[This Document is the Property of His Britannic Majesty's Government.]
CHINA RAILWAYS.
CONFIDENTIAL.
[25758]
No. 1.
188
[July 7.]
SECTION 2.
Papers communicated by Mr. C. S. Addis, July 7, 1909.
(1.)
MEMORANDUM of agreement made the 6th day of July, 1909, between the British and Chinese Corporation (Limited), having its registered office at 3, Lombard Street, in the city of London (hereinafter called the "corporation"), of the first part; Chinese Central Railways (Limited), having its registered office at 110, Cannon Street, in the said city (hereinafter called the "Central company"), of the second part; the Banque de l'Indo-Chine, having its office at 15 bis Rue Laffitte, Paris (hereinafter called the "French bank "), of the third part; and the Deutsch- Chinesische Eisenbahn-Gesellschaft m.b.H., having its office at 31, Unter den Linden, Berlin (hereinafter called the "German company "), of the fourth part; Whereas the parties hereto have expressed their willingness to enter into a general Anglo-Franco-German understanding for the purpose of governing their action in connection with the negotiations for and making to the Chinese Empire loans for railway purposes:
Now it is hereby agreed by and between the parties hereto as follows:-
1. In the matter of this agreement the French bank is acting on behalf of the French syndicate for Chinese business, consisting of the parties whose names are set forth in the first schedule hereto; and the German company is acting on behalf of the German syndicate for Chinese business, consisting of the parties whose names are set forth in the second schedule hereto. The French bank and German company reserve to themselves the right of increasing or reducing in each special case the number of parties interested in the French and German syndicates respectively and a similar right is reserved to the corporation, but so that in any such case any party dropping out in any special case shall still remain bound by the restrictive provisions hereof and any party coming in in any special case shall become subject to the restrictive provisions hereof.
2. This agreement relates to all loans and advances for railway purposes to be floated out of the Chinese Empire which may be made with the Chinese Imperial Government and [or] with Government departments and companies having Chinese Imperial or provincial Government guarantees, but does not relate to loans to be floated within the Chinese Empire nor to any loans in connection with the Hankow-Canton and Hankow-Chengtu Railways.
3. Any business of the kind hereinbefore defined to which this agreement relates which may be offered to either of the contracting parties of the first, third, and fourth parts (hereinafter jointly referred to as the "lenders") must be dealt with jointly by them in accordance with the stipulations of this agreement.
4. As regards joint action in respect of financial operations for railway purposes not having such guarantees, special agreements will have to be made in each separate
case.
5. This agreement is made on the principle of equality, namely, equal terms in every respect between the lenders, and each of the lenders enters into this agreement for their respective groups and shall take an equal share in all operatious and jointly sign all contracts, except as hereinafter provided, and shall bear in equal shares all charges in connection with any business (except stamp duties and any charges of and connected with the realisation by each of the lenders in their respective markets of their participation in the operations), and conclude all contracts with equal rights and obligations as between themselves: provided always that in cases where the introduction of third parties is calculated to prejudice the success of the negotiations any business falling within the scope of this agreement may be entertained and negotiations entered upon by either of the lenders alone with or without notice to the other lenders, and
B [2336 g-2]