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432 2. According to my understanding the agreement reached was the following:

(a) The term "post-Agreement debt" means a commercial debt owed by the Government of Brazil or a commercial debt owed by a person or corporation resident in Brazil, in respect of goods imported into Brazil through a valid import licence issued before the 9th of October, 1953, for which an application for sterling is approved by the Banking Fiscalisation Department of the Bank of Brazil, but does not include debts covered by the Exchanges of Notes for the settlement of Brazilian commercial arrears with the United Kingdom signed in Rio de Janeiro on the 1st of October, 1953, and in London on the 21st of December, 1953 (hereinafter referred to as the Exchanges of Notes). The term "United Kingdom creditor" means a person or corporation resident in the United Kingdom, or a territory for the international relations of which the United Kingdom is responsible.

(b) From the date on which the settlement of all commercial debts covered by the Exchanges of Notes has been completed the Government of Brazil will provide cover in accordance with paragraph III of the Exchange of Notes of the 1st of October, 1953, as modified on this date, to enable post-Agreement debts to United Kingdom creditors to be liquidated.

(c) The post-Agreement debts to United Kingdom creditors will be liquidated in chronological order of the dates of approval of the applications for sterling by the Banking Fiscalisation Department of the Bank of Brazil and will be repaid in full at the official rate of exchange for the £ sterling ruling on the 31st of July, 1953, as specified in Article III of the Exchange of Notes of the 1st of October, 1953.

3. Should your Excellency agree, I propose that the present Note together with that of your Excellency, of the same tenor, of this same date, shall constitute an Agreement between our two Governments, which shall become effective to-day.

I avail, &c.

IV

The Brazilian Ministerfor Foreign Affairs to Her Majesty's Ambassador at Rio de Janeiro No. 2430