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this maintains its present superiority, the revenue derivable from it is in no way jeopardized. The drug will bear heavier taxation than that now imposed upon it, and heavier taxation will probably be laid upon it.
But the Chinese have a right so to tax it, and my stipulation, while it adds nothing to the power of raising the rate of taxation already in their hands, secures to them the full amount of the tax that may be imposed. This is simple justice. But it is secured to them so far only at the ports. Their revenue still loses by the trade of Hong Kong, or, if it loses no longer, this is because they have resorted to a means of protection which, even were it applied without the smallest transgression of its lawful limits, must still be irksome, to say no more, to the Colony. Its lawful limits withal have not been unfrequently transgressed. The Chinese Government, having discovered that the Chinese junks trading with the Colony in many cases carry cargoes, whether of opium or other goods, imports or exports, which by their trade with the Colony avoid payment of duties, has placed round the Colony, at certain points, upon Chinese ground, a cordon of native custom-houses, which overhaul every junk entering or leaving the waters of the Colony. This, if the executive went no farther, would oppress the junk trade of the Colony, the executive being, like the junkmen, Chinese; but the right of the Chinese Government to inspect and tax its own junks could bardly be disputed. The limits of the right are transgressed when the native cruizers pursue the junks into the ports or waters of the Colony. The punishment or prevention of action of the kind is, of course, within easy reach of a Power like our own. But the embarrassment of the junk trade would continue much the same unless the native custom-houses were so overawed by our exhibition of force as to desist from performance of their lawful duty, in which case we should be in the wrong. The revenue China is seeking to protect is due to her. It is the interest of the Colony to render possible the discontinuance of these native custom- houses.
It must not be forgotten that, when Hong Kong was ceded to us in 1842, we looked the responsibility imposed upon us by the close proximity of the island to the mainland fairly in the face; and that, in the Supplementary Treaty signed by Sir Henry Pottinger at Hoo-Mun Chai in 1843, we agreed to co-operate with the Chinese Government in protecting it against the loss of revenue to which it would be exposed unless its junk trade were placed under surveillance. I quote below the provisions to which I refer :---
"ARTICLE XIII.
"All persons, whether natives of China or otherwise, who may wish to convey goods from any one of the five ports of Canton, Foochowfoo, Amoy, Ningpo, und Shanghae, to Hong Kong, for sale or con- sumption, shall be at full and perfect liberty to do so, on paying the duties on such goods, and obtaining a pass or port-clearance from the Chinese Custom-house at one of the said ports. Should natives of China wish to repair to Hong Kong to purchase goods, they shall have free and full permission to do so; and should they require a Chinese vessel to carry away their purchases, they must obtain a pass or port-clearance for her at the custom-house of the port whence the vessel may sail for Hong Kong. is further settled that in all cases those passes are to bo returned to the officers of the Chinese Govern- ment as soon as the trip for which they may be granted shall be completed.
"ARTICLE XIV.
It
"An English officer will be appointed at Hong Kong, one part of whose duty will be to examine the registers and passes of all Chinese vessels that may repair to that port to buy or sell goods; and should such officer at any time find that any Chinese merchant-vessel has not a pass or register from one of the five ports, she is to be considered as an unauthorized or smuggling vessel, and is not to be allowed to trade, whilst a report of the circumstance is to be made to the Chinese authorities. By this arrangement it is to be hoped that piracy and illegal traffic will be effectually prevented.
"ARTICLE XVI.
"It is agreed that the custom-house officers at the five ports shall make a monthly return to Canton of the passes granted to vessels proceeding to Hong Kong, together with the nature of their cargoes; and a copy of these returns will be embodied in one return and communicated once a-month to the proper English officer at Hong Kong. The said English officer will, on his part, make a similar return or communication to the Chinese authorities at Canton, showing the names of Chinese vessels arrived at Hong Kong, or departed from that port, with the nature of their cargoes; and the Canton authorities will apprise the custom-houses at the five ports, in order that, by these arrange- ments and precautions, all clandestine and illegal trade, under the cover of passes, may be averted."
The Supplementary Treaty was abrogated by Article I of the Treaty of Tien-tsin, together with the General Regulations of Trade appended to it, "the substance of their provisions," runs the clause, having been incorporated in this (the new) Treaty."
