AN ACT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP68-00140R000200220014-1
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 14
• Document Creation Date: December 9, 2016
• Document Release Date: August 30, 2000
• Sequence Number: 14
• Publication Date: December 16, 1963
• Content Type: REGULATION

Approved For ReleaisODJQ$ 1zoCIA-RDP68-00140R000200220014-1
88th Congress, H. R. 7885
December 16, 1963
2.n Ott
To amend further the Foreign Assistance Act of 1961, as amended, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, That this Act may
be cited as the "Foreign Assistance Act of 1963". Foreign Assist-
ance Act of 1963.
CHAPTER 1-POLICY
SEC. 101. Chapter 1 of part I of the Foreign Assistance Act of 1961,
as amended, is amended as follows:
(a) In the chapter heading strike out the words "SHORT TITLE AND".
b) Section 101, which relates to short title, is repealed. Repeal.
(c) Section 102, which relates to statement of policy, is amended as 75 Stat. 424. 22 USC follows : 2te.
(1) Insert between the fourth and fifth paragraphs the follow-22 .e 2151.
ing additional paragraph:
"It is the sense of the Congress that the institution of full invest-
ment guaranty programs under title III of chapter 2 of this part with 75 Stat. 429;
all recipient countries would be regarded as a significant measure of 76 Stat. 256.
pelf help by such countries improving the climate for private invest- 22 use 2181-
merit both domestic and foreign.". 2184.
(2) In the last sentence of the seventh paragraph, strike out
"should emphasize long range development assistance" and insert
in lieu thereof "shall emphasize long range development assist-
ance".
(3) Immediately after the tenth paragraph insert the following
new paragraph:
"It is the sense of the Congress that, in the administration of pro-
grams of assistance under chapter 2 of this part, every possible pre- 75 Stat. 426.
caution should be taken to assure that such assistance is not diverted USC 2161-
to short-term emergency purposes (such as budgetary purposes, bal
ance-of-payments purposes, or military purposes) or any other pur-
pose not essential to the long-range economic development of recipient
countries."
(4) The first sentence of the last paragraph is amended by strik-
ing out "Finally, the" and substituting "The", and by inserting
"(Including private enterprise within such countries)" immedi-
ately after "countries".
(5) Immediately after the first sentence of the last paragraph
insert the following new sentence: "In particular, the Con ress77 STAT. 379.
urges that other industrialized free-world countries increase their 77 STAT. 380.
contributions and improve the forms and terms of their assistance
so that the burden of the common undertaking, which is for the
benefit of all, shall be equitably borne by all."
(6) Immediately after the last paragraph, add the following
new paragraph:
"It is the sense of the Congress that assistance authorized by this
Act should be extended to or withheld from the government of South
Vietnam, in the discretion of the President, to further the objectives
of victory in the war again communism and the return to their home-
land of Americans involved in that struggle."
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approved For ReleM29QQ/q~tjjq CIA-RD
SEC. 102. Title I of chapter 2 of part I of the Foreign Assistance
Act of 1961, as amended, which relates to the development loan fund,
is amended as follows:
75 Stat. 426; (a) Amend section 201, which relates to general authority, as
76 Stat. 256. follows:
22 usC 2161. (1) In the second sentence of subsection (b), which relates to
considerations to be taken into account in making loans from the
development loan fund strike out clauses (1) and (2) and insert
in lieu thereof the following: "(1) whether financing could be
obtained in whole or in part from other free-world sources on rea-
sonable terms, including private sources within the United States,
(2) the economic and technical soundness of the activity to be
financed, including the capacity of the recipient country to repay
the loan at a reasonable rate of interest,".
(2) Subsection (d), which relates to interest rates on develop-
inent loans, is amended by inserting immediately after "in no
event" the following: "shall such funds (except funds loaned
22 USC 2165. under section 205 and funds which prior to the date of enactment
of the Foreign Assistance Act of 1963 were authorized or com-
mitted to be loaned upon terms which do not, meet the minimum
terms set forth herein) be loaned at a rate of interest of less than
2 per centum per annum commencing not later than ten years fol-
lowing the date on which the funds are initially made available
under the loan, during which ten-year period the rate of interest
shall not be lower than three-fourths of 1 per centum per annum,
nor".
(3) Add the following new subsection (f) :
(f) No assistance shall be furnished under this title for a project
unless the President determines that such project will promote the
economic development of the requesting country, taking into account
the current human and material resource requirements of that country
and the relationship between the ultimate objectives of the project and
the overall economic development of the country, and that such project
specifically provides for appropriate participation by private enter-
prise."
22 USC 2162. (b) Amend section 202(a), which relates to authorizations for the
development loan fund, as follows :
(1) Strike out "and $1,500,000,000 for each of the next four
succeeding fiscal years," and insert in lieu thereof ", $1,500,000,000
for the fiscal year 1963, $925,000,000 for the fiscal year 1964, and
77 STAT. 380. $1,500,000,000 for each of the next two succeeding fiscal years,".
77 STAT. 381. (2) Immediately before the period at the end thereof insert the
following: ": Provided further, That, in order to effectuate the
purposes and provisions of sections 102, 201, 601, and 602 of this
22 use 2151, Act not less than 50 per centum of the funds appropriated pur-
2161, 2351, suant to t its subsection for the fiscal years ending June 30, 1965,
2352. and June 30, 1966, respectively, shall be available for loans made
to encourage economic development through private enterprise".
