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imported or exported British vessels, they are paid by the Chinese merchants, same as if conveyed by Junks.

Macau is admitted by the Provincial Authorities to lie under an exceptional case. They notified that Tariff duties would be levied on junks proceeding there as to Hongkong.

But, difficulties presented themselves with regard to the territoriality of that Port, in consequence of which it was thought advisable to recall the Proclamation. It is evident that had the Provincial Government imposed the Tariff, it would have been tantamount to declaring Macao Portuguese territory, and that it is not prepared to do; and the Chinese merchant knew it, and would have placed Hongkong on the same basis.

I may observe, with respect to the latter part of the paragraph in Sir Herbert's despatch, that with the exception of Macao, for the reasons above stated, a Tariff of a similar, if not the same kind, is applicable.

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