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continue to operate in British Territory except with the express sanction of this Government, especially in view of the fact that the Chinese have always objected to a British Company owning and operating telegraph lines in China and so have shown their views as to rights of sovereignty in this matter.
It seems, however, useless to make further representations to the Director-General of Chinese Telegraphs and diplomatic representations through His Britannic Majesty's Minister at Peking would probably only result in further protracted correspondence.
13.
In these circumstances I propose to introduce an Ordinance into the Legislature making the construction and working of Telegraph Lines illegal in the future without a licence from this Government which would be issued on such terms and under such conditions as the Governor in Council might determine. If such an Ordinance were passed I should recommend the grant of a licence to the Chinese Telegraph Administration subject to an annual payment and to various conditions one of which would be that the ownership of the actual line should be recognised as vested in the Hongkong Government in the same way as the ownership of the line to the old frontier was so recognised. The Chinese Telegraph Administration would then be allowed to work, maintain, and take the profits from the line as they do now. This would be a better arrangement than for the Government or Eastern Extension Telegraph Company to take over the maintenance and working of the line within British Territory as it would not involve a transmitting station at the frontier which would be necessary