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Apprveeeh ar RWeW&a 2000/09/11 : C RDR88406MR000200220014-1
TITLE II-DEVELOPMENT GRANTS AND TECHNICAL COOPERATION
SEC. 103. Title II of chapter 2 of part I of the Foreign Assistance
Act of 1961, as amended, which relates to development grants and
technical cooperation, is amended as follows :
(a) In section 212, which relates to authorization, strike out "1963" 75 Stat. 428;
and "$300,000,000" and substitute "1964" and "$220,000,000", re- 76 Stat. 256.
spectively. 22 use 2172.
(b) Amend section 214, which relates to American schools and hos- 22 Usc 2174.
pitals abroad, as follows:
(1) In subsection (a) strike out "use, in addition to other funds
available for such purposes, funds made available for the purposes
of section 211 for" and substitute the word "furnish".
(2) In subsection (b) strike out "to use" and "foreign currencies
accruing to the United States Government under any Act, for pur-
poses of subsection (a) of this section and for" and substitute "to
furnish" before the word "assistance".
(3) Add the following new subsection:
"(c) There is hereby authorized to be appropriated to the President
for the purposes of this section, for the fiscal year 1964, $19,000,000,
to remain available until expended. Of the sums authorized to be
appropriated under this subsection, not to exceed $2,200,000 shall be
available for direct dollar costs in carrying out subsection (b) and
$4,700,000 shall be available solely for the purchase of foreign cur-
rencies accruing to the United States Goveimment under any Act."
TITLE III-INVESTMENT GUARANTIES
SEC. 104. Title III of chapter 2 of part I of the Foreign Assistance
Act of 1961, as amended, which relates to investment guaranties, is
amended as follows :
(a) Amend section 221(b), which relates to general authority, as 75 Stat. 429;
follows: 76 Stat. 256.
(1) In the first sentence after "wholly owned" insert "(deter- 22 use 2181.
mined without regard to any shares, in aggregate less than 5 per
centum of the total of issued and subscribed share capital, required
by law to be held by persons other than the parent corporation) ".
(2) In paragraph (1) strike out "$1,300,000,000" in the proviso
and substitute `$2,500,000,000".
(3) In paragraph (2) strike out "1964" in the fourth proviso
and substitute ` 1965".
(b) Amend section 222(a), which relates to general provisions, by 22 Usc 2182.
striking out "section 221(b)" and substituting "sections 221(b) and 22 use 2184.
224".
(c) Amend section 222(b)r which relates to general provisions, by
striking out "section 221(b)" in both places it appears and substituting
"sections 221(b) and 224".
(d) Amend section 222(d), which relates to general provisions, to
read as follows :
"(d) Any payments made to discharge liabilities under guaranties
issued under sections 221(b) and 224 of this part, sections 202(b) and
413(b) (4) of the Mutual Security Act of 1954, as amended, and section 71 Stat. 357;
111(b) (3) of the Economic Cooperation Act of 1948, as amended 68 Stat. 846.
(exclusive of informational media guaranties), shall be paid first out 22 use 1872,
of fees referred to in section 222(b) as long as such fees are available 1933.
and thereafter shall be out of funds, if an realized from the sale 62 stet. 143.
paid yr 22 use 1509.
of currencies or other assets acquired in connection with any payments
made to discharge liabilities under such guaranties as long as suc 77 STAT. 381,
funds are available and thereafter shall be paid out of funds hereto 77 STAT. 382.
fore appropriated for the purpose of discharging liabilities under the
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approved For Releaso?20@A/091*45: CIA-RfP68-0O440JROAO2O,0220J)14-1
77.STAT. 382.
aforementioned guaranties, and thereafter out of funds realized from
the sale of notes issued under section 413(b) (4) (F) of the Mutual
68 Stat. 846. Security Act of 1954, as amended, and section 111(c) (2) of the Eco-
22 USC 1933. nomic Cooperation Act of 1948, as amended, and finally out of funds
62 Stat. 143. hereafter made available pursuant to section 222(f)."
22 USC 1509. (e) Amend section 222(e), which relates to general provisions, to
22 use 2182. read as follows :
"(e) All guaranties issued prior to July 1, 1956, all guaranties
71 Stat. 357. issued under sections 202(b) and 413(b) (4) of the Mutual Security
22 USC 1872. Act of 1954, as amended, and all guaranties heretofore or hereafter
issued pursuant, to this title shall be considered contingent obligations
backed by the full faith and credit of the Government of the United
States of America. Funds heretofore obligated under the aforemen-
tioned guaranties (exclusive of informational media guaranties)
together with the other funds made available for the purposes of this
title shall constitute a single reserve for the payment of claims in
accordance with section 222(d) of this part.."
(f) Amend section 222 by adding at the end thereof the following
new subsection :
"(g) In making a determination to issue a guaranty under section
22 USC 2181. 221(b), the President shall consider the possible adverse effect of the
dollar investment under such guaranty upon the balance of payments
of the United States."
22 use 2184. (g) Amend section 224, which relates to housing projects in Latin
American countries, as follows:
(1) In subsection (b) strike out. "$60,000,000" and substitute
4'$150,000,000".
(2) Strike out subsection (c).
SEc. 105. Section 241 of the Foreign Assistance Act of 1961, as
75 Stat. 433. amended, which relates to development research, is amended by insert-
22 use 2201. ing "(a)" after the section heading and by adding at the end thereof
the following new subsection :
"(b) Funds made available to carry out this section may be used to
conduct research into the problems of population growth."
