October 17, 1945
United States Department of State Bulletin.
It is considered appropriate, at the time of the release to the American
public of the following directive setting forth United States policy
with reference to the military government of Germany, to preface the
directive with a short statement of the circumstances surrounding the
issuance of the directive to General Eisenhower.
The directive was issued originally in April 1945, and was intended
to serve two purposes. It was to guide General Eisenhower in the military
government of that portion of Germany occupied by United States forces.
At the same time he was directed to urge the Control Council to adopt
these policies for enforcement throughout Germany.
Before this directive was discussed in the Control Council, President
Truman, Prime Minister Attlee, and Generalissimo Stalin met at Potsdam
and issued a communiqué setting forth agreed policies for the control
of Germany. This communiqué was made public on August 2, 1945. The directive,
therefore, should be read in the light of the policies enumerated at
Potsdam. In particular, its provisions regarding disarmament, economic
and financial matters, and reparations should be read together with
the similar provisions set out in the Potsdam agreement on the treatment
of Germany in the initial control period and in the agreement on reparations
contained in the Potsdam communiqué. Many of the policy statements contained
in the directive have been in substance adopted by the Potsdam agreement.
Some policy statements in the Potsdam agreement differ from the policy
statements on the same subjects in the directive. In such cases, the
policies of the Potsdam agreement are controlling. Where the Potsdam
agreement is silent on matters of policy dealt with in the directive,
the latter continues to guide General Eisenhower in his administration
of the United States Zone in Germany.
Directive to Commander-in-Chief of United States Forces of Occupation Regarding the Military Government of Germany
1. The Purpose and Scope of this Directive:
This directive is issued to you as Commanding General of the United
States forces of occupation in Germany. As such you will serve as United
States member of the Control Council and will also be responsible for
the administration of military government in the zone or zones assigned
to the United States for purposes of occupation and administration.
It outlines the basic policies which will guide you in those two capacities
after the termination of the combined command of the Supreme Commander,
Allied Expeditionary Force.
This directive sets forth policies relating to Germany in the initial
post-defeat period. As such it is not intended to be an ultimate statement
of policies of this Government concerning the treatment of Germany in
the post-war world. It is therefore essential that, during the period
covered by this directive, you assure that surveys are constantly maintained
of economic, industrial financial, social and political conditions within
your zone and that the results of such surveys and such other surveys
as may be made in other zones are made available to your Government,
through the Joint Chiefs of Staff. These surveys should be developed
in such manner as to serve as a basis for determining changes in the
measures of control set forth herein as well as for the progressive
formulation and development of policies to promote the basic objectives
of the United States. Supplemental directives will be issued to you
by the Joint Chiefs of Staff as may be required.
As a member of the Control Council you will urge the adoption by the
other occupying powers of the principles and policies set forth in this
directive and, pending Control Council agreement, you will follow them
in your zone. It is anticipated that substantially similar directives
will be issued to the Commanders in Chief of the U.K., U.S.S.R. and
French forces of occupation.
General and Political
2. The Basis of Military Government:
a. The rights, power and status of the military government
in Germany are based upon the unconditional surrender or total defeat
b. Subject to the provisions of paragraph 3 below, you are,
by virtue of your position, clothed with supreme legislative, executive,
and judicial authority in the areas occupied by forces under your command.
This authority will be broadly construed and includes authority to take
all measures deemed by you necessary, appropriate or desirable in relation
to military exigencies and the objectives of a firm military government.
c. You will issue a proclamation continuing in force such proclamations,
orders and instructions as may have heretofore been issued by Allied
Commanders in your zone, subject to such changes as you may determine.
Authorizations of action by the Supreme Commander, Allied Expeditionary
Force, may be considered as applicable to you unless inconsistent with
this or later directives.
3. The Control Council and Zones of Occupation:
a. The four Commanders-in-Chief, acting jointly, will constitute
the Control Council in Germany which will be the supreme organ of control
over Germany in accordance with the agreement on Control Machinery in
Germany. For purposes of administration of military government, Germany
has been divided into four zones of occupation.
b. The authority of the Control Council to formulate policy
and procedures and administrative relationships with respect to matters
affecting Germany as a whole will be paramount throughout Germany. You
will carry out and support in your zone the policies agreed upon in
the Control Council. In the absence of such agreed policies you- will
act in accordance with this and other directives of the Joint Chiefs
c. The administration of affairs in Germany shall be directed
towards the decentralization of the political and administrative structure
and the development of local responsibility. To this end you will encourage
autonomy in regional, local and municipal agencies of German administration.
