“. . . that the required costs are converted into francs at a rate considerably in excess of the purchasing power of the mark and franc respectively; furthermore, that the purchases of the German Army in France are a means of control over the life in this country and that they will, moreover, as the German Government admits, partly be replaced by deliveries in kind.”
The memorandum terminates as follows:
“In these circumstances the onerous tribute required of the French Government appears arbitrary and exceeds to a considerable extent what might legitimately be expected to be demanded.
“The French Government, always anxious to fulfill the clauses of the Armistice Convention, can only appeal to the Reich Government in the hope that it will take into account the arguments presented above.”
THE PRESIDENT: The Court will adjourn now.
[The Tribunal recessed until 1400 hours.]
Afternoon Session
M. GERTHOFFER: This morning I had the honor of presenting to the Tribunal the fact that the Germans demanded of France an indemnity of 400 million francs a day for the maintenance of their army of occupation. I indicated that the French leaders of that time, without failing to recognize the principle of their obligations, protested against the sum demanded.
At the moment of their arrival in France the Germans had issued, as in the other occupied countries, Reichskreditkasse notes and requisition vouchers over which the bank of issue had no control and which was legal tender only in France. This issue represented a danger, for the circulation of this currency was liable to increase at the mere will of the occupying power.
At the same time, by a decree of 17 May 1940, published in the VOBIF of 17 May 1940, Number 7, which appears as Document Number 214 in the document book (Exhibit Number RF-214), the occupying power fixed the rate of the Reichsmark at 20 French francs per mark, whereas the real parity was approximately 1 mark for 10 French francs.
The French delegation, having become concerned over the increasing circulation of the Reichskreditkasse notes and over the increased volume of German purchases, as well as over the rate of exchange of the mark, was informed by the German delegation, on 14 August 1940, of its refusal to withdraw these notes from circulation in France. This is to be found in a letter of 14 August, which I submit as Document Number RF-215.
The occupying power thus unjustifiably created a means of pressure upon the French Government of that time to make it yield to its demands concerning the amount of the occupation costs, as well as concerning the forced rate of the mark and the clearing agreements, which will be the subject of a later chapter.
General Huntziger, President of the French delegation, addressed several dramatic appeals to the German delegation in which he asked that France should not be hurled over the precipice, as shown by a teletype report addressed by Hemmen on 18 August 1940, to his Minister of Foreign Affairs, a report discovered by the United States Army, bearing the Document Number 1741-PS(5), which I submit to the Tribunal as Exhibit Number RF-216. Here is the interesting passage of this report:
“These large payments would enable Germany to buy up the whole of France, including its industries and foreign investments, which would mean the ruin of France.”
In a letter and a note of 20 August, the German delegation summoned the French delegation to make partial payments, specifying that no distinction would be made between the German troops in France, that the strength of the German occupation would have to be determined by the necessities of the conduct of war. In addition, the fixing of the rate of the mark would be inoperative as far as the payments were concerned, since they would constitute only payments on account. I submit the note of the 20th of August of the German Government as Document Number RF-217.
The next day, 21 August 1940, General Huntziger, in the course of an interview with Hemmen, made a last vain attempt to obtain a reduction in the German demands. According to the minutes of this interview (Document Number RF-218), Germany was already considering close economic collaboration between herself and France through the creation of commissioners of exchange control and of foreign trade. At the same time Hemmen pledged elimination of the demarcation line between the two zones. But he refused to discuss the question of the amount of the occupation costs.
In a note of 26 August 1940, the French Government indicated that it considered itself obliged to yield under pressure and protested against the German demands; this note ended with the following passage:
“The French nation fears neither work nor suffering, but it must be allowed to live. This is why the French Government would be unable in the future to continue along the road to which it is committed if experience showed that the extent of the demands of the government of the Reich is incompatible with this right to live.” (Document Number RF-219.)
The Germans had the incontestable intention of utilizing the sums demanded as occupation costs, not only for the maintenance, the equipment, and the armament of their troops in France, or for operations based in France, but also for other purposes. This is shown in particular in a teletype from the Supreme Command of the Army, dated 2 September 1940, discovered by the United States Army, which I submit as Exhibit Number RF-220 (Document Number EC-204). There is a passage from this teletype message which I shall read to the Tribunal (Page 22):
“To the extent to which the incoming amounts in francs are not required for the troops in France, the Supreme Command of the Armed Forces reserves for itself the right to make further use of the money. In particular, the allocation of the money to any offices not belonging to the Armed Forces must be authorized by the Supreme Command of the Armed Forces, in order to insure definitely that, first, the entire amount of francs required by the Armed Forces shall be covered and that thereafter any possible surplus shall remain at the disposal of the Supreme Command of the Armed Forces for purposes important to the Four Year Plan.”
From another teletype message, which was seized in the same manner and which I submit as Exhibit Number RF-221 (Document Number EC-201), I read the following:
“It is clear that there was no agreement at all with the French as to what should be understood by ‘costs for maintenance of occupation troops’ in France. If we are in agreement among ourselves that at the present moment we must, for practical reasons, avoid interminable discussions with the French, on the other hand there must be no doubt that we have the right to interpret the term ‘maintenance’ in the broadest possible sense.”
Further on in the same teletype, Page 24, Paragraph 2, there is the following:
“In any case, the concessions demanded by the French on the question of specifying the amount of occupation costs and of the utilization of the francs thus delivered must be rejected.”
And finally the following paragraph:
“The utilization of sums paid in francs.
“Concerning the use of the francs paid which are not really required for the costs of the maintenance of the occupation troops in France, there can, of course, be no discussion with French authorities.”
The French then attempted, in vain, to obtain a reduction in the occupation costs and also a modification in the rate of the mark, but the Germans refused all discussion.
At the beginning of the year 1941, negotiations were resumed. In view of the intransigence of the Germans, the French Government suspended payments in the month of May 1941. Then, at the insistence of the occupying powers, they resumed it, but paid only 300 million francs a day. This is found in the document submitted as Document Number RF-222.
On the 15 December 1942, after the invasion of the entire French territory, Germany demanded that the daily payment of 300 million francs be raised to 500 million a day.
The