TITLE VI-ALLIANCE FOR PROGRESS
SEc. 106. Title VI of chapter 2 of part I of the Foreign Assistance
76 Stat. 257. Act of 1961, as amended, which relates to the Alliance for Progress, is
22 USC 2261- amended as follows:
2212~c 2211. (a) Amend section 251, which relates to general authority, as
follows :
(1) In subsection (b), amend the next to the last sentence
thereof by inserting immediately after "reasonable terms" the
following: "(including private sources within the United States),
the capacity of the recipient country to repay the loan at a reason-
able rate of interest,".
(2) In subsection (e) strike out "economical" and substitute
"economically".
(3) In subsection (f) strike out "Agency for International
Development" and substitute "agency primarily responsible for
administering part I".
(4) Add the following new subsection (g)
"(g) In order to carry out the policies of this Act, the President
shall, when appropriate, assist in promoting the organization, imple-
mentation, and growth of the cooperative movement in Latin America
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 ApproSpAF,gg>RMeq,5g32000/D. /11 : CIA> AP8.t49R000200220014-1
77 STAT. 383.
as a fundamental measure toward the strengthening of democratic
institutions and practices and economic and social development under
the Alliance for Progress"
(b) Amend section 252, which relates to authorization, as follows: 76 stat. 258.
(1) In the first sentence, strike out "fiscal years 1963 through 22 USC 2212.
1966, not to exceed $600,000,000 for each such fiscal year" and
insert in lieu thereof "fiscal years 1963, 1965, and 1966, not to
exceed $600,000,000 for each such fiscal year, and for use beginning
in the fiscal year 1964, not to exceed $525,000,000,".
(2) Immediately after "1963" the second time it appears
therein, insert the following : "and not to exceed $100,000,000 of
the funds appropriated pursuant to this section for use beginning
in fiscal. year 1964".
(3) At the end thereof add the following new sentence: "In
order to effectuate the purposes and provisions of sections 102, 251,
601, and 602 of this Act, not less than 50 per centum of the loan 22 USC 2151,
funds appropriated pursuant to this section for the fiscal years 2211, 2351,
ending June 30, 1965, and June 30, 1966, respectively, shall be 2352.
available for loans made to encourage economic development
through private enterprise."
(c) Amend section 253, which relates to fiscal provisions, by insert- 22 USC 2213.
ing immediately after the first sentence thereof the following new
sentence : "All receipts in foreign currencies from loans made under
this title or for nonmilitary assistance purposes under the Mutual
Security Act of 1954, as amended, or any Act repealed thereby, shall be 68 Stat. 1751832.
USC
available, in addition to other funds available for such purposes, for note.
loans on such terms and conditions as the President may specify to
carry out the purposes of subsection (g) of section 251 of this title,
and the President may, notwithstanding the provisions of this or any
other Act, reserve such currencies in such amounts (not to exceed
$25,000,000) as he shall determine to be necessary to provide for the
programs authorized by said subsection (g)."
TITLE VII-EVALUATION OF PROGRAMS
SEC. 107. Chapter 2 of part I of the Foreign Assistance Act of
1961, as amended, is further amended by adding at the end thereof a 75 Stat. 426.
new title as follows : 2161-
2213.
"TITLE VII-EVALUATION OF PROGRAMS
"SEC. 261. The President may appoint a committee to review and
evaluate the economic development program under this Act, and to
report to the President and to the Congress its findings."
CHAPTER 3-INTERNATIONAL ORGANIZATIONS AND PROGRAMS
SEC. 108. Section 302 of the Foreign Assistance Act of 1961, as 75 Stat. 433;
amended, which relates to international organizations and programs, 76 Stat. 259.
is amended by striking out "1963" and "$148,900,000" and substitut- 22 USC 2222.
ing "1964" and "$136,050,000", respectively.
CHAPTER 4-SUPPORTING ASSISTANCE
SEC. 109. Section 402 of the Foreign Assistance Act of 1961, as
amended, which relates to supporting assistance, is amended by strik- 75 Stat. 434;
ing out "1963"' and "$415,000,000" and substituting "1964" and 76 Stat. 259.
"$380,000,000", respectively. 22 USC 2242.
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approved For Release. a. p/ 4//1j15: CIA-RQP68-0$j40F~000&00?03014-1
77 STAT, 384.
CHAPTER 5-CONTINGENCY FUND
SEC. 110. Section 451 of the Foreign Assistance Act of 1961, as
75 Stat. 434; amended, which relates to the contingency fund, is amended by strik-
76 Stat. 259. ing out "1963" and "$300,000,000"" and substituting "196" and
22 USC 2261. "$160,000,000", respectively.
PART II
CHAPTER 1-POLICY
SEC. 201. Chapter 1 of part II of the Foreign Assistance Act of 1961,
as amended is amended as follows:
(a) In tfie chapter heading strike out the words "SHORT TITLE
AND".
Repeal. (b) Section 501, which relates to short title, is repealed.
75 Stat. 434.
22 USC 2301 CHAPTER 2-MILITARY ASSISTANCE
note.
SEC. 202. Chapter 2 of part II of the Foreign Assistance Act of
1961, as amended, which relates to military assistance, is amended as
follows :
75 Stat. 436. (a) In section 504(a), which relates to authorization, strike out
22 USC 2312. "the fiscal years 1962 and 1963" and "$1,700,000,000 for each such
fiscal year, which sums" and substitute "fiscal year 1964" and
"$1,000,000,000, which", respectively.