The German economic structure shall also be decentralized. The Control
Council may, however, to the minimum extent required for the fulfillment
of purposes set forth herein, permit centralized administration or establish
central control of (a) essential national public services such as railroads,
communications and power, (b) finance and foreign affairs, and (c) production
and distribution of essential commodities.
d. The Control Council should adopt procedures to effectuate,
and you will facilitate in your zone, the equitable distribution of
essential commodities between the zones. In the absence of a conflicting
policy of the Control Council, you may deal directly with one or more
zone commanders on matters of special concern to such zones.
e. Pending the formulation in the Control Council of uniform
policies and procedures with respect to inter-zonal travel and movement
of civilians, no civilians shall be permitted to leave or enter your
zone without your authority, and no Germans within your zone shall be
permitted to leave Germany except for specific purposes approved by
f. The military government personnel in each zone, including
those dealing with regional and local branches of the departments of
any central German administrative machinery, shall be selected by authority
of the Commander of that zone except that liaison officers may be furnished
by the Commanders of the other three zones. The respective Commanders-in-Chief
shall have exclusive jurisdiction throughout the whole of Germany over
the members of the armed forces under their command and over the civilians
who accompany them.
g. The Control Council should be responsible for facilitating
the severance of all governmental and administrative connections between
Austria and Germany and the elimination of German economic influences
in Austria. Every assistance should be given to the Allied Administration
in Austria in its efforts to effectuate these purposes.
4. Basic Objectives of Military Government in Germany:
a. It should be brought home to the Germans that Germany's
ruthless warfare and the fanatical Nazi resistance have destroyed the
German economy and made chaos and suffering inevitable and that the
Germans cannot escape responsibility for what they have brought upon
b. Germany will not be occupied for the purpose of liberation
but as a defeated enemy nation. Your aim is not oppression but to occupy
Germany for the purpose of realizing certain important Allied objectives.
In the conduct of your occupation and administration you should be just
but firm and aloof. You will strongly discourage fraternization with
the German officials and population.
c. The principal Allied objective is to prevent Germany from
ever again becoming a threat to the peace of the world. Essential steps
in the accomplishment of this objective are the elimination of Nazism
and militarism in all their forms, the immediate apprehension of war
criminals for punishment, the industrial disarmament and demilitarization
of Germany, with continuing control over Germany's capacity to make
war, and the preparation for an eventual reconstruction of German political
life on a democratic basis.
d. Other Allied objectives are to enforce the program of reparations
and restitution, to provide relief for the benefit of countries devastated
by Nazi aggression, and to ensure that prisoners of war and displaced
persons of the United Nations are cared for and repatriated.
5. Economic Controls:
a. As a member of the Control Council and as zone commander,
you will be guided by the principle that controls upon the German economy
may be imposed to the extent that such controls may be necessary to
achieve the objectives enumerated in paragraph 4 above and also as they
may be essential to protect the safety and meet the needs of the occupying
forces and assure the production and maintenance of goods and services
required to prevent starvation or such disease and unrest as would endanger
these forces. No action will be taken in execution of the reparations
program or otherwise which would tend to support basic living conditions
in Germany or in your zone on a higher level than that existing in any
one of the neighboring United Nations.
b. In the imposition and maintenance of such controls as may
be prescribed by you or the Control Council, German authorities will
to the fullest extent practicable be ordered to proclaim and assume
administration of such controls. Thus it should be brought home to the
German people that the responsibility for the administration of such
controls and for any break-downs in those controls will rest with themselves
and German authorities.
a. A Proclamation dissolving the Nazi Party, its formations,
affiliated associations and supervised organizations, and all Nazi public
institutions which were set up as instruments of Party domination, and
prohibiting their revival in any form, should be promulgated by the
Control Council. You will assure the prompt effectuation of that policy
in your zone and will make every effort to prevent the reconstitution
of any such organization in underground, disguised or secret form. Responsibility
for continuing desirable non-political social services of dissolved
Party organizations may be transferred by the Control Council to appropriate
central agencies and by you to appropriate local agencies.
b. The laws purporting to establish the political structure
of National Socialism and the basis of the Hitler regime and all laws,
decrees and regulations which establish discriminations on grounds of
race, nationality, creed or political opinions should be abrogated by
the Control Council. You will render them inoperative in your zone.
c. All members of the Nazi party who have been more than nominal
participants in its activities, all active supporters of Nazism or militarism
and all other persons hostile to Allied purposes will be removed and
excluded from public office and from positions of importance in quasi-public
and private enterprises such as (1) civic, economic and labor organizations,
(2) corporations and other organizations in which the German government
or subdivisions have a major financial interest, (3) industry, commerce,
agriculture, and finance, (4) education, and (5) the press, publishing
houses and other agencies disseminating news and propaganda. Persons
are to be treated as more than nominal participants in Party activities
and as active supporters of Nazism or militarism when they have (1)
held office or otherwise been active at any level from local to national
in the party and its subordinate organizations, or in organizations
which further militaristic doctrines, (2) authorized or participated
affirmatively in any Nazi crimes, racial persecutions or discriminations,
(3) been avowed believers in Nazism or racial and militaristic creeds,
or (4) voluntarily given substantial moral or material support or political
assistance of any kind to the Nazi Party or Nazi officials and leaders.
