The bill if enacted will, therefore, prohibit the foreign branch of any bank incorporated in any State of the Union from purchasing the securities of any foreign nation which is in default of its obligation to the United States."

The attorney urged that in order to overcome this the bill be amended so as to provide "that hereafter it shall be unlawful within the United States * * * for any person to purchase or sell * * *" Senator Robinson with the concurrence of Senator Johnson moved that the bill be so amended and this was done. Both indicated their view, however, that the amendment effected no change of substance, Senator Robinson stating (78 Cong. Rec. 1824):

"May I say that in my judgment the amendment does not change the meaning and effect of the bill; but the suggestion has been made by a prominent attorney that it does involve a question of the substance, and, as I understand, it is in harmony with the purpose of the bill."

It is my understanding that during the several years which have elapsed since passage of the Johnson Act American banks maintaining branches in foreign countries have conducted their affairs in accordance with the view thus apparently evidenced that the Johnson Act would not apply to customary transactions in such branches.

Both the Neutrality Act of 1937 and the Neutrality Act of 1939 employ without substantial change the above-mentioned phraseology as first inserted in the bill which became the Johnson Act. Counsel for the banks now urge that the difference in the language is immaterial and that the neutrality acts should be given the same interpretation as the Johnson Act so far as concerns applicability to bona fide transactions by foreign branches of American banks.

The facts submitted to me indicate that these foreign branches, in general, function more or less independently of the parent bank with separate capital set apart for their particular use or with branch office deposits, and that there is no shifting of funds and securities between the parent bank and its branches.

With respect to any so-called branches which are actually incorporated in the foreign countries and therefore separate

entities beyond our geographical and political jurisdiction there is, of course, no room for question. Also so far as concerns the Johnson Act I perceive no reason for challenging the practice heretofore followed in circumstances as above indicated involving no element of subterfuge.

I do not feel that it would be very helpful for me to consider further herein what interpretation the courts may place upon the neutrality acts as applied to transactions by unincorporated foreign branches of American banks. Counsel who urge the inapplicability of the statutes must realize that their arguments, however persuasive, lead only to what may be regarded as one answer to a question that can very easily be decided the other way, and that my approval of their position would afford no protection in subsequent prosecutions. This is illustrated by the case of United States v. Dietrich, 126 Fed. 671, 676, involving the prosecution of a United States Senator who after election to the Senate continued to hold and enjoy a certain contract in violation of a statute which the Attorney General had previously held inapplicable to contracts executed by Members of the Congress prior to their election.

Respectfully,

FRANK MURPHY.

TRANSFER OF AMERICAN SHIPS TO FRENCH INTERESTS The French Government having given assurance that certain vessels transferred by American interests to French interests are not intended to be employed to cruise or commit hostilities against the subjects, citizens, or property of another belligerent, the refusal to permit the vessels to depart from the jurisdiction of the United States is not justified by U. S. C., title 18, sec. 23.

The SECRETARY OF STATE.

DECEMBER 12, 1939.

MY DEAR MR. SECRETARY: Reference is made to the informal request, presented jointly by you and the Secretary of the Treasury, for the opinion of the Attorney General

upon the question whether the recent sale by certain American interests to French interests of a number of trawlers and tugs was in violation of U. S. C., title 18, sec. 23.

You were advised informally by this Department that since the pertinent facts bearing upon your question had not then been fully ascertained, the Attorney General was unable to render the opinion requested, but that with respect to such of the vessels as had not departed from the jurisdiction of the United States the known facts were sufficient to justify the refusal to permit such departure until the matter could be investigated and the pertinent facts ascertained.

You now state that in response to your inquiry the French Ambassador has today advised you as follows:

"After referring the matter to my Government I am able to give you the assurance that these ships are not intended to be employed to cruise or to commit hostilities against the subjects, citizens, or property of another belligerent."

In view of this assurance from the French Government it is my opinion that under the facts submitted the refusal to permit the vessels to depart from the jurisdiction of the United States is no longer justified.

Respectfully,

FRANK MURPHY.