22 USC 2313. (b) In section 505(a),. which relates to utilization of assistance,
change the period at the end thereof to a colon and add the following
proviso: "Provided, That, except (1) to the extent necessary to fulfill
prior commitments or (2) to the extent that the President finds, with
respect to any Latin American country, that the furnishing of military
assistance under this Act is necessary to safeguard the security of
the United States or to safeguard the security of a country associated
with the United States in the Alliance for Progress against overthrow
of a duly constituted government, and so informs the Congress, no
further military assistance under any provision of this Act shall be
furnished to any Latin American country."
22 USC 2318. 441963" (c)In section 510(a), which relates to special authority, strike out
in the first and second sentences and substitute "1964".
22 USC 2319. (d) In section 511, which relates to restrictions on military aid to
Latin America, strike out "$57,500,000" and substitute "$55,000,000,
of which a part may be used during each fiscal year for assistance in
im lementing a feasible plan for regional defense".
e) Add the following new section :
SEC. 512. RESTRICTIONS ON MILITARY AID To AFRICA.-No military
assistance shall be furnished on a grant basis to any country in Africa.,
except for internal security requirements or for programs described
in section 505 (b) of this chapter, unless the President determines
otherwise and promptly reports such determination to the Committee
on Foreign Relations of the-Senate and the Speaker of the House of
Representatives. The value of grant programs of defense articles
for African countries in fiscal year 1964, pursuant to any authority
22 USC 2315. contained in this part other than section 507, shall not exceed
$25,000,000."
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 ApprovedeEaeReteas*2000/09/-11: CIA' DP68-0014R000200220014-1
77 STAT. 385.
PART III
CIiAlTER 1-GENERAL PROVISIONS
SEc. 301. Chapter 1 of part III of the Foreign Assistance Act of
1961, as amended, which relates to general provisions, is amended as
follows :
(a) Section 601(b), which relates to encouragement of private enter- 75 Stat. 438.
prise, is amended as follows: 22 use 2351.
(1) At the end of paragraph (3), strike out "and".
(2) In paragraph (4), strike out "wherever appropriate" and
insert in lieu thereof "to the maximum extent practicable", and
strike out the period at the end thereof and substitute a semi-
colon.
(3) Add the following new paragraphs at the end thereof:
"(5) take appropriate steps to discourage nationalization,
expropriation, confiscation, seizure of ownership or control, of
private investment and discriminatory or other actions having the
effect thereof, undertaken by countries receiving assistance under
this Act, which divert available resources essential to create new
wealth, employment, and productivity in those countries and
otherwise impair the climate for new private investment essential
to the stable economic growth and development of those coun-
tries; and
"(6) utilize wherever practicable the services of United States
private enterprise (including, but not limited to, the services of
experts and consultants in technical fields such as engineering)."
(b) At the end of section 601 add the following new su'section:
"(c) (1) There is hereby established an Advisory Committee on Advisory Com-
Private Enterprise in Foreign Aid. The Advisory Committee shall mittee on Pri-
carry out studies and make recommendations for achieving the most vate Enterprise
effective utilization of the private enterprise provisions of this Act Esta,reigm Ata.
to the head of the agency charged with administering the program
under part I of this Act, who shall appoint the Committee. 22 USC 2151
"(2) Members of the Advisory Committee shall represent the public note.
interest and shall be selected from the business, labor and professional
world, from the universities and foundations, and from among persons
with extensive experience in government. The Advisory Committee
shall consist of not more than nine members, and one of the members
shall be designated as chairman.
"(3) Members of the Advisory Committee shall receive no compen-
sation for their services but shall be entitled to reimbursement in
accordance with section 5 of the Administrative Expenses Act of 1946
(5 U.S.C. 73b-2) for travel and other expenses incurred in attending 60 Stat. 808.
meetings of the Advisory Committee.
"(4) The Advisory Committee shall, if possible, meet not less fre-
quently than once each month, shall submit such interim reports as the
Committee finds advisable, and shall submit a final report not later
than December 31, 1964, whereupon the Committee shall cease to exist.
Such reports shall be made available to the public and to the Congress.
"(5) The expenses of the Committee, which shall not exceed $50,000,
shall be paid from funds otherwise available under this Act."
(c) Section 611(b), which relates to completion of plans and cost 22 use 2361.
estimates, is amended by striking out "circular A-47 of the Bureau of
the Budget" and substituting the Memorandum of the President
dated May 15, 1962,". 2362.
(d) Section 612, which relates to use of foreign currencies, is 22 USC
amended as follows :
(1) Insert "(a)" after the section heading.
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approved For Rely? 2Q00iQ9i44 : ClA-RpP68-QQj4QJppQ?Oggg9014-1
77 STAT. 386.
(2) Add the following new subsection (b) :
"(b) In order to provide for the foreign currency needs of United
States citizens for travel or other purposes, the Secretary of the Treas-
ury may make available for sale for United States dollars to such
citizens, at United States embassies or other convenient locations, for-
eign currencies acquired by the United States through operations
68 Stat. 832. under this Act, the Mutual Security Act of 1954, as amended, or any
22 use 1751 Act repealed thereby, or the Agricultural Trade Development and
note. Assistance Act of 1954, as amended, which (1) he determines to be in
68 Stat. 454. excess of the needs of departments and agencies of the United States
7 use 1691 for such currencies, and (2) are not prohibited from such use or com-
note. mitted to other uses by agreement heretofore entered into with another
country. United States dollars received from the sale of foreign cur-
rencies under this subsection shall be deposited in the Treasury as
miscellaneous receipts."
