provisions of paragraph 2 of an Agreement dated April 29, 1926, between France and the United States, to which Agreement this bond is subject and to which reference is hereby made. IN WITNESS WHEREOF, France has caused this bond to be executed in its behalf by its Ambassador Extraordinary and Plenipotentiary at Washington, thereunto duly authorized, as of June 15, 1925. THE FRENCH REPUBLIC: 43 Stat. 763. By Ambassador Extraordinary and Plenipotentiary DOUBLE TAXATION: SHIPPING PROFITS Exchange of notes at Washington June 11 and July 8, 1927 The Chargé d'Affaires ad interim of France to the Secretary of State [TRANSLATION] EMBASSY OF THE FRENCH REPUBLIC Washington, D.C., June 11, 1927 MR. SECRETARY OF STATE: Referring to the note your Excellency was pleased to send to Mr. Claudel on April 26 last, I have the honor to inform you that the French Government on May 20 issued a decree exempting from any tax on profits the citizens of the United States and American juridical persons operating navigation concerns in France. The decree of which your Excellency will find a copy herewith reproduces the wording quoted in my letter of January 19, which has been acknowledged by the United States Department of the Treasury as meeting the conditions required by Section 213(b) (8) of the Revenue Acts of 1921, 1924, and 1926 1 for the granting of an equivalent exemption in the United States. I may add that it goes into immediate effect in France. Under these conditions I should be glad if your Excellency would kindly give me the assurance that the French citizens and French companies will hereafter be exempt from the tax on profits derived from navigation business. Be pleased to accept, Mr. Secretary of State, the assurances of my very high consideration. HIS EXCELLENCY, THE HONORABLE FRANK B. KELLOGG, 1 44 Stat. 25. SARTIGES [ENCLOSURE-TRANSLATION] The President of the French Republic, On the report of the President of the Council, Minister of Finance, Decrees: Art. 1. Citizens of the United States of America not domiciled on the territory of the French Republic, as well as juridical persons organized in the United States of America, who exploit within the limits of the territory of the French Republic, navigation enterprises, with ships navigating under the American flag, are exonerated from any tax on the profits accruing exclusively from navigation. This exoneration, which, by way of reciprocity, shall take effect from January 1, 1921, concerns, notably, the tax on industrial and commercial profits instituted by heading 1 of the law of July 31, 1917, and the tax on income prescribed by the law of June 29, 1872, and the decree of December 6, 1872, as payable by foreign companies, whose shares are not quoted, but who possess movable or immovable property situated in France. Art. 2. The present decree will be submitted to the ratification of the Chambers, in conformity with the provisions of Article 5 of the law of April 29, 1926. Art. 3. The President of the Council, Minister of Finance, is charged with the execution of the present decree, which will be published in the Journal Officiel and inserted in the Bulletin des Lois. Done at Paris, May 20, 1927. By the President of the Republic: RAYMOND POINCARÉ GASTON DOUMERGUE The Secretary of State to the Chargé d'Affaires ad interim of France Department of State WASHINGTON, July 8, 1927 SIR: With further reference to your Embassy's note of June 11, 1927, relative to the proposed reciprocal exemption from taxation by the Governments of the United States and France of the income of French and American nationals derived from shipping, I have the honor to inform you that I am now in receipt of a communication from the Treasury Department dated July 7, 1927, concerning the matter, from which I quote the following: |