No such persons shall be retained in any of the categories of employment
listed above because of administrative necessity, convenience or expediency.
d. Property, real and personal, owned or controlled by the
Nazi party, its formations, affiliated associations and supervised organizations,
and by all persons subject to arrest under the provisions of paragraph
8, and found within your zone, will be taken under your control pending
a decision by the Control Council or higher authority as to its eventual
e. All archives, monuments and museums of Nazi inception, or
which are devoted to the perpetuation of German militarism, will be
taken under your control and their properties held pending decision
as to their disposition by the Control Council.
f. You will make special efforts to preserve from destruction
and take under your control records, plans, books, documents, papers,
files, and scientific, industrial and other information and data belonging
to or controlled by the following:
(1) The Central German Government and its subdivisions, German military
organizations, organizations engaged in military research, and such
other governmental agencies as may be deemed advisable;
(2) The Nazi Party, its formations, affiliated associations and supervised
(3) All police organizations, including security and political police;
(4) Important economic organizations and industrial establishments
including those controlled by the Nazi Party or its personnel;
(5) Institutes and special bureaus devoting themselves to racial,
political, militaristic or similar research or propaganda.
a. In your zone you will assure that all units of the German
armed forces, including pare-military organizations, are dissolved as
such, and that their personnel are promptly disarmed and controlled.
Prior to their final disposition, you will arrest and hold all military
personnel who are included under the provisions of paragraph 8.
b. The Control Council should proclaim, and in your zone you
will effectuate, the total dissolution of all military and pare-military
organizations, including the General Staff, the German Officers Corps,
the Reserve Corps and military academies, together with all associations
which might serve to keep alive the military tradition in Germany.
c. You will seize or destroy all arms, ammunition and implements
of war and stop the production thereof.
d. You will take proper steps to destroy the German war potential,
as set forth elsewhere in this directive.
8. Suspected War Criminals and Security Arrests:
a. You will search out, arrest, and hold, pending receipt
by you of further instructions as to their disposition, Adolf Hitler,
his chief Nazi associates, other war criminals and all persons who have
participated in planning or carrying out Nazi enterprises involving
or resulting in atrocities or war crimes.
b. All persons who, if permitted to remain at large would endanger
the accomplishment of your objectives will also be arrested and held
in custody until trial by an appropriate semi-judicial body to be established
by you. The following is a partial list of the categories of persons
to be arrested in order to carry out this policy:
[NOTE: There follows at this point in the directive a detailed list
of categories of Nazi war criminals and others who are to be arrested.
Some of these have not yet been found. It is considered that to publish
the categories at this time would put the individuals concerned on notice
and would interfere with their apprehension and punishment, where appropriate.
The list of categories is, therefore, withheld from publication for
If in the light of conditions which you encounter in Germany, you
believe that it is not immediately feasible to subject certain persons
within these categories to this treatment, you should report your reasons
and recommendations to your government through the Joint Chiefs of Staff.
If you believe it desirable, you may postpone the arrest of those whose
cases you have reported, pending a decision communicated to you by the
J.C.S. In no event shall any differentiation be made between or special
consideration be accorded to persons arrested, either as to manner of
arrest or conditions of detention, upon the basis of wealth or political,
industrial, or other rank or position. In your discretion you may make
such exceptions as you deem advisable for intelligence or other military
9. Political Activities:
a. No political activities of any kind shall be countenanced
unless authorized by you. You will assure that your military government
does not become committed to any political group.
b. You will prohibit the propagation in any form of
Nazi, militaristic or pan-German doctrines.
c. No German parades, military or political, civilian or sports,
shall be permitted by you.
d. To the extent that military interests are not prejudiced
and subject to the provisions of the three preceding subparagraphs and
of paragraph 10, freedom of speech, press and religious worship will
be permitted. Consistent with military necessity, all religious institutions
will be respected.
10. Public Relations and Control of Public Information:
As a member of the Control Council, you will endeavor to obtain agreement
for uniform or coordinated policies with respect to (a) control of public
information media in Germany, (b) accrediting of foreign correspondents,
(c) press censorship, and (d) issuance of official news communiqués
dealing with Control Council matters. United States policies in these
matters will be sent to you separately and you will be guided by these
in your negotiations on the Control Council.
