'Terminal' (ii) was the Inter-Allied heads of government conference at Potsdam (17 July/2 August 1945).

The third and last of the 'big three' conferences in World War II, this was designed to settle Allied differences about the post-war disposition of Europe and to decide on how best to end the war with Japan. Prime Minister Winston Churchill of the UK wished the conference to be held as soon as possible after the end of hostilities with Germany, and though President Harry S Truman, who had succeeded to the presidency of the USA only one month earlier on the death of President Franklin D. Roosevelt, agreed that it was necessary to thrash out matters with Premier Iosif Stalin of the USSR, he was adamant that he had to remain in the USA until the Congress had passed his budget proposals in July. Truman proposed a venue in Alaska or Vienna, but then agreed to Stalin’s suggestion that the 'Terminal' conference should be held in the Berlin suburb of Potsdam.

Initial meetings began on 15 July, but plenary sessions had to wait until 17 July when Stalin arrived. The Soviet leader immediately proposed that Truman should be chairman, and the conference got under way with the decision that a Council of Foreign Ministers should be established to draft peace treaties and the like. This initial decision was not matched by further agreement, for while Churchill and Truman wished the USSR to abide by the terms agreed at the 'Magneto' conference in Yalta for the disposition of eastern Europe, Stalin was clearly set on bringing these countries into the Soviet orbit as satellites rather than on enticing them into association with the USSR as free states after the election of truly democratic governments. Stalin also wished to claim war reparations from Italy, which the UK and USA wished to treat leniently as she had joined the Allied cause in 1943, and the situation was reversed in the cases of Romania, Bulgaria and Hungary, which had all joined the Soviets late in the war.

No decisions were reached on these matters at the 'Terminal' (ii) conference, and the subjects were then referred to the Council of Foreign Ministers. The whole question of war booty was also referred to the Council of Foreign Ministers.

The 'Terminal' (ii) conference was interrupted on 25 July when Churchill and his deputy, Clement Attlee, returned to the UK for the outcome of the British general election. The result was declared on 26 July, the coalition government of Churchill being replaced by a Labour administration under Attlee, and on 28 Attlee returned to Potsdam as head of the new British government for the final four meetings, which decided on the disposition and denazification of Germany, the establishment of new frontiers for Poland, and the prosecution of the war against Japan.

So far as Germany was concerned, the 'Terminal' (ii) conference decided that 'all German land, sea and air forces, the SS, SA, SD and Gestapo, with all their organisations, staffs and institutions, including the General Staff, Officers' Corps, Reserve Corps military schools, war veterans' organisations, and all other military and quasi-military organisations, together with all clubs and associations which serve to keep alive the military tradition in Germany, are to be completely and finally abolished'. War criminals were to be arrested for trial, and all high-ranking Nazi officials and service personnel were to be interned. Nazi party members were to be banned from public office, and from positions of responsibility in public or private undertakings. War reparations were to be extracted by the victors from each nation’s zone of occupation.

So far as Poland was concerned, the Allies started from the premise that while the USSR would receive that part of Poland east of the Curzon Line, Poland would be compensated by territory taken from defeated Germany. In the event the USSR annexed those parts of Poland it wanted, and at the same time allocated its puppet regime in Poland the portions of Germany as far west as the Oder and Neisse rivers. This gave Poland some of Germany’s richest agricultural and industrial territories, and uprooted many millions of ethnic Germans who flocked to the west.

At the Potsdam conference the Combined Chiefs-of-Staff decided for a temporary partition Vietnam at the 17^th parallel, just to the north of Da Nang, for the purposes of operational convenience. It was agreed that British forces would take the surrender of Japanese forces in Saigon for the southern half of Indo-China, and the Japanese forces in the northern half would surrender to the Chinese.

At the end of the 'Terminal' (ii) conference, Attlee and Truman were joined by Generalissimo Chiang Kai-shek of China in issuing the Potsdam Declaration (the USSR not then being at war with Japan), which stated 'We call upon the government of Japan to proclaim now the unconditional surrender of all the Japanese armed forces…The alternative for Japan is prompt and utter destruction.' Japan refused even to answer, and the result was the dropping of two atomic bombs (on Hiroshima and Nagasaki on 6 and 9 August respectively) to bring World War II to an end.