Repeat London No. 2310.

1. Canada has been requested by SHAPE to enter into negotiations with the Gov­ernment of France for the development of the airfield at Faulquemont for occupa­tion by the Royal Canadian Air Force by September 1, 1952. A formal invitation has been forwarded to Canada and to France through their respective National Mili­tary Representatives at SHAPE, requesting the two countries to commence negotia­tions and to advise SHAPE when such negotiations are to begin in order that a representative of that Headquarters may assist. (The text is in the hands of the Canadian Military Representative at SHAPE).

2. Although it had been intended originally that airfield and operating facilities up to the minimum agreed standards would be constructed by the host country through arrangements to be made by SHAPE (bilateral negotiations between coun­tries being required only for personnel accommodation and facilities over and above the agreed minimum standards and for the eventual admission of Royal Canadian Air Force units to the field), SHAPE has now indicated that it will not be able to carry out the basic negotiations at this time (see section 1 of AC/4R/27 for the original understanding and SHAPE/LOG/1121/51; LOG 6100 for the position taken later by SHAPE).

3. Accordingly, you are requested to address a note immediately to the French Government along the lines indicated below.

Outline of Communication to the French Government

(1) In accordance with the invitation received from SHAPE, the Canadian Gov­ernment is desirous of entering into negotiations with the French Government on the following matters relating to an airfield in France intended for occupancy by units of the Royal Canadian Air Force as part of the infrastructure programme covered by the agreement reached at the Seventh Session of the North Atlantic Council (document DD(51)248)?

(a) Agreement by the French Government to receive representatives of the Canadian Government and to develop with them and with SHAPE mutually acceptable arrangements concerning the rate and technical details of construc­tion on the airfield to be occupied by units of the Royal Canadian Air Force, in accordance with paragraph 6 of document DD(51)290.?

(b) Confirmation that the site in the vicinity of Faulquemont recommended by SHAPE, as reported in SHAPE's telegram SHAPTO 1681 (copy available with Canadian Military Representative to SHAPE), is suitable for the Royal Canadian Air Force and that the French Government is prepared to make it available within the NATO infrastructure programme.

(c) Provision of the airfield, operating facilities and basic utilities required at the approved site up to the agreed minimum standards established by SHAPE and the Standing Group on the financial terms specified in documents DD(51)248 and DD(51)290.

(d) Arrangements for the construction of any other operational facilities at this field required by the Royal Canadian Air Force over and above those approved by SHAPE and the Standing Group as minimum standards.

(e) Arrangements for the construction of personnel accommodation at this site in accordance with specifications acceptable to the Royal Canadian Air Force and to SHAPE.

(2) These negotiations are proposed by the Canadian Government in order to facilitate the early conclusion of a part of the infrastructure programme essential to the defence plans undertaken by the North Atlantic Treaty Organization. In view of this fact, the Canadian Government considers that, as far as these negotiations con­cern the provision of land and facilities up to the minimum standards required by SHAPE for operational purposes, the Canadian Government is acting for NATO in its dealings with the French Government.

(3) In view of the fact that the first units of the Royal Canadian Air Force are expected to be ready to occupy the selected site by September 1, 1952, it is the desire of the Canadian Government that these negotiations should commence as soon as possible.

(4) It is also the view of the Canadian Government that a representative of SHAPE might be associated with these negotiations when matters of concern to SHAPE are under discussion and that the French and Canadian Governments should extend an invitation to SHAPE to be represented on those occasions.

(5) To the extent that arrangements, supplementary to the Agreement between the Parties to the North Atlantic Treaty regarding the Status of their Forces, may be required eventually to govern the entry of Royal Canadian Air Force units into France and their occupancy of the approved airfield, it is suggested that any neces­sary negotiations on this subject might take place at a later stage. (End of outline of communication to the French Government).

Negotiating Background

4. As indicated in paragraph 3(2) above, the Government regards these negotia­tions as being undertaken in behalf of NATO, and considers that this point should be made clear in the terms of the agreement that will be necessary between Canada and France regarding the airfield.

5. With regard to point (1)(a), the principle of the admissibility of Canadian per­sonnel for inspection of the site and for consultation with the French authorities regarding work on the airfield would appear to be established in paragraph 6 of D­D(51)290. It would seem desirable, however, to reach a rather more detailed under­standing with the French Government concerning the role of Canadian personnel in examining the site initially, in laying down precise specifications for the construc­tion of the field within the broad performance or operational standards specified by SHAPE and the Standing Group, and in establishing the specifications for any sup­plementary facilities and personnel accommodation required by the Royal Cana­dian Air Force. The preliminary negotiations should not prejudice the method of carrying out the construction, but should pave the way for detailed plans to be worked out by a team including representatives of the R.C.A.F. and of the Depart­ment of Defence Production. The airfield might be completed more quickly and at less cost if Canada, rather than France, makes the contractual arrangements direct with French contractors. Such an arrangement would facilitate under proper control the appropriate supply of Canadian materials and components such as prefabricated huts. It is desirable in the early negotiations with France not to preclude the development of such an arrangement but to leave the final settlement of this problem until the Canadian team have had an opportunity of surveying requirements and reporting to you.

