h the allied and associated powers shall have the right
to take, in case of voluntary default by Germany, and which Germany
agrees not to regard as acts of war, may include economic and financial
prohibitions and reprisals and in general such other measures as the
respective Governments may determine to be necessary in the
circumstances.

[Sidenote: Germany's capacity to pay.]

The commission shall consist of one representative each 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. It shall permit
Germany to give evidence regarding her capacity to pay, and shall assure
her a just opportunity to be heard. It shall make its permanent
headquarters at Paris, establish its own procedure and personnel; have
general control of the whole reparation problem; and become the
exclusive agency of the Allies for receiving, holding, selling, and
distributing reparation payments. Majority vote shall prevail, except
that unanimity is required on questions involving the sovereignty of any
of the Allies, the cancellation of all or part of Germany's obligations,
the time and manner of selling, distributing, and negotiating bonds
issued by Germany, any postponement between 1921 and 1926 of annual
payments beyond 1930 and any postponement after 1926 for a period of
more than three years of the application of a different method of
measuring damage than in a similar former case, and the interpretation
of provisions. Withdrawal from representation is permitted on twelve
months' notice.

[Sidenote: Guarantees to cover claims.]

The Commission may require Germany to give from time to time by way of
guarantee, issues of bonds or other obligations to cover such claims as
are not otherwise satisfied. In this connection and on account of the
total amount of claims, bond issues are presently to be required 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 bearing 2-1/2 per cent interest between 1921
and 1926, and thereafter 5 per cent, with a 1 per cent sinking fund
payment beginning 1926; and an undertaking to deliver 40,000,000,000
marks gold b