11. German Courts:
a. All extraordinary courts, including the Volksgerichtshof (People's Court) and the Sondergerichte (Special Courts), and
all courts and tribunals of the Nazi Party and of its formations, affiliated
associations and supervised organizations will be abolished immediately.
b. All ordinary criminal, civil and administrative courts,
except those previously re-established by order of the military government,
will be closed. After the elimination of all Nazi features and personnel
you will permit those which are to exercise jurisdiction within the
boundaries of your zone to resume operations under such regulations,
supervision and control as you may consider appropriate. Courts which
are to exercise jurisdiction over territory extending beyond the boundaries
of your zone will be reopened only with the express authorization of
the Control Council and under its regulation, supervision and control.
The power to review and veto decisions of German courts shall be included
within the power of supervision and control.
With the exception of the Reichshriminalpolizei (Criminal Police)
all elements of the Sicherheitspolizei (Security Police), e.g., Geheimestaatspolizei (Gestapo), and the Sicherheitsdienst der S.S. will be abolished. Criminal and ordinary
police will be purged of Nazi personnel and utilized under the control
and supervision of the military government.
13. Political Prisoners:
Subject to military security and the interests of the individuals
concerned, you will release all persons found within your zone who have
been detained or placed in custody on grounds of race, nationality,
creed or political opinions and treat them as displaced persons. You
should make provision for the review of convictions of alleged criminal
offenses about which there may be substantial suspicion of racial, religious
or political persecution, and in which sentences of imprisonment have
not been fully served by persons imprisoned within your zone.
a. All educational institutions within your zone except those
previously re-established by Allied authority will be closed. The closure
of Nazi educational institutions such as Adolf Hitler Schulen, Napolas
and Ordensburgen and of Nazi organizations within other educational
institutions will be permanent.
b. A coordinated system of control over German education
and an affirmative program of reorientation will be established designed
completely to eliminate Nazi and militaristic doctrines and to encourage
the development of democratic ideas.
c. You will permit the reopening of elementary (Volksschulen),
middle (Mittelschulen) and vocational (Berufsschulen)
schools at the earliest possible date after Nazi personnel has been
eliminated. Textbooks and curricula which are not free of Nazi and militaristic
doctrine shall not be used The Control Council should devise programs
looking toward the reopening of secondary schools, universities and
other institutions of higher learning. After Nazi features and personnel
have been eliminated and pending the formulation of such programs by
the Control Council, you may formulate and put into effect an interim
program within your zone and in any case may permit the reopening of
such institutions and departments which offer training which you consider
immediately essential or useful in the administration of military government
and the purposes of the occupation.
d. It is not intended that the military government will intervene
in questions concerning denominational control of German schools, or
in religious instruction in German schools, except insofar as may be
necessary to insure that religious instruction and administration of
such schools conform to such Allied regulations as are or may be established
pertaining to purging of personnel and curricula.
15. Arts and Archives:
Subject to the provisions of paragraph 6 above, you will make all
reasonable efforts to preserve historical archives, museums, libraries
and works of art.
Economic General Objectives and Methods of Control
16. You will assure that the German economy is administered and controlled
in such a way as to accomplish the basic objectives set forth in paragraphs
4 and 5 of this Directive. Economic controls will be imposed only to
the extent necessary to accomplish these objectives, provided that you
will impose controls to the full extent necessary to achieve the industrial
disarmament of Germany. Except as may be necessary to carry out these
objectives, you will take no steps (a) looking toward the economic rehabilitation
of Germany, or (b) designed to maintain or strengthen the German economy.
17. To the maximum extent possible without jeopardizing the successful
execution of measures required to implement the objectives outlined
in paragraphs 4 and 5 of this directive you will use German authorities
and agencies and subject them to such supervision and punishment for
non-compliance as is necessary to ensure that they carry out their tasks.
For this purpose you will give appropriate authority to any German
agencies and administrative services you consider essential; provided,
however, that you will at all times adhere strictly to the provisions
of this directive regarding denazification and dissolution or elimination
of Nazi organizations, institutions, principles, features, and practices.
To the extent necessary you will establish administrative machinery,
not dependent upon German authorities and agencies, to execute or assure
the execution of the provisions of paragraphs 19, 20, 30, 31, 32, 39
and 40 and any other measures necessary to an accomplishment of your
industrial disarmament objectives.
18. In order to decentralize the structure and administration of the
German economy to the maximum possible extent, you will
a. ensure that the action required to maintain or restore essential
public utilities and industrial and agricultural activities is taken
as far as possible on a local and regional basis;
b. on no account propose or approve in the Control Council
the establishment of centralized administration of controls over the
German economy except where such centralization of administration is
clearly essential to the fulfillment of the objectives listed in paragraphs
4 and 5 of this directive. Decentralization in administration should
not be permitted to interfere with attainment of the largest practicable
measure of agreement on economic policies in the Control Council
19. You will institute or assure the maintenance of such statistical
records and reports as may be necessary in carrying out the objectives
listed in paragraphs 4 and 5 of this directive.