75 Stat. 444; (e) Section 620, which relates to prohibitions against furnishing
76 Stat. 260. assistance to Cuba and certain other countries, is amended as follows:
22 use 2370. (1) Subsection (a) is amended as follows:
(A) Insert "(1)" immediately after "(a)".
(B) At the end thereof add the following new paragraphs :
"(2) Except as may be deemed necessary by the President in the
interest of the United States, no assistance shall be furnished under
this Act to any government of Cuba, nor shall Cuba be entitled to
receive any quota authorizing the importation of Cuban sugar into the
United States or to receive any, other benefit under any law of the
United States, until the President determines that such government
has taken appropriate steps according to international law standards
to return to United States citizens, and to entities not less than 50 per
centum beneficially owned by United States citizens, or to provide
equitable compensation to such citizens and entities for property taken
from such citizens and entities on or after January 1, 1959, by the
Government of Cuba.
"(3) No funds authorized to be made available under this Act
(except under section 214) shall be used to furnish assistance to any
country which has failed to take appropriate steps, not later than 60
days after the date of enactment of the Foreign Assistance Act of
1963-
"(A) to prevent ships or aircraft under its registry from trans-
porting to Cuba (other than to United States installations in
Cuba) -
"(i) any items of economic assistance,
"(ii) any items which are, for the purposes of title I of the
65 Stat. 645. Mutual Defense Assistance Control Act of 1951, as amended,
22 use 1611- arms, ammunition and implements of war, atomic energy
1611d. materials, petroleum, transportation materials of strategic
value, or items of primary strategic significance used in the
production of arms, ammunition, and implements of war, or
"(iii) any other equipment, materials, or commodities,
so long as Cuba is governed by the Castro regime; and
"(B) to prevent ships or aircraft under its registry from trans-
porting any equipment, materials, or commodities from Cuba
(other than from United States installations in Cuba) so long as
Cuba is governed by the Castro regime."
(2) Subsection (e) is amended to read as follows:
"(e) The President shall suspend assistance to the government of
any country to which assistance is provided under this or any other,
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approv ct Ft' a 6ase62000/0881 : CIAFI3MM 1-4?R000200220014-1
77 STAT. 387.
Act when the government of such country or any government agency
or subdivision within such country on or after January 1, 1962-
"(1) has nationalized or expropriated or seized ownership or
control of property owned by any United States citizen or by any
corporation, partnership, or association not less than 50 per
centum beneficially owned by United States citizens, or
"(2) has taken steps to repudiate or nullify existing contracts
or agreements with any United States citizen or any corporation,
partnership, or association not less than 50 per centum beneficially
owned by United States citizens, or
"(3) has imposed or enforced discriminatory taxes or other
exactions, or restrictive maintenance or operational conditions,
or has taken other actions, which have the effect of nationalizing,
expropriating, or otherwise seizing ownership or control of
property so owned,
and such country, government agency, or government subdivision fails
within a reasonable time (not more than six months after such action,
or, in the event of a referral to the Foreign Claims Settlement Com-
mission of the United States within such period as provided herein,
not more than twenty days after the report of the Commission is
received) to take appropriate steps, which may include arbitration,
to discharge its obligations under international law toward such
citizen or entity= including speedy compensation for such property in
convertible foreign exchange, equivalent to the full value thereof, as
required by international law, or fails to take steps designed to provide
relief from such taxes, exactions, or conditions, as the case may be; and
such suspension shall continue until the President is satisfied that
appropriate steps are being taken, and no other provision of this Act
shall be construed to authorize the President to waive the provisions of
this subsection.
"Upon request of the President (within seventy days after such
action referred to in paragraphs (1), (2), or (3) of this subsection),
the Foreign Claims Settlement Commission of the United States
(established pursuant to Reorganization Plan No. 1 of 1954, 68 Stat.
1279) is hereby authorized to evaluate expropriated property, deter- 5 use 133z-
mining the full value of any property nationalized, expropriated, or 15 note.
seized, or subjected to discriminatory or other actions as aforesaid, for
purposes of this subsection and to render an advisory report to the
President within ninety days after such request.. Unless authorized
by the President, the Commission shall not publish its advisory report
except to the citizen or entity owning such property. There is hereby
authorized to be appropriated such amount, to remain available until
expended, as may be necessary from time to time to enable the Com-
mission to carry out expeditiously its functions under this subsection."
(3) Add the following new subsections:
"(i) No assistance shall be provided under this or any other Act,
and no sales shall be made under the Agricultural Trade Development
and Assistance Act of 1954, to any country which the President deter- 68 Stat, 454.
mines is engaging in or preparing for aggressive military efforts 7 use 1691
directed against- note.
"(1) the United States
"(2) any country receiving assistance under this or any other
Act, or
"(3) any country to which sales are made under the Agricul-
tural Trade Development and Assistance Act of 1954,
until the President determines that, such military efforts or prepara-
tions have ceased and he reports to the Congress that lie has received
assurances satisfactory to him that such military efforts or prepara-
tions will not be renewed. This restriction may not be waived pur-
suant to any authority contained in this Act.
