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that these three vessels should remain available for the miscellaneous requirements which are usually served by a much larger number of vessels. It was accordingly decided to watch, but not to interfere with the arrangements made by the owners, and the charters were allowed to stand. It is understood that in 1918 the sis. "Castlefield" entered Singapore three times, and the s.s "Manapouri" four times. The s.s. "Brisbane" was running regularly to Hong Kong.

(e).

The

8. 8. "Ching Chow" is owned by the Green Island Cement Company of HongKong, and her special trade is the carrying of limestone from Haiphong to Hong Kong for the account of the owners. The Hong Kong Government diverted her to carry coal for its own and Admiralty account.

(f).

The s. 8. "Van Waerwijk" has not at any time been under the control of the Hong Kong Government.

10. It must be concluded that the protest made by the Government of the Straits Settlements was founded upon a complete misconception of the policy adopted by the Hong Kong Government and of the steps taken to carry it into effect. The one ain has been to use the tormage available to the best possible advantage and the allegation that essential services were deserted for speculative ventures is entirely without foundation.

11. On the 3rd February the Secretary of State telegraphed instructions regarding the method of calculation of commission payable to Managers and other third parties. Mr. Long had telegraphed the outlines of a scheme on the 25th May, 1918 but he stated that the exact method of ascertainment was still under enquiry; and accordingly no steps were taken in the matter. The Hong Kong Government at the commencement of the control had undertaken to pay a fixed commission of 5 per centum, for the reasons given in Sir Henry May's telegram of the 17th April, 1918 and in paragraph 10 of his Confidential Despatch of the 21st May 1918; and it was decided to take no steps with regard to the instructions of the 3rd February, firstly because of this ..

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