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(F 5468/3361/10).
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Cypher telegram to Sir A. Clark-Kerr (Shanghai). Foreign Office 10th June, 1939. 11.15 a.m.
No. 456.
The Hongkong Government propose to introduce an ordinance designed to facilitate the preventive work of the Chinese Customs by prohibiting the clearance of ships for unopened porus in China. The matter is of course covered by Article 47 of the Tientsin treaty which gives Chinese Government the right of confiscation in
such cases. In the present circumstances Chinese authorities are apparently unable to exercise this power and are asking for assistance to prevent unauthorised trade.
We do not dispute validity of the Treaty, but in return for restriction of trade with unopened ports it granted to our vessels the right to trade at the opened ports. The Chinese Government can no longer assure us that right in places like Canton which have been closed by the Japanese and I am not sure that it would be in the real interests either of China or ourselves to go out of our way to prevent the temporary diversion of trade to places where it can still be done. In this connexion see Consul-General Shanghai's telegram No. 85 [of June 5th].
Please telegraph your observations after consultation with the Consul-General at Canton and the Trade Commissioner at Hongkong.
Repeated to Hongkong, Trade Commissioner Hongkong No. 18 and Canton No. 15.
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