20. You will initiate appropriate surveys which may assist you in
achieving the objectives of the occupation. In particular you will promptly
undertake surveys of supplies, equipment and resources in your zone.
You will endeavor to obtain prompt agreement in the Control Council
to the making of similar surveys in the other zones of occupation, and
you will urge appropriate steps to coordinate the methods and results
of these and other future surveys conducted in the various zones. You
will keep the Control Council, United States Representative on the Reparation
Commission and other appropriate authorities, currently apprised of
the information obtained by means of intermediate reports or otherwise.
German Standard of Living
21. You will estimate requirements of supplies necessary to prevent
starvation or widespread disease or such civil unrest as would endanger
the occupying forces. Such estimates will be based upon a program whereby
the Germans are made responsible for providing for themselves, out of
their own work and resources. You will take all practicable economic
and police measures to assure that German resources are fully utilized
and consumption held to the minimum in order that imports may be strictly
limited and that surpluses may be made available for the occupying forces
and displaced persons and United Nations prisoners of war, and for reparation.
You will take no action that would tend to support basic living standards
in Germany on a higher level than that existing in any one of the neighboring
United Nations and you will take appropriate measures to ensure that
basic living standards of the German people are not higher than those
existing in any one of the neighboring United Nations when such measures
will contribute to raising the standards of any such nation.
22. You will urge upon the Control Council that uniform ration scales
be applied throughout Germany, that essential items be distributed equitably
among the zones, that net surpluses be made available for export to
Allied countries, and that imports be limited to the net deficits of
Germany as a whole.
Labor, Health, and Social Insurance
23. You will permit the self-organization of employees along democratic
lines, subject to such safeguards as may be necessary to prevent the
perpetuation of Nazi or militarist influence under any guise or the
continuation of any group hostile to the objectives and operations of
the occupying forces.
24. You will permit free collective bargaining between employees and
employers regarding wage, hour and working conditions and the establishment
of machinery for the settlement of industrial disputes. Collective bargaining
shall be subject to such wage, hour and other controls, if any, as may
be instituted or revived by your direction.
25. Subject to the provisions of paragraph 48 of this directive you
are authorized to direct German authorities to maintain or reestablish
nondiscriminatory systems of social insurance and poor relief.
26. You are authorized to direct the German authorities to maintain
or re-establish such health services and facilities as may be available
Agriculture, Industry and Internal Commerce
27. You will require the Germans to use all means at their disposal
to maximize agricultural output and to establish as rapidly as possible
effective machinery for the collection and distribution of agricultural
28. You will direct the German authorities to utilize large-landed
estates and public lands in a manner which will facilitate the accommodation
and settlement of Germans and others or increase agricultural output.
29. You will protect from destruction by the Germans, and maintain
for such disposition as is determined by this and other directives or
by the Control Council, all plants, equipment, patents and other property,
and all books and records of large German industrial companies and trade
and research associations that have been essential to the German war
effort or the German economy. You will pay particular attention to research
and experimental establishments of such concerns.
30. In order to disarm Germany, the Control Council should
a. prevent the production, acquisition by importation or otherwise,
and development of all arms, ammunition and implements of war, as well
as all types of aircraft, and all parts, components and ingredients
specially designed or produced for incorporation therein;
b. prevent the production of merchant ships, synthetic rubber
and oil, aluminum and magnesium and any other products and equipment
on which you will subsequently receive instructions;
c. seize and safeguard all facilities used in the production
of any of the items mentioned in this paragraph and dispose of them
(1) remove all those required for reparation;
(2) destroy all those not transferred for reparation if they are especially
adapted to the production of the items specified in this paragraph
and are not of a type generally used in industries permitted to the
Germans (cases of doubt to be resolved in favor of destruction);
(3) hold the balance for disposal in accordance with instructions
which will be sent to you.
Pending agreement in the Control Council you will take these measures
in your own zone. You will not postpone enforcement of the prohibitions
contained in subparagraphs a and b and the instructions
in subparagraph c without specific approval of your government
through the Joint Chiefs of Staff except that, in your discretion, you
may permit the production of synthetic rubber and oil, aluminum and
magnesium, to the minimum extent necessary to meet the purposes stated
in paragraphs 4 and 5 of the directive pending action by the Joint Chiefs
of Staff upon such recommendation for postponement as you may make.
