lands. Obviously this might be used as a means to dispossess the present owners.
Carranza, meanwhile, had given a reply to the protests of foreign powers against his decrees, denying the right of complaint and declaring that if foreigners had grievances, the Mexican courts were open to them. The oil interests joined in taking action for legal protection under Mexican law. The Mexican Congress was called to consider what should be done. Though the attitude of the government was officially unchanged, assurances were received in May, 1919, that no law enacted by the Congress in the proposed petroleum code would have retroactive effect. The American Department of State was advised that the new oil law would not nationalize oil properties acquired before May 1, 1917. [1]
This assurance seemed to indicate that the road was now open toward an amicable adjustment of the petroleum difficulties, but subsequent developments did not show that to be the case. The various notes exchanged indicated that the Mexican government still sought recognition of national ownership of the petroleum resources. Direct steps to this end having been declared unacceptable by the United States, the same result was sought through further provisions concerning denouncements of property, taking out of drilling permits, and decrees concerning the so-called Federal Zone.[2]