This is true of all the other provisions of those two instruments. They were, to quote the same Article, "amended and improved." No reference to the junk trade of Hong Kong was made in the new Treaty; not, I am convinced, out of indifference to
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the interests or rights of the Chinese. Lord Elgin, the negotiator of the Treaty, felt so strongly upon this subject that he declined to stipulate for the participation of British shipping in the general cabotage of China. The surveillance of the junk trade of Hong Kong, so prescribed by Sir Henry Pottinger's Treaty of 1843, was left unnoticed, imagine, simply because during the fifteen years that had elapsed since that Treaty was signed, the Chinese, whatever the cause, indifference or fear of trouble, had never mani- fested the smallest desire to give effect to any arrangement of the kind provided.
One reason in the first part of the period in question was, perhaps, that the junk trade of the Colony was insignificant; but from 1854, when Canton was for some months invested by T'ai P'ing rebels, it had continued to grow in importance.
And in 1868 it was believed (by the Chinese) that revenue was suffering a loss of about 300,0001. a-year upon cargoes carried by junks frequenting Macao and Hong Kong, opium being, of course, the most valuable of the cargoes run into outports on the mainland.
The Hoppo, or Chinese Superintendent of Customs, when complaining of this (I am unable, without reference, to say in what document), remarked that this evasion of duty along the west coast of the province was practicable only because at Hong Kong, which he speaks of as still belonging to the Province of Kwang Tung, "China has no custom- house, nor are persons stationed there for purposes of inspection ;" and he suggested that the Governor of Hong Kong should be directed by the British Minister to instruct the Consul at Hong Kong to put a stop to the smuggling of imports.
I drew attention to this in 1868, in the Memorandum on Revision of Treaty before referred to. The Hoppo's confusion of ideas as to our territorial rights and the depart- ments of our services apart, I pointed out that his reasoning was not so absurd as at first sight it might be thought; that the form of his protest but betrayed a belief, common to Chinese officials, that when British subjects were exterritorialized in China, the British Government undertook to restrain them from wrong-doing, In this, of course, he included the enabling or assisting the Chinese wrong-doer to do wrong. In early days, before the first war, the native monopolists, known as the Co-Hong, not only collected the duties on the foreign trade, but controlled and were held responsible for all the proceedings of foreigners. When Consuls were appointed under our first Treaty, it was declared in Rule 15 of the Supplementary Regulations of 1843 that, whereas "it has hitherto been the custom when an English vessel entered the port of Canton that a Chinese hong merchant stood security for her, and all duties and charges to be paid through such security merchant, these security merchants being now done away with, it is understood that the British Consul wil henceforth be security for all British ships entering any of the aforesaid five ports "the five ports opened in 1842 to trade. This, no doubt, explains the Hoppo's construction of our official liability.
The Instruments quoted have ceased to possess the force of a Treaty. Technically, the Chinese Government has no right to call on the Colony to co-operate with it in the protection of Chinese revenue. But I have thought it well to recall the fact that we were at one time sensible of the justice of a claim to our co-operation.
It has been made matter of complaint that the attention of the Chinese Government was directed to the loss its revenue was sustaining by its foreign auxiliaries in the Inspectorate of Customs. If So, the Inspectorate, in my opinion, discharged a simple duty. The Chinese Superintendent of Customs (the Hoppo, as we call him), remarking that there was no authority to control irregular trade between Hong Kong and the Chinese coast, as he, whether ignorantly or impertinently, put it, "no Consul at Hong Kong," proceeded to control it himself. He, or the Canton Government, organized a fleet of steamers, and placed three custom-houses on three points of Chinese territory to overhaul all junks communicating with the Colony. I consider that the Canton Government herein exercised an undoubted right. The Government of China has an undoubted right, in my opinion, to see that Chinese junks carrying Chinese produce into Hong Kong have duly cleared from the Chinese port of export, and a right, equally good, to see that imports leaving Hong Kong pay what is due to the Chinese Govern- ment as import duty.
The form of proceeding resorted to at these custom-houses undoubtedly distresses the junk trade, and, through it, reflects an injury on colonial interests that gives the Colony some ground of complaint. It is to the change in form of proceeding, therefore, that I have addressed myself; but as the Chinese right to adhere to the present form is complete, it appears to me that our only escape from its irksomeness is through the discovery of a means, to which the Chinese cannot object, of otherwise securing them their lawful revenue.
It is complained
The action of their executive is irksome in more ways than one. that their cruizers have in some cases pursued Chinese junks into our waters, and have
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