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France Moves to Settle Tsarist Debts

PARIS -- The French Cabinet, acting on the eve of a state visit to Moscow by President Jacques Chirac, approved a bill Wednesday to settle a dispute with Russia over gold and imperial bonds dating back to the 1917 Bolshevik revolution.


The bill, which now must be approved by parliament, would ratify an agreement reached last May under which France accepted a smaller than anticipated compensation for holders of tsarist bonds repudiated by the Soviets.


Russia in return dropped claims to imperial gold transferred to France during and after the revolution.


The deal paved the way for Moscow to join the informal Paris Club of creditor nations and pursue claims for billions of dollars owed it by developing countries.


It also enabled Moscow to issue new bonds in France.


The agreement said neither Russia nor France would pursue claims on mutual debts accumulated before May 9, 1945.


France had claimed the Soviet government owed some $30 billion after it repudiated its pre-World War I debt to 400,000 French holders of tsarist bonds.


Under the new agreement, Moscow settled the claim by agreeing to pay France $400 million within three years.


In turn, Moscow said it would drop claims for compensation from Paris for damage caused by France's 1918-1922 intervention in the Russian civil war following the 1917 Bolshevik revolution, according to the document.


Moscow agreed not to seek the return of gold transferred to Germany under the 1918 Brest-Litovsk peace accord, which pulled Russia out of World War I. The gold was later transferred to France under the 1919 Versailles peace treaty after the end of the war.


Russia also agreed to drop claims for the return of imperial gold reserves seized by the opponents of the Bolsheviks in the civil war and sent to France.

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