F.E.C. Policy Paper.
1. Because of crucial importance of Japanese Settlement, Ambassador should attend all future meetings in order to follow through policy.
2. F.E.C. is body dealing with occupation policy. There has been a delay of 18 months in reaching agreement on occupation policy as a whole which was drafted by Dr. Evatt in December 1945. The original draft was considered in situation different from the present and we can hardly accept draft which has been implemented piecemeal, and grudgingly at that, when whole problem of settlement is now becoming acute.
3. We cannot accept F.E.C. as peace-making body. Its procedures are governed by the veto and, as a result, policy agreed on at the official level eighteen months ago has been held up ever since by the threatened exercise of the veto of one or other member or by the delays which a member under a veto can always procure.
4. You should make clear to Marshall that Australia cannot possibly agree to transfer of peace-making functions to a body set up to deal with control policy only and with a veto. You should draw pointed attention of Marshall to the United States note of 13th December, 1946, which states-
'The United States hopes and desires that in the formulation of the peace treaty with Japan Australia will participate on a full and equal basis....
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