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amazement over such proposals; that the French must recognize the
Farben "claim to leadership"; that French prosperity was due only to the
"Diktat" of Versailles; that France was actually defeated and that they would
have to accept the conditions stated or face the prospect of an immediate
expropriation of their plants. The defendant von Schnitzler flatly rejected the
French proposals as an "imputation and insult," stating that the proposals
ignored the "political and economic facts," especially since "France had
declared war on Germany."
108. The next day Farben insisted that a new
company be organized into which the French dyestuffs industry would be
incorporated, with Farben holding a 51 percent participation. Production and
the expansion of facilities were to be controlled, and the export market was to
be entirely relinquished by the French.
109. Protesting the harshness
of the terms, the management of the French firms sought to shift the
negotiations from a private to a governmental basis. Farben was adamant. Then
the French submitted an alternative plan providing for participation by Farben
in a newly formed sales organization rather than a production organization.
This, too, was rejected. The defendant von Schnitzler addressed the French
saying: "If you don't come to terms on the basis suggested by us, we shall
impose on your plants the same regime we have applied to Mulhouse." The plants
of the Societé des Matières Colorantes et Produits Chimiques de
Mulhouse, and the Kuhlmann plant at Villers St. Paul, had already been seized
by the Germans. Thereupon an agreement was reached in principle, although the
French still protested a 51 percent participation by Farben.
110. On 18
November 1941, the result of the "negotiations" was finally formalized in the
"Francolor Agreement." This agreement embodied the terms which Farben had
prepared prior to the conference of 20 January 1941. It provided, among other
things, for creation of a new corporation known as Francolor to which were
transferred the principal assets of Kuhlmann, Saint Denis, and
Saint-Clair-du-Rhone. Farben took a 51 percent participation in Francolor. In
exchange for its assets, the French received shares of Farben stock
representing one percent of Farben's capitalization. Such shares could not be
sold by the French purchasers, except to each other. Having thus acquired
control, Farben "Aryanized" the plant, transferred skilled French workers to
Germany, dismantled and shipped special equipment to Germany, and converted
these plants to armament production.
111. The German Government annexed
Alsace-Lorraine, and confiscated the plants located there which belonged to
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