Berlin (Jul. 2)
Failure of the Allied Control Council’s property control element to reach an agreement on a restitution law for the four zones of Germany has compelled the property control group to turn the problem over to the Control Council’s financial division, which is the next highest body, it was learned today.
The chief obstacle to an agreement is reported to be the disposal of property belonging to Nazi victims who died heirless. The British and Americans favor having this property or the proceeds therefrom placed in a central rehabilitation fund, (##)le the French and Soviets want the property returned to whatever German government is set up.
Should the financial division fail to reach an agreement, the issue will be (##)mitted to the Control Council itself. There is also the possibility that the British and the Americans, operating through the newly constituted bi-zonal economic council, may promulgate a restitution law in their zones.
The German Council of States, which consists of the four Minister Presidents (##) the provinces in the U.S. zone, adopted a sweeping restitution law last March 12 (##) the insistence of the American Military Government. The Council recommenfied, however, that the law not be promulgated until agreement could be reached on extending (##) provisions to all of Germany. As a result, the AMG initiated the present Control Council talks.