Chapter XXXIII: Section VIII: Reparation and Restitution

The Allied and Associated Governments affirm and Germany accepts the responsibility of herself and her allies for causing all the loss and damage to which the Allied and Associated Governments have been subjected as a consequence of the war imposed upon them by the aggression of Germany and her allies. The total obligation of Germany to pay is to be determined and notified to her not later than May 1, 1921, by an Interallied reparations commission. At the same time a schedule of payments to discharge the obligation within thirty years shall be presented.... She further agrees to restore to the Allies cash and certain articles which can be identified.

Germany shall pay within two years one thousand million pounds sterling in either gold, goods, ships, etc.; this sum being included in the first thousand million bond issue referred to later. Expenses such as those of the army of occupation and payments for foodstuffs, raw materials, etc., may be deducted at the Allies' discretion.

Germany further binds herself to pay all sums borrowed by Belgium from her allies as a result of Germany's violation of the treaty of 1839, up to November 11, 1918, and will at once issue and hand over to the Reparations Commission 5 per cent gold bonds falling due in 1926.

Germany is required to make compensation for all damages caused to civilians, such as injury caused by acts of war, exposure at sea, maltreatment of prisoners; damages to the Allied peoples represented by pensions and separation allowances, to property; damages to civilians forced to labor; damages in the form of fines or levies imposed by the enemy.

The sums for reparation which Germany is required to pay shall become a charge upon her revenues prior to that for the service or discharge of any domestic loan.

In case of voluntary default by Germany the Allied and Associated Powers shall take measures which Germany agrees not to regard as acts of war, and may include economic and financial prohibition and reprisals.

The Reparations Commission shall consist of one representative of the United States, Great Britain, France, Italy, and Belgium, a representative of Serbia or Japan taking the place of the Belgian representative when the interests of either country are particularly affected, with all other Allied Powers entitled, when their claims are under consideration, to the right of representation without voting power. The commission shall permit Germany to give evidence regarding her capacity to pay and assure her opportunity to be heard. Permanent headquarters will be established at Paris, which will become the exclusive agency of the Allies for reparations. Majority vote will prevail, except that unanimity is required on questions involving the sovereignty of the Allies, the cancellation of all, or part of Germany's indebtedness, the time and manner of selling, negotiating, etc., bonds issued by Germany.

The commission may require Germany to give issues of bonds from time to time to cover claims not otherwise satisfied. Bond issues are required presently of Germany in acknowledgment of its debt as follows: 20,000,000,000 marks gold payable not later than May 1, 1921, without interest; 40,000,000,000 marks gold bonds bearing interest at 5 per cent under terms fixed by the commission. Interest on Germany's debt will be 5 per cent., unless otherwise determined by the commission. Payments not made in gold may be accepted in the form of properties, commodities, businesses, rights, concessions, etc.

The German Government recognizes the right of the Allies to the replacement ton for ton and class for class of all merchant ships and fishing boats lost or damaged owing to the war, and cedes to the Allies all German merchant ships of 1,600 tons gross, and upward; one-half of her ships between 1,600 and 1,000 tons gross, and one-quarter of her steam trawlers and other fishing boats, to be delivered within two months to the Reparations Commission. Germany further agrees to build as reparation merchant ships to the amount not exceeding 200,000 tons gross annually during the next five years. All ships used for inland navigation taken by Germany from the Allies are to be restored within two months; the amount of loss not covered by such restitution to be made up from Germany's river fleet up to 20 per cent thereof.

To effect payment by deliveries in kind, Germany is required for a period of years varying in each case to deliver coal, coal-tar products in specific amounts to the Reparations Commission. The conditions of delivery will be modified so as not to interfere with Germany's industrial requirements.

DEVASTATED AREAS.

Germany undertakes to devote her economic resources directly to the physical restoration of the invaded areas, replacing destroyed articles by the delivery of animals, machinery, etc., existing in Germany and to manufacture materials needed for reconstruction.

Germany is to deliver to France annually for ten years coal equivalent to the prewar output of Nord and Pas de Calais mines, and the annual production during above ten-year period. Germany further gives options over ten years for delivery of 7,000,000 tons of coal per year to France, in addition to the above, of 8,000,000 tons to Belgium, and of an amount rising from 4,500,000 in 1919 to 1920 to 8,500,000 in 1923 to 1924 to Italy, at prices fixed as prescribed in the treaty. Provision is also made for delivery to France of benzol, coal-tar and ammonia.

Germany is to restore within six months the Koran of the Caliph Othman to the King of the Hedjaz, the skull of the Sultan Okwawa to Great Britain, and to the French Government papers and flags taken in 1870. For destroying the Louvain library Germany is to hand over manuscripts, rare books, etc., to the equivalent of those destroyed.

Germany is also to hand over to Belgium the wings of the altar piece of "The Adoration of the Lamb" by the Van Eyck's, now in Berlin, and the wings of the altar piece "The Last Supper," now in Berlin and Munich.

FINANCE.

Powers to which German territory is ceded will assume a portion of the German prewar debt, the amount to be fixed by the Reparations Commission, except Alsace-Lorraine and Poland. If the value of the German public property in ceded territory exceeds the amount of debt assumed, the states to which the property is ceded will give credit on reparation for the excess, excepting Alsace-Lorraine. Mandatory powers will not assume any German debts, or give any credit for German Government property. Germany renounces all right of representation on, or control of, state banks, commissions, or like organizations.

Germany is required to pay the total cost of the armies of occupation as long as they are maintained in German territory, this cost to be a first charge on her resources. The cost of reparations is the next charge, after making such provisions for payment for imports as the Allies may deem necessary.

Germany is to deliver to the Allied and Associated Powers all sums deposited in Germany by Turkey, and Austria-Hungary, in connection with the financial support extended to them during the war, and to transfer to the Allies all claims against Austria-Hungary, Bulgaria, or Turkey in connection with agreements made during the war. Germany confirms the renunciation of the treaties of Bucharest and Brest-Litovsk.

Germany will expropriate any rights or interests of her nationals in public utilities in ceded territories, or those administered by mandatories, and in Turkey, China, Russia, Austria-Hungary and Bulgaria, and transfer them to the Reparations Commission which will credit her with their value.