On 19 October 1956, Japan and the Soviet Union signed a Joint Declaration providing for the end of the state of war and for the restoration of diplomatic relations between both countries.

In addition, the Soviet Union pledged to support Japan for UN membership and to waive all World War II reparations claims.

When the final agreement had been reached on the terms of the Joint Declaration, the Japanese delegation decided to interpret it as including a discussion of the territorial problem in the future peace negotiation by interpreting the declaration jointly with "Hatoyama-Bulganin letters" and "Matsumoto-Gromyko letters".

The formula did not pass, however, since in spite of preliminary agreement with the Soviets to shelve the territorial issue, Japan raised it at the negotiations and managed to get their territorial clause in the declaration but "interpreted in such a manner as to preserve the plenipotentiaries' face at home": "Habomais and Shikotan were promised in the Joint Declaration, and the question of Kunashiri and Etorofu was to be settled during negotiations for a peace treaty.

"[8] The disagreement between "two-island transfer" stipulated in the 1956 declaration and Japan's persistent demand of "four-island return" became the cornerstone for the continuation of the Kuril Islands dispute in the Soviet and post-Soviet years.