31. As an additional measure of disarmament, the Control Council should
a. prohibit initially all research activities and close all
laboratories, research institutions and similar technical organizations
except those considered necessary to the protection of public health;
b. abolish all those laboratories and related institutions
whose-work has been connected with the building of the German war machine,
safeguard initially such laboratories and detain such personnel as are
of interest to your technological investigations, and thereafter remove
or destroy their equipment;
c. permit the resumption of scientific research in specific
cases, only after careful investigation has established that the contemplated
research will in no way contribute to Germany's future war potential
and only under appropriate regulations which (1) define the specific
types of research permitted, (2) exclude from further research activity
any persons who previously held key positions in German war research,
(3) provide for frequent inspection, (4) require free disclosure of
the results of the research and (5) impose severe penalties, including
permanent closing of the offending institution, whenever the regulations
Pending agreement in the Control Council you will adopt such measures
in your own zone.
32. Pending final Allied agreements on reparation and on control or
elimination of German industries that can be utilized for war production,
the Control Council should
a. prohibit and prevent production of iron and steel, chemicals,
non-ferrous metals (excluding aluminum and magnesium), machine tools,
radio and electrical equipment, automotive vehicles, heavy machinery
and important parts thereof, except for the purposes stated in paragraphs
4 and 5 of this directive
b. prohibit and prevent rehabilitation of plant and equipment
in such industries except for the purposes stated in paragraphs 4 and
5 of this directive; and
c. safeguard plant and equipment in such industries for transfer
on reparation account.
Pending agreement in the Control Council, you will put such measures
into effect in your own zone as soon as you have had an opportunity
to review and determine production necessary for the purposes stated
in paragraphs 4 and 5 of this directive.
33. The Control Council should adopt a policy permitting the conversion
of facilities other than those mentioned in paragraphs 30 and 32 to
the production of light consumer goods, provided that such conversion
does not prejudice the subsequent removal of plant and equipment on
reparation account and does not require any imports beyond those necessary
for the purposes specified in paragraphs 4 and 5 of this directive.
Pending agreement in the Control Council, you may permit such conversion
in your zone.
34. Subject to the provisions of paragraphs 30 and 32, the Control
Council should assure that all feasible measures are taken to facilitate,
to the minimum extent necessary for the purposes outlined in paragraphs
4 and 5 of this directive.
a. repairs to and restoration of essential transportation services
and public utilities;
b. emergency repair and construction of the minimum shelter
required for the civilian population;
c. production of coal and any other goods and services (excluding
goods specified in paragraphs 30 and 32 unless measures to facilitate
production are specifically approved by this Government through the
Joint Chiefs of Staff) required for the purposes outlined in paragraphs
4 and 5 of this directive.
You will assure that such measures are taken in your own zone pending
agreement in the Control Council.
35. In your capacity as zone commander and as member of the Control
Council you will take steps to provide for the equitable interzonal
distribution and the movement of goods and services essential to the
purposes set forth in paragraphs 4 and 5 of this directive.
36. You will prohibit all cartels or other private business arrangements
and cartel-like organizations, including those of a public or quasi-public
character such as the Wirtschaftsgruppen providing for the regulation
of marketing conditions, including production, prices, exclusive exchange
of technical information and processes, and allocation of sales territories.
Such necessary public functions as have been discharged by these organizations
shall be absorbed as rapidly as possible by approved public agencies.
37. It is the policy of your government to effect a dispersion of
the ownership and control of German industry. To assist in carrying
out this policy you will make a survey of combines and pools, mergers,
holding companies and interlocking directorates and communicate the
results, together with recommendations, to your government through the
Joint Chiefs of Staff. You will endeavor to obtain agreement in the
Control Council to the making of this survey in the other zones of occupation
and you will urge the coordination of the methods and results of this
survey in the various zones.
38. With due regard to paragraph 4 a, the Control Council should
adopt such policies as are clearly necessary to prevent or restrain
inflation of a character or dimension which would definitely endanger
accomplishment of the objectives of the occupation. The Control Council,
in particular, should direct and empower German authorities to maintain
or establish controls over prices and wages and to take the fiscal and
financial measures necessary to this end. Pending agreement in the Control
Council you will assure that such measures as you consider necessary
are taken in your own zone. Prevention or restraint of inflation shall
not constitute an additional ground for the importation of supplies,
nor shall it constitute an additional ground for limiting removal, destruction
or curtailment of productive facilities in fulfillment of the program
for reparation, demilitarization and industrial disarmament.
Power, Transportation, and Communications
39. Both as member of the Control Council and zone commander you will
take appropriate steps to ensure that
a. power, transportation and communications facilities are
directed in such a way as to carry out the objectives outlined in paragraphs
4 and 5 of this directive;
b. Germans ale prohibited and prevented from producing, maintaining
or operating all types of aircraft.
