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Japanese Government is that the sugar in question having once passed through a foreign port on its way to Yokohama could not be regarded as coming within the category of goods exempted from duty on the ground of having been conveyed coastwise.

But as the fact of the consignment in question having been despatched from Formosa was established by the through Bill of Lading, instructions have been sent to the Custom House at Yokohama to make an exception in this case and to refund the duty collected, in accordance with the rule regarding the reimportation of domestic productions.

I should be grateful if Your Lordship would be so good as to instruct me for my future guidance whether British merchants are entitled in case of this kind to claim the right of having goods from Formosa passed through the Custom House without the payment of duty. The Treaty stipulation which the importers would naturally rely on is that contained in Article XI of the Austro-Hungarian Treaty with Japan of 1869.

I have &c.,

(Signed)

Ernest Satow.

Art. XX of the Austro-Hungarian Treaty

Has to do no.

Seen to refer further as regards have between Port of Japan and another Port of Japan than Art. XI of Treaty with Japan of 1896, and does not seem to touch the case of goods transhipped at Hong Kong in route between Formosa & Japan.

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