6. No commitments should be made, at least at this time, to give France special concessions regarding the supply of raw materials from Canada. You may receive further instructions on this subject as the negotiations proceed.

7. Concerning point (1)(b), the present understanding is that the French and Canadian Governments should agree on the site, subject to SHAPE's approval which can probably be assumed in this case since this particular site has been rec­ommended by SHAPE.

8. With reference to point (1)(c), the French Government is responsible for arranging to have the field and its related facilities brought up to the minimum standards. Payment of the Canadian share of the costs, as determined by the Ottawa agreement (DD(51)248), will be made on the advice of the Committee which is to be established pursuant to document DD(51)290, and in accordance with the terms of payment specified in that document.

9. With regard to points (1)(d) and (e), it will be open to the Canadian negotiators to urge that these costs should be shared. Particularly since the airfield in question is one which was already in existence, it would seem fair to suggest that these additional facilities are likely to have a significant residual value to the French authorities for either military or civilian purposes and that, accordingly, they should not be unwilling to meet some part of the cost. The Canadian Government is willing to agree that the French Government should own the fixed installations, including accommodation, beyond minimum standards, although it might ask France to make some payment if the latter takes over and uses these fixed installa­tions. Canada should, however, have user rights for the period that the airfield is required for the purposes of the North Atlantic Treaty.

10. The question of the responsibility for ordinary maintenance of the airfield has not been included in the subjects for negotiation since this is a matter which has not yet been discussed in more than a preliminary manner in the various NATO bodies. On earlier occasions, the French representatives have suggested that, in return for retention of ownership of the commonly financed facilities, their Government would be prepared to meet the costs of the upkeep of at least those facilities (although possibly not of the facilities financed nationally by the government whose forces are occupying the field). Since then the position has become some­what confused and it is not completely clear whether the French authorities would be prepared to accept this obligation without further payment. During the negotia­tions the situation may be further clarified as a result of discussion in the NATO Infrastructure Committee, in which event it would be appropriate for the Canadian negotiators to discuss the question with the French authorities. For the present at least the Canadian Government view is that it would expect France to provide maintenance. The question of what services should be regarded as maintenance for this purpose, and of whether France should be expected actually to provide the services or merely to pay for them, should be regarded as one for discussion at a technical level if the issue should arise.

11. The question of the possible exemption from taxation by host governments of the various expenditures (whether commonly or nationally financed) associated with infrastructure is a matter at present being examined in a more general context. Accordingly, it would seem undesirable to raise the question for discussion at pre­sent unless the French Government should so wish. As matters develop, it may be found appropriate to introduce this subject into the negotiations at a later stage. It is in order, however, to inform the French Government early in the negotiations of the general view of the Canadian Government that the arrangements regarding tax­ation which will apply to Canadian expenditures abroad arising out of the NATO programme should be in accord in each case with the most favourable arrange­ments granted by the host government to any other NATO government.

12. It is suggested that you should be primarily responsible for the conduct of the negotiations with the French Government on the subjects listed above. It is assumed that you will wish to delegate a member of your staff to participate contin­uously in the detailed negotiations.

13. It is intended, in agreement with Mr. Wilgress, that the interests of the Department of National Defence in these negotiations will be represented by Mr. Alex Ross as occasion may required. Mr. Wilgress will also make Mr. A.E. Ritchie available, as may be necessary, to advise on any features of the general NATO infrastructure discussions which may be relevant to these particular negotiations. On any legal questions, particularly those involving interprÉtations of the NATO Agreement on the Status of Armed Forces, Mr. E.A. Cote of Canada House will also be available for consultation.

14. On the military aspects of the negotiations, it is intended that the Chairman of the Canadian Joint Staff, London, who is as you know, the Canadian National Mili­tary Representative to SHAPE, will be the officer responsible for advising you and providing such assistance as you may require. He will make the necessary arrange­ments for the provision of Canadian technical staff, including expert representation from the Department of Defence Production, to work in Paris under your supervi­sion. (The Department of Defence Production has engaged for this purpose Mr. Albert Deschamps, a well7known engineer and contractor of Montreal).

15. You may consider it desirable to have a meeting with all the Canadian advis­ers and experts mentioned above prior to the first meeting with the French representatives.

16. The Council Deputies are to be informed of the procedure Canada proposes to follow. Separate instructions are being sent to Mr. Wilgress on this point, and are being repeated to you. Please send Mr. Wilgress the exact text of the note to the French Government as soon as it has been delivered, and of course you will send me a copy and keep me fully informed of developments.