You will determine the degree to which centralized control and administration
of power, transportation and communications is clearly necessary for
the objectives stated in paragraphs 4 and 5 and urge the establishment
of this degree of centralized control and administration by the Control
Foreign Trade and Reparation
40. The Control Council should establish centralized control over
all trade in goods and services with foreign countries. Pending agreement
in the Control Council you will impose appropriate controls in your
41. Both as member of the Control Council and as zone commander you
will take appropriate steps to ensure that
a. the foreign trade controls are designed to carry out the
objectives stated in paragraphs 4 and 5 of this directive;
b. imports which are permitted and furnished to Germany are
confined to those unavoidably necessary to the objectives stated in
paragraphs 4 and 5;
c. exports to countries other than the United Nations are prohibited
unless specifically authorized by the Allied governments.
42. Both as member of the Control Council and as zone commander you
will adopt a policy which would forbid German firms to participate in
international cartels or other restrictive contracts and arrangements
and order the prompt termination of all existing German participations
in such cartels, contracts and arrangements.
43. You will carry out in your zone such programs of reparation and
restitution as are embodied in Allied agreements and you will seek agreement
in the Control Council on any policies and measures which it may be
necessary to apply throughout Germany in order to ensure the execution
of such programs.
44. You will make full application in the financial field of the principles
stated elsewhere in this directive and you will endeavor to have the
Control Council adopt uniform financial policies necessary to carry
out the purposes stated in paragraphs 4 and 5 of this directive. You
will take no steps designed to maintain, strengthen or operate the German
financial structure except in so far as may be necessary for the purposes
specified in this directive.
45. The Control Council should regulate and control to the extent
required for the purposes set forth in paragraphs 4 and 5 the issue
and volume of currency and the extension of credit in Germany and in
accordance with the following principles:
a. United States forces and other Allied forces will use Allied
Military marks and Reichsmark currency or coins in their possession.
Allied Military marks and Reichsmark currency and coin now in circulation
in Germany will be legal tender without distinction and will be interchangeable
at the rate of one Allied Military mark for one Reichsmark. Reichskreditkassenscheine
and other German military currency will not be legal tender in Germany.
b. The Reichsbank, the Rentenbank or any other bank or agency
may be permitted or required to issue bank notes and currency which
will be legal tender; without such authorization no German governmental
or private bank or agency will be permitted to issue bank notes or currency.
c. The German authorities may be required to make available
Reichsmark currency or credits free of cost and in amounts sufficient
to meet all the expenses of the forces of occupation, including the
cost of Allied Military Government and including to the extent that
compensation is made therefor, the cost of such private property as
may be requisitioned, seized, or otherwise acquired, by Allied authorities
for reparations or restitution purposes
Pending agreement in the Control Council you will follow these policies
in your own zone.
You will receive separate instructions relative to the currency which
you will use in the event that for any reason adequate supplies of Allied
Military marks and Reichsmarks are not available, or if the use of such
currency is found undesirable.
You will not announce or establish in your zone, until receipt of
further instructions, any general rate of exchange between the Reichsmark
on the one hand and the U. S. dollar and other currencies on the other.
However, a rate of exchange to be used exclusively for pay of troops
and military accounting purposes in your zone will be communicated separately
46. Subject to any agreed policies of the Control Council, you are
authorized to take the following steps and to put into effect such further
financial measures as you may deem necessary to accomplish the purposes
of your occupation:
a. To prohibit, or to prescribe regulations regarding transfer
or other dealings in private or public securities or real estate or
b. To close banks, but only for a period long enough
for you to introduce satisfactory control, to remove Nazi and other
undesirable personnel, and to issue instructions for the determination
of accounts to be blocked under subparagraph 48 e below.
c. To close stock exchanges, insurance companies, and similar
financial institutions for such periods as you deem appropriate.
d. To establish a general or limited moratorium or moratoria
only to the extent clearly necessary to carry out the objectives stated
in paragraphs 4 and 5 of this directive.
47. Resumption of partial or complete service on the internal public
debt at the earliest feasible date is deemed desirable. The Control
Council should decide the time and manner of such resumption.
