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This article explores the effects of organizational memory on decision making with particular reference to British foreign policy regarding trade with Bulgaria in the years immediately preceding the Second World War. It argues that British policy, in conjunction with that of other Allied powers, pushed Bulgaria into a state of economic dependence on Nazi Germany. Bulgaria desired neutrality but eventually had to succumb to the pressures of its economic lifeline and join the war on the side of the Axis powers. These British policies were heavily influenced by the institutional memory of Bulgaria as an enemy from the First World War. The particulars of the organizational structure of the British Foreign Office meant little change in policy would occur right up to the beginning of the war, in spite of the recognized strategic importance of Bulgaria becoming an Allied partner or, at least, remaining neutral. This structure also contributed to an ongoing cultural bias that further reinforced rigidity in British policy development. [ABSTRACT FROM AUTHOR]