Enclosure 6.
80
Chinese partnerships, a problem which hitherto has proved insoluble, though for years past some of the best legal brains in the Colony have been engaged upon it. A general system of licensing, necessarily involving the inspection of books and transactions, seems imprac- ticable, as it would tend to deter Chinese from establishing themselves, and even from continuing here, in trade.
11. The suggestion that alien and Chinese corporations trading as Hongkong registered companies should be specially controlled is in conflict with Article XXVI (9) of the Royal Instructions. It was put forward by the Chamber at the time when the Companies Ordinance, 1911, was in course of preparation, and it was very fully considered. This Government was not then, and it is not now, satisfied that abuses are more prevalent in one class of local Company than in another. The existing law makes it compulsory for a Hongkong registered Com- pany to keep a book in the English language containing a daily summary of receipts and payments. The books of a Company are generally speaking open only to the directors and secretary and to the auditor; and it would seem not unreasonable, in a Colony where the very large majority of merchants are of Chinese race, that the auditor should suit himself to the convenience of the Company by making himself acquainted with Chinese book-keeping rather than that the Company should alter its system of books for the convenience of the auditor. I may express the hope that one of the first-fruits of the school for instruction in Chinese, recently inaugurated by the Cham- ber, will be an auditor of British race fully conversant with Chinese methods of accounting.
12. I find it difficult to believe the suggestion of the Chamber that the present system of ascertaining the qualification of an auditor of Chinese Companies is derided by the Chinese, as Chinese can- didates for the post of authorised auditor are examined by an exceptionally strong Committee of the leading Chinese merchants of the Colony.
13. I attach a copy of a minute by the Attorney General regard- ing the Chamber's remarks under the heading "Insurance".
14. Measures of control of shipping which is at present enemy may be necessary after the war, and this subject is no doubt engaging the attention of His Majesty's Government. But in the opinion of this Government exclusion would not be in the best interests of Hongkong.
15. I am thoroughly in accord with the Chamber's view that competition can best be met by practical knowledge and organisa- tion. In this connection I am strongly in favour of the appointment of a Commercial Attaché for South China.
16. I have no reniarks to make on, nor does the Chamber specifi- cally refer to, the questions contained in enclosure 2 to the Despatch under reference. These questions hardly touch this Colony.
17. If the Chamber of Commerce have no objection to their letter of the 8th January being made public, I wish to publish this Despatch which has been endorsed by the Members of the Executive Council without exception, and I shall be obliged if you will inform me by telegraph whether I may do so.
I have, &c.,
F. H. MAY,
Governor, &e.