48. Subject to any agreed policies of the Control Council,
a. You will prohibit:
(1) the payment of all military pensions, or emoluments
or benefits, except compensation for physical disability limiting the
recipient's ability to work, at rates which are no higher than the lowest
of those for comparable physical disability arising from non-military
(2) the payment of all public or private pensions
or other emoluments or benefits granted or conferred:
(a) by reason of membership in or services to the
former Nazi party, its formations, affiliated associations or supervised
(b) to any person who has been removed from an office or position
in accordance with paragraph 6, and
(c) to any person arrested and detained in accordance with paragraph
8 during the term of his arrest, or permanently, in case of his subsequent
b. You will take such action as may be necessary to insure
that all laws and practices relating to taxation or other fields of
finance, which discriminate for or against any persons because of race,
nationality, creed or political opinion, will be amended, suspended,
or abrogated to the extent necessary to eliminate such discrimination.
c. You will hold the German authorities responsible for taking
such measures in the field of taxation and other fields of public finance,
including restoration of the tax system and maintenance of tax revenues,
as will further the accomplishment of the objectives stated in paragraphs
4 and 5.
d. You will exercise general supervision over German public
expenditures in order to ensure that they are consistent with the objectives
stated in paragraphs 4 and 5.
e. You will impound or block all gold, silver,
currencies, securities, accounts in financial institutions, credits,
valuable papers, and all other assets falling within the following categories:
(1) Property owned or controlled directly or indirectly,
in whole or in part, by any of the following:
(a) The German Reich, or any of the Lander, Gaue
or provinces, any Kreis, Municipality or other similar local subdivision;
or any agency or instrumentality of any of them including all utilities,
undertakings, public corporations or monopolies under the control
of any of the above;
(b) Governments, nationals or residents of other nations, including
those of territories occupied by them, at war with any of the United
Nations at any time since 1 September 1939;
(c) The Nazi Party, its formations, affiliated associations and supervised
organizations, its officials, leading members and supporters;
(d) All organizations, clubs or other associations prohibited or dissolved
by military government;
(e) Absentee owners, of non-German nationality including United Nations
and neutral governments and Germans outside of Germany;
(f) Any institution dedicated to public worship, charity, education
or the arts and sciences which has been used by the Nazi Party to
further its interests or to cloak its activities;
(g) Persons subject to arrest under provisions of paragraph 8, and
all other persons specified by military government by inclusion in
lists or otherwise.
(2) Property which has been the subject of transfer
under duress or wrongful acts of confiscation, disposition or spoliation,
whether pursuant to legislation or by procedure purporting to follow
forms of law or otherwise. (3) Works of art or cultural material of
value or importance, regardless of the ownership thereof.
You will take such action as will insure that any impounded or blocked
assets will be dealt with only as permitted under licenses or other
instructions which you may issue. In the case particularly of property
blocked under (1) (a) above, you will proceed to adopt licensing measures
which while maintaining such property under surveillance would permit
its use in consonance with this directive. In the case of property blocked
under (2) above, you will institute measures for prompt restitution,
in conformity with the objectives stated in paragraphs 4 and 5 and subject
to appropriate safeguards to prevent the cloaking of Nazi and militaristic
49. All foreign exchange transactions, including those arising out
of exports and imports, shall be controlled with the aim of preventing
Germany from developing a war potential and of achieving the other objectives
set forth in this directive. To effectuate these purposes the Control
a. Seek out and reduce to the possession and control of a special
agency all German (public and private) foreign exchange and external
assets of every kind and description located within or outside Germany.
b. Prohibit, except as authorized by regulation or license,
all dealings in gold, silver, foreign exchange, and all foreign exchange
transactions of any kind. Make available any foreign exchange proceeds
of exports for payment of imports directly necessary to the accomplishment
of the objectives stated in paragraphs 4 and 5 of this directive, and
authorize no other outlay of foreign exchange assets except for purposes
approved by the Control Council or other appropriate authority.
c. Establish effective controls with respect
to all foreign exchange transactions, including:
(1) Transactions as to property between persons
inside Germany and persons outside Germany;
(2) Transactions involving obligations owed by or to become due from
any person in Germany to any person outside Germany; and
(3) Transactions involving the importation into or exportation from
Germany of any foreign exchange asset or other form of property.
Pending agreement in the Control Council, you will take in your zone
the action indicated in subparagraphs a, b and c above. Accordingly, you will in your zone reduce to the possession and
control of a special agency established by you, within your Command,
all German foreign exchange and external assets as provided in subparagraph a. You will endeavor to have similar agencies for the
same purpose established in the other zones of occupation and to have
them merged as soon as practicable in one agency for the entire occupied
territory. In addition you will provide full reports to your government
with respect to all German foreign exchange and external assets.
50. No extension of credit to Germany or Germans by any foreign person
or Government shall be permitted except that the Control Council may
in special emergencies grant permission for such extensions of credit.
51. It is not anticipated that you will make credits available to
the Reichsbank or any other bank or to any public or private institution.
If, in your opinion, such action becomes essential, you may take such
emergency actions as you may deem proper, but in any event, you will
report the facts to the Control Council.
52. You will main such accounts and records as may be necessary to
reflect the financial operations of the military government in your
zone and you will provide the Control Council with such information
as it may require, including information in connection with the use
of currency by your forces, any governmental settlements, occupation
costs, and other expenditures arising out of operations or activities
involving participation of your forces.