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control on our part over the railway when completed places the business outside the category of a concession," and to request you to be good enough to further call the attention of His Majesty's Government by cable to the alteration in the agreement of the 2nd October, 1909, and our contention is respect thereof.

I have, &c.

FFRENCH.

This Document is the Property of His Britannic Majesty's Government.]

[B]

CHINA RAILWAYS.

CONFIDENTIAL.

16664

RECE 6May 12 JUN 10,

SECTION 1.

Enclosure 2 in No. 1.

Lord Ffrench to Mr. Max Müller,

Sir,

Peking, April 16, 1910. I HAVE the honour to inform you that on the 30th September, 1909, I notified his Excellency Sir John Jordan that Messrs. Pauling and Co. (Limited) proposed entering into an agreement with the American group, providing for their mutual interests and co-operation in the construction and financing of the proposed railway between Chinchow and Aigun. I also informed his Excellency that this agreement contemplated the financing of the railway being reserved to the American group and their associates on the condition that the railway in question should be built by Messrs. Pauling and Co. (Limited). In accordance with à construction contract to be entered into between them and the Chinese authorities, and that it was also agreed that half the materials purchased abroad should be American, provided that the price was not in excess of current European market rates.

I have now the honour to inform you that the proposed agreement between the two firms in question has since been ratified, and to request that you will be good enough to communicate this information to His Majesty's Government.

I have, &c.

FFRENCH.

[16827]

No. 1.

Papers communicated by Mr. C. S. Addis, May 12,

(1.)

M. St. Simon to Mr. C. S. Addis. Chor Mr. Addis,

Paris, le 11 mai, 1910. JE vous envoie, ci-joint, copie de la lettre que nous avons adressée aujourd'hui à notre Ministère des Affaires Etrangères, en lui remettant le texte du mémorandum que nous avons arrêté hier.

Votre bien dévoué,

M. le Ministre,

(2.)

M. St. Simon to M. Pichon.

ST. SIMON.

Paris, le 11 mai, 1910. Nous avons l'honneur de vous adresser, ci-joint, la copie d'un mémorandum arrêté entre nous et le représentant du groupe anglais, et que nous savons correspondre aux vues des deux autres groupes dans l'emprunt du Houkouang.

Ce document apporte la solution indiquée par votre département à la question des ingénieurs en chef et constate l'échange fait entre le groupe anglais et nous de la dernière section du Chemin de Fer Hankéou-Tehengtu.

En portant ce document à votre connaissance, nous vous serions reconnaissants de vouloir bien le faire parvenir à M. Paul Cambon, en lui donnant les instructions nécessaires pour que notre Ambassadeur à Londres puisse en entretenir le Foreign Office.

Veuillez, &c.

(3.)

Memorandum.

By an agreement dated the 14th and 15th May, 1909, it was agreed as regards the appointment of chief-engineers of the Szechuan Railway that the line should be divided into three equal sections between the German, the French, and the British groups respectively.

An American group having since preferred a claim to participation, and this claim having been admitted by the above three groups, it is hereby agreed to alter the above division of three into four equal engineering sections as follows:-

Germans 800 kilom, chief-engineer, of which 200 kilom, American sub-engineer. Americans: 200 kilom, sub-engineer, plus 400 kilom. chief-engineer. English: 600 kilom. chief-engineer.

French: 600 kilom. chief-engineer.

Any surplus remaining over to be divided in terms of the said intergroup agreement of the 14th and 15th May, except that the division shall be between the American, British, and French groups in equal proportion, but not so as to exceed the length of 800 kilom. for each group.

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