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approved For Re l seL OO 9 1 : CIA-RDP68MO ORO0t20O0014-1
"(j) No assistance under this Act shall be furnished to Indonesia
unless the President determines that the furnishing of such assistance
is essential to the national interest of the United States. The Presi-
dent shall keep the Foreign Relations Committee and the Appropria-
tions Committee of the Senate and the Speaker of the House of Repre-
sentatives fully and currently informed of any assistance furnished to
Indonesia under this Act.
"(k) Until the enactment of the Foreign Assistance Act of 1964 or
other general legislation, during the calendar year 1964, authorizing
additional appropriations to carry out programs of assistance under
this Act, no assistance shall be furnished under this Act to any country
for construction of any productive enterprise with respect to which the
aggregate value of such assistance to be furnished by the United States
will exceed $100,000,000. No other provision of this Act shall be con-
strued to authorize the President to waive the provisions of this
subsection.
"(1) No assistance shall be provided under this Act after December
31? 1965, to the government of any less developed country which has
failed to enter into an agreement with the President to institute the
75 Stat. 429; investment guaranty program under section 221(b) (1) of this Act,
76 Stat. 256. providing protection against the specific risks of inconvertibility under
22 Usc 2181. subparagraph (A), and expropriation or confiscation under subpara-
graph (B), of such section 221 (b) (1).
"(m) No assistance shall be furnished on a grant basis under this
Act to any economically developed nation capable of sustaining its own
defense burden and economic growth, except (1) to fulfill firm commit-
rnents made prior to July 1, 1963, or (2) additional orientation and
training expenses under part II hereof during fiscal year 1964 in an
amount not to exceed $1,000,000."
75 Stat. 445;
76 Stat. 262.
22 USC 2381.
75 Stat. 447;
76 Stat. 262.
22 USC 2384.
CHAPTER 2-ADMINISTRATIVE PROVISIONS
SEC. 302. Chapter 2 of part III of the Foreign Assistance Act of
1961, as amended, which relates to administrative provisions, is
amended as follows :
(a) Amend section 621, which relates to exercise of functions, by
striking out the last sentence thereof and substituting the following:
"In providing technical assistance under this Act, the head of any
such agency or such officer shall utilize, to the fullest extent practicable,
goods and professional and other services from private enterprise on
a contract basis. Insuch fields as education, health, housing, or agri-
culture, the facilities and resources of other Federal agencies shall
be utilized when such facilities are particularly or uniquely suitable
for technical assistance, are not competitive with private enterprise,
and can be made available without interfering unduly with domestic
proggrams.
"
(b) Amend section 624, which relates to statutory officers, as
follows :
(1) In subsection (a) (2) strike out "two shall have the rank
of Deputy Under Secretaries" and substitute "one shall have the
rank of a Deputy Under Secretary".
(2) In subsection (a) (3) strike out. "nine" and substitute
"ten".
(3) In subsection (b) strike out "paragraphs (2) and" and
substitute "paragraph".
(4) In subsection (d) (1) after the words "Deputy Inspector
General, Foreign Assistance," where they first appear insert "who
shall be appointed by the President by and with the advice and
consent of the Senate,", and strike out "$19,500" and substitute
"$20,000".
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 ApprovedcF, ir),Rele,a,.@6Z000/O 11I I CIAAPP& a0A1_4?g000200220014-1
77 STAT. 389.
(c) Amend section 626(b), which relates to experts, consultants, 75 Stat. 451.
and retired officers, as follows: 22 UsC 2386.
(1) Strike out the entire first sentence.
2 In the second sentence strike out "Nor shall such service"
and substitute "Service of an individual as an expert or con-
sultant under subsection (a) of this section shall not".
(d) Amend section 631, which relates to missions and staffs abroad, 22 Use 2391.
by adding the following new subsection (c) :
"(e) The President may appoint any United States citizen who is
not an employee of the United States Government or may assign any
United States citizen who is a United States Government employee to
serve as Chairman of the Development Assistance Committee or any
successor committee thereto of the Organization for Economic Cooper-
ation and Development upon election thereto by members of said Com-
mittee, and, in his discretion, may terminate such appointment or
assignment, notwithstanding any other provision of law. Such person
may receive such compensation and allowances as are authorized by the
Foreign Service Act of 1946, as amended, not to exceed those authorized 60 Stat. 999.
for a chief of mission, class 2, within the meaning of said Act, as the 22 USC 801
President may determine. Such person may also, in the President's note.
discretion, receive any other benefits and pperquisites available under
this Act to chiefs of special missions or staffs outside the United States
established under this section."
(e) Amend section 635, which relates to general authorities, by add- 22 USC 2395.
ing the following new subsection (k) :
"(k) Any cost-type contract or agreement (including grants)
entered into with a university, college, or other educational institution
for the purpose of carrying out programs authorized by part I may
provide for the payment of the reimbursable indirect costs of said
university, college, or other educational institution on the basis of
predetermined fixed-percentage rates all lied to the total, or an element
thereof, of the reimbursable di ect costs incurred."
(f) Amend section 636, which relates to provisions on uses of funds, 22 USC 2396.
by adding the following new subsection (h) :
"(h) In carrying out programs under this Act., the President shall
take all appropriate steps to assure that, to the maximum extent pos-
sible, (1) countries receiving assistance under this Act contribute
local currencies to meet the cost of contractual and other services
rendered in conjunction with such programs, and (2) foreign cur-
rencies owned by the United States are utilized to meet the costs of
such contractual and other services."
