FROM THE OFFICE OF PUBLIC AFFAIRS

Let me begin by extending the U.S. side's heartfelt sympathy for Austria as it confronts the tragedy at Kaprun. Americans also perished in this tragedy, and we very much share your grief.

We have just concluded two very productive days of negotiations to discuss the Framework Concerning Austrian Negotiations Regarding Nazi Era Property/Aryanization Issues and the establishment of a General Settlement Fund, which would provide ex gratia payments to certain persons for Nazi-era property losses on the territory of present-day Austria. Our goal is to reach agreement by the end of the year.

The participants included the Austrian delegation, very ably led by Ambassador Sucharipa, Austria's special envoy for Nazi-era property issues. He was supported by Ambassador Winkler and a representative of the Austrian companies, Dr. Pichler. On the victims' side, there were the plaintiffs' attorneys, representatives of the Conference on Jewish Material Claims, and representatives of the Austrian Jewish Community and Israel's supervision group of Austrian Jews.

I would like to list the achievement of our talks:

• All the participants confirmed that the Framework agreed upon in October remains the basis for our negotiations.
• The Austrian government confirmed its intent to establish a General Settlement Fund consistent with the Framework, which will make payments to those who suffered property losses, under specifically defined circumstances where there were gaps and deficiencies in past Austrian restitution efforts.
• We had an informative discussion regarding the historical and legal issues concerning both the property losses during the Nazi era on the territory of present day Austria and Austria's post-war restitution and compensation efforts.
• The participants also discussed a detailed structure for the General Settlement Fund.
• We agreed that the General Settlement Fund would be a capped fund and there would be subcaps for each of the specific categories, which will be covered by the Fund.
• We have reviewed a series of property categories that included movable property related to the Doretheum, liquidated businesses, real property, insurance, and financial assets.
• There were differences expressed among the participants regarding legal and historical issues. During the discussions of businesses, expert studies were quoted that provided the following information:
• Among Jewish businesses valued over 5,000 Riechsmarks, which were requested by the Nazi's to be registered in 1938,
• 33,000 existed in 1938, of which,
• 7,000 were destroyed immediately after the Anschluss by mobs (referred to as "wild Aryanization")
• 4,353 were formally Aryanized
• the balance (about 21,650) were totally liquidated.
• Experts also indicated that the total value of the 26,000 businesses (that remained in existence following the "wild Aryanization) registered with the authorities in 1938 amounted to 321 million Reichsmarks. While many of the Aryanized businesses were to some degree restituted, for liquidated businesses, mainly small entities in most cases there was neither compensation nor restitution. There was no formal restitution program for these businesses. There were also many other Jewish businesses liquidated that were not registered because they were valued at less than 5,000 Reichsmarks.
• In addition, we had an informative discussion of the discriminatory taxes Jews were required to pay after the Anschluss and Austria's post-war efforts to restitute such taxes to the victims. The Claims Conference asserted 181 million Reichsmarks in flight/emigration taxes and 147 million Reichsmarks in Jewish property taxes were paid. Discussions are still ongoing concerning how the General Settlement Fund might address this issue.
• We had already achieved agreement in October that Austria would provide $150 million. This amount will be distributed in its entirety on an expedited basis to all Holocaust survivors originating from or living in Austria. This amount will cover 1) apartment and small business leases; 2) household property; 3) personal valuables and effects.
• There is a growing consensus that the Fund would include both a claims-based and an equity-based component, making payments to claimants under specifically-defined circumstances, using relaxed standards of proof.
• Ambassador Sucharipa and I have called upon all participants to consider a standstill on any further legal action, assuming these negotiations continue to be productive. New litigation would be inconsistent with the spirit of achieving a negotiated settlement on these issues. This call seemed to be supported by the participants.
• Finally, all participants recognize that our goal in achieving agreement on a General Settlement Fund would be to provide a remedy for outstanding property issues. In return, the victims' representatives would need to agree to dismiss all property-related Nazi era lawsuits against Austria and Austrian companies, and the USG would be prepared to take appropriate steps to support legal peace for Nazi-era property issues involving Austria and Austrian companies.

As you know, these property talks were launched in Vienna on October 24 immediately following the signing of an agreement on a slave and forced labor fund. Last week, we had two productive meetings that helped pave the way for our progress today. We agreed to form a small working group to accelerate our work.

Our next meeting is scheduled for November 30 - December 1 in Vienna.

In addition to those participants I have already mentioned, there were also historical experts advising us who took part in the meetings.