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

6

We shall be obliged if his Excellency the officer administering the Government would be good enough to inform His British Majesty's chargé d'affaires by cable of the above, and to press for the immediate abolition of the tax, whether collected by the Kwong Yuen General Office or others.

(Telegraphic.)

We have, &c.

DAVID SASSOON AND Co. (Limited), (R. H. JOSEPH, Manager). E. D. SASSOON AND Co.

Euclosure 13 in No. 1.

Acting Governor Sir F. May to Mr. Max Müller.

Hong Kong, September 17, 1910. BY latest reports from Sassoon's it appears that some persons desire to take over privileges accorded to Kwong Yuen Office, and have addressed petitions to Chinese authorities for approval of revised regulations. Request you will be good enough to take advantage of opportunity press for withdrawal of regulations tax.

0

OPIUM.

CONFIDENTIAL.

[37815]

No. 1.

C O

34472

RECE

[October 25.]

REG910 NOV 10

SECTION 2.

Foreign Office to Messrs. E. D. Sassoon and Co.

Foreign Ofice, October 25, 1910. Gentlemen,

I AM directed by Secretary Sir E. Grey to acknowledge the receipt of your letter of the 29th ultimo, enquiring as to the present position of affairs with regard to the opiam regulations issued by the provincial authorities of Kwangtung.

In reply I am to inform you that the Chinese Government have approached His Majesty's Government with certain proposals in regard to the opium question in general; but these proposals are now under consideration, and it is not possible, therefore, to make any detailed statement at this moment as to the nature of the settlement that may be arrived at. His Majesty's Government desire to secure reasonable protection for the wholesale trade in foreign opium against arbitrary taxation of a discriminating character, while co-operating with the Chinese Govern- ment in its efforts to restrict the opium habit among the general population, and recognising its right to regulate the retail trade.

With regard to the remark contained in your letter under reply respecting the Chinese reference made by His Majesty's consul-general at Canton to Kowloon as a port of entry," Sir E. Grey understands that there is a station of the Chinese Imperial Maritime Customs at that port, and that Mr. Jamieson's expression is perhaps. attributable to that fact.

I am to say that Sir E. Grey is unable to agree that the consul-general's attitude The question as to is open to the unfavourable comments expressed in your letter, the extent to which the regulations of the Kwangtung Government infringe treaty stipulations is not free from difficulty, and the consul-general is bound to consider it from all points of view.

Nor is Sir E. Grey able to admit that there has been any lack of firmness or insistency on the part of His Majesty's chargé d'affaires at Peking. It should be borne in mind that in interpreting the stipulations of existing treaties with regard to the opium trade, and in insisting upon their observance, His Majesty's Government and their representatives in China have to take into consideration the changed attitude of the Chinese Government with regard to opium and the opium habit, and their pledge to co-operate with them in their endeavour to restrict consumption and to eradicate that habit throughout the Chinese dominions. In the enforcement of treaty rights they desire to avoid resort to action which would be inconsistent with this general policy of co-operation, or would raise doubts as to their good faith in the matter.

The possibility of terminating the provisions of the Chefoo Agreement has not been overlooked. As this would give the Imperial and provincial Governments in China complete freedom in taxing foreign opium beyond the limits of the treaty ports, Sir E. Grey doubts whether it would be of much benefit to the foreigu opium trade.

I am, &c.

F. A. CAMPBELL..

[2957 6b-2]

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