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Inclosure 2 in No. 1.
Regulations for the Open Mart to be established by the Chinese Government outside the City of Chinan.
1. Boundaries.-In order to prevent the mart which is to be established outside Chinan from encroaching on "the interior," a definite district must be set apart for it. The place now decided on for an interuational place of business for Chinese and foreigners is situated in the western suburb, to the south of the Kiao-chou-Chinan Railway, from Shih-wu Tien (the Fifteen Pavilions) on the east to Pei-ta-huai-shu (the Big North Huai Tree) on the west, the southern boundary being the main road to Chang Ching, and the northern the railway. The extent from east to west is not quite li, and from north to south about 2 li, the total area being over 4,000 mou All the Treaty Powers will be allowed to appoint officials for this place to take charge of commercial affairs, and foreign merchants will be permitted at their will to travel to and fro, lease land, set up houses of business, and to live and trade with Chinese merchants on an equal footing. The city, its suburbs, and the neighbouring country outside the limits of the open mart will still be subject to the Regulations regarding land in the interior, and it will not be permissible for foreign merchants to lease houses and buildings and to set up houses of business there.
Lease of Land.The boundaries of the mart having been fixed, all the inclosed land, both crown and private, must first be surveyed and divided into lots, the price of which will be fixed according to the order of their superiority; and in order to prevent extortion and coercion between buyers and sellers, private house and property when required for use will be purchased by the Government and leased to Chinese or foreign merchants.
A Notification will also be issued informing landlords and tenants that private purchase and sale of land is forbidden, and that tenants wishing to take a piece of land on lease must first, in accordance with the Regulations, proceed to the Office of Works and be registered, in order that they may be taken in order of priority and that disputes may not arise.
(Detailed Regulations with regard to the renting of land will be separately drawn up.)
3. Government.When the mart is opened to trade, merchants will be drawn to the place in great numbers, and Chinese and foreigners will dwell there together; consequently, numerous international cases will certainly arise, for the control of which it will be necessary to appoint a special official. The Chi-Tung-Tai- Wu-Lin Taotai, being on the spot, has therefore been selected to he Superintendent. (Chien-tu.) The administrative business connected with a port may be divided into three clauses, viz. :--
(1.) The business of the Office of Works, which consists of the repair of the roads, the building of offices, and all other works of construction and repair;
(2.) The work of the police office, which specially manages the policing of the roads and the investigation of smuggling; and
(3.) That of a Court of Law which administers litigation between Chinese and foreigners.
The appointment of special officials to have separate charge of these matters will be the duty of the said Taotai. However, as there are multifarious matters connected with the administration of an open port, a further high official, well versed in inter- national affairs, will be appointed to reside at the Court to assist in the investigation and settlement of the cases, and in addition the Superintendent of northern trade and the Governor of Shantung may appoint a foreign official to aid in the adminis- tration.
4. The construction of roads, laying of drains, building of offices, erection of gaols, digging of wells, and planting of trees throughout the mart must be undertaken one by one. The first in importance is the solid and neat construction of the houses, and then the levelling the roads, but first of all it is intended to accurately measure and define the boundaries within the mart limits, and then funds will be provided for the carrying out of the other undertakings in the order of their importance.
5. The port to be established outside the City of Chinan, being a land mart, differs from the other Treaty ports. The issue of Regulations for the establishment of a custom-house must, therefore, be postponed till the conditions of trade have been
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observed, when they will be from time to time drawn up. The funds for the establishment of road police, the erection of street lights, and for the cleansing of the roads will, at first, be supplied by the Chinese officials, and they will be empowered, as circumstances require and according to the Regulations in force at other ports, to levy proportional rates and taxes on houses and shops and on large and small carts, and both Chinese and foreign merchants will be required to pay such taxes.
6. Finances.--On the opening of the mart to trade, many new public works will be undertaken. The expenditure of the mart may therefore be divided in two classes :---
(1.) The expenses connected with its establishment, such as the purchase of land and the carrying out of public works, the amount of which will be very consider- able; and
(2.) The current expenses of each year, such as the salaries of officials and wages of employés, and other expenses on account of public business.
Funds to defray this expenditure should be obtained by Memorial and used with economy.
7. Prohibitions.- Within the limits of the mart it is forbidden to erect mat-sheds, to store gunpowder and dynamite, to recklessly discharge rifles and revolvers, to carry arms of any sort with the exception of those carried by officers and soldiers, and to commit all other acts which are prejudicial to the common welfare. Offenders will be dealt with according to the laws of their nationality. However, explosives for the use
of public works are omitted from the above prohibition, but the permission of the local authorities must first be obtained, and such explosives must not be stored in the mart for any length of time.
8. A great extension of correspondence may be expected after the opening of the mart. It will be the duty of the Government to set up a post-office, telegraphis, and telephones, and foreigners are excluded from undertaking these matters.
9. Subsidiary Marts.-The opening Wei-hsien and Chou Ts'un as subsidiary marts has already been obtained by Memorial, and the Regulations with regard to them will be similar to those with regard to the mart outside Chinan.
The above nine clauses are only general Regulations, and all matters mentioned therein will require separate detailed Regulations in order to insure their proper performance. All questions arising out of the circumstances of the position of the mart and not touched on in the above Regulations will in due course be discussed and dealt with,
Your Highness,
Inclosure 3 in No. 1.
Sir E. Satow to Prince Ching.
Peking, March 23, 1905. I HAVE the honour to acknowledge the receipt of your Highness' note of the 7th instant, inclosing copy of the Regulations drawn up by the High Commissioner for Northern Ports and the Governor of Shantung for the trading mart to be opened by China herself outside the city of Chinan-fu in Shantung.
I shall be glad to learn the date upon which it is proposed to open this mart, and as these Regulations are of a general nature, I need only state for the present that if any British subjects establish themselves in business at Chinan-fu they will, of course, continue to be under the jurisdiction of their own authorities, and that the rights which they enjoy under Treaty in other ports cannot be circumscribed by any local Regulations The expectation is expressed in Rule 3 that, when the mart is opened to trade, merchants will be drawn to the place in great numbers, and Chinese and foreigners will dwell there together. I hope this expectation may be fulfilled, though the experience of past years shows that the proper sequence of events is to allow a commercial community to form first, and then to frame Regulations for its administration. The examples furnished by Hangchow, Soochow, and other ports opened in recent years should be sufficient to prove that the surveying of land, its division into lots, the price of which have been fixed beforehand, and the forbidding of the private purchase and sale of land, are not in themselves measures which attract either foreign or Chinese merchants to take up their residence in the areas specially delimitated for that purpose. International trade has developed best in