TRANSFER OF APPOINTING POWER IN FARM CREDIT ADMINISTRATION UNDER REORGANIZATION PLAN NO. II

All functions relating to the appointment, fixing of compensation, transfer, promotion, demotion, suspension, or dismissal of persons to or from any positions in the Farm Credit Administration were transferred to the Secretary of Agriculture by sec. 404 of Reorganization Plan No. II.

The SECRETARY OF AGRICULTURE.

DECEMBER 28, 1939.

MY DEAR MR. SECRETARY: Reference is made to your recent letter requesting my opinion "whether the authority to appoint and prescribe the duties of officers and employees

of the Farm Credit Administration, which was vested by law in the Governor of the Farm Credit Administration prior to July 1, 1939, may now be exercised by the Secretary of Agriculture.”

The Farm Credit Administration was transferred to and made a part of the Department of Agriculture by section 401 (a) of Reorganization Plan No. I (H. R. Doc. No. 262, 76th Cong., 1st sess.), 53 Stat. 1423, which reads:

"The Farm Credit Administration, the Federal Farm Mortgage Corporation, and the Commodity Credit Corporation, and their functions and activities, together with their respective personnel, records, and property (including office equipment), are hereby transferred to the Department of Agriculture and shall be administered in such Department under the general direction and supervision of the Secretary of Agriculture, who shall be responsible for the coordination of their functions and activities."

Reorganization Plan No. I became effective July 1, 1939, by virtue of Public Res. No. 20, Seventy-sixth Congress, approved June 7, 1939, 53 Stat. 813, and the Governor of the Farm Credit Administration thereupon became and now is an officer in the Department of Agriculture.

Section 404 of Reorganization Plan No. II (H. R. Doc. No. 288, 76th Cong., 1st sess.), 53 Stat. 1431, also made effective as of July 1, 1939, by Public Res. No. 20, Seventy-sixth Congress, provides:

"Except as prohibited by section 3 (b) of the Reorganization Act of 1939, all functions relating to the appointment, fixing of compensation, transfer, promotion, demotion, suspension, or dismissal of persons to or from offices and positions in any department vested by law in any officer of such department other than the head thereof are hereby transferred to the head of such department and shall be administered under his direction and supervision by such division, bureau, office, or persons as he shall determine."

In my opinion, the provisions of section 404 above quoted are sufficient to transfer to and vest in the Secretary of

Agriculture all functions relating to the appointment, fixing of compensation, transfer, promotion, demotion, suspension, or dismissal of persons to or from any positions in the Farm Credit Administration, now a part of the Department of Agriculture, which under the law as it existed prior to July 1, 1939, the effective date of Reorganization Plan No. II, were vested in the Governor of the Farm Credit Administration, who on that date became an officer in the Department of Agriculture by virtue of Reorganization Plan No. I. Your question is therefore answered in the affirmative. Respectfully,

FRANK MURPHY.

FREE MAILING OF PUBLICATIONS BY THE SECURITIES AND EXCHANGE COMMISSION

The Securities and Exchange Commission may use the franking privilege to send to persons on its mailing lists inquiries as to whether they desire certain publications of the Commission.

Such action is authorized by Regulations of the Joint Committee on Printing and is not in violation of sec. 6, act of May 16, 1939, as amended, prohibiting executive departments and independent establishments from transmitting publications through the mail, free of postage, unless a request therefor has been received.

It is not permissible to enclose with matter entitled to free mailing other matter, which, if sent separately, would not be so entitled. The purpose of sec. 6, supra, was to reduce the amount of printed and mimeographed matter transmitted by the executive departments and independent establishments through the mail free of charge, to reduce the cost of carrying such matter, and to prevent publications from being sent to persons who have no use for them or who do not desire them.

The PRESIDENT.

JANUARY 6, 1940.

MY DEAR MR. PRESIDENT: I have the honor to refer to your memorandum of November 7, transmitting the request of the Securities and Exchange Commission dated November 2 for my opinion upon certain questions concerning the application of section 6 of the act of May 6, 1939, 53 Stat 654, 683, as