The New York herald. [volume] (New York, N.Y.) 1920-1924, 1921-09-01
OIL CONTROVERSY
NEAR SETTLEMENT
Decision of Mexican SUI
preme Court Shows Arti-
Gle ~ Not Retroactive.
TEXAS COMPANY WINS
Department Of Commerce
Restrained From DenOunc-
ing Right to Its Lands.
EXPECT TAX AGREEMENT
United States, However, Will
Insist ON Treaty Admitting
Non-Retroactivity.
EXPECT TAX AGREEMENT
By tho Associated Press.

MEXICO CITY, Aug. 31.--Local repre-
eentatives of American oil companies
declined to-day to express opinions
concerning the action of the Supreme
Court Tuesday night in unanimously
granting an injunction to the Texas
Company enjoining the Mexican De-
partment Of Commerce and Industry
from renouncing rights to oil lands
held by the Texas Company prior to
May 1, 1917.
They said they preferred not tolgive
their opinions until the text of the
formal decision of the court is pub
lished, which probably will be within
ten days.
It was the general sentiment here.
however, that the non-retroactivity OF
Article XVII. of the Mexican constitu-
ton has been definitely decided by the
decision. and that supporting the SUI
preme Courts decision is President Obre-
CONS reiteration that the famous Article
XVII. never was construed by MS
Government as being retroactive.
Expect Treaty to Insist.
Tho question most frequently asked
here to-day was what would be the
attitude Of the United States toward
recognition of Mexico il the Supreme
Courts action is construed as the final
word on the retroactivity of Article
xxVI Persons who are not considered
optimists. and several newspapers OPP
posed to the Government, asserted to-
day that the United States State Depart
ment probably would maintain its insist
ence that President Obregon sign a
treaty inasmuch as the Supreme Courts
action, or even a Congressional enact
ment. might be subject to revision or
modification by any succeeding Admin
istration.
One newspaper, the Omega, pointed
out that the Supreme Court two years
ago declared Article XVII. was retro
active 1t is matter Of record that the
Mexican Foreign Office six months ago
officially informed the American En-
bassy here that the article was retro
active.
The next step taken by the Mexican
Government doubtless will be the intro
duction In the Chamber of Deputies Of
a new petroleum bill shortly after the
Chamber convenes in regular session to-
morrow.
Export Tax Compromise.
Indications are that compromise
agreement on the export and produce
ton taxes on oil will be reached this
week between the heads of the five
American oil companies now in Mexico
city and Secretary of the Treasury de
Ia Huerta. 1t was limited to-day that
such an agreement probably would be
effected on Friday and that the Ameri-
LII
satisfied with the results obtained.
Intimation OF this happy elimination
of this weeks conferences is contained
In various terse announcements by Mex
lean officials. including President Obre-
gon, who express themselves as optimis-
tic over the progress made thus far ana
as extremely hopeful for the future.
A Mexican Government statement to-
day asserted that the american oil 'Een
have come to Mexico animated with the
best motives and determined to come to
a speedy and amicable agreement
President Obregon was quoted as saying
that the first conference between Secre-
tary de la Huerta and the Americans
indicated widely divergent opinions re
harding taxes, but that this disparity
OF opinions will be smoothed out granted
that good will animates both sides"
II IS understood that the oil delegates
have prepared counter proposals regard
ing taxes, which were to be presented to
Secretary de la Huerta late to-day as a
basis for the anticipated compromise
agreement.
II is considered unlikely that the
Americans will meet President Obregon
again except to exchange social courtc
sizes, as the entire settlement SO far as
Mexico is concerned lies with Secretary
de la Huerta.