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contraband) can be carried on by British subjects resident and trading in China with the subjects of hostile powers.
1. Within the limits of China.
2. Beyond these limits.
Consul-General to Shanghai Branch
(a) British subjects in China cannot claim a "neutral domicile."
(6) All contracts with enemy subjects are suspended or extinguished on declaration of war.
(c) The courts of law are closed to each other's subjects and therefore no contract with an enemy subject can be enforced by legal process,
(d) There is no question of a license for British subjects to go on trading with the enemy at their pleasure as though a state of war did not exist.
(e) H.M. Government would not expect a British subject to forego a profit or incur a loss when no tangible gain to his country or damage to the enemy is involved.
(f) Transactions wholly confined to China and coming within the terms of paragraph (c) are not reprehensible.
The line taken by the Foreign Office is as follows:-
Foreign Office to Shipping Conference.
(1) The transactions prohibited in Proclamation of 9th September are transactions with Germany or Austria.
(2) A German or Austrian whose commercial domicile is in China cannot be considered, for this purpose, "resident or carrying on business in Germany or Austria."
(3) It is not legally forbidden for British shipowners to accept shipments made by German or Austrian merchants from porta in the Far East to
British, Allied
ports
or Neutral
(a) provided that the shippers neutral or allied country.
或学
commercial domicile
is in a
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(b) and provided that no territory is involved.
contract with a person in enemy
(4) The transaction would be prohibited if it were in effect one with a firm
or person established in enemy territory, the shipper in the neutral country being merely an Agent.
(5) The shipowner must, if the goods to be carried are contraband, be satisfied that they are not intended uitimately for use in an enemy country.
(6) Referring to No. 2 (F.O. 7/11/14).
H.M. Government has never recognised the German claim that German concessions in China are German territory:
(a) therefore it is prepared to make no distinction between Germana and Austrians resident in German concessions and those whose commercial domicile is situated elsewhere in China:
(b) but regard both classes alike as being situated in a neutral country.
(7) Re Article 6, Proclamation 9th September, which provides:
Where an Enemy has a branch locally situated in British, allied or neutral territory, not being neutral territory in Europe, transactions by or with such branch shall not be considered as transactions with or by an enemy.
The Foreign Office adds that the transaction in question must be really with
the branch and not in effect with the Head Office.
Proclamation 9th September. Trading with the Enemy. Paragraph 3. The expression "enemy" in this Proclamation means:
Any person or body of persons of whatever nationality resident or carrying on business in the enemy country:
but does not include :
persons of enemy nationality who are neither resident nor carrying on business in the enemy country.
China Association Shanghai Circular to Members. October 26th.
1. The shipping of cargo by a German firm in British bottoms to allied or neutral ports does not infringe the terms of the King's Proclamation.
2. With the object of preventing or restricting supplies reaching the enemy through neutral countries, Marine Insurance Companies in England have agreed that all policies covering war risks to neutral countries shall contain the following clause :-
"Warranted free from any claim arising from capture, seizure, or detention by
"the British Government or their allies."
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