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was demanding the immediate punishment of the offenders and an apology, failing which he suggested that retaliatory action should be taken, and he quoted Admiralty telegram of the 11th May, which gives the Commander-in-chief certain discretionary powers. This telegram, or rather series of telegrams (Nos. 812 to 815), was repeated by Commander-in-chief to the Governor, Hong Kong, and the British Minister, on receipt in accordance with Admiralty orders to do so. The Governor, Hong Kong, presumably repeated it to Canton, or else Canton intercepted it.

2. On the 16th May (received the 17th) Rear-Admiral Boyle requested authority to take retaliatory action after consultation with Governor, Hong Kong, should such incidents recur. In reply. Commander-in-chief said he would be prepared to approve of suitable retaliation should an apology not be forthcoming. but no operation was to be embarked upon until the actual proposals had been received and approved by Commander-in-chief.

3. On the 16th May (received the 17th) Consul-General, Canton, said he had seen General Lichaisum and had presented three demands, namely :—

(a.) Adequate punishment to officer in charge of guilty troops and any other persons implicated in the outrage; names and punishments to be communicated to consul-general.

(b.) Compensation for damage (which was slight.)

(e) Commander of Whampoa Forts to call in person and in uniform on board

British man-of-war to apologise.

The consul-general proposed to give them a time-limit of five days for complete compliance, failing which he suggested that retaliatory action be taken. He asked that a cruiser be sent to Whampoa or that other dispositions of a menacing nature should be made. He added that there could have been no mistake about the identity of the Lungshan," as she had passed the spot where she was attacked several times a week for years past.

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Admiral Boyle was directed to send a suitable ship to Whampoa.

4. On the 17th May Admiral Boyle reported that demands had been presented (as in paragraph 3 above) and that General Lichaisum had asked for three days to consider them, which had been granted. At the expiration (the 19th May) it was proposed to present them again with a short time-limit, and, if refused, he had undertaken to take action.

Admiral Boyle was informed that no action was to be taken without the Commander-in-chief's consent.

5. On the 17th May the British Minister said that he agreed with the consul- general's first telegram (paragraph 1).

6. On the 18th May Admiral Boyle acknowledged receipt of his orders, and reported that "Dauntless had proceeded to Whampoa and that he had already arranged for aeroplanes to visit the locality. He also said that if action had to taken, and he did not anticipate it would, he recommended taking Bogue and Dane Island Forts.

7. On the 18th May the Governor, Hong Kong, said that at a meeting of the Hong Kong Defence Committee they were unanimously of opinion that if by the 19th May General Lichaisum had not complied with the demands presented to him he should be presented with an ultimatum, the terms being the same as in paragraph 3 with an additional one, i.e., that guarantee should be given against further outrages and suppression of anti-British manifestations. Acceptance should be required within twenty-four hours, failing which, commencing at dawn on the 21st May, the Bogue Forts should be captured, and, as soon as possible after, the Dane Island defences.

8. To the proposals of the Governor, Hong Kong, in paragraph 7 above, the Commander-in-chief replied on the 18th May (actually the time of origin was 0001/19th) that he did not agree with those proposals, as they were not in keeping with Admiralty telegrams Nos. 812 to 815. Also that the punishment proposed was far in excess of the gravity of the offence, and that it was not thought that the British Government would support the proposals. That the Commander-in-chief looked upon the incident as the act of a few undisciplined soldiers, and that he had repeated the Governor's telegrain to the Admiralty with comments as above.

9. On the 20th May the Consul-General, Canton, reported that he had repeated his demands and stated that compliance was required by Monday, the 23rd May. He had fixed 200 dollars as the amount of the compensation, and considered that the punishment of the officer responsible should consist of imprisonment.

He also said that he had approved the proposals of the Senior Naval Officer, West River, for the destruction of Matshed barracks and gun positions. (Note.- Prior to this no proposals of the Senior Naval Officer, West River, had reached Commander-in-chief.)

The consul-general said that he did not agree with the proposals of the Governor, Hong Kong, to capture Bogue and Dane Island defences. The latter contained the military academy, and, in any case, the proposal was out of proportion to the offence, which had caused no material damage.

He added that such action might become necessary later if the Chinese showed fight which was unlikely.

10. On the 20th May, the Consul-General, Canton, warned consuls at ports in South China to stand by for repercussions in the event of action being taken.

11. On the 20th May. Admiral Boyle said that, failing approval of his original proposal (see paragraph 6), he thought that if Dane Island was going to be touched the business should be taken seriously, ample force used, and both the island and the mainland batteries put out of action. He stressed that the plan of the Senior Naval Officer, West River, was a pure gamble on the Chinese not resisting, and that there were many objections to it. He thought that indiscriminate bombing and shelling was undesirable, and that the river should be opened entirely by disabling -not necessarily destroying the batteries, or the first steps towards doing so should be taken, i.e., the occupation of Bogue defences as a sanction, to be held until our own arrangements were made. He thought that to attack Dane Island only, as had been suggested, would not clear the river or safeguard our communications with Shameen. It would be irritating but ineffective.

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On the 20th May, the Governor, Hong Kong, sent a long telegram to the Secretary of State for the Colonies. He described the incident, and stated that about fifty shots were fired. This was the first report of the extent of the firing; he argued that, while the actual shooting might have been the act of undisciplined soldiers. if the Canton Government did not comply with the demands, they then became identified with the outrage and it would no longer be the act of undisciplined soldiers. No shooting at British ships had hitherto taken place on the West River, and he wanted it nipped in the bud. He urged that the best form of sanction would be the capture of Bogue Forts and Dane Island defences, because that would keep open the waterways between Hong Kong and Shameen and give security to our shipping. This would not mean war on China because China no longer existed politically. He also added that the Military Academy on Dane Island was notoriously Bolshevik.

If this major operation was not approved, then he urged that something must be done in deference to the fact that the consul-general had already presented an ultimatum.

He said that Admiral Boyle, for technical reasons, did not agree with destroying Matsheds and Gun Positions on Dane Island in the manner proposel by Senior Naval Officer, West River (the manner in which it was proposed to do this was not reported to Commander-in-chief). He thought it should be done from the air. Therefore, the only alternative proposal they could make was incendiary bombs dropped on Matsheds Barracks situated at the spot where the firing took place. (Note. Other than the mention of Matsheds in Mr. Brenan's telegram of the 20th May (same day as Governor's telegram-see paragraph 9) this was the first intimation that they existed at the spot where the firing took place.)

13. On the 20th May the Commander-in-chief received a telegram from the Consul-General, Canton, dated the 18th May, 10:30 A.M., informing the "Admiral, Hong Kong. that the Minister had approved his proposal regarding Whampoa, and asking what date and hour he suggested for time limit of ultimatum, observing that he should be prepared for action immediately on its expiration. and that the commander of the forts might delay until the last minute before coming to apologise. The consul-general himself suggested 1100 on the 23rd May. He also asked him what retaliatory action he, the Senior Naval Officer, Hong Kong, proposed to take.

14. On the 20th May, at 1135 the Consul-General, Canton, telegraphed at length to the Foreign Office, repeated to everybody, reviewing the situation in the light of Commander-in-chief's telegram to the Admiralty (which he must have intercepted, or else Governor, Hong Kong, passed it to him). He said position at that moment was that he, acting on the strength of recent Admiralty instructions, and after approval of the Minister and consultation with naval authorities at

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