(g) Amend section 637(a), which relates to administrative 76 Stat. 262.
expenses, by striking out. "1963" and "$53,000,000" and substituting 22 USC 2397.
"1964" and "$54,000,000", respectively.
(h) After section 637 add the following new section:
"SEc. 638. PEACE CORPS ASSISTANCE.-No provision of this Act
shall be construed to prohibit assistance to any country pursuant to
the Peace Corps Act, as.amended; the Mutual Educational and Cul- 75 Stat, 612,
tural Exchange Act of 1961, as amended: or the Export-Import Bank 22 USC 2501
Act of 1945, as cuneuded: or famine or disaster relief, including such note.
relief through voluntary agencies, under title II of the Agricultural 75 Stat. 527.
Trade Development and Assistance Act of 1954, as amended." 22 .C 2451
note.
Stat.
526.
Ciim-t%R 3-MISCELI.ANF.Ous PROVISIONS 59
12 USC SC 635
SEc. 303. Section 644(f) of the Fssistance Act. of 1961, as note.
Foreign - ~ 68 Stat. 457.
amended, which relates to definition of defense services, is amended 7 USC 1721-
by inserting "including orientation" after "training" the first time it 1724.
appears. 75 Stat. 461.
22 USC 2403.
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approved For Relq eL?,0,PgjP%6151: CIA J QP68-gp MQ0i,20Qq 0014-1
SEC. 304. Section 645 of the Foreign Assistance Act of 1961, as
75 Stat. 462. amended, which relates to unexpended balances, is amended to read as
22 USC 2404. follows:
"SEC. 645. UNEXPENDED BALANCES.-Unexpended balances of funds
made available pursuant to this Act, the Mutual Security Act of 1954,
68 Stat 832. as amended, or Public Law 86-735 are hereby authorized to be con-
22 USC 1751 tinued available for the general purposes for which appropriated, and
note. may at any time be consolidated, and, in addition, may be consolidated
with appropriations made available for the same general purposes
under the authority of this Act."
PART IV-AMENDMENTS TO OTHER LAWS
SEC. 401. The Act to provide for assistance in the development of
Latin America and in the reconstruction of Chile, and for other pur-
74 Stat. 869. poses (Public Law 86-735, 22 U.S.C. 1942 et seq.), is amended as
follows :
(a) Insert following the enacting clause "That this Act may be cited
as the `Latin American Development Act"'.
(b) In section 2 strike out "$500,000,000" and substitute
"$680,000,000".
SEC. 402. Section 231 of the Trade Expansion Act of 1962 (Public
76 Stat. 876. Law 87-794, approved October 11, 1962) is amended as follows:
19 USC 1861. (a) Insert " (a) "before the words "The President shall".
(b) Add the following new subsection:
"(b) The President may extend the benefits of trade agreement con-
cessions made by the United States to products, whether imported
directly or indirectly, of a country or area within the purview of sub-
section (a) which, at the time of enactment of this subsection, was
receiving trade concessions, when he determines that such treatment
would be important to the national interest and would promote the
independence of such country or area from domination or control by
international communism, and reports this determination and the rea-
sons therefor to the Congress."
SEC. 403. The Agricultural Trade Develo went and Assistance Act
of 1954, as amended (7 U.S.C. 1691 at seq.), is amended as follows:
75 Stat. 306. (a.) Section 101(f) is amended to read as follows:
7 USC 1701. "(f) obtain rates of exchange applicable to the sale of com-
modities under such agreements which are not less favorable than
the highest of exchange rates legally obtainable from the Govern-
ment or agencies thereof in the respective countries."
68 Stat. 457. (b) Section 105 is amended by adding at the end thereof the follow-
7 use 1705. ink; new sentence: "The President shall utilize foreign currencies
received pursuant to this title in such manner as will, to the maximum
extent possible, reduce any deficit in the balance of payments of the
United States."
7 usC 1706. (c) (1) Section 106 is amended by adding at the end thereof a new
sentence as follows: "For the purposes of this title and title IV, the
term `surplus agricultural commodity' shall include any domestically
produced fishery product (not including fish flour until approved by
the Food and Drug Administration) if the Secretary of the Interior
has determined that such product is at the time of exportation in excess
of domestic requirements, adequate carryover, and anticipated exports
for dollars."
Effective date. (2) The amendment made by paragraph (1) of this subsection shall
not be effective for purposes of title I of the Agricultural Trade Devel-
7 USC 1701- opment and Assistance Act of 1954, as amended, until January 1,
1709. 1965.
7 USC 1722. (d) Section 202 is amended by striking out "economic development"
and inserting in lieu thereof "economic and community development".
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approv&d1o ReIIiast92100/09/'P1 : CIA-RDP68 0G140R000200220014-1
77 Stat. 391.
SEC. 404. (a) Section 571(a) of the Foreign Service Act of 19462 as 74 Stat. 833.
amended, is amended by changing the final period to a colon and adding 22 USC 961.
the following : "Provided, That in individual cases when personally
approved by the Secretary further extension may be made."
(b) Section 911(2 of the Foreign Service Act of 1946, as amended, 60 Stat. 1026.
is amen e y inset g ." 22 USC 1136.
the-following: accompanying him -far-
on
aut$orizecl travel within the country of his asst nment or at the discre-
tion of-Elie Secretary, outside the coixn`try of Ixs asst; nment, but in_ n~
c'a-se-tt exceed one me bet o leis ftimilY;".
