145
We believe it to be correct to state that the privilege in question was granted to the China Merchants' Steam Navigation Company through a report to the Tsung-li Yamên made by the Chibli Viceroy (Li Hung-chang-interested in China Merchants' Steam Navigation Company, of course) in the 10th month of the 11th year of Tung Chi
=1872.
Over 230,000 piculs brick tea were imported into Tien-tsin during 1904, and The classed in the Customs Returns under native imports as brick tea for Russia. proportion of this quantity imported and transferred by Russians under their special privilege for Kiachta is very small, and is probably considerably less than the odd 30,000 piculs. The large proportion is imported by the steamers of the China Merchants' Steam Navigation Company, and forwarded by Chinese under a bond issued by the Customs which has to be returned by the Superintendent of Trade at Kalgan, certified that the produce has duly arrived. Nominally, it may be supposed that this tea ex China Merchants' steamers is forwarded to Kiachta, but we believe that the first actual market is in Kalgan, and there is no doubt that the tea is actually consumed in Mongolia. Tea forwarded by Russians, which may really reach Klachta, certainly finds its way back into Mongolia. Tea forwarded by Russians is covered by precisely similar documents to those accompanying Chinese shipments.
A shipment of 1,410 piculs tea ex a steamer of the China Merchants' Steam Navigation Company imported and forwarded through the Customs by the hong Hsiang Far Yuan,
is charged the following taxes :—
Coast trade duty
Wharfage dues
Native customs dury, at 12 cands, per pieul
A li-kin charge of 4 cands per picul
Lotal
The shipment er the China Navigation Company's steamer " for on the 28th October last, had to bear the following taxes :----
Coast trade duty, at 30 cands per picul
Wharfage dnes
Native customs duty, at 30 cands, per picul
A li-kin charge, at 15 cands per picu!..
Total
Haikwan Taels. Nil
38.07
169.20
56.40
263-67
Nanchang" applied
Haikwan Tacls.
423-00
38.07
423-00
211.50
1,095 57
constituting a preferential duty against the steam-ship "Nanchang " of 831.90 Haikwan taels, or, say, 59 cands, per picul, in favour of Chinese steamers as against British steamers, and by this means the China Merchants' Steam Navigation Company have secured the monopoly of carriage of Shansi brick tea from Hankow to Shanghae by river steamer and thence to Tien-tsin by coast steamer.
The tea in question is known at Hankow as Shansi brick tea, because the buyers are Shansi people who resell to the Mongolians,
The following Articles in Treaties appear to be framed to assist in circumstances of this nature:
Article XIV of the French Treaty of Tien-tsin, 1860, viz. :----
"No privileged commercial Society henceforward be established in China, and the same should apply to any organized coalition having for its end the exercise of a monopoly of trade. In case of the contravention of the present Article, the Chinese authorities, on the representation of the Consul or Consular Agent, shall advise as to the means of dissolving such Associations--of which they are also bound to prevent the existence by the preceding prohibitions--so as to remove all that may stand in the way of free competition."
Article XXIV, British Treaty of Tien-tsin, 1858, viz. :----
"It is agreed that British subjects shall pay on all merchandize imported or exported by them the duties prescribed by the Tariff; but in no case shall they be called upon to pay other or higher duties than are required of the subjects of any other foreign nation."
We shall be much obliged if His Majesty's Minister will give directions that some course be taken, either through these Articles or by such means as he thinks fit,
5
whereby the desired end may be attained. The matter is an important one, for not only is a considerable trade at present affected and closed to British steamers, but it appears that if the China Merchants' Steam Navigation Company cau sustain their right to receive preferential treatment in duties and taxation on brick tea, the way is open to them to establish further monopolies of other items of coasting trade.
In view of this aspect of the case, we shall esteem it a favour if an expression of opinion can be given us at an early date, in order that we may proceed cautiously in any further action it may be desired to take.
We trust that we have not written too lengthily, and that the importance of the subject may be sufficient justification.
We are, &e.
(Per pro. Butterfield and Swire),
(Signed)
G. J. EDKINS,
Agents, China Navigation Company (Limited).
Inclosure 3 in No. 1.
Sir E. Satow to Consul-General Hopkins.
(No. 8.) Sir,
Peking, February 19, 1906. I HAVE received your despatch No. 15 of the 14th instant, forwarding a letter addressed to you by the representative of Messrs. Butterfield and Swire at Tien-tsin, in which he states that they are anxious to bring within their business activities the transport by their steamers of brick tea to Tien-tsiu and its conveyance thence, under overland pass, on the same terms as brick tea shipped by vessels of the China Merchants' Steam Navigation Company.
An examination of the Tien-tsin Customs Returns for 1904, to which Mr. Edkins refers, would appear to show that all the tea re-exported in that year was sent overland to Siberia, Russia, &c., by way of Kalgan and Kiachta, and Article 10 of the Regula- tions of the 24th February, 1881, governing the overland trade between Russia and China, distinctly states that Chinese produce exported from Tien-tsin overland to Russia must be carried by way of Kalgan, and that sale thereof en chemin will subject the merchant concerned to the penalties laid down in Article 8 of the same Regulations, while Article 16 declares that Russian merchants are prohibited from conveying merchandize belonging to Chinese merchants and passing it as their property.
The question of duties is also fully dealt with in Article 10. Chinese produce brought to Tien-tsin for export overland to Russia pays full export duty at the original port of export of and coast trade duty at Tien-tsin, but the latter is refunded if the produce is exported to Russian territory within a year after its payment, so that native produce carried overland to Russia is liable to payment of one full export duty only.
Messrs. Butterfield and Swire, however, allege that they believe that part of the brick tea brought to Tien-tsin is carried to Kalgan for sale there, and not exported to Russia, and they wish to take part in this transport trade; but they are only the carriers, and not the owners, and I know not of any Treaty right or privilege entitling British or other foreign subjects to overland passes to convey native produce, the property of Chinese, from a port overland to a place in the interior of China. Mr. Hosie will be shortly in Tien-tsin, and will take the opportunity of looking into the question in all its bearings.
You should communicate a copy of this despatch to Messrs. Butterfield and Swire.
I have, &c.
ERNEST SATOW.
(No. 23.) Sir,
(Signed)
Inclosure 4 in No. 1.
Consul-General Hopkins to Sir E. Satow.
Tien-tsin, March 1, 1906. WITH reference to your despatch No. 8, of the 19th ultimo, on the subject of the carriage transport inland of brick tea, copy of which I communicated to
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