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Fiscal Agent of the United States
rCircular No. 2 4 7 9
L August 12, 194

To all Banking Institutions, and Others Concerned,
in the Second Federal ^Reserve District:

For your information we quote below from a telegram received today from the Treasury
The following is the text of General Ruling No. 10-A issued today:
Title 31—Money ana Finance: TreasuryChapter I—Monetary Offices, Department of the Treasury
O f f i c e of t h e S e c r e t a r y
Part 132—General Rulings under Executive Order No. 8389,
A u g u s t 12 1942
as amended, Executive Order No. 9193, Sections 3(a) and
5(b) of the Trading with the Enemy Act, as amended
by the First W a r Powers Act, 1941, relating to foreign
funds control.*
G E N E R A L R U L I N G NO. 10-A
U N D E R E X E C U T I V E ORDER NO. 8389, AS AMENDED, E X E C U T I V E ORDER NO. 9193, SECT I O N S 3(a) A N D 5(b) O F T H E T R A D I N G W I T H T H E E N E M Y ACT, AS A M E N D E D BY T H E
F I R S T W A R P O W E R S ACT, 1941, R E L A T I N G T O F O R E I G N F U N D S C O N T R O L

(1) Unless authorized by a license expressly referring to this general ruling:
(a) No Philippine company shall make any payment, or perform any covenant,
duty, condition or service within the United States on, or with respect to, any direct
or indirect obligation or security of, or claim against, such company.
(b) No person shall exercise within the United States any right, remedy, power
or privilege with respect to, or directly or indirectly arising out of or in connection
with, any obligation or security of, or claim against, any Philippine company, including any right, remedy, power or privilege with respect to any guaranty, covenant or
agreement that such Philippine company will perform any covenant, duty, condition,
or service.
(2) Unless otherwise provided, an appropriate license or other authorization issued
by the Secretary of the Treasury shall remove all the restrictions, disabilities and other
limitations imposed by this general" ruling to the same extent as such restrictions, disabilities and other limitations have been imposed by this general ruling.
(3) This general ruling shall not be deemed to prohibit or otherwise restrict the
ordinary purchase, sale, transfer, pledge, or hypothecation of, or similar dealing in,
securities which are issued by, or the obligation of, any Philippine company or to prohibit
or restrict transactions incidental thereto.
(4) As used in this general ruling, the term "Philippine company" shall mean:
(a) Any partnership, association, corporation or other organization organized
under the laws of the Philippine Islands and which prior to January 1, 1942, derived
its principal income from the Philippine Islands;
(b) Any sole proprietorship which prior to January 1, 1942, derived its principal
income from, and was primarily engaged in business in, the Philippine Islands; and
(c) Any agent, trustee, transfer or paying agent, or other representative of or for
any Philippine company to the extent that it acts as such.


Acting Secretary of the Treasury
* Part 132;—Sec. 5(b), 40 Stat. 415 and 966; Sec. 2, 48 Stat. 1; 54 Stat. 179; Public No. 354, 77th Congress, 55 Stat. 838; Ex. Order 8389, April 10, 1940, as amended by Ex. Order 8785, June 14, 1941, Ex. Order
8832, July 26, 1941, Ex. Order 8963, December 9, 1941, Ex. Order 8998. December 26, 1941, and Ex.
Order 9193, July 6, 1942; Regulations, April 10, 1940, as amended June 14, 1941, and July 26, 1941.


T h e following is the text of a press release issued today in connection with the abovementioned general ruling:
Washington, D. C.
Press Service
No. 32-83

Wednesday, August 12, 1942

T h e Treasury Department today announced a moratorium on obligations of Philippine
companies held in the United States. This moratorium does not apply to the obligations
of the Philippine Government.
Pursuant to General Ruling No. 10-A issued today under the presidential freezing
orders no Philippine company may make any payment in this country on its obligations
and no person may enforce in the United States any claim or obligation against a
Philippine company. Such payments can be made and such claims can be enforced only
if a foreign funds control license is first obtained.
Treasury officials stated that today's action was intended to make it clear that the
assets in the United States of Philippine companies were fully frozen so that the interests
of all the parties involved could be fully and properly protected. It was pointed out that
some of these Philippine companies had assets in the Philippines worth many millions of
dollars before the war and only a relatively small amount of funded indebtedness. The
companies do not have assets in the United States at this time to meet maturing obligations and since no one knows or could know, the present condition or value of property
in the Philippines, it is, at the present time, impossible to deal fairly with the respective
rights of stockholders, bondholders and other creditors. Under today's ruling the situation
will be frozen until it is possible to ascertain the facts.
It was pointed out by Treasury representatives that Philippine companies would not
be permitted to use today's ruling to avoid paying their obligations in any case where
funds were available and such payments could be made on an equitable basis. In such
cases the Treasury will license payments upon appropriate application by interested
parties. Moreover, the Treasury expects Philippine companies to furnish their creditors
upon demand with information concerning their present ability to pay their obligations.
Any failure to furnish such information will be dealt with appropriately by the Treasury.

Additional copies of this circular will be furnished upon request.



Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102