(C) I e of t e Foreign Service Act of 1946, as amended, is 22 USC 1131-
amended by striking out section 921(d), relating to use of Government 1158,
vehicles, and by inserting immediately after section 913 the following 70 Stat. 705.
new section : 22 USC 1139.
"USE OF GOVERNMENT OWNED OR LEASED VEHICLES
"SEC. 914. Notwithstanding the provisions of section 5 of the Act
of July 16, 1914, as amended (5 U.S.C. 78), the Secretary may author- 60 Stat. 810.
ize any principal officer to approve the use of Government owned or
leased vehicles located at his post for transportation of United States
Government employees and their dependents when public transporta-
tion is unsafe or not available."
(d) Title X of the Foreign Service Act of 1946, as amended, is 22 USC 801
amended by adding at the end thereof the following: notes, 803-
810.
"PAR?r I--EmUC'ATIONAI. FACILITIES
"SEC. 1081. Whenever the Secretary determines that educational
facilities are not available, or that existing educational facilities are
inadequate, to meet the needs of children of American citizens sta-
tioned outside the United States engaged in carrying out Government
activities, he is authorized, in such-
uch manner as he deems appropriate
and under such regulations as lie may prescribe, to establish, operate
and maintain primary schools, and school dormitories and related
educational facilities for primary and secondary schools, outside the
United States, or to make grants of funds for such purposes, or other-
wise provide for such educational facilities. The provisions of the
Foreign Service Buildings Act, 1926, as amended, and of paragraphs 44 Stat. 403.
(h) and (i) of section 3 of the Act ent itled `An Act to provide certain 22 USC 299.
basic authority for the Department of State', approved August 1,
1956 (5 U.S.C. 170h(h) and 170h(i) ), Inay be utilized by the Secretary 70 Stat. 890.
in providing assistance for educational facilities. Assistance may
include, but shall not be limited to hiring, transporting, and payment
of teachers and other necessary personnel."
SEC. 405. The Act entitled " 1n Act to provide certain basic author-
ity for the Department of State", approved August 1, 1956 (5 U.S.C.
170f-170t), is amended by inserting immediately after section 12 the
following new section:
"SEC. 13. There is hereby established a working capital fund for the
Department of State, which shall be available without fiscal year
limitation, for expenses (including those authorized by the Foreign
Service Act of 1946, as amended) and equipment, necessary for main- 60 Stat. 999.
tenance and operation in the city of Washington and elsewhere of 22 USC 801
(1) central reproduction, editorial, data processing, audiovisual, note.
library and administrative support services; (2) central supply serv.
ices for supplies and equipment (including repairs), and (3) such
other administrative services as the Secretary, with the approval of
the Bureau of the Budget, determines may be performed more advan-
tageously and more economically as central services. The capital of
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1
 Approved5For3Re se-2O0MOVI 1 : CIA-RoP68L&Q44ROOO2M220014-1
77 the fund shall consist of the amount of the fair and reasonable value of
such supply inventories, equipment, and other assets and inventories
on order, pertaining to the services to be carried on by the fund, as the
Secretary may transfer to the fund, less the related liabilities and
unpaid obligations, together with any appropriations made for the
purpose of providing capital. Not to exceed $750,000 in net assets
shall be transferred to the fund for purposes of providing capital.
The fund shall be reimbursed, or credited with advance payments,
from applicable appropriations and funds of the Department of State,
other Federal agencies, and other sources authorized by law, for sup-
plies and services at rates which will approximate the expense of
operations, including accrual of annual leave and depreciation of plant
and equipment of the fund. The fund shall also be credited with other
receipts from sale or exchange of property or in payment for loss or
damage to property held by the fund. There shall be transferred into
the Treasury as miscellaneous receipts, as of the close of each fiscal
year, earnings which the Secretary determines to be excess to the needs
of the fund. There is hereby authorized to be appropriated such
amounts as may be necessary to provide capital for the fund."
SEC. 406. The first sentence of the first section of the Act entitled
"An Act to authorize participation by the United States in parlia-
nientary conferences of the North Atlantic Treaty Organization",
22 USC 1928a. approved July 11, 1956 (70 Stat. 523), is amended to read as follows:
"That not to exceed eighteen Members of Congress shall be appointed
to meet jointly and annually with representative parliamentary groups
from other NATO (North Atlantic Treaty Organization) members,
for discussion of common problems in the interests of the maintenance
of peace and security in the North Atlantic area."
Approved December 16, 1963.
LEGISLATIVE HISTORY:
HOUSE REPORTS: No. 646 (Comm. on Foreign Affairs),
(Comm. of Conference).
SENATE REPORT No. 588 (Comm. on Foreign Relations).
CONGRESSIONAL RECORD, Vol. 109 (1963):
Aug.
22:
Considered in House.
Aug.
23:
Considered and passed House.
Oct.
22,
24, 28-30: Considered in Senate.
Nov.
1,
4-8, 12-14: Considered in Senate.
Nov.
15:
Considered and passed Senate, amended.
Dec.
9:
House agreed to conference report.
Dec.
12:
Conference report considered in Senate.
Dec.
13:
Conference report agreed to in Senate.
No. 1006
Approved For Release 2000/09/11 : CIA-RDP68-0014OR000200220014-1