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Enclosure I in No. 1.

Memorandum communicated to the Wai-chiao Pu by Sir J. Jordan.

HIS Majesty's Minister begs to acknowledge the receipt, in reply to his memorandum of the 16th instant, of a memorandum from the Wai-chiao Pu dated the 20th instant, embodying a telegram from the tu-tu of Chekiang to the effect that a proclamation excluding Indian opium from the scope of opium prohibition was issued on the 9th instant to all subordinates to be posted up everywhere. That such a proclamation was not posted everywhere on the date stated may be gathered from the fact that His Majesty's consul at Hangehow found it necessary to apply to the tu-tu on the 15th and was furnished with a copy only on the 17th instant. Sir John Jordan begs to enclose a copy of that proclamation. It begins by stating that the 17th February was the date fixed for the complete suppression of opium in the province of Chekiang; but as that province in which opium is now being cultivated has not qualified under the Opium Agreement of the 8th May, 1911, to exclude Indian opiumu, the latter is a legitunate article of import into Chekiang, and any attempt to exclude it or to interfere with its transit under treaty transit certificate is a breach of that agreement and of treaty stipulations. That such breaches of treaty are occurring may be gathered from the fact that the holders of the nine chests of Indian opium illegally seized at Chiang-t'ou and detained for months were not allowed to forward the drug to destination, but were compelled to carry it back to Shanghai, and that local passes or permits are being enforced on foreign opium with a view to its removal and exclusion from the province. His Majesty's Minister begs to enclose a copy of the regulations governing these permits, to point out that the enforcement of such permits is an unjustifiable attempt to exclude Indian opium from a province not yet qualified to exclude, and he has to demand their immediate withdrawal on the ground that they constitute a restriction on a trade the conduct of which is carefully defined in the additional article to the Chefoo Agreement, and that it is one of the restrictions which the Chinese Government solemnly pledged themselves in the Opium Agreement of 1911 to withdraw and never reimpose.

The proclamation goes on to say that the wholesale Indian opium trade is governed by treaty stipulations which for the present remain in force as hitherto; but the compulsory closing of prepared opium shops whose proprietors are the wholesale dealers has put a stop to the wholesale trade which the proclamation professes may continue as hitherto, while the authorities are doing everything in their power to obstruct that trade by enforcing a system of passes allowing export but forbidding import. His Majesty's Minister has repeatedly called attention to the irregularity of these provincial regulations, and he has again to point out the serious consequences which their continuance will inevitably entail. The measures to be taken to regulate the retail trade were clearly defined in the telegraphic instructions sent by the Wai-wu Pu to the high provincial authorities in June 1911, and it is the duty of the Wai-chiao Pu to see that these instructions are obeyed, not, as they are at present, ignored.

The memorandum under acknowledgment further states that the tu-tu of Chekiang telegraphs that the alleged proclamation regarding the destruction by fire of opium stocks was never in fact issued; but His Majesty's Minister begs to enclose copies of a proclamation issued by the Military Governor of Shao-hsing Fu on the 18th February, and of a proclamation issued by the superintendent of public affairs for the prefecture of Hangehow on the 3rd April, both of which enjoin the destruction by burning of opium stocks, and Sir John Jordan has to request the Wai-chiao Pu to call upon tu-tu of Chekiang to substantiate his assertion that no such proclamation bad been issued.

In conclusion, Sir John Jordan must request the Wai-chiao Pu to exercise their authority and immediately instruct the Chekiang as well as the Fukien authorities by telegraph that all obstruction of and interference with the Indian opium trade in these provinces must at once cease, and that in the regulation of the retail trade provided for in the last paragraph of article 7 of the Opium Agreement of the 8th May, 1911, they must be guided by the telegraphic instructions issued by the Wai-wu Pu in

June 1911.

Peking, April 29, 1912.

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Enclosure 2 in No. 1.

Memorandum communicated to Sir J. Jordan by the Wai-chiao Pu.

(Translation.)

THE Wai-chiao l'u have the honour to acknowledge the receipt, on the 19th April, of a copy of the memorandum addressed to the President on the subject of opium suppression in Chekiang, and also of a memorandum, dated the 29th April, enclosing copies of proclamations and permit regulations issued by that province.

The fears of the Indian opium importers at Shanghai that the sudden introduction of suppressive measures by the Chekiang authorities may, in view of the beavy stocks of the drug, involve a financial crisis are undoubtedly actual facts, but the public opinion and enthusiasin in the province with regard to measures for the eradication of the opium evil are also extremely hard to repress.

In regard to the statement that "that province in which opium is now being cultivated has not qualified to exclude Indian opium, and any attempt to exclude it is a breach of treaty and agreement," the following passage in the proclamation issued by the Chekiang civil administration is to be observed

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Apart from the wholesale trade in Indian opium which, as it is affected by the treaties, may temporarily be governed by the old rules, all transport and sale of opium paste of native origin and all private smoking or growing of opium shall, on detection, be dealt with and punished appropriately."

This proclamation prohibits explicitly the transport and sale of opium paste of native origin, and does not therefore affect treaty or agreement; and the existence of this definite pronouncement in the civil administrator's proclamation shows that the passage in the regulations governing permits for export of opium from that province, which states that" for the stocks of opium remaining unsold in opium shops a permit may be taken out for export to other provinces which have not yet enforced suppression," must also be a specific reference to opium paste of Chinese origin.

Moreover, the proclamation issued by the superintendent of public affairs for the prefecture of Hangchow states clearly that "it is laid down that only prepared This would opium shops must be closed, raw opiuni shops not being included.” seem, therefore, to be a different matter from the "restrictions on the wholesale trade" complained of.

But as to whether, as a matter of fact, the regulations governing permits for the export of opium do or do not involve the Indian drug, and whether the closing of the prepared opium shops can or cannot be effected gradually and at different dates, the Wai-chiao Pu must again telegraph to the Chekiang provincial authorities to investigate and devise some arrangement. The main object, and indeed the only ideal scheme, will be to ensure that no serious panic affects the trade of opium merchants, and that the opium suppression laws are in nowise checked.

May 1, 1912.

Enclosure 3 in No. 1.

Memorandum communicated to the Wai-chiao Pu by Sir J. Jordan.

HIS Majesty's Minister begs to acknowledge the receipt of the Wai-chiao Pu's memorandum of the 1st instant in reply to his memoranduin of the 29th April. In this reply the Wai-chian Pu argue that, because the proclamation issued by the civil administrator of the province of Chekiang states that the wholesale trade in Indian opium, as it is affected by the treaties, may temporarily be governed by the old rules, the enforced export under permit of surplus stocks of opium must refer to prepared opium of Chinese origin. Such is not the case, and Sir John Jordan begs to enclose, for the information of the Wai-chiao Pu, a copy of a permit issued by Mr. Ch'u Pu-cl'eng, the civil administrator of Chekiang, under which two chests of Indian raw opium were compulsorily transported out of that province to the province of Kiangau. Again, the Wai-chiao Pu contend that, as the proclamation issued by the superintendent of public affairs for the prefecture of Hangchow commands the closing of prepared opium shops only while raw opium shops are not interfered with, there is

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