The Moscow Peace Treaty: Ceasefire, Territorial Cessions and Implementation in 1940

In March 1940, Finland and the Soviet Union's Winter War entered peace negotiations. Finland faced a choice between territorial concessions and continued fighting. On 7 March, Foreign Minister Väinö Tanner told US Minister H. F. Arthur Schoenfeld that Soviet demands included not only Hanko but Viipuri and Sortavala. Finland hoped the United States would encourage reduced demands so peace could be reached quickly.

External help could not be delivered at will. Tanner also reported that Scandinavian countries would neither send large forces nor permit British and French troops to cross their territory. Risto Ryti later told Parliament that, following contacts and messages through Sweden, the government sent a delegation to Moscow on 6 March. Whether continued war could secure better terms was central to accepting the agreement.

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The parties signed in Moscow on 12 March. Finland's delegates were Prime Minister Ryti, Juho Kusti Paasikivi, General Rudolf Walden and Professor Väinö Voionmaa; the Soviet delegates were Vyacheslav Molotov, Andrei Zhdanov and Aleksandr Vasilevsky. Article 9 made the treaty effective immediately upon signature, with ratification to follow. The protocol fixed cessation of hostilities for noon Leningrad time on 13 March, or 11:00 Finnish time.

Finland's Parliament approved on 15 March. The proceedings record 145 votes in favour, three against, nine blank ballots and 42 absentees. A Finnish implementing decree of 21 March confirmed ratification and exchange of instruments on 20 March. This later formality was distinct from entry into force on the 12th and the ceasefire on the 13th.

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Article 2 redrew the frontier, giving the Soviet Union the Karelian Isthmus including Viipuri, areas on Lake Ladoga's western and northern shores, Gulf of Finland islands and some northern border territory. The attached map defined the line, to be demarcated in detail by a joint commission established within ten days of signature.

Hanko had a different arrangement. Finland leased the peninsula, nearby waters and islands to the Soviet Union for thirty years at eight million Finnish marks annually, for a naval base with land and air forces needed for its defence. Finnish troops were to withdraw within ten days of the treaty's entry into force. Both sides also undertook not to attack one another or join alliances or combinations directed against the other.

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The ceasefire protocol first required a one-kilometre neutral strip between forward units, followed by withdrawals and handovers by sector. Troops were to move at least seven kilometres per day, maintaining separation between withdrawing rearguards and following advance units. Soviet withdrawal from Petsamo had a separate deadline of 10 April. Towns, bridges, dams, railway junctions and power stations were not to be destroyed during transfer.

Implementation was not completed on signing night. Schoenfeld reported on 25 March that evacuation of the last ceded areas was expected the next day, but the boundary in the Salla district was not yet fully settled. On 6 April, US Chargé Walter Thurston relayed the Swedish minister's observation that evacuation and Soviet takeover were progressing and the joint boundary commission was working. Diplomatic records show phased implementation, not self-executing clauses.

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The agreement also addressed economic connections. The Soviet Union obtained transit through Petsamo to and from Norway and passage for goods through Finland to and from Sweden. Article 7 required each country to construct its own section of a railway from Kandalaksha to Kemijärvi, aiming for completion in 1940. Article 8 linked restored economic relations with separate trade negotiations.

A US diplomatic report in May 1940 relayed a TASS announcement that the approximately 160-kilometre Soviet section from Kandalaksha to Kuolajärvi had been completed on 30 April. It expressly concerned only that section. Finland was preparing to continue its own work, with rails supplied by the Soviet side. Transit provisions therefore required new construction and supply negotiations; completion of one section did not mean the entire line was connected.

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Territorial transfer made civilian resettlement and economic recovery urgent Finnish government tasks. On 15 March, acting Bank of Finland head Jukka Rangell told Schoenfeld that people evacuated from ceded areas needed resettlement and the country needed reconstruction funds. Peace redirected expenditure without immediately eliminating shortages.

On 10 April, Tanner, by then Minister of Supply, explained that more credit would be needed over the next two or three months to purchase food and industrial raw materials and get through the following winter. The Moscow treaty ended the current hostilities, while implementation extended into population movement, boundary surveys, transport works and national finance.

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