New Britain herald., 1927-10-03
Expect America to Accept With Reservation September 30
 Compromise Proposals
U. 5. DEMANDING MINIMUM
 RATES DURING INQUIRY

cial Treaty-Washington Rebuke ed ] Tor Reference To Penalty Section Of Its Imports Law,
 Washington. Oct. 5 dP-While the
 most recent French tariff note i,
 viewed by administration officials a. conciliatory and perhaps opening | me way to settlement Of the present 1 dispute, text of the first two note, 1 excnanged shows that the French sulls nave been trained directly on
 American tariff rates from the time the Franco German commercial
 treaty was signed.
 l lhese notes Were made public
 simultaneously today in Washing
 ton ana Paris, to be followed later py the current chapter in the in. | terchange, the French note received
 saturday The American reply is | now being formulated and IS expect.
 ed to go forward late this week. The new French note cites tho equalization provisions of the Amer ican tariff act, Section 3l5. as an. l thority under which treaty nego- tlations might proceed. That section authorizes adjustment of rates up or down to allow for any difference m American and foreign production costs or the articles involved in or der 10 remove the difference when the articles are placed in competi- ton here with American products.
 The Washington government is prepared to assure France that it Will make full use of this section in . deallng with tariff rates against "hlch that country may complain. hnt 1t will not bind itself to reduce
 those rates, Any change in rate vii,
 De based on study of production
 costs and 1t will go up or down as
 that study dictates.
 1 Officials are In some doubt as 10
 whether the French authorities
 realize that in many previous cases such studies have brought tariff in- creases
 See Radical Changes In any event, examination Of tho llrst French note shows the new suggestion is wide departure from the original proposal for d treaty based on reciprocity and to include If necessary such reduction r adaptations of the (American) tar if as would permit certain unnam- ed French goods to enter the Ameri- can market. In reply the state de- partment implied surprise that the French government did not know that the American tariff law does not envisage the inclusion of treaty Of reciprocaiy in regard to rates of duty"
 While the French tariff system carried a three column system, the maximum of which is now applied to American goods involved in the dis pute. for the specific purpose Of treaty bargaining on rates, the American note said, American laws 'embody no such margin for bar gaining" and the proposal for gen. eral most t-favored- national relations was reiterated as the best way of solving the problem.
 In attacking the American tariff schedules. the French note charac. terlzed them as setting up "prohi- bitlve regime against certain French goods to which the Washing ton government answered that tariff rates were "a matter solely of inter- nal policy" and not involved in the dispute with France which was con- fined strictly to French tariff des- examinations now in force against American products.
 French Cite Lack Of Harmony
 In admitting an Augmentation" Of these rates, the French note said they had come about under the GUS toms reform" of August 50, which was Instituted in consequence of the Franco-German treaty" It adds that the previous Exceptional treatment" granted American goods entering France and which was withdrawn by the August 80 decree was not in harmony with the constant in- crease in American rates and the re- enforcement Of customs barriers practiced by America" since 1921 to the "detriment Of certain specific products of the French trade The latest and as yet unpublish- ed French note rehukes the Wash ington government for a threatening reference to the penalty section Of i the American tariff law. That re-
 mark was prompted, presumably by | the statement in the American note calling attention to section Sl7 as authorizing counter discrimination. ! but asserting that Washington 'Is livery loath' to make such duty in- lcreases despite serious discrimina- tions" and has rferained from doing | so in the hope that negotiation of 1 m lost favored nation treaty and ad- interim suspension of the French | discriminatory rates would settle the
 controversy without that recourse.
 Insist on Reciprocity
 The French insistence upon the
 principle of reciprocity does not de- 1 mand any special reduction in the ! American tariff for France alone,
 but simply reduction in the Amer ican duties on French products.
 The French memorandum cites
 the high tariffs on French exports l to America and asks reductions
 which simple equity suggests and l (Contiuusd on Page 15))