My Lords, on behalf of the noble and learned Lord Chancellor, who is unavoidably absent on urgent Government business, I beg to move the Motion standing in his name. An Anglo-Italian Clearing Office was set up in 1936, with a view to ensuring that the sterling derived from Italian exports to the United Kingdom should be used to meet Italian liabilities to the United Kingdom. The Clearing Office (Italy) Order, 1936, made by the Treasury on July 10, 1936, provided that the sterling received by the Clearing Office should be placed to a reserve account pending the conclusion of negotiations with the Italian Government. Subsequently, on November 6, 1936, a Clearing Agreement was concluded with Italy providing for the distribution of the sterling received by the Clearing Office. This agreement was put into force by the Clearing Office (Italy) Amendment Order, 1936, made by the Treasury on November 11, 1936. An amending agreement was signed on March 18, 1938, and was brought into effect by the Clearing Office (Italy) Amendment Order, 1938, which was made by the Treasury on March 28, 1938.
On the outbreak of war with Italy, the agreements automatically lapsed, and no further distribution of the sterling in the Clearing was made to creditors in this country. However, the provisions of the Orders under which debts due by United Kingdom creditors for goods of Italian origin must be paid to the Anglo-Italian 288 Clearing Office remained in force; but, under the specific provisions of Section 8 of the Trading with the Enemy Act, 1939, the sterling amounts standing in the Anglo-Italian Clearing at the outbreak of war, and subsequent additions thereto arising from the payment of pre-war debts by British residents, have been paid over to the Custodian of Enemy Property with a view to their preservation in contemplation of arrangements to be made at the conclusion of peace.
The Clearing Office (Italy) Amendment Order, 1943, of which confirmation is now proposed, provides that the previous Orders shall not apply to debts in respect of Italian goods imported into this country after the coming into force of this Order. They will not, therefore, be paid to the Clearing Office. The purpose of the Order is to establish a clear distinction between pre-war and post-war debts. Pre-war debts to Italy—both those payable through the Clearing and those payable outside the Clearing—will be held in suspense, in the hands of the Custodian, until such time as a general settlement can be made, a time which is clearly not the present. At the same time, payment for current imports from Italy, which we may shortly expect to receive, will not have to be made in accordance with pre-war machinery.
For the time being any exports to, or imports from, Italy which may take place will be on Government account, and it would clearly be unsuitable that sums due by Government Departments for purchases made in Italy should be paid into a Clearing Account set up to carry out an agreement which no longer exists, and then handed over to the Custodian of Enemy Property. These sums should be available against the current claims which we may have on Italy, and not least against the cost of the supplies which this country will have to send into Italy for the relief of the civilian population. When private trade with Italy can be resumed, it will be necessary to make further arrangements with the Italian Government for payment machinery, but it is impossible in the present unsettled stage to foresee what arrangements will be necessary. In accordance with Section 4 of the Debts (Clearing Offices and Import Restrictions) Act, 1934, the present Order must be approved by each House of Parliament within 28 days of the making of 289 the Order, excluding any time during which Parliament is dissolved or prorogued or both Houses of Parliament are adjourned for more than four days. I beg to move.
§ Moved, That the Special Order, as reported from the Special Orders Committee yesterday, be approved.—(Viscount Clifden.)
§ On Question, Motion agreed to.