The Washington herald., 1918-08-16
MAY
OILFIELD
OF AMERICANS
Lays a Confiscatory Tax
Which May Bring Serious
Situation for Allies.

The Mexican governments arbitrary
refusal to consider the British protest
against oil taxes brought out here yes
terday that a similar communication
from the United States has been en-
trrely ignored by Carranza.
The reuslt was an announcement by
accredited Representatives Of American
oil companies, which control the bulk
Of the Mexican oil fields, that they
have decided to ignore Carranza's oil
decree.
The executive officers and represen-
tatives Of the oil companies have been
meeting in Houston, New York and
Washington to consider all phases of
the situation. The final resolution
was to refuse payment Of rentals i'm
posed and the consequent recognition
of the very much more vital confisca-
tory features OF the decree.
Could seise OIL Lands.
One effect of the failure to pay the
new land rentals will be to throw oil
properties open to announcement, it is
declared This means the Mexican
government will be left free to seize
the oil fields and dispose Of them to
others, unless protection Is AFFORDED
By the interested governments.
Such a situation has not been over
looked In Germany. 1t IL said. 1t gives
added Significance to the recent boast
OF Albert Ballin, president of the vast
German shipping syndicate. and of
Herr Won Riedemann. the petroleum
king. that they possess definite pros
poets of exploiting oil fields in certain
overseas countries"
Statements obtained from important
producers Of petroleum in Mexico fol-
low:
Mexico Dodges.
"Mexico's reply lodges the issue
Recent oil DEGREES issued in Mexico
are based on the latest constitution
of Mexico. which attempts to vest In
the nation. oil deposits acquired law
fully by American, British and Dutch
companies. on which the allies oil
supply depends. Incidental mention
OF confiscatory taxes was made in
the British and American notes, but
the protests were distinctly directed
against the confiscation OF oil.
'As stated in the American note:
The United States cannot acquiesce
in any procedure, ostensibly or nomi-
nally in the form Of taxation. but
really resulting In confiscation of pri-
vate property and arbitrary depriva-
tion OF vested rights
Foreign Minister Aguilar states
that the oil companies must exhaust
their remedies in Mexican courts. This
they are doing. with small hope OF
success, in view Of the statement OF
the Mexican chief justice that he and
his colleagues are first revolutionists
and then Judges.
False Guarantees.
"His statement that the Mexican
government gives guarantees to the
oil producers facilitating their devel-
opment is not in accord with the
facts. Since February %, this year.
House. Millard. Dunn. Espaula, Coop
er. Meza and Stevenson, unarmcd
American employees of American COM
panies. and ten Mexican employees
have been murdered; eleven Amer
lean employees wounded in murder
Gus assault by armed Mexicans or
soldiers, and $125O00 stolen from
American paymasters in thirty-one
separate robberies in the oil terri
tory controlled by his government.
Laws Gave Title.
'The former laws and governments
OF Mexico for more than thirty years
recognized the title of foreigners as
we'll as Of Mexican citizens to oil
under the surface. Inducements to
develop these oil lands at great ex-
pense have been offered to foreign
ers, have been accepted. and scores OF
millions Of dollars expended in lands.
leases, material and labor. to prove
the existence of oil in these lands
and to develop. These contracts were
made by governments OF Mexico,
fully recognized by all civilized na-
tions.
"As TO the rebuke which Aguilar.
in the note. administers to the Brit
ish government, and, by inference.
also to the American government.
which has filed notes similar to that
OF Great Britain. establishment and
surprise are the only emotions which
1t can evoke"